The_Economist_-_28th_February6th_March_2026_-_The_Economist

America’s trap in Iran State of the disUnion Blue scowl: private credit in peril Who leads the Muslim world? FEBRUARY 28TH–MARCH 6TH 2026 The daunting quest for critical minerals DIGGING FOR VICTORY C002 -- 1 of 80 -- Whether you’re a start-up or a global player, the UK offers talent, infrastructure, investment, and support to help you thrive. To see things differently, choose the UK. Find out more at business.gov.uk Great Technology drives global growth C002 -- 2 of 80 -- 3 The Economist February 28th 2026 Contents The world this week 5 A summary of political and business news Leaders 7 Commodities Digging for victory 8 Going to war with Iran Ready aims, fire? 8 Private markets Coming home to roost 10 Europe v America To thine own self be true 12 Airport expansion Grounded growth Letters 14 On teenagers and social media, Thailand’s economy, concerts in China, British cuisine, “The Simpsons” By Invitation 15 Douglas Irwin on Donald Trump’s tariffs Briefing 16 America’s quest for minerals Rocks around the clock United States 19 Midwest migration 20 SCOTUS and POTUS 21 The battle for Texas 22 Accidental killers 23 California’s 250th 24 Lexington The state of the union The Americas 25 Mexico takes down a drug lord 26 Scandal at Brazil’s Supreme Court 28 Cuba’s solar boom Asia 29 Islam in South-East Asia 30 Jaipur’s endangered walled city 31 Sino-Japanese irritations 31 Google Maps in South Korea 32 Banyan India’s VIP culture China 33 Making it in China 34 Anthropic’s accusations 35 Spring Festival travel 37 Chaguan Property pain Middle East & Africa 38 Trump and Iran 39 The limits of Iran’s repression 40 Ali Larijani’s ambitions 41 South Sudan unravels Contents continues overleaf ⏩ On the cover America is racing to break China’s chokehold on critical minerals: leader, page 7. A new era of state-sponsored mining beckons: briefing, page 16. The stunning rise of China’s most audacious miner, page 56 America’s trap in Iran Starting a war with Iran without a clear purpose would be recklessly dangerous: leader, page 8. Most Americans have no idea what Donald Trump wants to accomplish, page 38. Iran’s rulers may be unsettled, but they are making few concessions, page 39 State of the disUnion The president’s address was not fitting for America’s 250th birthday: Lexington, page 24. America’s bosses worry too much about geopolitics and not enough about local politics: Schumpeter, page 60 Blue scowl: private credit in peril Investors must demand more transparency from lenders to private markets: leader, page 8. AI is prompting investors to reassess every business model under the sun: Buttonwood, page 66 Who leads the Muslim world? The title has many contenders, but Turkey’s president leads the pack, page 51. Economic growth in Malaysia and Indonesia has not led to secularism, page 29 Free Exchange Does China violate one of the world’s most venerable economic laws? Page 67 → Download The Economist’s app for articles, podcasts, videos and more, published throughout the week. C002 -- 3 of 80 -- 4 The Economist February 28th 2026 Contents © 2026 The Economist Newspaper Limited. All rights reserved. Neither this publication nor any part of it may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior permission of The Economist Newspaper Limited. The Economist (ISSN 0013-0613) is published weekly except combined issues in July and December, by The Economist Newspaper Limited, 900 3rd Avenue, 16th Floor, New York, NY 10022-5088. The Economist is a registered trademark of The Economist Newspaper Limited. Periodicals postage paid at New York, NY and additional mailing offices. 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Published since September 1843 to take part in “a severe contest between intelligence, which presses forward, and an unworthy, timid ignorance obstructing our progress.” Editorial offices in London and also: Amsterdam, Beijing, Berlin, Brussels, Cape Town, Chicago, Dubai, Lagos, Madrid, Mexico City, Montevideo, Mumbai, Nairobi, New Delhi, New York, Paris, San Francisco, São Paulo, Shanghai, Singapore, Taipei, Tokyo, Washington DC PEFC certified This copy of The Economist is printed on paper sourced from sustainably managed forests certified by PEFC www.pefc.org PEFC/29-31-296 Volume 458 Number 9488 Europe 42 Italy’s court referendum 43 Drone killers in Ukraine 44 Slovakia, car king 44 France’s right-wing martyr 45 Siberia in wartime 46 Charlemagne Luxury in doubt Britain 47 Heathrow’s new runway 48 A new top mandarin 49 Special educational needs 50 Bagehot Paranoia politics International 51 Who speaks for Muslims? 53 The Telegram Finland’s stay-calm president Business 54 PE feasts on small business 55 The Sphere goes global 56 China’s mining star 57 Fake meat in trouble 58 The war on PDFs 58 Anthropic v the Pentagon 59 Bartleby The magic of Tony Robbins 60 Schumpeter CEO-councilmen Finance & economics 61 Trade after IEEPA 62 Does AI lift productivity? 63 Dodgy AI economics 64 America’s welfare states 65 Measuring capital flows 66 Buttonwood Churning markets 67 Free Exchange A Chinese food puzzle Science & technology 68 World models 69 Blood tests for cancer 70 Stone Age markings 71 Well Informed Fibremaxxing Culture 72 Stray Kids strike a chord 73 Escaping the Nazis 74 Hannibal Lecter’s appeal 74 Line-dancing Gen Z 75 Pokémon at 30 76 When China went communist Economic & financial indicators 77 Statistics on 42 economies Obituary 78 Philippe Gaulier, instructor of clowns C002 -- 4 of 80 -- 5 The Economist February 28th 2026 The world this week Politics Donald Trump gave his state- of-the-union speech to Con- gress. At one hour and 48 min- utes it was the longest ever. The president claimed he was responsible for a “golden age” in America, though his poll ratings suggest otherwise, with voters expressing deep concern about the cost of living. Mr Trump made the speech a few days after the Supreme Court struck down his “reciprocal” tariffs as well as tariffs on Canada, China and Mexico for not stopping drug smuggling. It ruled that the duties could not be imposed under the emergency-powers act that Mr Trump had cited; America “is not at war with every nation in the world”, it said. The presi- dent said the court’s decision was “unfortunate”. A state within a state The Mexican government deployed an extra 2,500 securi- ty-force personnel to the state of Jalisco to quell a wave of violence after the death of “El Mencho”, the boss of Jalisco New Generation Cartel, in a military raid. Heavily armed members of the drug gang set up roadblocks, attacked busi- nesses and burned cars; flights to Guadalajara and Puerto Vallarta were briefly disrupted. Twenty-five National Guard troops were killed amid the mayhem, as were dozens of gang members. Claudia Shein- baum, the president, declared that calm had been restored. Bolivia has started working with America’s Drug Enforce- ment Administration again, according to its interior min- ister. Bolivia, a big producer of cocaine, expelled DEA agents in 2008 under the leftist presi- dent, Evo Morales. America’s relationship with Bolivia has warmed considerably since its new centrist president, Rodrigo Paz, came to power last November. Cuba opened fire on a speed- boat that was approaching its northern shore, killing four of the ten occupants. It arrested the other six. The authorities said all ten were Cuban nation- als who lived in the United States and were attempting a “terrorist infiltration” when they were intercepted. America said it would conduct its own investigation of the incident, which comes amid renewed tension with Cuba. European leaders, including Ursula von der Leyen, the president of the European Commission, gathered in Kyiv to mark the fourth anniversary of Russia’s invasion of Ukraine. Mark Rutte, the secretary-general of NATO, called for more aid to help the Ukrainian war effort, but Hungary is now threatening to block a €90bn ($106bn) loan in a dispute with Ukraine over an oil pipeline from Russia. Mean- while, Britain imposed nearly 300 new sanctions on Russian firms and individuals, includ- ing Transneft, a pipeline oper- ator responsible for trans- porting more than 80% of Russian oil exports. Russian media reported that an investigation had been opened into Telegram, a global social- networking platform with 1bn users, for abetting Ukrainian and Western intelligence. Pavel Durov, Telegram’s founder, said Russia had opened a criminal case against him for aiding terrorism. He said offi- cials were trying to suppress free speech, “a sad spectacle of a state afraid of its own people”. Russian media described him as a tool of NATO. Mr Durov left Russia in 2014. A suicide-bomber blew himself up near Savyolovsky train station in Moscow, killing a policeman. The authorities said the man came from the Udmurt republic, which lies 1,100km (680 miles) east of Moscow. Vladimir Putin claimed the bomber had been recruited online. Peter Mandelson, a former government minister in Brit- ain, was arrested on suspicion of misconduct in public office. This followed the arrest of Andrew Mountbatten-Wind- sor, King Charles’s brother, on similar grounds in relation to his work as a British trade envoy. Both cases are linked to information obtained from the Jeffrey Epstein files; both men had close friendships with the deceased sex offender. Lord Mandelson, who last year was the Labour government’s ambassador to America, de- nied speculation that he had been about to flee Britain, claiming it was “baseless”. Both men have been released pend- ing further investigation. But they’re still talking America’s military build-up in the Middle East continued, with the USS Gerald R. Ford, the world’s largest warship, steam- ing its way to the region. Leaks from the Pentagon revealed defence officials’ worries about the risks of extended strikes against Iran. Donald Trump expressed his surprise at Iran’s failure to “capitulate” in the face of the American threat. Meanwhile, new anti-govern- ment protests broke out at several Iranian universities. The American embassy in Israel announced that it would start providing passport servic- es to Israeli settlements in the West Bank. In a statement posted on X, it said it would offer services to American citizens in Efrat, a settlement, and would roll them out to another settlement in the coming months. Israeli settle- ments are considered illegal under international law. The UN added four senior leaders of the Rapid Support Forces (RSF), the rebel group in Sudan’s civil war, to its sanc- tions list. The sanctions follow an assessment by the UN that the RSF’s campaign in Sudan’s Darfur region last year bore “the hallmarks of genocide”. China placed immediate curbs on exports to at least 20 firms in Japan of rare earths and other critical minerals that can be used for military or civilian purposes. Relations have soured between the two coun- tries since Takaichi Sanae, the Japanese prime minister, sug- gested she might respond forcefully if China invaded Taiwan, and then laid out plans to boost national defence. Pakistan targeted suspected terrorist sites in Afghanistan with air strikes, following a wave of bombings that the Pakistani government says were directed by militants in Afghanistan. The Taliban government in Kabul claimed dozens of people were killed during the offensive. The UN said 13 civilians died. After the air raids, gunmen killed seven people in Kohat, in north-west Pakistan, and a suicide-bomber killed two police officials in Punjab province. The Pakistani Taliban claimed responsibility for both attacks. India’s prime minister, Narendra Modi, visited Israel, where he met his counterpart, Binyamin Netanyahu, and gave a speech to the Knesset. The leaders discussed strength- ening security and trade ties between the two countries. Ahead of the visit Mr Netanya- hu said India was part of a “hexagon of alliances…that stand together against the radical axes” and are “commit- ted to stability and progress”. C002 -- 5 of 80 -- 6 The Economist February 28th 2026 The world this week Business Donald Trump’s new 10% global tariff came into force. The president imposed the levy under a statute from 1974, after the Supreme Court struck down his previous tariffs. In its decision the court did not say whether refunds should be issued for tariffs collected under the disallowed policy. That will be left to lower courts. FedEx has become the first large company to sue the gov- ernment for a full refund of the duties it has had to pay. The legal process will be long, slow and complicated. Mr Trump intends to raise his global tariff eventually to 15%. That has angered countries that have struck a trade deal or are negotiating with America. Lawmakers in the European Parliament suspended the ratification process for the EU’s agreement with America, though the EU trade commis- sioner said respect for the deal was “paramount”. Mr Trump warned countries not to “play games”, or they could face even higher tariffs. The American economy grew by 1.4% at an annual rate in the fourth quarter of 2025, a big drop from the 4.4% recorded in the third quarter. The Bureau of Economic Analysis estimated that the long government shutdown shaved one percent- age point off the quarter’s growth rate. The economy expanded by 2.2% in the whole of 2025, the slowest pace since the pandemic year of 2020. The yen fell sharply against the dollar, after Takaichi Sanae, Japan’s prime minister, nomi- nated two doveish candidates to the Bank of Japan’s policy board. Asada Toichiro and Sato Ayano support economic stimulus and lower interest rates, which could put them at odds with Ueda Kazuo, the central bank’s governor, who may want to raise rates. Aston Martin decided to cut its workforce by 20%, as it struggles to generate cash and manage its large pile of debt. The British luxury carmaker blamed tariffs in part, saying they had been “extremely disruptive” to its business. Rewriting the script Paramount raised its hostile takeover offer for Warner Bros Discovery from $30 a share to $31. Warner acknowledged that this could constitute a “superior proposal” to the deal it has accepted from Netflix. It said it would engage with Paramount, but that the merger agreement with Netflix remained in effect. The government of Panama said Moller-Maersk and MSC, two European shipping lines, were now operating two ports on the Panama Canal. In January the country’s Supreme Court annulled the contract of CK Hutchison, a Hong Kong conglomerate, to run the facil- ities. The Panamanian presi- dent said CK Hutchison had established an “autonomous territory” at the vital waterway during its decades-long oper- ations. The company described the takeover as “unlawful”. Aliko Dangote, Africa’s richest man, said he would list his oil refinery in Lagos on the Nige- rian stock exchange in the coming months, with the mi- nority stake currently owned by the state oil company up for grabs. The listing of the refin- ery, which is valued at some $20bn, may help spur interest in the country’s stockmarket. IBM’s share price recorded its biggest one-day loss since 2000, after Anthropic an- nounced that its AI coding tool could now update an old pro- gramming language that is run on IBM’s mainframe comput- ers. Modernising the system “once required armies of con- sultants spending years map- ping workflows”, boasted Anthropic. “AI changes this.” Gulp IBM’s share price was not the only one to come under pres- sure, as a fresh sell-off hit the stocks of software firms. A blog post by Citrini Research, a platform for equity research, bore some of the blame. It imagined an economy torn asunder by AI in 2028, when America’s unemployment rate hits 10%. The firm stressed that its analysis was a scenario and not a prediction. “This isn’t bear porn or AI-doomer fan- fiction,” it noted. Still, it then went on to describe an “eco- nomic pandemic”, as white- collar jobs once considered tedious disappeared. They were replaced by AI agents that “found nothing tedious”. Meta announced that AMD will supply it with graphics-pro- cessing units to help power its AI infrastructure. Under the deal Meta could take a stake of up to 10% in the chipmaker. As it seeks ways to feed its vora- cious appetite for computing power, Meta has also recently reached a chip-supply agree- ment with Nvidia. It plans to spend up to $135bn this year on AI. Nvidia produced another stellar set of quarterly earnings. Revenue rose by 73%, year on year, to $68.1bn, and net profit came in at $43bn, up by 94%. Computing demand for AI “is growing exponentially”, said Jensen Huang, its CEO. IBM Share price, $ Source: LSEG Workspace 300 250 200 150 100 26 25 24 2023 C002 -- 6 of 80 -- Leaders 7 The Economist February 28th 2026 IN 1973 A club of Arab petrostates held the world to ransom by halting crude-oil exports to countries they accused of supporting Israel. Petrol prices soared; Western economies buckled. Today the danger is that China will use its grip on other natural resources to achieve its aims, such as seizing Taiwan. It has already shown its power by choking off exports of rare-earth metals last year. That is why America is staging its biggest intervention in commodity markets in decades. The battleground is the supply of “critical” metals, a group of minerals vital to making military, electrical and computing infrastructure—everything modern economies need to be safe, high-tech and green. China supplies most of these: it mines about 80% of the world’s tungsten, for instance, and refines 99% of its gallium. This is spurring America into an all-out campaign to diversify its sourcing of 60 minerals. It has pledged billions of dollars to dozens of mining projects at home and abroad, floated plans to create price floors and trade blocs, and announced a vast stockpile to cover months of national needs. The risk now is that America depends too much on its scattershot efforts—and that, in seeking control, it breaks the flexible and resilient system of market incentives that ensures the smooth functioning of the global economy. China’s grip on critical minerals has exposed the West’s most serious strategic weakness in many years. Last April, during its trade war with America, China restricted exports of seven crucial rare earths; it targeted another five in October. Nearly a third of Pentagon procure- ment programmes faced the risk of shortages, as did industries from carmaking to renewable energy. The prospect of large-scale disruption prodded President Donald Trump into a trade truce with Xi Jinping, as well as a relaxation of American controls on some technology exports. Yet Mr Xi can deploy the weapon again whenever he chooses. Meanwhile, exports of rare earths for dual-use applications—the expanding grey zone between military and civilian uses—remain largely barred, sapping Western efforts to rearm. It would be nice to say that the best defence against China’s tactics is to double down on global markets. They certainly have a part to play. The oil crises of the 1970s boosted the de- velopment of commodity trading—in which prices for key ma- terials are set on exchanges by millions of buyers and sellers entering 40m derivatives contracts daily. Time and again, hit by wars, industrial strikes and natural disasters, markets have handled shocks better than government planners ever could. However, America is right. China’s dominance over critical minerals means that continuing to place full faith in the invisi- ble hand would be naive and unsafe. China has spent decades building control over minerals, bankrolling projects at home and acquiring assets abroad. Its producers have consolidated into behemoths that the state can control and which have the market power to deter would-be competitors by flooding global markets—even if that means taking temporary losses. America’s task, therefore, is to strike a balance. On the one hand, it needs to insure against the risk that China cuts off ex- ports again, and to deter it from doing so by raising the cost of further restrictions. On the other, it needs to nurture markets. Subsidies and stockpiles are expensive. State-to-state mineral agreements invite rent-seeking, side deals and corruption—a risk with the Trump administration. Dirigisme muffles the price signals that encourage conservation and innovation. Unfortunately, America is mismanaging these trade-offs (see Briefing). Officials seem to deem almost any expense to be an acceptable price for security. Money is being spread wastefully thin, not focused where China’s grip is tightest, in refineries and smelters. From Delaware to the Democratic Republic of Congo, chancers are pitching the administration dud projects in the hope of easy money. In return for peace in Ukraine (on his terms), Vladimir Putin is promising Mr Trump a bogus $12trn in deals, including lots in energy and mining. America’s campaign should instead follow three principles. The first is to narrow the scope. Not all 60 minerals it deems critical genuinely are. Aluminium, lead and zinc are abundant, recyclable and substitutable; China would struggle to corner vast industrial-metal markets like copper. America should therefore concentrate on niche, vital metals, such as some rare earths, where China can more easily restrict exports. Priority should go to critical industries—defence, and perhaps health care—leaving carmakers to fend for themselves. America should focus on projects near completion. Even keeping a small share of supply out of China’s control can break its chokehold, because Mr Xi will know that America has alternatives. A second principle is to use all the tools at hand. America’s targeted stockpiles can cover immediate needs in a crisis, and its purchase contracts at pre- agreed prices can attract private investors and get projects off the ground. But it must also attend to refining and processing. Refiners that produce one main metal often leave critical by-products in waste rock, because processing costs too much. Conditional state backing could change their calculus. Throughout, however, America must strive to ensure that price signals get through—the third principle. The economy will continue to adapt and innovate only if buyers and sellers face high prices when supply is limited. By contrast, low fixed prices will exacerbate dependence. Shovel ready For the Trump administration, national security means Amer- ica First. That is translating into a race to lock up scarce sup- plies at others’ expense, causing its allies to worry they will be left behind. But even an administration that doubts the utility of military alliances should work with others over natural resources. Europe has engineering expertise; Japan, an earlier victim of China’s mineral blackmail, has experience in secur- ing supply chains. Together they bulk up the market. Against China’s geology, industriousness and political system, Ameri- ca’s ability to work with others is its greatest asset. ■ America is racing to break China’s chokehold on critical minerals Digging for victory C002 -- 7 of 80 -- 8 The Economist February 28th 2026 Leaders ⏩ EARNING A NAME for issuing empty threats can be devas- tating. Ask Barack Obama. Thirteen years ago, a dictator in the Middle East defied a warning from America’s then-presi- dent not to cross a “red line” by using chemical weapons against his own people. The world held its breath, asking itself when Mr Obama would punish, or even topple, the tyrant for his war crime. Instead, Mr Obama did nothing. Syria’s vile ruler held on for over a decade. Half a million people died. For many, from that moment, the president’s credibility was shot. Today, another murderous regime in the Middle East has been rabidly killing its own people. Iran’s rulers massacred perhaps 20,000 demonstrators in January. President Donald Trump said at the time that he would ride to the protesters’ rescue, promising that “help is on the way” and urging them to remain on the streets. Since then, Mr Trump has sworn to topple Iran’s regime. In his state-of-the-union address this week he vowed to block any resur- gence of Iran’s “sinister” nuclear programme. Has Mr Trump thereby set his own red line in the Middle East? You might suppose not. No politician today is less bound by his own bombastic out- bursts and contradictions. Had the president merely shunned Iran, few would have held him to account for his noisy pledges. Yet few people are more likely to take Mr Obama as a cau- tionary tale than the present occupant of the White House. More importantly, Mr Trump has done a lot more than talk. To give his words extra credibility, he has sent an armada towards Iran’s shores. The Middle East now hosts the largest concen- tration of American military firepower since 2003. A second aircraft-carrier, the USS Gerald R. Ford, has just sailed in. Jets, bombers and other airborne forces have assembled. Allies are on alert. By preparing the means to punish the regime of Aya- tollah Ali Khamenei, Mr Trump is bringing this crisis to a head. This is both a moment of jeopardy and a test of his credibility. A further reason to expect military action is that the presi- dent may be getting a taste for it. Last June he ordered bom- bers from Missouri to help Israel’s air force in a 12-day war to “obliterate” Iran’s nuclear programme. In January he again rolled the dice on a high-risk operation, sending special forces to Caracas to seize Venezuela’s dictator, Nicolás Maduro. Mr Trump would prefer to win without firing a shot. But Iran’s rulers have a say, too, and they look defiant. They may judge that they can play for time at nuclear talks with Ameri- ca—or agree to a deal, only to stall over the details. Mr Khame- nei may be prepared to put his country through an air war. Perhaps the 86-year-old is ready to be a martyr; more probably he bets he will live, even if many others die. Iran’s rulers seem united, and few, even among the Amer- icans, seem to bank on missiles alone toppling them. The regime may be expecting to emerge stronger from any conflict simply by surviving. If that is Iran’s calculation, Mr Trump has put himself in a bind (see Middle East & Africa section). Launching an attack without a clear goal is exactly the sort of misstep he has long derided. Too many small and short wars turn out to be big and long. Iran has drones and ballistic mis- siles. Its leaders say they are readier than last year to use them against America and its allies. Imagine if a strike kills many American troops. China or Russia would be thrilled to see America bogged down, yet again, in the Middle East. Mr Trump may yet set out a war aim that could win support from the public and Congress. But until he does, he would do better to keep talking with his fleet standing by, rather than start a war—even if holding fire looks like backing down. ■ Starting a war with Iran without a clear objective would be recklessly dangerous Ready aims, fire? Going to war with Iran THE GIANTS of private investment risk seeing a tantalising prize slip from their grasp. Three of the biggest—Apollo, Blackstone and KKR—collectively oversee assets that have bal- looned to $3trn, from $200bn in 2008. So far, they have had to raise the lion’s share of this from a select group of financial in- stitutions and the über-rich. Now they and their competitors have the mass market in their sights. They have launched a wave of funds designed to entice retail savers to invest in un- listed assets such as private equity, property and private debt. Their whole endeavour may now be under threat. On Febru- ary 18th Blue Owl, a little-known firm, halted planned with- drawals from one of its retail funds. “OBDC II” has assets worth just $1.6bn. Yet news that Blue Owl has stopped redemptions, and is instead selling assets to return capital to all its investors, has sent shockwaves through the industry. Share prices fell in much bigger listed private-investment managers; half a dozen of them have lost a combined $100bn in market value since the start of the year. That is because Blue Owl turned out to be a coal-mine canary. OBDC II has cast doubt on the model that such firms had hoped would “democratise” private investment and win them new revenue streams. Private-investment firms and their backers must now urgently work out what went wrong. Light regulation has let their markets boom for the better part of two decades. They cannot expect this to continue if they sell pro- ducts to retail investors and do not honour their promises. Investors must demand far more transparency from private-markets firms Coming home to roost Private markets C002 -- 8 of 80 -- Launched in 1953, the Fifty Fathoms is the fi rst modern diver’s watch. Created by a diver and chosen by pioneers, it played a vital role in the development of scuba diving. It is the catalyst of our commitment to ocean conservation. “Creation” Wildlife Photographer of the Year 2021 Grand Title winner © Laurent Ballesta A Fifty Fathoms is for eternity. C002 -- 9 of 80 -- 10 The Economist February 28th 2026 Leaders ▸ ⏩ At stake are not just the revenues of a few asset managers. Access to private markets promises retail investors a way to share in big potential returns. The vast majority of the world’s assets are unlisted, including many of the most exciting businesses. Putting retail investors’ savings to work in private markets would also be a boon for the wider economy. Compa- nies developing artificial intelligence are ravenous for capital, and Blue Owl’s funds are important lenders to them. In America in particular, such firms’ prospects will increasingly determine both the rate of growth and how well the country competes with China. OBDC II aspired to solve a long-standing problem with retail investments in private markets. Directing savings towards private assets is difficult because they are illiquid. This makes regulators wary and puts off inves- tors who like being able to buy or sell at the drop of a hat—if they need cash for an emer- gency, say. OBDC II used a model popularised by Blackstone’s Real Estate Income Trust, launched in 2017, which offers limited liquidity. Investors can ask to cash out each month or quarter, but the fund agrees to process total redemptions worth up to only 5% of its net asset value each quarter. Should requests exceed that figure, it caps the total at 5% and grants them pro rata. Whether Blue Owl’s failure to stick to this was caused by its own incompetence, or by a fundamental flaw in the model, is still unclear. The very fact that this question remains unan- swered should disturb anyone with a stake in institutions, such as pension schemes and university endowments, that are heavily exposed to unlisted assets. If regulators do not require funds like OBDC II to disclose far more about how they man- age liquidity mismatches, their investors surely must. Fortunately, the odds favour incompetence. A fund grant- ing quarterly redemptions worth up to 5% of its assets is hardly promising the moon: at worst, it is offering to sell its portfolio over five years. This is the same as the typical wind-down period for standard private-markets funds. Providing regular liquidity ought to be especially easy for private-credit funds of OBDC II’s variety, since these invest in loans that pay interest, which can be used to meet redemptions. For these reasons, it would be a mistake for zealous regula- tors to make it harder for ordinary people to buy private assets. It is, in truth, suspicious that private-investment giants are racing to sell to the mass market just when deals between them have slowed. But amateur investors are capable of scepticism. They can judge, for instance, the wisdom of investing in once-buzzy firms that were bought out during the mania of 2021, at “fair values” set by the seller. They should not expect to be bailed out—as they might if their bank collapsed—after making unwise investments. Investors, meanwhile, should use their market power. They should not give money to managers whose operations are too opaque to understand. No fund promising annual returns in the high single-digit percentage points, or more, is a safe bet. It might hold loans that could fall through, property that could be left vacant or firms that could fail. If it also offers liquidity, while investing in illiquid assets, it could fail there, too. Re- sponsible asset managers should help clients scrutinise these risks. If they do not, their golden opportunity may slip away. ■ EUROPEAN ECONOMISTS spend a lot of time looking envi- ously across the Atlantic. Despite tariff chaos and a collapse in immigration, at the last count America’s GDP per head was growing by 1.8% a year; the figure for the euro area was just 1%. Compared with America, Europe lacks a unified market for products and especially services, as well as cheap energy, low taxes and the flexibility to hire and fire workers easily. Technocrats know it. By our tally, Mario Draghi’s land- mark report on Europe’s low growth draws unfavourable com- parisons with America more than 70 times. If only America’s states were equally attuned to the sources of their advantage. As we report this week, their economic policy is moving in a strikingly European direction, even as the Trump administration deregulates at a federal level. Not every- thing they are doing is bad, but they must beware of following Europe down a path of fragmentation and interventionism. One way in which the states are turning European is in their approach to new technologies and markets (see Schumpeter). Whereas Congress has yet to pass any comprehensive laws on artificial intelligence, legislators in five states have passed their own, conflicting, laws and 16 more are on the job. Cars can drive themselves in eight states, including North Dakota and North Carolina, but they must not cross into their southern namesakes. As America’s Department of Justice waves through contentious mergers—like that between Hewlett Packard Enterprise and Juniper Networks, two corporate- computing giants—even the enforcement of antitrust law is fragmenting across state lines. State attorneys-general, led by California’s, are investigating the deal. Some states are resist- ing deregulation of consumer finance and gambling. At the same time, many states are building European-style welfare states, financed by taxes (see Finance & economics section). Take paid maternity or paternity leave—a benefit which Europeans are shocked that Americans lack. Over the past five years, something remarkable has hap- pened. The number of states that have made it mandatory for employers to offer paid-leave programmes has doubled. Some 114m Americans—around a third—live in states that now guar- antee at least 12 weeks of paid family leave (in many places up to 24 weeks is available for new mothers). These schemes are often lavish, replacing almost all forgone income. The policies in New Jersey and New York are roughly as generous as those in France and Belgium. Citizens of these states pay for this privilege with higher taxes: New Yorkers, for example, hand America’s states should beware of copying Europe too much Distance learning Europe v America C002 -- 10 of 80 -- C002 -- 11 of 80 -- 12 The Economist February 28th 2026 Leaders ▸ over almost as much of their incomes as Britons do. Some of this experimentation is welcome. The states have long acted as policy laboratories. Americans are mobile and will leave failing places, acting as a brake on bad economic policy (see United States section). Some of America’s advan- tages, such as the English language and the concentration of talent in Silicon Valley, are entrenched. And there are things America could learn from Europe. Economies like Denmark’s manage to combine European- style support for families and workers with dynamic labour markets and high living standards (albeit at the cost of high taxes). Maternity leave is obviously not a threat to capitalism. California has offered it since 2004, and still managed to become the home of the AI revolution. Yet in other respects America is in danger of emulating the model of a continent that has struggled to shake its reputation as an economic laggard. The threat is particularly acute with regulation. A divergence in rules and codes for businesses would undermine the power of America’s single market. The promise of being able to make sales easily to nearly 350m con- sumers is a powerful incentive to innovate. Regulatory frag- mentation is hard to remedy: though businesses, like individ- uals, can vote with their feet, they still want to be able to sell their software tools and vehicles across the country. Watch out! America’s federal and state politicians alike tend to take their country’s advantages for granted. Fortunately, as the experi- ence with tariffs and immigration shows, America’s dynamism is so great that it can afford to make mistakes. Yet even as Europe eyes its growth enviously, America would be better off if it also gazed sceptically back. ■ IN JANUARY 2025 Britain’s Labour government threw its weight behind plans for a third runway at Heathrow airport. This was meant to signal its commitment to growth. But an- nouncing grand infrastructure ambitions is easy; turning them into reality is hard. Since then the project to expand Europe’s busiest airport has tripped one warning light after another. The main cause for alarm is the growing cost. Heathrow is already the second-most-expensive big airport in the world for passengers after Auckland (see Britain section). Heathrow Airport Limited (HAL), its operator, has presented plans to expand and modernise the airport at a privately funded cost of £49bn ($66bn). That is nearly twice the price of Dubai’s plan to build four more runways at its new hub. (Lord Deighton, who chairs The Economist Group, until recently also chaired HAL.) The proposals for Heathrow could cause already high landing charges to double; passengers may choose to fly elsewhere. The headwinds buffeting the expansion are eerily similar to those that trouble High Speed 2 (HS2), Britain’s previous ill-fated foray into big transport infrastructure. This rail line between London and Birmingham has been delayed by more than a decade, its scope has been severely cut and its costs have more than doubled in real terms. The projects share some unavoidable challenges, such as London’s exorbitant construction costs. But other obstacles are not inevitable. Rather, they are symptomatic of govern- ments that are too timid to change the planning system and too naive to stop private operators from running up the bill. HS2 offers a lesson in how not to run a planning process. It took more than three years to get through Parliament, before requiring over 8,000 further permissions from local agencies. Labour has slightly improved the planning system for Heath- row, limiting opportunities for legal challenges. But an excess of consultation and legal hoops will still make costs soar. Plan- ning paperwork alone is on track to eat up more than £1bn. The HS2 debacle also reflected unclear objectives and mis- aligned incentives. The project became focused on speed when its original aim was to add rail capacity. The government lacked the commercial nous to control costs, and contractors had little incentive to contain them. It is the same with Heath- row. HAL’s proposal spares no expense: £1.3bn on car parks, for example, and a complex design for new terminals. From HAL’s perspective, this makes sense: the returns the regulator allows it to make are linked to how much money it invests. But the government is failing to rein the firm in. It would be easy to conclude that the project should be can- celled. That would be a mistake. Britain badly needs a new run- way to protect and expand the global connections on which the success of its open, island economy relies. Heathrow is already one of Europe’s most congested airports. Failure to act will make London less attractive. Instead, the government needs to toughen up. It should start with planning. Robert Jenrick, Reform UK’s would-be chancellor, has promised emergency legislation to give Heathrow full planning consent. Labour should steal his idea, making sure the legisla- tion removes the need for any other planning permissions and isn’t bogged down by consul- tations. Done well, this could be a model for future projects. The state must also strip out the incentives to gold-plate the scheme. That means taking design control away from HAL and giving it to an independent body without a financial inter- est in excessive costs. This body could then commission HAL for specific work, but only when it is best for the job. HAL will warn of delays. The government should call its bluff—and set up a stand-alone planner, as it did for the National Grid. Building big infrastructure is not just about getting out of the private sector’s way. When a firm has a monopoly, as HAL does at Heathrow, or the National Grid does over power trans- mission, the state must be a tough, commercially astute coun- terparty. Without such hard-headedness, all Britain’s grand infrastructure projects risk coming in late and over budget. ■ Heathrow’s new runway looks likely to become another grand infrastructure fiasco Grounded growth Airport expansion C002 -- 12 of 80 -- 13 EXECUTIVE FOCUS                                                         
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    …  ˆ“” ƒƒƒƒ•      C002 -- 13 of 80 -- 14 The Economist February 28th 2026 → Letters should be addressed to the Editor at: The Economist, The Adelphi Building, 1-11 John Adam Street, London WC2N; Email: letters@economist.com. More letters available at: economist.com/letters How safe is social media? Your arguments in favour of allowing under-16s to continue using social media treated the case for a ban with a breeziness that sits uneasily with the scale of the issue (“Let them scroll”, February 14th). You acknowl- edge the growing evidence that social media harm at least some children while noting that the evidence is mixed. Yet you imply that, without over- whelming proof of universal damage, policymakers should refrain from acting. That is not how prudent societies manage risk to children. Public policy often pro- ceeds on credible evidence of harm to a meaningful minority, particularly where potential exposure to the harm is near- universal. We do not wait for universal proof before setting age limits on alcohol, driving or gambling. Nor do we abandon regulation because enforce- ment is imperfect. Such mea- sures signal norms, support parents and shape behaviour. A ban would be hard to define and enforce, you say. Difficulty is not a reason for inaction. Policymakers routine- ly navigate complexity in fields from finance to pharmaceu- ticals. When a widely used consumer product poses cred- ible risks to children, regulators do not wait for perfect evi- dence; they restrict or with- draw it until safety can be demonstrated. And the suggestion that limiting access to social media merely “delays” a child’s inev- itable exposure to it is also unconvincing. Age thresholds exist because maturity matters. A 12-year-old and a 16-year-old differ in impulse control and resilience to social pressure. Granting access later aligns risk with a greater capacity to manage it. The question is not whether social media have upsides; few technologies are wholly malign. It is whether products engineered to maximise en- gagement among developing minds deserve fewer guardrails than toys, medicines or alcohol. Today’s platforms should be withdrawn from young users until it can be shown that they are safe by design. DAISY GREENWELL ALEXA VARAH ANDY COCKBURN Smartphone Free Childhood London What Thailand must do Following Anutin Charnvira- kul’s surprise win in Thailand’s election you rightly noted the tension between his populist base and the technocrats he has appointed to run economic policy (“Thailand’s conserva- tives win a shock big victory”, February 14th). As you have argued with Japan, leaders who win on a wave of right-wing nationalism must ultimately govern from the centre if they are to deliver durable results. Mr Anutin faces the same imperative. The early evidence is cau- tiously encouraging. Thailand’s GDP grew by 2.5% year-on-year in the fourth quarter of 2025, well above market expecta- tions. Much of this reflects the tenure of Dr Ekniti Nitithanprapas as finance minister; his fiscal discipline has already contributed to a modest compression in govern- ment-bond yields. Public investment surged by 13.3% in the quarter, and the disburse- ment rate in the first three months of the fiscal year reached 18.7%, meaningfully ahead of the prior year’s 13%. Yet structural challenges remain. Export growth of 8.7% masks a worrying divergence: computer-export values rose by 91% while actual production grew by only 17%, raising con- cerns about genuine industrial deepening. Light manufactur- ing and raw materials contin- ued to contract, squeezed by Chinese competition. The real test for Mr Anutin is whether he can use his now- rare political capital—a conser- vative majority, a mandate for constitutional reform, and a professional economic team— to pursue the structural agenda that Thailand has deferred for a generation: fiscal consolida- tion, trade liberalisation and moving the economy up the value chain. DR PIYASAK MANASON Head of economic research InnovestX Securities Bangkok Food glorious food I have always found it fascinat- ing how public perceptions of Britain influenced investors’ views of the economy (“A manufactured panic”, January 31st). Perhaps if Britons were more optimistic the world would start to see us similarly. A good starting point would be George Orwell, who wrote “In Defence of English Cooking” in 1945. A hard sell you might think, but its pages were devot- ed to countering unfair inaccuracies about Britain’s culinary reputation. Why focus on tasteless soggy food, when the truth is found in a wholesome British roast, a weekend fry-up, West Country cider, Scottish whisky and literally any baked good from the Peak District. As Orwell said “It is not a law of nature that every restaurant in England should be either for- eign or bad, and the first step towards an improvement will be a less long-suffering atti- tude in the British public itself.” ABBIE HINES-LLOYD London Home truths “The decline of single-earner homebuyers” (February 14th) mentioned that most Amer- icans see the single-bread- winner family home as por- trayed in “The Simpsons” as unrealistic, given the cost of living. The series has already touched on this, in an episode from 1997. Frank Grimes, a new employee at the nuclear plant, visits the Simpsons’ home and marvels at the lifestyle they lead (it’s a “palace”) on just one salary, while he, a single man, has a second night job at the foundry and has to live “in a single room above a bowling alley”. When asked how he can afford it, Homer replies, “I dunno. Don’t ask me how the economy works.” LEO COTTON Bloomington, Minnesota Letters teenagers and social media, Thailand’s economy, concerts in China, British cuisine, “The Simpsons” Our song I read your article regarding the resurgence of China’s live music scene with interest (“Enjoying the boom times”, February 14th). You noted that more than 133,000 visi- tors stayed overnight in the city of Zhuji because of fans “rocking out to indie bands” at the Xi Shi Music Festival. The festival was indeed a draw, but another crowd- puller that accounted for the surge was the series of con- certs by Wang Leehom, a superstar in Mandopop (Mandarin pop), held in Zhuji around the same time. This distinction does not undermine your conclusion that the concert economy is booming; rather, it amplifies it. The boom is not limited to the growing indie scene but is also powered by the mas- sive mobilising power of established pop icons. Both forces are working in tandem to revitalise local tourism. STEVEN ZHOU Hangzhou, China C002 -- 14 of 80 -- 15 The Economist February 28th 2026 Douglas Irwin THE HISTORIC ruling by America’s Supreme Court on February 20th blocks President Donald Trump’s unchecked ability to impose tariffs on a whim. But those who hoped it would mark a change in American policy, including the threat of future tariffs, have already been sorely disappointed. To justify last year’s Liberation Day tariffs, the Trump adminis- tration invoked the International Emergency Economic Powers Act (IEEPA) of 1977, which gives the executive the power to “reg- ulate” foreign transactions in a “national emergency”. In its 6-3 de- cision, the court bluntly ruled: “IEEPA does not authorise the Pres- ident to impose tariffs.” Writing for the court, Chief Justice John Roberts stated that the framers of the constitution “did not vest any part of the taxing power in the Executive Branch”. The court noted: “When Congress has delegated its tariff powers, it has done so in explicit terms, and subject to strict limits.” The ruling is important beyond its implications for current trade policy. Had the court not limited Mr Trump’s actions, presi- dential power on import tariffs would have been completely un- checked by any congressional limitation on the use of that power. This would have been a radical rewrite of the constitution. Such a disastrous outcome was avoided. Although the messy process of refunding the revenue collected has yet to begin, the Liberation Day tariffs are history. Before Americans could break out imported bubbly to cele- brate, though, Mr Trump immediately raised tariffs again. Unlike the hotch-potch of rates on different countries under IEEPA, he imposed a flat duty of 10%—expected soon to rise to 15%—on all imports, using Section 122 of the Trade Act of 1974. This allows the president to impose duties as high as 15% for up to 150 days in the case of “large and serious” balance-of-payments deficits. After 150 days, congressional authorisation would be required. The administration surely wants tariffs beyond 150 days. Might it force Congress to vote for higher tariffs in an election year? Un- likely: tariffs are broadly unpopular and in the upcoming midterm elections that might sink Republicans, who are divided on the is- sue anyway, unaccustomed as they are to voting for tax increases. These new tariffs are likely to face legal challenges as well. Is America really suffering from a balance-of-payments deficit? Economists argue not: the terminology, they insist, reflects archa- ic language from the Bretton Woods period of fixed exchange rates that ended in the 1970s. Another avenue for legal challenge is Section 122’s stipulation that the tariffs “shall be of broad and uni- form application with respect to product coverage”. The Trump approach, to grant many exemptions on specific goods, ranging in the past from coffee to smartphones, seems out of step with that. These developments weaken the president’s powers: the broad discretionary scope of the IEEPA approach is gone, and Section 122 prevents the president from treating countries differently from each other—a key part of the leverage he so enjoys. Yet other cud- gels remain to satisfy his desire to bash particular countries. Some are targeted at countries engaged in unfair trade practic- es: Section 301 was used to impose tariffs against China in Mr Trump’s first term and could be brandished against other, newly declared unfair traders. Others, such as Section 232 of the Trade Expansion Act, are aimed at stopping imports of specific goods from any country on national-security grounds. These have alrea- dy been used in the case of steel, aluminium and other products, and the Trump administration is looking to use them elsewhere. Forcing the president to invoke these statutes will throw some sand in the tariff wheels. Cases must be filed, reports must be written and findings must be issued before pronouncements take effect. But the threat of tariffs remains real. Meanwhile, the fate of all the “deals” that the Trump adminis- tration cut with other countries as a result of the IEEPA tariffs is yet to be determined. Other countries are unlikely to revoke them for fear of provoking the president, but the EU has paused ratifica- tion of its deal to seek clarity about the American situation. The recent gyration of American tariffs has rattled businesses and trading partners alike. Even after the ruling, many will contin- ue to worry about an unanticipated flaw of post-war American trade laws: excessive congressional deference to the president. Congress started delegating powers long ago on the assump- tion that presidents would focus on the national interest and thereby counterbalance the inherent protectionism that emerges from the legislature, where parochial interests predominate. The president would be the wise actor who took into account not just the interests of domestic companies competing against imports, with which Congress was disproportionately concerned, but also the interests of consumers and exporters whose fate Congress of- ten neglected when it was in charge of trade policy. That assump- tion has proved false. In coming years, when cooler heads prevail, Congress might consider curtailing some of the president’s discretionary authority to impose arbitrary tariffs on imports. It could introduce some checks or time limits on presidential authority to curb abuses of tariff threats and impositions. Such limits would have to be em- bedded in a larger piece of legislation that the president could be persuaded to sign, as any standalone bill curbing presidential au- thority would elicit a veto that would be difficult to override. For now, the world should take seriously the president’s vow to rebuild the tariff wall. He has ample authority to do so under va- rious statutes, albeit with greater difficulty and more restrictions. Hopes that the Supreme Court would put an end to one person’s tariff obsession are likely to prove vain. ■ Douglas Irwin is an economics professor at Dartmouth College. BY INVITATION Donald Trump has ways to rebuild his tariff wall, albeit with greater difficulty C002 -- 15 of 80 -- 16 The Economist February 28th 2026 Briefing America’s quest for minerals Rocks around the clock FOR MOST of the past 30 years Western firms have been leaving rather than in- vesting in the Democratic Republic of Congo, says Guy-Robert Lukama. The for- mer chair of Gécamines, the main state- owned miner, reckons Chinese entities have stakes in 90% of Congolese projects. But now the Americans are “pushing, pushing, pushing”. In December American firms secured the first crack at a trove of mines and exploration sites in Africa’s most mineral-rich country. The US govern- ment also invested $553m in the Lobito Corridor, a railway from Congo’s copper- belt to Angola’s Atlantic coast, for faster shipping to America. In February Orion CMC, a consortium that includes the Amer- ican government, agreed to buy a 40% stake in the only Western-controlled cop- per and cobalt mines in Congo. America is hunting with urgency across the planet for minerals which it deems of critical importance, in a desperate bid to break China’s stranglehold on the global supply of many of them. The Trump ad- ministration has signed mineral-themed partnerships with more than 20 countries from Argentina to Uzbekistan. Every big geopolitical pivot America has made late- ly—in Ukraine, Venezuela, Greenland— has been partly justified by the mineral riches those countries harbour. One min- ing boss says he runs into the president’s staff “almost anywhere, almost monthly”. The administration has backed dozens of mining projects, promised to create giant stockpiles, and sought to set price floors in order to protect Western mines against Chinese dumping. It is a newly “ag- gressive, imaginative, transactional” ap- proach, says Brian Menell of TechMet, a miner the government has backed—one that marks a level of intervention in metals markets unseen since the early cold war. “It’s our generation’s space race,” says Mi- chael Scherb of Appian Capital, a private- equity firm that invests in mining. The race has a clear and obvious leader. China is the biggest miner, and by far the dominant refiner, of many of the world’s most “critical minerals” (see chart 1 on next page). The category encompasses some 30 to 60 metals deemed vital to computing, electrification, aerospace and defence— the pillars of rich, modern economies. It lumps together common metals like cop- per (29m tonnes produced in 2025) with niche ones like “heavy” rare earths (some of them produced in the tens of tonnes an- nually), which are used in iPhones, data centres, surgical lasers and military tech. Feeling the squeeze China’s control of many critical metals gives it enormous leverage over its eco- nomic and military rivals—and it uses that leverage. Last April China restricted ex- ports of seven of the most prized rare earths. As shortages loomed, supply chains for F-35 jets, missiles, drones, radars and electric motors threatened to snap. Car- makers and many other companies suf- BELO HORIZONTE, CAPE TOWN, RIYADH AND WASHINGTON, DC Threatened by China’s dominance of rare-earth metals, America is on a quest to secure minerals around the world. A new era of state-sponsored mining beckons ⏩ C002 -- 16 of 80 -- Briefing America’s quest for minerals 17 The Economist February 28th 2026 ▸ ⏩ fered across Europe and Asia. The blows were so immediate and powerful that Pres- ident Donald Trump quickly scaled back his beloved tariffs on China to seal a trade- war truce. Chinese officials also used a new export-licence requirement to extract detailed proprietary information from Western manufacturers. And China still limits sales of a dozen minerals from anti- mony to tungsten, greatly increasing their cost (see chart 2 on next page). The Trump administration, scarred by this experience, has decided to emulate what it sees as the recipe for China’s su- premacy: heavy-handed intervention in commodity markets. To understand why America—and many other governments— distrust free markets to fix this problem, start with how they diagnose it. In 1987 Deng Xiaoping declared “the Middle East has oil, China has rare earths”, framing metal dominance as a strategic asset. In the four decades since, China has built its near-monopoly across many metals by lav- ishing public funds and cut-rate loans on preferred mines and refineries, and by pri- oritising production over the safety of workers and the environment. China also uses its market clout to crush competitors, dumping particular metals to crash prices and so force existing mines out of business or cause new pro- jects to be mothballed. Low-priced Chi- nese rare earths played a part in the closure of Mountain Pass in California—once the world’s largest rare-earth mine—in 2002. (A toxic spill cleanup and new, tougher en- vironmental regulations compounded its competitive disadvantages.) That mine has since reopened under new American ow- nership, but in many other cases distressed assets have ended up in Chinese hands. Early this decade, as lithium prices surged and new projects proliferated, Chinese producers ramped up output until prices collapsed, causing Western mines to stum- ble—and Chinese firms to snap up a hand- ful of them, from Mali to Mexico. The Trump administration’s brute- force intervention involves a jumble of in- stitutions. One of the most active is the re- purposed Export-Import Bank (EXIM), which used to channel funds to green pro- jects under President Joe Biden. The ener- gy and defence departments and the US International Development Finance Cor- poration (DFC) are also splashing money around. David Copley, a former gold miner on America’s National Security Council, is co-ordinating the frenzy. The campaign is remarkably broad, po- tentially covering all 60 minerals labelled critical by the United States Geological Survey—including abundant, widely recy- cled metals such as aluminium, lead and zinc. Notably it also is focused less on re- fining metals, where China is most domi- nant, than on digging elements out of the ground. “They are working their way through the periodic table,” says a mining boss. Officials favour projects nearing pro- duction or ripe for expansion. “Time is not on our side,” says one. The ambition is to protect not just the defence industry from China, but civilian ones, too. The Trump administration is pulling three main central-planning levers to make projects competitive. The first is straight from the Chinese script: subsidising the upfront cost of new mines through loans and direct investment, which also encour- ages private lenders to stump up capital. Since October the Pentagon has commit- ted $2.8bn in equity and debt to eight min- ing and refining projects, biased towards metals such as gallium and germanium that China has at times stopped exporting. In the past year EXIM has issued $15bn in letters of interest (signalling its intent to lend) for critical-mineral projects, includ- ing $455m for a rare-earth venture in Amer- ica and $350m for cobalt and nickel in Aus- tralia. The Department of Energy has ap- proved $7bn in loans to domestic ventures in graphite, lithium and potash. The DFC has deployed both equity and debt “in the world’s most strategic regions”, says Ben Black, its boss. It has provided seed fund- ing for critical minerals in Ukraine and a third of the $1.8bn Orion CMC is injecting into Congo. It is mulling a $700m invest- ment in Kazakh tungsten mines. To keep its deal pipeline stocked, the administration is signing agreements giv- ing American firms first dibs on mining in- vestments abroad. It has inked 21 bilateral pacts with foreign governments and con- cluded negotiations for 17 more. In some cases financing comes with a novel condi- tion, that little or none of the output be sold to China. The Economist understands that one large loan recently offered to a mine abroad by the American government was initially delayed because the Trump administration wanted it to stop shipping to China. In Africa aid is being linked to governments agreeing to mining deals. Stocking the larder America’s second lever is to guarantee some purchases from miners, in the form of Project Vault, a national stockpile of minerals to support civilian industries. (The Pentagon already keeps small stashes of materials for military use.) Inspired by America’s 50-year-old, 415m-barrel Strate- gic Petroleum Reserve, Project Vault would fund purchases by a select group of commodities traders of all 60 critical min- erals. It is to be financed by a $10bn loan from EXIM and $2bn in private capital. The goal is to cover weeks or months of demand for various metals, and up to a year’s supply for some like yttrium, which is used in lots of important gear, including jet engines. Companies would pay fees up front and commit to purchasing metals at a set price, then be granted access to the stockpile when crisis strikes. More than a dozen firms—including General Motors, Boeing, Google and GE Vernova—have in- dicated a willingness to join. The third lever is maintaining price floors, so that miners will not be put out of business if China dumps a mineral on the market. The Trump administration en- tered into its first (and thus far only) such scheme last July, as part of a public-private partnership with MP Materials, which runs a rare-earth refinery in Texas. It sets a ten- year floor on the price of neodymium-pra- seodymium (NdPr) oxide: if MP sells below $110 a kilogram, the Pentagon pays the dif- ference. (The Pentagon has also commit- ted to buy all the rare-earth magnets MP produces at a planned new MP facility for the first ten years of the plant’s operation.) America has since pitched the idea of price floors to allies. In February the State Department hosted a “Mineral Ministeri- al” in Washington, attended by 54 coun- tries (China was not invited). America pro- posed a “minerals club” that, it said, would “reshape the global market”. For some commodities, producers inside the bloc would be assured of a price floor when sell- ing to firms from within the club. When transactions settle below that price, a kitty funded by member countries would pay producers the difference. Imports from outside the club—read China—would face a tariff bringing the end cost to consumers up to the floor. The administration has giv- en roughly 30 countries until March to re- turn letters of commitment. Separately, America is in talks with the European Un- Mine, all mine Critical-minerals supply, 2024, % of total Sources: IEA; USGS  Tungsten Nickel Copper Lithium Rare earths Graphite 100 80 60 40 20 0 Mining Rest of world China Gallium Copper Lithium Cobalt Rare earths Graphite 100 80 60 40 20 0 Refining C002 -- 17 of 80 -- Briefing America’s quest for minerals 18 The Economist February 28th 2026 ▸ ion, Japan and Mexico about partnerships on minerals that might feature price floors. Western allies share similar goals to America’s but are not pursuing them as ag- gressively. The EU has set targets for re- ducing Chinese imports and speeding up permitting for new mines, and signed part- nerships with Chile, Namibia and others. But it has committed little money—€3bn ($3.5bn) across 34 minerals—and countries it has approached say it asks for assured supply while offering little in return. Australia and Canada are spending somewhat more than Europe, but mostly at home. Japan is the most active, having al- ready suffered from Chinese manipulation of metals markets: in 2010, China imposed an unofficial ban on exports of rare-earths to Japan during a row over disputed is- lands. Japan responded then by taking mi- nority stakes in foreign mines in exchange for guaranteed supply (it also greatly ex- panded its critical-metals stockpile). Exec- utives at JOGMEC, its resource-security agency, say it is now “aggressively” invest- ing even more and taking “much more risk”. But they are not keen on price floors, arguing that “free markets” are in the long run “a necessary condition” for success. Some miners also express discomfort with price floors and other interventions. “We don’t like fiddling with markets,” says an executive. Incumbents who grew large without state support resent new entrants crowding the market, notes Huw McKay, a former chief economist at BHP, a mining giant, who is now at the Australian Nation- al University. Most global mining firms spent recent years retrenching rather than taking risky bets in distant countries. Free- port-McMoRan, once the largest private investor in Congo, sold its last project there to a Chinese firm in 2020. The clearest beneficiaries are likely to be smaller mining firms that might other- wise struggle to raise capital. Guardian Metal Resources, which plans to mine tungsten—a metal America has not pro- duced commercially since 2015—received a Pentagon grant in July. The award helped the firm attract private capital, says Oliver Friesen, its boss, allowing it to accelerate engineering studies. It now has four drill- ing rigs on its site in Nevada. Digging in the wrong places Will America secure the supply it craves? Many experts worry the government is tak- ing a scattershot approach, instead of fo- cusing on only the most important miner- als (see chart 3). Another problem is that the sums deployed, though large in aggre- gate, can be tiny for individual projects: most EXIM cheques are for millions or tens of millions of dollars—a rounding error for mines that can cost billions to develop. A bigger risk is spending heavily for meagre results. The world is not short of critical-mineral projects; very few are likely to be profitable. Opportunities for corrup- tion are rife, with an administration known for cronyism spreading largesse in an in- dustry known for attracting cowboys and charlatans. A State Department official notes a rise in non-American firms regis- tered in Delaware, which requires minimal disclosure, pitching mining projects. There is scepticism among some in Congo that Virtus Minerals, a firm led by former sol- diers and intelligence officers that agreed to buy a distressed Congolese mine in Feb- ruary, is equipped to run it. In January the government declared an intent to provide $1.6bn in backing for Round Top, a Texas rare-earth project, sending the share price of its sponsor, USA Rare Earth, surging. The site has been touted for development since at least the 1980s without success. America’s sole price-floor experiment carries obvious risks. MP Materials has lit- tle incentive to seek a good price for its NdPr, since Uncle Sam must top up what- ever it receives to $110 a kilogram. Quarter- ly results show the firm’s average price in the three months to September (before the price floor came into effect) was $59 a kilo- gram. NdPr leaving China fetched $78 a kilogram over the same period. America’s price-floor club would face similar problems. Jamieson Greer, the US trade representative, insists to The Econo- mist that it is still worth pursuing. “I’d rath- er get inefficient production from a bunch of market economies I’m generally aligned with than efficient production from a country I’m not strategically aligned with.” But China presents another problem that the scheme does not account for: most raw metals produced inside the club must be sent to China for refining, so there is no es- cape from Chinese leverage. What is more, China could then redirect refined metals to other buyers, defeating the club’s purpose. Building a civilian stockpile looks equally fraught. The oil reserve works be- cause it involves a single commodity which can be refined at home. Hoarding metals is a far more complicated proposition. Stor- ing ores requires lots of space and serves little purpose without domestic refiners to process them. Refined metals are less bul- ky, but also less fungible. Should copper be held as powder, wire or bars? Many of America’s proposed interven- tions in the mining industry will probably get watered down, stall or collapse. Mar- kets are sceptical: metals prices have bare- ly twitched in response to America’s an- nouncements. “No one understands what’s going to happen,” says Ellie Saklatvala of Argus Media, a price-reporting agency. Chinese mining firms seem unfazed; they are continuing to acquire assets abroad. Even if many of its initiatives prosper, the Trump administration’s approach does too little to loosen China’s grip where it is tightest: in refining. Government med- dling in the commodities market could prove costly for taxpayers while distorting price signals, potentially discouraging in- novative entrants. And many producers, aside from fearing China’s wrath, will fear a change in the political winds, which could come in Congress this year or in the White House in 2028. The greatest risk of America’s experiment in centrally planned mining is that it depends on the whims of the central-planner-in-chief. ■ Element-ary risk Selected critical minerals, estimated supply risk and economic importance* *Measured in scale, value creation and industrial dependency Source: The Economist High → ← Low Economic importance* Supply risk ↓ Low ↑ High Other Energy transition Industrial inputs Technology/defence Germanium Germanium Germanium Germanium Germanium Germanium Germanium Germanium Germanium Germanium Heavy rare earths Cobalt Baryte Copper Copper Copper Copper Copper Copper Copper Lithium Lithium Lithium Lithium Lithium Lithium Lithium Lithium Silicon metal Nickel Nickel Nickel Nickel Nickel Nickel Nickel Helium Titanium Titanium Titanium Titanium Titanium Titanium Titanium Titanium Titanium Graphite Tungsten Tungsten Tungsten Tungsten Tungsten Tungsten Tungsten Tungsten Tungsten Tungsten Tungsten Tungsten Tungsten Tungsten Tungsten Tungsten Tungsten Tungsten Tungsten Tungsten Tungsten Tungsten Tungsten Tungsten Tungsten Tungsten Tungsten Tungsten Tungsten Magnesium Magnesium Magnesium Magnesium Magnesium Magnesium Magnesium Magnesium Magnesium Magnesium Magnesium Bismuth Bismuth Bismuth Bismuth Bismuth Bismuth Bismuth Bismuth Bismuth Boron Boron Boron Boron Boron Boron Scandium Scandium Scandium Scandium Scandium Scandium Scandium Scandium Scandium Bauxite Fluorspar Fluorspar Fluorspar Fluorspar Fluorspar Fluorspar Fluorspar Fluorspar Fluorspar Fluorspar Fluorspar Fluorspar Arsenic Arsenic Arsenic Arsenic Arsenic Arsenic Arsenic Arsenic Arsenic Vanadium Vanadium Vanadium Vanadium Vanadium Vanadium Vanadium Vanadium Vanadium Vanadium Phosphate rock Precious meddles Europe, metal prices, $’000 per tonne Source: Argus Media Chinese export controls announced 60 40 20 0 26 2023 Antimony 90 60 30 0 26 2023 Bismuth 900 600 300 0 26 2023 Dysprosium 600 400 200 0 26 2023 Indium 150 100 50 0 26 2023 Tellurium 1.5 1.0 0.5 0 26 2023 Tungsten C002 -- 18 of 80 -- 19 The Economist February 28th 2026 United States Demography Turn that U-Haul around OF ALL THE buildings in Rockford, Illi- nois, a city of roughly 150,000 people, City Hall is among the prettiest. Originally a bank that went bust in the Depression, it rises eight storeys above the city’s main commercial strip. On the ground floor is a grand arched atrium. The view from the mayor’s office is, sadly, not so handsome. There are rather too many parking lots, and more than one abandoned factory. Looking out, it would be easy to think that Rockford is just another fading midwest- ern industrial town, struggling to maintain its past glory. And yet go a little closer, and Rockford is doing surprisingly well. There is a free art museum, with a Roy Lichtenstein painting. A long-derelict factory recently reopened as a smart hotel. The city has an ornate Japanese garden. And businesses are growing, not closing. Some 8,700 peo- ple work at the airport, several thousand more than a decade ago. Clusters of manu- facturing sit around it. There is “not a plane that’s going over the United States right now that does not have pieces that come from Rockford”, boasts Tom McNa- mara, the mayor. But the biggest change is that fewer people are leaving the city. In 2024, accord- ing to Census Bureau data based on tax re- turns, 141 more people left Rockford for other parts of America than moved in. For most of the decade up to 2020 the annual loss was between 2,000 and 3,000. In 2025, though the full figures are not yet avail- able, the city may well have gained more people than it lost for the first time since before the global financial crisis of 2007- 09. Although the city’s amenities help, Rockford also reflects a broader trend. Last year the Midwest census region, which stretches from the Dakotas to Ohio, gained more domestic migrants than it lost. In 2022, some 180,000 people moved out. Last year 16,000 moved in (see chart on next page). That, says Hamilton Lombard, a de- mographer at the University of Virginia, is a remarkable turnaround—especially since it is occurring at a time when America’s overall population is growing as slowly as it ever has. The data do not go back far enough to be sure, but Mr Lombard guess- es that the last time more people moved to the Midwest than left was in the 1950s, when black Americans headed north to factory jobs and away from Jim Crow. By the 1970s, if not before, deindustrialisation had reversed the flow, creating a sort of re- verse Great Migration. Illinois is perhaps where the change is most obvious. In 2022 the Land of Lincoln lost nearly 150,000 people to other states. Some smaller counties downstate have been losing population practically since Lincoln himself was alive. This creates huge fiscal pressure, as spending on pen- ROCKFORD, ILLINOIS People are moving to the Midwest again → ALSO IN THIS SECTION 20 SCOTUS and POTUS 21 The battle for Texas 22 Accidental killers 23 California’s 250th 24 Lexington: The state of the union ⏩ C002 -- 19 of 80 -- 20 The Economist February 28th 2026 United States ▸ ⏩ sions grows while tax revenues do not. In- deed, roughly 40% of Chicago’s budget goes on pensions and debt. Such pressures may soon become less intense, however. Last year just 40,000 people left Illinois, some 73% fewer than three years before. Across the rest of the region, the turna- round is less pronounced and more un- even, but still apparent. Many older, once- industrial cities are doing much better. Last year the Census Bureau estimated that the total population of the city of De- troit grew for the first time in nearly 70 years, in part because of a reduced outflow of domestic residents. The metro area of Cleveland, Ohio, another rustbelt city, is also losing fewer people. By contrast, Co- lumbus, a city in the same state but with the feel of the sunbelt minus the sun, has seen large inward migration become a modest outflow. What could explain the overall shift? Talk to any state or local official and they, of course, take credit. People are discover- ing that “Michigan is a remarkably global and cosmopolitan place”, says Quentin Messer, who runs the state economic-de- velopment agency. Having moved from Louisiana, he says his new home is “the most beautiful state in the United States”, and that its thriving sports teams are part of the reason why people might move in. Mr Lombard has a more convincing ex- planation. It is about the cost of living. He contrasts Phoenix, a fast-growing city, with Chicago. The Arizonan metropolis “used to be relatively affordable. It’s just not at all any more,” he says. Rents in Chi- cago are around $150 a month cheaper. On top of this, it is possible to live without a car and see a decent show at the theatre. “You can buy an incredibly nice house with a yard and a garage for $200,000,” says Mr McNamara, the mayor of Rockford. In recent decades the biggest outflow from Chicago has been of working-class, often black, families. In the decade to 2020, Cook County, which contains the ci- ty, lost 100,000 black residents—some to next-door states, many to places such as Atlanta and Houston. Now the South is no longer as cheap and its pay is no longer much higher. In the Midwest the decades- long decline in manufacturing jobs has slowed, and until recently wages in the sec- tor were rising quickly. It is too early to say if the great-migra- tion flip will be sustained. The winters are still bleak, and southern sun will remain a lure. Manufacturing employment is once again struggling, in part because of Do- nald Trump’s tariffs. The bigger problem, though, is that even if fewer people leave the Midwest for elsewhere in America, the Trump adminis- tration has cut off the largest supply of new workers: international migration. In January the Congressional Budget Office reduced its forecast of how much the American population will grow over the next decade from 15m people to 8m, be- cause of lower migration and birth rates. For the first time in decades the immigrant population is probably falling, countering any small domestic gains. With the total population flattening, for any one region to grow, somewhere else must shrink. ■ Reverse flow United States, net domestic migration, ’000 Source: Census Bureau Northeast West Midwest South 1,000 500 0 -500 2022 2025 -180k +16k SCOTUS and POTUS The Trump court? Not quite APRESIDENT’S MOST lasting mark is the justices he appoints to the Supreme Court. But as Donald Trump learned anew on February 20th when two of his appoin- tees voted to nullify sweeping tariffs he im- posed last spring (see Finance & econom- ics section), presidents have no control ov- er their nominees once they are confirmed. Mr Trump heaped insults on Justices Amy Coney Barrett and Neil Gorsuch, jurists he tapped in 2020 and 2017, for voting the wrong way in Learning Resources v Trump. Their judgments were an “embarrassment to their families”, he said. But Justice Brett Kavanaugh, Mr Trump’s pick in 2018, who voted to save the tariffs, received presiden- tial kudos for his “genius”. Mr Trump may divide the court into team-mates and rivals, but the justices’ fo- cus is elsewhere. They are engaged in internecine struggles over rarefied ques- tions of statutory interpretation—dis- agreements that transcend ideology and the current political moment. Chief Justice John Roberts’s majority opinion that the International Emergency Economic Pow- ers Act does not give presidents the au- thority to impose tariffs was a brisk 21 pag- es. But five more opinions (two dissenting, three concurring) ballooned the ruling to 170 pages and led to a 107-day wait be- tween oral argument and decision day. Learning Resources represents a striking counterpoint to the conventional view of today’s Supreme Court as Mr Trump’s reli- able ally. To be sure, the conservative su- permajority smoothed his return to the White House and has blessed many as- pects of his agenda. In 2024 Trump v An- derson repelled a challenge to his candida- cy, and Trump v United States handed him an umbrella of immunity against criminal prosecution. In 2025 the justices gave him nearly two dozen interim victories—let- ting him gut the Department of Education, bar transgender soldiers and lift immigra- tion protections for nearly 1m people. Yet the court pushed back last April when the administration whisked purport- ed gang members to El Salvador without due process, and in December after it tried to mobilise the National Guard in Chicago. The emphatic setback in Learning Resourc- es, the first full-dress merits case involving a policy of Mr Trump’s second term, shows a court that has red lines. Mr Trump’s bid to sack Lisa Cook from the Federal Re- serve’s board and to cull the constitution’s birthright-citizenship guarantee are two more battles he will probably lose. The fight in Learning Resources turned not on the wisdom of Mr Trump’s retalia- tory tariffs but on the “major-questions doctrine”, a principle that stops the execu- tive branch from undertaking moves of vast significance without clear authorisa- tion from Congress. The six conservatives used the tool during Joe Biden’s presidency to throttle plans to cancel student debt, clean up power plants and protect renters from eviction. For half of the conservative supermajority—Chief Justice Roberts and Justices Barrett and Gorsuch—the same limits doomed Mr Trump’s tariffs. Justices Ketanji Brown Jackson, Elena Kagan and Sonia Sotomayor, who have long criticised the major-questions doc- NEW YORK The tariffs ruling reveals justices split over doctrine, not Donald Trump Declaration of independence C002 -- 20 of 80 -- 21 The Economist February 28th 2026 United States ▸ trine as a departure from ordinary textual- ism, reached the same result without in- voking what Justice Kagan once called a “get-out-of-text-free card”. Justice Kava- naugh and Justices Samuel Alito and Clar- ence Thomas voted to uphold the tariffs despite their affection for the doctrine, opining that it has less bite when presi- dents are engaged in foreign affairs. Still finer distinctions characterise Jus- tice Barrett’s and Gorsuch’s permutations of the major-questions doctrine (explored in their duelling concurring opinions). As the justices refine their approach to bal- ancing congressional and executive pow- er—a fundamental aspect of America’s constitutional design—they may have one eye on the current occupant of the White House. But their horizon extends beyond a single presidency. The court is working to- wards a “rule for the ages”, as Justice Gor- such has said, even if the justices are of many minds over what it should say. ■ The battle to flip Texas Biblical sins and hot wheels DONALD TRUMP IS not on the ballot in the midterms, but he hovers over eve- ry race. His unpopularity gives Democrats an excellent chance of winning the House of Representatives in November. Some Democrats even dream of capturing the Senate. A dramatic tussle in Texas shows how that might be possible. On March 3rd both Republicans and Democrats will pick their candidates. Each party’s primary voters face a similar choice: a fire-breather who thrills the base or the candidate who is more likely to win. Republicans seem poised to pick the for- mer. If Democrats avoid the same mistake, they could perhaps win a statewide race in Texas for the first time since 1994. The Republican primary pits John Cor- nyn, the four-term incumbent, against Ken Paxton, a populist. With his silver hair and sober suit, Mr Cornyn looks like a cartoon- ist’s idea of a senator. A former judge, he calls himself a “work horse” not a “show horse”. In the Senate he has pushed through many laws; sometimes he even dares to work with Democrats. By any normal standards, he is conser- vative: he strained to repeal Obamacare and still opposes gay marriage. Like many calculating Republicans he has suppressed his distaste for the president. Ten years ago he called Mr Trump an “albatross”; now he diligently rubber-stamps his agenda. But MAGA true believers are rallying around Mr Paxton, who strikes them as more authentically Trumpy. In his decade as Texas’s attorney-general, he has sued Google and Meta for “spying on Texans”, Pfizer for “conspiring to censor” informa- tion about the supposed flaws of its vac- cines and swing states for allegedly distri- buting fake ballots. He boasts about suing Joe Biden 107 times. Like Mr Trump, Mr Paxton runs into trouble from time to time. He was accused of securities fraud (he settled by paying $300,000). His own party in the Texas House impeached him for corruption; the Senate did not convict him. His wife filed for divorce last year on “biblical grounds”. A pro-Cornyn ad calls Mr Paxton not just “corrupt” but also “weird”. Mr Paxton claims that all the charges against him were a conspiracy hatched by the same kind of dark forces that tried to impeach and prosecute Mr Trump. Polls show the two neck-and-neck. Be- cause a third candidate, a lesser-known congressman from Houston, has entered the Republican race, it will probably go to a run-off. Since run-offs tend to attract fewer but more hard-core voters, Mr Pax- ton will probably win, Bill Miller, a political consultant, predicts. Both leading candi- dates are desperately courting Mr Trump. But Mr Trump has yet to endorse anyone, perhaps for fear of backing a loser. The Democrats’ choice is between Jas- mine Crockett, a black congresswoman from Dallas, and James Talarico, a white state representative from the Austin sub- urbs. Both are progressives, but their styles could hardly be more different. Ms Crock- ett fires up angry Democrats with the in- sults she hurls online. Mr Trump is “Putin’s ho”. Greg Abbott, the wheelchair-bound governor of Texas, is “Governor Hot- wheels”. Republicans are, generically, “ass- holes” and Hispanics who vote for them have a “slave mentality”. The base wants “someone who expresses their id”, says Jim Henson, a pollster. Asked about his party’s prospects against her, Mike Johnson, the Republican Speaker of the House of Rep- resentatives, giggled and tapped his fin- gers together like Dr Evil. Mr Talarico is calmer and probably more electable. The 36-year-old former teacher is articulate and devout, using scripture to embarrass Republicans who voted to make schools post the ten com- mandments. On the stump, he argues that the real enemy is not the right but the bil- lionaires screwing the little guys. He is a hit on liberal podcasts, but has also ap- peared on the Joe Rogan show, which ap- peals to conservatives. In the first week of early voting he was interviewed by Stephen Colbert, a national television host. CBS re- fused to broadcast the segment, for fear of the Trump administration weaponising impartiality rules against it. The interview aired online only—where it went viral. “Donald Trump is worried we’re about to flip Texas,” Mr Talarico crowed. Betting markets predict that Mr Paxton will face Mr Talarico in November. If so, the national Democratic Party will pour money into the race, which is already one of the costliest ever. To capture the Senate, the Democrats need to gain four seats. That would mean winning all the toss-up states and at least two that lean Republi- can, such as Texas. The Lone Star state is conservative enough that even a candidate as ethically challenged as Mr Paxton will be hard to beat. But if Mr Trump provokes a Democratic tsunami, as some predict, Texas could be the state that flips the Sen- ate—and constrains him for his last two years in office. ■ AUSTIN Democrats have a chance to score a stunning upset in November Lone-star stakes C002 -- 21 of 80 -- 22 The Economist February 28th 2026 United States Accidental killers Hyacinth heartbreak IN A GREEK myth Apollo accidentally kills the Spartan prince Hyacinthus with a discus. As the god mourns his lover, a flower blooms from the drops of Hyacin- thus’s blood. The story of hope after harm has inspired a club in America that nobody wants to belong to: the Hyacinth Fellow- ship. The fellowship is a support group for people who have accidentally killed some- body. “We are not the good guys in our sto- ries,” says one member, who at the age of 16 skidded off the road while driving at night and killed her friend in the passenger seat, the town’s prom queen. In America someone is accidentally killed roughly every 18 minutes. Most die in car crashes, though some are killed by medical mistakes, guns unexpectedly go- ing off or freak accidents. Compared with other rich countries the statistics are ex- ceptional. In 2024, 39,000 Americans died in road accidents; relative to the size of the population, that is double the rate in France and four times Britain’s. Beyond the poorest places only a handful of coun- tries—Kazakhstan, Georgia, Kyrgyzstan and Armenia—are worse. Much attention is rightfully paid to the victims. But far too little is given to the tens of thousands of people struggling after unintentionally taking a life. It is no mystery why fatal accidents are so common. America has one of the big- gest networks of roads and Americans drive more miles, and more on high-speed “stroads”—a hybrid of a street and a road— that are shared with pedestrians. In 2024, 78% of American workers commuted by car, compared with 55% of Britons. Cars also tend to be bigger, making them more likely to kill on impact. Most accidents happen at night and many of the drivers are drunk. But the risk of killing is not evenly distributed across the country. Sun- belt states are far more dangerous (see chart). More streets in those states are owned by state governments, and highway engineers too often design them prioritis- ing efficiency rather than safety. The result is a high share of Americans nursing trauma, typically in silence. In in- terviews with eight people who had acci- dentally killed someone and joined the Hyacinth Fellowship, The Economist learned that many are told by family and friends not to talk about it. Some bottle it up for years, if not decades. It is common to fear some sort of karmic punishment. “I thought God’s retribution would come back for me,” says a man who feels he has lived only “half a life” since his accident. Anniversaries of the killing become more important than birthdays. For some the guilt is too much to bear. A man in his mid-20s who killed a girl in a boating accident a year and a half ago committed suicide four weeks later. Before he died he tried to sell all of his belongings to help pay for her funeral. Relationships can become strained. Survivors seek validation from loved ones that they are not monsters, but hearing that “it’s not your fault” provides little comfort. Therapy can help a lot, but most therapists are not trained to counsel such people. Many accidental killers describe becoming emotionally numb and strug- gling to finish university or work. For years one man had recurrent night- mares about running people over, only to wake up to his legs jerking to try to slam on the brakes. Starting a family terrified him: “I have ramped-up anxiety about bad things happening to my kids because I took somebody’s daughter.” For the families of victims, suing the perpetrator can be the only way to get clo- sure. Each year Americans bring about 100,000 wrongful-death lawsuits. Whether that is the right remedy is debatable, but it comes at a cost. One woman who was charged with vehicular manslaughter re- members feeling sick to her stomach when her lawyers argued in court that a deer might have run out into the road, causing her to swerve. “I had some amnesia but I knew that wasn’t what happened,” she says. A black man who was drunk and 18 years old at the time of his accident re- members feeling “terrified of being mis- treated in prison”. Mothers Against Drunk Driving came after him “like a mob”. The anxiety didn’t go away once he served his time. “I remained financially solvent my whole life but could never save,” he says. “I didn’t want to have anything that someone could take away from me”. If American roads were safer fewer peo- ple would die—and fewer people would be left to live like this. But cars probably won’t get smaller and Americans won’t suddenly depend on them less. There are, however, other fixes that work. The road ahead Jeff Speck, an urban planner, has helped 60 cities redesign their roads to cut deaths. Speed limits matter less than environmen- tal cues, he argues: trees, tighter bends and narrower lanes force drivers to slow down. Replace traffic lights with four-way stop signs and crashes fall by two-thirds, he says, because people simply don’t speed through them. Come what may, the Hyacinth Fellow- ship will keep getting new members. The group runs monthly calls, spiritual coun- selling, writing workshops and legal semi- nars. Many feel that in the group they have real community for the first time. “We’re just one beggar trying to help another beg- gar find bread,” says Chris Yaw, the rever- end who runs its board. The fellowship hopes to become a household name like Alcoholics Anony- mous, and for first responders to tell survi- vors about them at the scene of a crash. To shake the stigma more Americans will need to understand that in an instant their world, too, can come crashing down. But as the woman who killed the prom queen puts it: “Some people really think that they are in control of their own destiny.” ■ ATLANTA The psychological toll on those who kill by accident is huge—and mostly hidden Sorrow in the South US, road deaths per 100,000 people, 2023 Sources: National Safety Council; CDC, National Centre for Health Statistics Massachusetts New York Rhode Island Hawaii New Jersey South Carolina Arkansas Alabama New Mexico Mississippi 30 25 20 15 10 5 0 Best Best Best Best sstates tates tates tates tates Worst Worst Worst Worst Worst states states states states states states C002 -- 22 of 80 -- 23 The Economist February 28th 2026 United States California history On the trail “HI, EVERYONE, CAN we gather around this table here?” Mark Wil- kinson, of the Santa Barbara County Trails Council, waves a group of 25 hikers to- wards a picnic area on a bluff overlooking the Pacific. The surf crashes gently on the beach below and, after a week of rain, tiny yellow flowers cover the cliffs. Over the next five miles the group will walk the same path that the Anza expedition tra- versed 250 years ago, when Spanish sol- diers and settlers began the colonisation of what was then known as Alta California. “They camped right in this area,” says Mr Wilkinson, “maybe where the freeway is.” American history is normally told from east to west. But the story of modern Cali- fornia does not begin with shouts of “Eure- ka!” during the gold rush, or with state- hood in 1850. In the late 18th century Spain was a waning colonial power worried that the Russians or the English would en- croach upon its unsettled territory. Adven- turers had reached Alta California by sea, but never over land. So in 1775 Juan Bautis- ta de Anza, a Spanish explorer, led 240 sol- diers and civilians on a perilous 1,200-mile quest from Sonora, in modern Mexico, to the San Francisco Bay (see map). The expedition stalled and commenced again in 1776, the same year America’s founders signed the Declaration of Inde- pendence. The names of neighbourhoods along California’s coast recall the caravan’s descendants: Feliz, Berryessa, Bernal. “It’s always a history that falls out of our nation- al narrative,” says Steven Hackel, a histori- an at the University of California, River- side. “People can’t get their mind around the fact that there was a history here that’s independent of what happened in the summer of 1776 on the east coast.” Most of the people in Mr Wilkinson’s group had never heard of the Anza expedi- tion. They are retirees and avid hikers from Santa Barbara who read about the walk in their local newspaper. We set off along the beach. The tide is out, the sun is climbing, and the Channel Islands are visible off- shore. Pedro Font, a chaplain for the Anza expedition, was a dutiful diarist who wrote in detail about this part of the journey. “All this road as far as the camp site runs along the sea beach, almost touching the waves,” he noted. “The people of the expedition who had never seen the sea found many things to marvel at.” So did we. After a steep climb, the group stops to gawk at a seal sanctuary. “Oh my god, they are bask- ing!” Maureen Wallace exclaims, as she points out the baby seals on the sand. We pause at the site of a former Chu- mash village in the city of Carpinteria, named for their expert craftsmanship. Mr Wilkinson had warned his flock that the Anza expedition presaged tragedy for Cali- fornia’s indigenous peoples. Font wrote about the Chumash with curiosity and de- rision: “The Indians are great fishermen and very ingenious…But they are very thievish, a characteristic of all Indians.” The Spanish brought disease and disrup- tion. Natives forced to live in cramped bar- racks in the Franciscan missions suffered from “endemic ill health turbocharged by the occasional epidemic”, explains Mr Hackel. Their numbers plummeted. In 2020, when southerners were tearing down monuments to the Confederacy, California had a reckoning over its colonial past. Prot- esters toppled statues of Junípero Serra, the architect of the mission system who was (controversially) canonised in 2015. Like Anza and his crew before them, the hikers encounter a salt marsh that blocks their way. “Mother nature guided their direction and it guides us today,” says Mr Wilkinson. We go around. Egrets wade in the shallows. Mrs Wallace tells this cor- respondent to keep an eye out for leopard sharks, which breed in the creek. The company ambles onto a bike path that runs alongside the 101 freeway. The quiet of the marsh gives way to the clam- our of California traffic. Amtrak’s Pacific Surfliner train trundles through the same corridor, between the Santa Ynez moun- tains and the sea. That is no coincidence. “We tend to use the same pathways over time,” says Christopher Bentley of the Na- tional Park Service, which is tasked with connecting the expedition’s entire trail. In- digenous routes became the Anza trail, which eventually matured into some of California’s coastal roads and railways. During the last mile, The Economist tries to imagine what this part of the coast looked like in Anza’s day, before the high- way, the power lines, the wineries and surf shops. But modernity, and lunch, beckon. The hikers stop and wave goodbye. We have arrived at that most prosaic of Cali- fornian landmarks—the parking lot. ■ CARPINTERIA The triumphs and tragedies of the Anza expedition Los Angeles Los Angeles Los Angeles Los Angeles Los Angeles Los Angeles Phoenix Phoenix Phoenix Phoenix TTucson ucson Tucson TTucson T Hermosillo Hermosillo Hermosillo Carpinteria Carpinteria Carpinteria Santa Santa Santa Barbara Barbara Barbara Channel Is. Channel Is. Ariz Ariz Arizona Sonora California California California California MEXICO MEXICO MEXICO MEXICO MEXICO MEXICO PACIFIC PACIFIC OCEAN CEAN UNITED STATES UNITED STATES UNITED STATES UNITED STATES UNITED STATES UNITED STATES UNITED STATES UNITED STATES San F San F San F San F San Francisco rancisco rancisco rancisco rancisco rancisco rancisco rancisco rancisco rancisco rancisco rancisco rancisco rancisco Sonoran Desert Sonoran Desert Sonoran Desert Sonoran Desert C o ll oo rr a r a r d o R i v e r 250 km Juan Bautista de Anza historic trail corridor Source: National Park Service C002 -- 23 of 80 -- 24 The Economist February 28th 2026 United States Donald Trump’s unworthy state of the union AT THE BEGINNING of his first term as president, Donald Trump used his address to a joint session of Congress to deliv- er “a message of unity and strength”, urging bipartisan action as he looked nine years ahead to America’s celebration of the 250th anniversary of its declaration of independence. “What will Amer- ica look like as we reach our 250th year?” he wondered then. As Mr Trump marked the arrival of that anniversary in his state-of-the-union speech on February 24th, America does not look at all like the country that, on the occasion of his rookie out- ing nine years ago, he tried to conjure up. Mr Trump began that address, in February 2017, by observing that it was Black History Month and declaring there was still work to be done on “our na- tion’s path toward civil rights”. He urged support from Congress for some initiatives that remain central to his politics, such as building a border wall, but also for others that have long since shrivelled, such as “positive immigration reform”, along with “ac- cessible and affordable” child care, new investment in women’s health and for “clean air and clean water”, and a “rebirth of hope” in “our neglected inner cities”. Mr Trump told Congress then, “True love for our people requires us to find common ground.” This week, as Mr Trump heralded the American anniversary, he still touted grandiose visions—of a “golden age” and a “turn- around for the ages”, achieved in just his first year back in office— but they did not include any summons to an American common ground. He did not mention unity. Instead he repeatedly called Democratic congressmen “sick” and “crazy” and said they were “destroying our country”. If they had power, he warned, they would open America’s borders to “some of the worst criminals anywhere in the world”, the likes of the “Somali pirates who ran- sacked Minnesota” by committing fraud. He said Democrats can win elections only by cheating. What has happened, in the past decade, to the president who once talked about unity? And to the country where that idea still seemed plausible, or at least desirable, in its politics? An impeach- ment, a pandemic, a racial reckoning over police violence, an in- surrection to block the peaceful transfer of power and then anoth- er impeachment, plus assorted lawsuits and prosecutions proba- bly all played roles. So did Mr Trump’s growing confidence in the power of his polarising politics. After all, he dutifully read that first speech to Congress off the teleprompter, and it lasted just an hour. This time, he set a numbing record for such speeches, at an hour and 48 minutes, and he was most engaged with his material when he departed from his script, though his “weave” became ever more frayed as the evening wore on. (“Space Force is my baby, be- cause we did that,” he said, to entirely Republican applause, though he said nothing about what the force was up to.) Consider the House chamber from the president’s vantage point. To his right sat Democratic representatives who he be- lieves, with reason, will support him in almost nothing he does. Directly in front of him sat four justices of the Supreme Court which, though dominated by conservatives, had just signalled its commitment to its independent authority. By ruling unlawful his novel assertion of a presidential power to impose border taxes at whim, it stripped Mr Trump of his prized thunderbolts, his most reliable means of dominating the world’s attention and extracting obeisance from abroad. “An unfortunate ruling”, Mr Trump called it in his speech, with uncharacteristic restraint. With those two constituencies beyond his control, Mr Trump focused his message upon the Republican representatives in the chamber. He cannot afford to lose them. But he knows that, with midterm elections this autumn, they are growing restive. Recent polling shows that public approval of Mr Trump is plumbing depths not seen since the insurrection of January 6th 2021. Key constituencies, including independent voters, Latinos and even young Republicans, are losing confidence in him. Fully six in ten respondents told the Marist poll this month that America is worse off now than a year ago. SOTU voce Although Mr Trump has savaged Republican members of Con- gress who have broken with him in recent months on tariffs or making war, he was careful in his speech to make no such criti- cisms. He offered few new policy ideas. But his open contempt, if not hatred, of Democrats, along with his trademark braggadocio about his own accomplishments, helped draw Republicans to- gether by signalling his intention to go on the offensive over the economy and immigration. Seeming, as usual, less like the House speaker than a house elf, Mike Johnson sat perched over Mr Trump’s left shoulder, grinning eagerly at his faintest witticism; the president has learned that Mr Johnson will serve as his loyal whip rather than the leader of a coequal branch of government. Mr Trump did supply some uplift. The Olympic men’s hockey team and the heroic servicemen he pointed to in the gallery were reassuring evidence that, in this 250th year, Americans still have passions apart from politics and values that transcend partisan- ship. But when it came to politics, culture war substituted for any loftier ambition; Mr Trump’s invocation of Black History Month in 2017 gave way in 2026 to acronymic sloganeering: “We ended DEI in America!” On a momentous question, whether America will again attack Iran and if so why, the president offered only a muddle. On the fourth anniversary of Russia’s invasion of Ukraine he had no new vision for ending the war. He had nothing to say about the challenge posed by China or the promise and peril of ar- tificial intelligence. This speech is likely to be remembered only for its length, but its effect will be to further shrink the signifi- cance of the state-of-the-union address. ■ LEXINGTON An address not fit for America’s 250th birthday C002 -- 24 of 80 -- 25 The Economist February 28th 2026 The Americas Mexico’s gangs The take-down SUNDAY FEBRUARY 22ND will go down in Mexican history. Early in the morn- ing Mexican special forces captured a po- werful drug lord in his home state of Jalis- co. The government said that Nemesio Ru- bén “El Mencho” Oseguera Cervantes, the boss of Jalisco New Generation Cartel (CJNG), one of the country’s two biggest gangs, subsequently died from wounds sustained during the shoot-out. The 59-year-old former policeman was Mexico’s most wanted person. Over the two decades since the gang’s emergence he had built a criminal enterprise that co- vered almost all of Mexico, with an array of business lines and a penchant for brutality. El Mencho was a top target for the govern- ment of the United States because he traf- ficked drugs into the country, including deadly fentanyl. The State Department had offered a $15m reward for information leading to his capture. The operation is a triumph for Mexico’s president, Claudia Sheinbaum. Since com- ing to power a year and a half ago, Ms Sheinbaum has made security a priority. She has distanced herself from the hands- off approach, known as “hugs not bullets”, of her predecessor and mentor Andrés Ma- nuel López Obrador. She has appointed a serious security minister, Omar Harfuch, and together they have boosted intelli- gence-gathering capabilities and confront- ed gangs. Mexican politicians of all stripes welcomed El Mencho’s demise. Taking down such a powerful gangster will also give Ms Sheinbaum kudos with Donald Trump. Mr Trump has repeatedly asked Ms Sheinbaum to do more to dis- mantle Mexico’s gangs. He has regularly suggested that if she does not, the United States will do it for her, with unilateral mil- itary strikes on Mexican territory. The de- cision to go after El Mencho was almost certainly taken, at least in part, to please Mr Trump, says Eduardo Guerrero of Lan- tia, a security consultancy in Mexico City. Although the operation was supported by American intelligence, it was, crucially, carried out by Mexican special forces. That will help bolster the credibility of an outfit whose trustworthiness is questioned by the Americans, who worry that corrupt troops will warn gangs of operations. El Mencho had escaped previous attempts to capture him. Despite the success of the operation, Mexico now faces uncertainty. El Men- cho’s capture risks throwing the country into turmoil. That is because it harks back to a discredited approach to fighting gang- sters: going at any cost after their bosses. Ms Sheinbaum has repeatedly criticised the so-called kingpin strategy in the past. Removing gang leaders tends to cause their organisations to splinter, prompting infighting. Murders shoot up. The violence following El Mencho’s death was almost immediate, though more to do with gangsters expressing anger than the start of internecine conflict. They car- ried out attacks in at least 15 states, setting fire to buses and banks and blocking roads. MEXICO CITY After killing Mexico’s most powerful drug lord, the government faces the risk that violence will escalate → ALSO IN THIS SECTION 26 Scandal at Brazil’s Supreme Court 28 Cuba’s solar boom ⏩ C002 -- 25 of 80 -- 26 The Economist February 28th 2026 The Americas ▸ ⏩ Airlines cancelled flights. The govern- ments of Mexico, the United States and elsewhere issued shelter-in-place orders for those in the affected areas. Some 60 people were killed in the violence. About half were state forces. By February 25th things had largely calmed down, and schools in Jalisco reopened. Yet this calm does not mean that the fallout is over. When Ismael “El Mayo” Zambada, a leader of the Sinaloa Cartel, was taken into American custody in July 2024, it took three months before real in- tra-gang fighting broke out. The violence has yet to be quelled, swamping the state of Sinaloa. (Joaquín “El Chapo” Guzmán, its other former leader, was already serving a life sentence in the United States.) The death of El Mencho is different: one part of CJNG did not betray another, as in the Si- naloa Cartel. But the power vacuum is still there to be filled. “Now it’s calm again,” says Rafael Altamira, a construction work- er in Puerto Vallarta, in the state of Jalisco. “But it’s like the sea: it looks calm, then the tsunami comes. We are waiting for some- thing more to happen.” In fact the nature of CJNG increases the chances of ongoing violence. It is an amal- gam of 92 groups which operate across Mexico, and so ripe for fragmentation, says Mr Guerrero. It is not clear whether El Mencho had a succession plan, nor wheth- er the six other gangsters killed during the firefight were members of the cúpula, CJNG’s top brass, or mere bodyguards. The group’s brutality is well known. In its early years it worked with the Sinaloa Cartel to fight the Zetas, another gang. Since then it has expanded to work in all 32 states in Mexico. Today it combines the Si- naloa Cartel’s ability to corrupt politicians and businesspeople with the Zetas’ vio- lence. To spread terror its sicarios have hung bodies from bridges or scattered them, dismembered, into the street. In 2020 it carried out a brazen attempt to as- sassinate Mr Harfuch, who was the securi- ty minister for Mexico City at the time. A diverse portfolio, from drug-traffick- ing to fuel theft and even timeshare fraud, has made CJNG extremely rich, too. That increases the incentives for violence. It has also allowed the gang to accrue immense firepower, including mines and drones that carry explosives. Mexican officials say that among the weapons they found in El Men- cho’s safe-house were rocket launchers that can shoot down aircraft and destroy armoured vehicles. The group also manu- factures its own weapons. “We don’t know what the cost of his arrest will be, but we know there will be one,” says Cecilia Far- fán-Méndez of the Global Initiative Against Transnational Organised Crime, a think-tank in Geneva. If not contained, outbreaks of violence risk becoming “an epidemic that can take years to temper”, says Mr Guerrero. The government, he says, will need to take out CJNG’s regional bosses to prevent them waging local campaigns. Mr Harfuch re- cognises this. During a press conference on February 23rd he said his security cabi- net would be “very attentive to…restructur- ing within the cartel, especially if it’s going to be violent”. The army has sent 2,500 troops to Jalisco to join the 7,000 already there. Mr Trump certainly wants more. The day after El Mencho’s capture he wrote on social media that “Mexico must step up their effort on Cartels and Drugs!” In June Guadalajara is due to be the venue for four matches of the football World Cup, which Mexico is co-hosting with the United States and Canada. That raises the political stakes for keeping vio- lence under control. Ms Sheinbaum and Mr Harfuch have enjoyed modest success at bringing down Mexico’s high murder rate. If it spikes again while the world watches, that might be their undoing. ■ Michoacán Zacatecas Guerrero Sinaloa State of Mexico Mexico City Guadalajara PACIFIC OCEAN Gulf of Mexico Jalisco Sinaloa UNITED STATES 500 km Mexico, violent events linked to organised crime February 22nd-23rd 2026 Source: DataInt Most severe Least severe Violence leaves its mark An almighty court Scandal supreme IT STARTED WITH a banker who liked su- permodels and private jets. Yet when Daniel Vorcaro was arrested and his bank, Banco Master, liquidated for practising fraud, he was not the only one quaking in his patent-leather shoes. Investigators re- vealed that Mr Vorcaro had ties with poli- ticians of all stripes, but also with Brazil’s most senior judges. That revelation has ig- nited discussion about the conduct of members of the country’s highest judicial body, the Federal Supreme Court (STF). This matters because right-wing candi- dates are expected to sweep the Senate in Brazil’s general election in October. They may gain enough seats to impeach Su- preme Court judges. The right holds spe- cial animus towards the Supreme Court for its role in prosecuting its former leader and president, Jair Bolsonaro. Last year the STF sentenced him to 27 years in jail for at- tempting a coup after losing his re-election bid in 2022. Yet even as the court has de- fended democracy it has become more prickly, sometimes casting criticism of its members as an attack on democracy itself. When the case against Mr Vorcaro came to the STF, a lottery system assigned its leadership to Justice José Antonio Dias Toffoli. There were problems from the start. Around the time he took over the case he flew on a private jet with a lawyer for Banco Master. Soon after he reduced the time given for witnesses in the case to testify to the federal police, and barred most of the police’s forensic experts from accessing material seized from Mr Vorcaro (a decision he later walked back). It then emerged that Mr Vorcaro had invested in a luxury resort owned by Mr Toffoli’s broth- ers and in which Mr Toffoli has a stake. Initially, Mr Toffoli kept mum about the resort. But on February 12th it emerged that the federal police, who had looked at Mr Vorcaro’s mobile phone, had handed a confidential report to the president of the RIO DE JANEIRO Brazil’s Supreme Court has an ethics problem C002 -- 26 of 80 -- 27 The Economist February 28th 2026 The Americas ▸ STF, raising concerns about Mr Toffoli’s potential conflicts of interest. The report contains allegations of phone calls be- tween Mr Toffoli and Mr Vorcaro, meet- ings the two held, and messages that dis- cuss payments of 20m reais ($4m) to a firm co-owned by Mr Toffoli. Mr Toffoli denies any wrongdoing and says that charges of bias are based on mere “speculation”. He claims the payments were related to the sale of shares in the resort, and that they were declared to tax authorities. Still, after mounting pressure, he stepped aside. Mr Toffoli’s fellow justice, Alexandre de Moraes, is also in trouble. When evidence emerged that Mr Moraes’ wife, who is a lawyer, had been given an unusually vague and lucrative contract to represent Banco Master, Mr Moraes opened an investiga- tion into tax officials for leaking confiden- tial information. On February 17th federal police raided the homes of four suspect of- ficials. Mr Moraes ordered that the sus- pects wear ankle monitors, cancelled their passports and banned them from travel- ling or entering the premises of the tax au- thorities. Many Brazilians were indignant. “Combating leaks and the sale of confi- dential data is important,” said Alessandro Vieira, a centre-right senator. “But it should not serve as a smokescreen to con- ceal unjustified assets or crimes commit- ted by important figures of the republic.” Mr Moraes ordered that investigation using his authority as the head of the court’s “fake-news inquiry”. He has led this probe since 2019, when the court estab- lished it to investigate attacks against its members and their families on social me- dia. Unlike much of the court’s activity, the fake-news inquiry’s operations have always been sealed. When the inquiry started, members justified this by citing the seri- ousness of the threats emanating from Mr Bolsonaro and his followers. This is hard to square with Mr Moraes’ use of the inquiry to probe tax officials. Nor is it the first time that the inquiry’s remit has expanded. In 2019 Mr Moraes used it to kill an investigation by the tax authorities into a number of officials, in- cluding STF judges. That same year a local investigative outlet, Crusoé, reported links between Mr Toffoli and the boss of Ode- brecht, a Brazilian construction firm at the heart of Latin America’s biggest-ever cor- ruption scandal. After the story was pub- lished, Mr Moraes used his position as head of the fake-news inquiry to order that the article be scrubbed from the internet. Only public outcry forced him to reverse course. Mr Toffoli went on to annul all fines against Odebrecht, despite the fact that the firm’s executives had admitted to running a department dedicated to paying bribes to politicians totalling $800m. Interaction between businesses and the court is common. Gilmar Mendes, the STF judge with the longest tenure, holds an an- nual bash in Lisbon with dozens of the most senior politicians, magistrates and businesspeople. Many attendees have cas- es pending before the STF. The event, dubbed “Gilmarpalooza” by the Brazilian press, is organised by a private university founded by Mr Mendes and now run by his son. That university has previously re- ceived funding from J&F Investimentos, the holding company which controls JBS, the world’s largest meatpacking firm. J&F had cases pending before the STF at the time of the funding. Nepotism is also widespread. Estadão, a Brazilian newspaper, has tallied 1,860 cas- es currently with the STF or the Superior Court of Justice (STJ), the highest appellate court for non-constitutional matters, in which close relatives of STF members are the main lawyers. In 70% of them, the law- yers were assigned after their relative was appointed to the STF. Many companies, in- cluding those with cases before the court, bet that hiring a relative of an STF judge will win them special treatment. Take Mr Moraes’ wife, who runs a law firm together with the couple’s son and daughter. Before Mr Moraes was appoint- ed to the court in 2017, her law firm had 27 cases before the STF and STJ. Today she has 152. It has become easier for people con- nected to STF judges to bring cases before the court. That is because in 2023 the judg- es declared a law “unconstitutional” that had forbidden them from ruling in cases that involved businesses or individuals linked to firms run by their relatives. Some members of the court seem to be- lieve they have a problem, at least with public perception. According to Pedro Do- ria, a political analyst, recent opinion poll- ing shows that for more than half of Brazil- ians, the single most important criterion as they consider which legislators to vote for in general elections this year is their legis- lator’s commitment to the impeachment of Supreme Court judges. To clean up the court’s image the STF’s new president, Ed- son Fachin, formally proposed on February 2nd that the court adopt an ethics code. He has appointed Justice Cármen Lúcia to run the drafting process. The details will be hammered out over months, but the idea is to copy some elements of supreme- court ethics codes in the United States and Germany. The code will probably pre- scribe how judges should treat cases brought before the court by their relatives. It may also contain rules about participa- tion in events, judges’ use of privileged in- formation, financial transparency and the use of social media. Mr Toffoli and Mr Moraes pushed back immediately. Both men say they have never judged a case in which there was a conflict of interest. They claim that the adoption of an ethics code is not necessary. But what- ever they may say, their enemies in Con- gress are watching. ■ Defender of democracy, censor of journalism When judges make the law Brazil, Federal Supreme Court, constitutional breach arguments (ADPFs) filed Source: Federal Supreme Court 150 120 90 60 30 0 25 20 15 10 05 2000 C002 -- 27 of 80 -- 28 The Economist February 28th 2026 The Americas Energy in Cuba Solar salvation “SONS OF BITCHES!” exclaims Juan, a tour guide in Old Havana, when asked what he thinks of the Americans. While he would happily see the back of Cuba’s government, which does “nothing for the people”, Donald Trump’s squeeze on the regime is making life harder than ever for him and other Cubans. Ideological concerns are a distant second to the strug- gles of daily life: getting children to school, enough petrol in the car, food on the table. The energy shortage was an over- whelming problem even before Mr Trump’s attention turned to Cuba. His threat to impose tariffs on any country which supplies Cuba with oil has become an effective embargo. Tourism has slumped. Airlines can no longer refuel in Havana. Tour buses sit idle. The price of food, when it can be found, has shot up along with the cost of transport. Petrol, of- ficially priced at $1.10 a litre, is rationed via an app. Embassies receive quotas based on size, car fleet—and friendliness (Russia en- joys a generous allowance). On the black market a litre fetches 4,000 pesos ($8). Many thoroughfares are eerily quiet. Many streetlights are no longer turned on at night. Blackouts, already measured in hours, stretch longer. Charcoal stoves have reappeared to cook food. The government is trying to economise. Several large hotels owned by Gaesa, the military conglomerate that dominates tou- rism, have been shut in order to concen- trate remaining visitors and conserve fuel. Bureaucrats have been told to work from home. The state has also allowed private firms to start importing their own fuel, if they can get it, easing Gaesa’s monopoly. Yet things are not as bad as they might be, and not only because the island meets 40% of its fuel needs with its own heavy, sulphurous crude. Mr Trump is obsessed with oil, but Cuba has been building out an alternative source of energy supply at re- cord pace: solar panels imported from Chi- na. According to Chinese export data com- piled by Ember, a think-tank, in the 12 months to April 2025 Cuba’s imports of Chinese solar panels grew by a factor of 34, faster than anywhere else in the world. The island has gone from having almost no so- lar power a few years ago to levels which help it cope with Mr Trump’s embargo. The regime’s energy policy is mostly re- sponsible for the boom. In March 2024 the government announced a plan to build two gigawatts of solar power plants by 2028. It depends heavily on China for funding and construction, as well as for the solar panels themselves. On February 11th the govern- ment claimed that its new solar plants gen- erated almost a gigawatt of power during the lunchtime peak, enough in that mo- ment to meet the electricity needs of a third of the country. The government now says it aims for renewables to provide 24% of Cuba’s electricity by 2030, up from roughly 5% in 2024. The crisis induced by Mr Trump has opened more locals’ minds to free energy from the sun. Businesses and households are tapping it where they can. Marta Deus, who runs Mandao, a food-delivery firm, has installed solar panels at her office. “Demand is high,” reports a saleswoman in Copextel, a state retailer that sells solar panels and water heaters. Peak demand comes in the evening, when the sun has gone down. Solar panels alone cannot help with that. But Cubans are now importing Chinese batteries at a furious pace, too. Chinese electric vehicles are also proliferating (see chart). Carlos Al- zugaray, a former Cuban diplomat, drives a Chinese-made Dongfeng around Havana. He bought it in 2024, in large part because of growing fuel shortages. A firm called Ecocargo operates a small fleet of electric taxis and delivery vans. “Cuba may experi- ence the fastest energy transition in the world,” says a Cuban economist living in Havana, who asked to remain anonymous. As plentiful and cheap as Chinese solar panels are, they cannot stave off the cur- rent crisis. A home-solar kit from Copextel costs around $5,000, far out of reach for most families. Buying privately is allowed, but few firms want to sell in Cuba under the American embargo. And even firms willing and able to invest in solar are still stuck if they run out of fuel today. Aldo Ál- varez of Mercatoria, another delivery com- pany, says he suspended operations last week for lack of fuel. Not worth the trouble For now, the American pressure campaign is doing more to hurt ordinary Cubans than it is to dislodge their rulers. It makes solar power, a much more sovereign source of energy than oil imports, invaluable. But Cuba’s persistent failure to pay its debts may be starting to discourage the Chinese from financing new panels. And Mr Trump’s aggression is only making them more hesitant. ■ HAVANA Chinese solar panels are flooding into the troubled island nation Solar power to the people Panel power Chinese clean-tech exports to Cuba, $m 12-month moving average Source: EMBER 12 10 8 6 4 2 0 25 24 23 2022 Solar photovoltaic Electric vehicles Batteries C002 -- 28 of 80 -- 29 The Economist February 28th 2026 Asia Islam in South-East Asia When piety is prestigious GOVERNMENTS IN South-East Asia once feared the rise of Islamist terro- rism, and acted forcefully and successfully to suppress it. These days a different trans- formation has been taking hold in the re- gion’s two big Muslim-majority countries, Malaysia and Indonesia. Islam is asserting itself not through violence but peacefully through politics, laws, consumer culture and social pressure. Last month a new criminal code, which bans pre-marital sex and expands the scope of the crimes of blasphemy and apostasy, came into force in Indonesia. The code also recognises “any living law”; that could allow local officials to enforce sharia (Islamic law) strictures that discrim- inate against women and minorities. A few months earlier, in August, the Malaysian state of Terengganu began enforcing a sharia provision that imposes a fine of up to 3,000 ringgit ($770) and prison terms of up to two years on Muslim men who miss even a single Friday prayer. Not even Iran or Saudi Arabia imprisons prayer-dodgers. Both countries challenge an assump- tion that modernisation naturally leads to secularisation. Despite their economic progress, religiosity is intensifying, not weakening. This contradicts a pattern seen across East Asia and Europe, where eco- nomic development has correlated well with declining religious observance. Some liberals argue that education, liberalisation and internet access inevitably pull societ- ies towards secular values. Muslim-majori- ty countries in South-East Asia suggest otherwise. “What matters is not an indi- vidual’s years of education, but what a community regards as prestigious,” writes Alice Evans of King’s College London. Pi- ety has become prestigious. The two countries practise Islam very differently. Malaysia recognises it as the official religion and gives states jurisdic- tion over religious matters. Different states maintain different sharia laws, co-ordinat- ed nationally by JAKIM, the federal depart- ment for Islamic development. The budget for 2026 allocated a record 2.6bn ringgit ($642m) for “Islamic development”—50 times the 50m ringgit allocated to main- tain all non-Muslim places of worship. Indonesia lacks a comparable central authority. Its state ideology, pancasila, for- bids atheism but guarantees religious free- dom for the six faiths it officially recognis- es: Islam, Protestantism, Catholicism, Buddhism, Hinduism and Confucianism. Muslim organisations such as Nahdlatul Ulama, which claims more than 100m fol- lowers, promote an inclusive Islam that blends with local traditions. These groups run schools, hospitals and universities in the world’s third-largest democracy, while promoting the idea that Islamic values and democracy reinforce each other. Indone- sian Islam has absorbed centuries of Hin- du-Buddhist practices, animist beliefs and diverse indigenous cultures. JAKARTA AND KUALA LUMPUR Economic growth in Malaysia and Indonesia has not led to secularism → ALSO IN THIS SECTION 30 Jaipur’s endangered walled city 31 Sino-Japanese irritations 31 Google Maps in South Korea 32 Banyan: India’s VIP culture ⏩ C002 -- 29 of 80 -- 30 The Economist February 28th 2026 Asia ▸ That tolerance remains visible. Be- tween February 17th and 19th millions of Indonesians celebrated the start of Rama- dan, Lent or the lunar new year. Yet in both countries piety is ascendant. The diver- gence lies in how it is channelled. Islam drives political competition in Malaysia. The ruling and opposition parties vie for Malay voters, who make up 60% of the electorate and must under the constitution be, at least nominally, Muslim. “Both try to out-Islamise each other,” says Azmil Tayeb of Universiti Sains Malaysia. This dynamic is making Malaysia “more conservative and more Islamicised”. By 2023 PAS, a stridently Islamist party, was in control of four states and had be- come the largest single party in the federal parliament, though still in opposition there. Malaysia’s dual legal system formal- ly separates civil courts from sharia ones that handle personal and religious matters concerning Muslims. In practice religious authorities increasingly encroach into the civil space, says Norshahril Saat of the In- stitute of South-East Asian Studies in Sin- gapore. Tensions are especially visible where Muslim and non-Muslim lives inter- sect, such as in custody disputes and reli- gious conversions. In May Malaysia’s court of appeal dis- missed an appeal by a man who had con- verted from Christianity to Islam to marry a Muslim. After the marriage ended he sought to convert back, but the court ruled that sharia judges had jurisdiction. “These kinds of cases are happening all over Ma- laysia,” says Mr Azmil. Social media shape how people under- stand and practise Islam. TikTok, Insta- gram and YouTube have become arenas for religious outreach, debate and judgment, says Awang Azman of the University of Malaya. TikTok helped PAS expand its vote at the previous election. Other trends in- clude celebrity preachers and “micro-dak- wah”: short religious videos. Indonesia, though experiencing a simi- lar religious revival, has largely avoided Malaysia’s path to state-enforced confor- mity. The share of Indonesian women who wear the hijab has surged from around 5% in the late 1990s to roughly three-quarters today, but this is a transformation driven by social pressure and voluntary adoption rather than laws. Observant Muslim influ- encers command huge online audiences, often promoting conservative interpreta- tions to millions. Yet beyond the new crim- inal code, the most cited example of al- leged intolerance remains a two-year pri- son sentence handed to Basuki Tjahaja Purnama, known as Ahok, the governor of Jakarta, for blasphemy in 2017—widely seen as driven by political and ethnic rival- ry as much as religious hostility. Beyond spreading ideas, social media have the power to push authorities into ac- tion. In Malaysia everyday choices can quickly become matters of state concern once they are amplified online. On January 16th a Zumba instructor went viral dancing in a headscarf and an outfit that did not cover her knees. She apologised, but the Is- lamic department in the state of Selangor opened an inquiry into whether she had brought “Islam into disrepute”. Earlier in January a gay-rights NGO can- celled a private glamping event after na- tionwide online backlash. Homosexuality is a crime punishable by whipping and pri- son terms of up to 20 years in Malaysia. In 2024 the owner of KK Super Mart, a grocer- ies chain, was charged with intending to hurt Muslim feelings after socks bearing the word “Allah” appeared at three of its 800 outlets. Although “Allah” simply means God in Arabic and Malay, Malay- sia’s home ministry declared in 2013 that the word should be reserved exclusively for Muslims. Outraged social-media users viewed the socks as an insult. For Islamist politicians such outrage is useful fuel. Expect to see more of it in Ma- laysia. In Indonesia, politicians have so far refrained from using religion as a tool; but maintaining its pluralism requires con- stant vigilance. ■ ON ENTERING JAIPUR’s old town, you hear the staccato of a vintage printing press in one alley and in the next the clang of chisels against marble idols. Each lane of the walled city has its own soundscape, organised by tradi- tional trade castes. But what about that bang? Probably one of its traditional townhouses, or havelis, being razed to the ground. UNESCO, the UN’s cultural arm, granted Jaipur’s walled city, with its dusky-pink façades and ornate balco- nies, World Heritage status in 2019. Now it has given local authorities until the end of this year to show they are doing enough to preserve it. Otherwise it could join the company of Dresden, Liverpool, and Oman’s oryx sanctuary: the only three places to have won and then lost their world-heritage tag. Back in 1991, there were around 1,200 havelis; now, that figure is about 800. The rest have been demolished or modernised beyond recognition thanks to an unholy trinity of corruption, apathy and scarcity of cash. The colour code is off, too. “Jaipur pink” has envel- oped the city since 1876, when Mahara- ja Ram Singh had the whole town coat- ed in a distinct hue of terracotta ahead of a royal visit from Britain. Other colours are banned. But pollution and unco-ordinated painting have broken Jaipur’s visual harmony into a mess of historically inaccurate shades, some dangerously close to orange. It’s not just the colour. Over 600,000 locals squeeze past rotting rubbish piles, duck under a jungle of sagging wires and breathe fumes from open drains. Built for a tenth of this number, the old town is bursting at the seams. Heritage conservation can seem like a pretty elitist thing to fret about, and the UNESCO tag confers fame but no funds. Still, UNESCO’s ultimatum may turn out to be the best thing that could have happened to the walled city. Landing on the interim list for “heritage in dan- ger” could finally fast-track much- needed UN cash. And the prospect of officially losing the world-heritage tag may jolt authorities into enforcing heritage by-laws and having a frank chat with haveli owners about protect- ing what could be precious assets if, for instance, they were converted into heritage hotels. Politicians may not care about policing the correct shade of pink. But they surely want the status that comes with it. India Fifty shades of pink JAIPUR A threat from UNESCO might help Jaipur save its heritage Well worth saving C002 -- 30 of 80 -- 31 The Economist February 28th 2026 Asia ⏩ East Asian security CHINA AND Japan have a long history of feuding. Four years passed between the arrest of a drunken Chinese fishing captain that sent relations into a tailspin in 2010 and the beginning of the reconcilia- tion process. The neighbours are now locked in another stand-off that shows no signs of ending: on February 24th China announced new curbs on rare-earth ex- ports to at least 20 Japanese firms, ratchet- ing up pressure on Japan’s new prime min- ister, Takaichi Sanae (pictured). The latest spat began after Ms Takaichi, a China hawk, took office in October. Chi- na’s displeasure was evident from the start: Xi Jinping did not send even a perfunctory congratulatory message, breaking with diplomatic precedent. In parliament the next month, Ms Takaichi stepped beyond her government’s traditionally ambiguous position regarding a potential crisis around Taiwan, suggesting Japan would have a role to play. A Chinese consul-gen- eral in Osaka suggested, in turn, that the Japanese leader’s “filthy neck” ought to be “cut off”. Chinese restrictions on tourism and trade followed. For Ms Takaichi the diplomatic ten- sions have been a boon domestically. Her refusal to cave to Chinese pressure rein- forced her image as a leader capable of de- fending Japan in a dangerous world, help- ing to produce a historic victory for her rul- ing Liberal Democratic Party (LDP) in low- er-house elections on February 8th. Ms Takaichi hopes to use her new supermajor- ity to accelerate Japan’s efforts to strength- en its armed forces, which it has pursued in large part to counter China’s growing mil- itary might. This week, the LDP finalised a proposal to lift a longstanding ban on the export of lethal weapons, hoping to jump- start the defence industry. China is equally unlikely to back down. Its displeasure over Ms Takaichi’s ties with Taiwan runs considerably deeper than her comments in the Diet. The Japanese prime minister has warm relations with Taiwan’s independence-minded Democratic Pro- gressive Party (DPP); after she took office, Lai Ching-te, Taiwan’s president and a bugbear of Beijing, posted a congratulato- ry message calling her a “steadfast friend of Taiwan”. China has sought to paint Ms Takaichi as a dangerous nationalist: for in- stance, during a speech at the Munich Se- curity Conference this month, China’s for- eign minister, Wang Yi, warned that Japan is haunted by the “ghosts of militarism”. Such claims have failed to convince many outside China. Economic coercion will bite harder. China accounts for 20% of Japan’s total trade and 20% of its foreign tourists. The Chinese government has called for its na- tionals to stop travelling to Japan; flight traffic between China and Japan during the lunar new-year holiday this month fell by half compared with the same period last year. Japan still relies on China for some 70% of its imports of rare earths, even after years of efforts to diversify supplies. Long- term supply disruptions would ripple across Japanese industry. The head of Ja- pan’s trading-house association calls Chi- na’s curbs on exports to Japan “a challenge to the global supply chain as a whole”. China’s trade curbs have been re- strained so far. The government has re- frained from encouraging broad boycotts of Japanese goods. (During the downturn in relations in the early 2010s, Chinese protesters set fire to Japanese car dealer- ships.) The latest rare-earth bans target only 20 Japanese firms, mostly involved in the defence industry; another 20, includ- ing carmakers, were put on a watch list. Both sides have so far sought to contain the risk of escalation. This month Japan detained a Chinese fishing captain who re- fused inspections inside its exclusive eco- nomic zone; he was released the next day. Yet Chinese coastguard vessels patrolled near the disputed Senkaku islands (which China calls the Diaoyu) for a record 356 days last year. This week Japan announced plans to deploy missiles on Yonaguni, its island closest to Taiwan, for the first time. The longer tensions simmer, the greater the danger they boil over. ■ TOKYO AND BEIJING The latest feud between the East Asian giants is unlikely to end soon Handling the heat Sino-Japanese irritations South Korea Lost in Seoul GOOGLE MAPS wants to close its gaps. One of the biggest in the search giant’s navigation app is South Korea. Nearly two decades after the service launched, even basic walking or driving di- rections there are unavailable. The South Korean government has long denied Google’s requests for detailed cartograph- ic data, citing national-security concerns. That stance has helped home-grown tech firms, such as Naver, the country’s most- used search engine, remain South Korea’s dominant digital-map providers. This month Google submitted yet an- other bid to receive higher-quality map da- ta. This time the South Korean government has to navigate trickier terrain. As part of an investment deal agreed with America last year in exchange for tariff reduction, South Korea pledged to facilitate “cross- border transfer of data, including for loca- tion, reinsurance and personal data” for American companies—a clear reference to the ongoing dispute with Google and other tech firms. Donald Trump has alrea- dy threatened to re-raise tariffs on its ally for not ratifying the deal fast enough. The map Google wants is 1:5,000 scale. The South Korean government’s mapping agency has this, but exporting it to servers abroad requires government approval. Giv- en its unpredictable nuclear-armed neigh- bour to the north, South Korea takes issue with publishing the co-ordinates and close-up satellite imagery of sensitive sites such as military facilities. That has left SEOUL Google Maps makes another pitch for better data C002 -- 31 of 80 -- 32 The Economist February 28th 2026 Asia ▸ IT IS EASY for politicians to forget, amid the trappings of power, that they are public servants. But not for Narendra Modi. India’s prime minister has always insisted that the government exists to serve. When he rose to national office in 2014, he declared that he was not the country’s prime minister but its “chief servant”. Since then, “the Modi govern- ment has been synonymous with service, not power,” the home minister declared recently. The chief servant, he added, “works 24 hours a day, seven days a week for the people”. To underline its commitment, the government renamed the street on which Mr Modi lives from Race Course Road to the Path of Public Welfare. Last year it changed the names of state go- vernors’ official residences from Raj Bhavan (Government House) to Lok Bhavan, the People’s House. And on February 13th Mr Modi inaugurated a new prime-ministerial office. He has christened it Seva Tirth, or Sacred Place of Service. Mounted on the outside of the building is a legend that translates as “The citizen is akin to God.” Indian citizens may have felt less than divine when, just three days later, Mr Modi arrived to inaugurate the AI Impact Summit, a five-day conference in Delhi. Around noon that day, in antici- pation of his arrival, parts of the conven- tion complex were closed off. Thou- sands of people were booted out. It was hours before they were allowed back in. The AI contest is widely seen as a two-horse race between America and China, which produce the most powerful and popular models. India is an enthusi- astic adopter, but it is not known as an innovator. The summit was designed to change that impression by showing the country’s modern face to the world. What tens of thousands of attendees saw instead was a fulsome display of India’s retrograde “VIP culture”. Consider the arrangements for the shindig. Ordinary visitors had to contend with an absurd list of restrictions prohib- iting everything from bags and laptops to hand sanitiser and water bottles. VIPs were waved through. Leaving was no easier. On one of the “summit’s” evenings the roads leading to the venue were closed to all but VIPs. Unimportant Persons were forced to walk over a mile to find cabs and public transport. Delhiites outside the blast radius of the convention centre did not escape unscathed. Huge chunks of the city were closed or restricted to ease travel for VIPs. The spillover trapped commuters in gridlock all week. Flights out of Delhi airport were delayed. There is no public infrastructure so important that it cannot be disrupted for VIPs. Crucial roads across India’s already congested cities are routinely blocked to allow swift passage for public servants. When Mr Modi visited Mumbai to cam- paign for the general election in 2024, authorities shut down a metro line as well as bus services. After a bombing in Delhi last year, relatives of victims com- plained that they were prevented from entering the hospital to see their loved ones even as VIPs were escorted in. These shenanigans sometimes carry a price greater than inconvenience. After a stampede killed at least 37 people at a big religious gathering in north India last year, eyewitnesses complained that they had been pushed into crowded pens because vast spaces had been reserved for VIPs. When another stampede oc- curred at another religious event a few months later, pilgrims again reported that the exit had been blocked for VIPs, leaving only one point for both ingress and egress and, arguably at least, again contributing to the death toll. Ensuring the security of leaders is a serious business in a polarised country that has lost two prime ministers (one serving, one while campaigning to return to office) to assassinations. And some, like Mr Modi, inspire such devotion that they need protecting from their fans, too. But the entitlement is both endemic and extravagant. It spans geography, parties and branches of government. To have any power is to be a VIP. Some state leaders travel in convoys that rival the American president’s. Even minor min- isters get police escorts that run traffic lights and bully other motorists. VIP culture is a marker of status. It operates on an ancient principle of India’s highly stratified society: that servant and master must never drink from the same glass, sit at the same table, pass through the same doorway or in any way appear as equals. For centu- ries that meant the master was supreme. The genius of India’s public “servants” has been to reverse the hierarchy. BANYAN Are you being served? India’s leaders claim to be servants but act like masters Google sourcing its base map from TMap Mobility, a local navigation service, for a hefty fee. The local partner’s map is at the desired scale, though censored to remove sensitive locations; but to calculate routes for users around the world, the tech giant wants multiple data centres to process the map. If the map lived only on South Korea- based servers, faraway users would face delays in browsing, Google says. The com- pany insists on keeping its service global. Local players are worried about giving Google access. Ninety percent of firms surveyed by the Korean Association of Spatial Information oppose the move. Ob- jections include concerns about South Ko- rea becoming a testing ground for ad- vanced technologies and the low corporate tax that Google, like other tech giants, pays in the country. The real issue is a pro- tectionist fear that domestic firms will lose their edge. Google also charges more for its API than local competitors, and smaller companies using Google’s map data can run up big bills, reckons Mr Mo. So far Naver has held its ground. Google accounted for only around 30% of South Korea’s search traffic last year, com- pared with 90% globally. Despite support- ing only four languages (versus Google’s 80-plus), Naver’s map includes a popular feature that gives better crowdsourced in- formation about most establishments in South Korea than Google does. As for who provides directions to get there, the two might have to duke it out. ■ C002 -- 32 of 80 -- 33 The Economist February 28th 2026 China Picking winners Among the lucky few THE YEAR of the fire horse, which began on February 17th, is hardly galloping along for many Chinese. A property bust and chronic deflation have eroded people’s assets, incomes and prospects. Residential property, where Chinese people store the bulk of their wealth, has lost a fifth of its value on average since 2021. Wage growth is weak. And youth unemployment is ho- vering around 17%. Some graduates find themselves forced into precarious employ- ment in the gig economy. Others say they are choosing to “lie flat” rather than look for a grinding job. But in a sea of people losing, one group is winning. They are what Xi Jinping, Chi- na’s leader, calls nongchaoer: a Chinese term referring to those who “ride the tide” of great economic changes. Today that tide is flowing towards the strategic technol- ogies, such as artificial intelligence and ro- botics, that dominate the country’s five- year plans for tech supremacy (the next one will be released in March and will cov- er the period to 2030). Smart, young and sometimes from modest backgrounds, the nongchaoer do not flash their growing wealth (and in any case, tend to prefer home-grown electric vehicles to Porsches). And they do not see officials as a source of pesky regulation to be avoided—but as their biggest backers. Mr Xi met a group of them publicly just before the lunar holiday. These tide-riders are different from winners of the past in several ways. Educa- tion is an important one. In recent decades China’s economic rise created several waves of opportunity for the talented or lucky: from low-end manufacturing in the early 2000s to the rise of e-commerce in the 2010s and the property boom which lasted until 2021. Each minted its own mil- lionaires and billionaires. In the boom times even a certificate from a backwater college could go a long way. In 2017 a sur- vey of China’s 2,000 wealthiest entrepre- neurs found that half had no degree at all. Tough at the top But today’s nongchaoer are an elite bunch. They typically hold STEM degrees from one of China’s top 40-odd universities, known as the “985” group, which every year produce just 460,000 of the country’s 12m graduates (including masters and PhD students). The youngest members of the group that Mr Xi met, for example, includ- ed Zhang Linfeng, the co-founder of a company applying AI to science; Chen Jia- nyu, the founder of a robotics firm; and Wang He, another roboticist working on embodied AI. All were born in the 1990s BEIJING Meet the youngsters who are making their fortunes in China today → ALSO IN THIS SECTION 34 Anthropic’s accusations 35 Spring Festival travel 37 Chaguan: Property pain ⏩ C002 -- 33 of 80 -- 34 The Economist February 28th 2026 China ▸ ⏩ and graduated from “985” institutions. Opportunities in China’s economy once lay in lots of places, from social con- nections to land. Now they primarily go to those who can grasp technology, says Li Jingyuan, a graduate of Zhejiang Universi- ty (also a 985 college) and the founder of a company that makes 3D printers. Govern- ment data suggest that lucrative careers are increasingly concentrated in the high- est echelons of tech. The financial sector, although still cushy, has seen only sluggish salary growth in the past few years amid a crackdown on bankers’ bonuses (see chart). Lawyers have fared worse. But the top tenth of software engineers by salary have seen their wages grow by 8% per year in real terms since 2020. The clev- erest engineers have enjoyed pay rises amid a war for talent among China’s big- tech companies. An AI researcher at one such company in Beijing admits he has far more money than he knows what to do with (he spends most of his time at work and his hobby, hiking, is hard to splash cash on). DeepSeek, China’s AI darling, has been offering salaries of more than 1.4m yuan ($200,000) per year, ten times that of the average white-collar worker in China. Nongchaoer tend to concentrate in just a few places: Yizhuang, a tech district in Beijing, Shenzhen, a southern electronics- manufacturing hub, and Hangzhou, a ca- nal-crossed city in eastern China. On the surface their offices mimic those in Silicon Valley, complete with beanbags, table foot- ball and wandering robots. But the differ- ence lies in the looming presence of the government. The walls bear framed pic- tures of visiting Communist Party cadres and awards from local officials praising “model” companies. Only recently China’s tech sector was battered by officialdom. In 2020 Jack Ma, the founder of the tech giant Alibaba, made a speech attacking regulators for sti- fling innovation with “outdated supervi- sion”. Mr Ma then disappeared from public view for several months and officials blocked the planned initial public offering of one of his companies. China has since squeezed its tech sector, with regulators targeting everything from cryptocurrency exchanges to video-game developers. Offi- cials prefer the brightest and best to be in the strategic industries China needs to compete with America. Mr Xi has urged tech workers to “cultivate feelings of devo- tion towards serving the country”. The nongchaoer are keen to emphasise the ways officials help rather than hinder them. Policy can cause “uncertainties”, but it creates lots of “certainties” too, says Yi Haoxiang, the 35-year-old founder of a company in Hangzhou that makes AI-po- wered smart-glasses and a brain-computer interface intended to help treat depression (both are technologies the government has marked as national priorities). Local offi- cials subsidise his research and develop- ment costs, office rent and travel to over- seas conferences. Mr Yi praises the way of- ficials “prevent excessive, destructive com- petition” by discouraging bidding wars over new patents from universities. “The government is the most stable force in the country, so the closer you get to it the more stable you become,” says Fred Chu, a 32- year-old whose company sells AI-powered monitoring software to the Hangzhou gov- ernment for around 10m yuan a year. It is used for real-time tracking of road and environmental conditions. State-guided innovation of this sort has its problems. Priorities are set by central- government officials betting on the tech- nologies they happen to think will prove critical. Local officials burn cash support- ing favoured but feeble firms in their neighbourhoods. And state-supported in- dustries can lurch from glory to gore if sub- sidies are pulled back. But for a shrewd en- trepreneur willing to surf where directed, money sloshes from local-government cof- fers, state-owned companies and national venture-capital funds. Just in December China’s central government announced a new 100bn-yuan fund to invest in startups. And it is hard to deny that some of the re- sults from all this state involvement are im- pressive. Chinese tech companies are now globally competitive in everything from electric vehicles and renewable energy to telecommunications and AI. The party’s big bet on high-tech indus- tries may not end up benefiting most Chi- nese workers. Economists at Citigroup, a bank, point out that big industrial firms have shed 23m jobs since 2014. Automa- tion, they argue, is largely to blame. Still, Mr Xi seems sure his approach to China’s development is the right one. “Sci-tech self-reliance is the key to building China into a great modern socialist country,” he told the nongchaoer group. Mr Xi’s “cordial exchange with us has strengthened our de- termination and sense of mission even more”, one later told state media. ■ They can’t get enough China, % increase in annual salary of top 10% of earners by occupation, 2020-24, real terms Source: Ministry of Human Resources and Social Security 300 250 200 150 100 50 Salary, 2024, yuan ’000 50 40 30 20 10 0 Mining Managers Managers LLegal, social egal, social and religious Financial services Financial services Software and IT Software and IT Energy and wwater services ater services Repeat after me Tigers or copycats? AMERICA’S TOP artificial-intelligence labs have accused their Chinese rivals of being ruthless copycats. This month Anthropic and OpenAI each disclosed evi- dence that leading Chinese AI labs have il- licitly used American models to train their own. The firms accuse Chinese researchers of aggressively “distilling” American chat- bots—feeding them prompts in order to learn from and mimic their responses. “China is, in effect, stealing the weights of our best AI models,” says Chris McGuire of the Council on Foreign Relations, an American think-tank. “These are among the most valuable assets on earth.” Such claims are not new. OpenAI ac- cused DeepSeek of similar behaviour early last year, after the Chinese lab shocked Sil- icon Valley with the release of its R1 model. Since then Chinese firms have unveiled models that rival American chatbots on certain metrics, with as little as a few weeks’ delay, while being cheaper to train and run. Anthropic’s claim on February 23rd that three leading Chinese firms have secretly tried to emulate its chatbot helps to explain how they have kept pace. Amer- ican labs say Chinese competitors use “dis- tillation attacks” to jump closer to the fron- tier of model development for just a frac- tion of the cost. AI labs have closely watched rivals’ ef- forts to train on their products over recent months. Anthropic’s disclosure comes as the industry awaits DeepSeek’s newest model, which could appear as soon as next week. According to Reuters, the Trump ad- ministration believes DeepSeek trained the system in a facility in Inner Mongolia on Nvidia’s advanced Blackwell chips, in violation of export controls. DeepSeek is said to be planning to hide its use of the chips, potentially pitching the release as a win for China’s effort to localise its AI sup- ply chain. America’s government, however, argues that the model’s advanced capabili- ties are likely to rely on distillation. American firms commonly use the same methods to train non-frontier models on the cheap, especially for free “open- weight” systems. But Anthropic says that using its products to train a rival model, as it alleges three Chinese firms—DeepSeek, Moonshot and MiniMax—have attempted, is a violation of its terms of service. An- thropic alleges they cumulatively created 24,000 fraudulent accounts that engaged with its models more than 16m times. The DeepSeek’s new model has American officials and firms on edge C002 -- 34 of 80 -- 35 The Economist February 28th 2026 China ▸ ⏩ firms have not responded publicly. Google DeepMind said that it had observed “intel- lectual-property theft” of its systems in a report earlier this month, but did not attri- bute the attacks. Both labs said that distil- lation attempts had become more com- mon over the past year. One reason for this is that distillation has become more powerful. Until recently, AI labs improved chatbots by feeding them vast quantities of text scraped from the in- ternet. The more a model read, the cleverer it became. But the frontier has shifted. To- day, cutting-edge models learn by trial and error, attempting tasks repeatedly and re- inforcing only the approaches that work. That eats at the limited computing power of chip-constrained Chinese companies. Distillation helps. By using other people’s machines to produce such “synthetic data”, the labs ensure they keep their own chips dedicated to training. The rub is that American labs spend billions to create data in the first place. They pay human experts—mathemati- cians, say—to write step-by-step solutions to hard problems, to create worked exam- ples for their models to learn from. Unlike the diffuse knowledge gained from the web, the know-how needed to complete a task, like a maths problem or booking a flight, is specific and extractable. Copycats can ask models to do tasks and simply har- vest their solutions, without all the trial and error. American labs make expensive bets on training techniques with high failure rates. Individual training runs can cost billions, while firms have committed $5trn of data- centre investment between now and 2030, according to JPMorgan Chase, a bank. Such largesse is challenged by rivals that are nearly as good, but much cheaper. Since DeepSeek released R1, China’s glo- bal share of the open-model market has rapidly grown, overtaking America’s, ac- cording to researchers at the Massachu- setts Institute of Technology in Boston. It is technically difficult to detect and prevent knowledge distillation, warn American labs. And doing so is made hard- er by the increasing sophistication of Chi- nese efforts. These include circuitously routing their online traffic to shield its ori- gins or splitting up tasks across thousands of accounts. Speaking to The Economist, an American official says “a cottage industry” of small firms has sprung up inside China to provide co-ordinated distillation activi- ties, while obscuring the identity of their customers. “The US cannot accomplish open-source leadership if we don’t address this problem,” says the official. Some Chinese AI researchers point out online that it is hypocritical for labs that trained their models on others’ intellectual property to call foul. Nonetheless, An- thropic, OpenAI and Google DeepMind want action. The American government could ask China’s leadership to crack down on the behaviour, perhaps during Donald Trump’s forthcoming visit to Beijing. But the prospects of Xi Jinping’s government doing so are slim. Alternatively, says Mr McGuire, America could punish Chinese firms engaged in distillation, by booting them from American cloud providers or tightening chip controls. Yet Mr Trump ap- pears unwilling to do anything that might upset the current detente. For now, frontier labs may have to get used to AI firms copy- ing their work. ■ Lunar New Year Examining the great rush THE RUSH home for the Spring Festi- val’s festivities each year, known as the chunyun, is a cultural moment of sorts in China. Many have tried to capture a sense of the hubbub. In “Lost On Journey”, a comedy released in 2010, Li Chenggong, an uppity businessman, wants to get home to Changsha for the Lunar New Year. Terrible weather forces him to switch from a first- class ticket on a plane to a hard seat on a “green-skinned” slow train. Jostled by mi- grant workers, uproar surrounds him as ba- bies cry, passengers eat and suitcases tum- ble. Eventually he meets a happy-go-lucky dairy worker with whom he reluctantly goes on an adventure. Packing up Such scenes were once an accurate depic- tion of the experiences of millions as they travelled to reunite with loved ones. But changes in the chunyun since speak to new social trends in China. This year workers got February 15th to 23rd off for celebra- tions—a day longer than usual—and The Economist watched as they journeyed to and from their holiday destinations. Our number-crunching uses data that are cur- rently available; more will appear over the coming weeks. China’s population is shrinking, yet the getaway rush keeps growing. Officials monitor travel over a 40-day period around the break and expect a record 9.5bn trips to be made this year, up from 8.4bn in 2024. One reason for the rise is that the Chinese are increasingly travelling not just to visit family and friends in their hometowns (though most do), but are also squeezing in a little tourism. Given testing economic conditions, holidaymakers are spending less per per- son than they did before the pandemic, says Goldman Sachs, a bank, but overall tourism revenue increased by 5.7% year on year (adjusted for the longer holiday). Thrifty sightseers and bargain-hunters are more common. Fujian and Hubei prov- inces saw juicy increases in duty-free sales, according to research by Citigroup, anoth- er bank. So did Hainan, the sub-tropical is- land-province which seems to have lured those keen for a spot of winter sun. “Re- verse chunyun”, where elders visit their children in the big city instead of the other way round, also trended on social media. Modes of transport are shifting, too. Officials reckon that four-fifths of people How travel during the Spring Festival is changing C002 -- 35 of 80 -- 36 The Economist February 28th 2026 China ▸ use private transport, including cars and vans. And train travel is getting more pop- ular. A decade ago 11% of journeys that used commercial transport involved a train; last year this stood at 28%. This time the share is expected to be higher as Chi- na’s high-speed rail network continues to expand. There were 2,000km of track in 2010 and 50,000km at the end of 2025. Many cannot afford to board the zippiest trains, however. Videos this year also pur- port to show cheaper, older green-skinned trains packed with people. (Authorities quickly scrubbed them off the Chinese in- ternet and decried them as fakery generat- ed by artificial intelligence.) Moving swiftly on High-speed rail has slashed travel times across the country and may be one reason why it appears that the chunyun is being compressed. The Economist has download- ed data from Baidu Migration, a platform run by China’s biggest search engine, which crunches user-location data from its maps app and related services to work out how many people are on the move at any particular time. It shows that the busiest travel day before the new year is creeping closer to the actual day: in 2019 this was four days before, in 2023 it was three days and this year it was just two days (see chart). It is also possible that workers want to toil for longer so as to earn more before the big break. Much travel still takes place east of the Heihe-Tengchong line (see map), which geographers use to divide China into its densely and sparsely populated parts. But our calculations from Baidu’s data, which do not account for modes of transport, show that people are travelling shorter dis- tances (see chart). The share of trips taking place within a province was 62%, up from 54% in 2020. It all suggests that China is developing regional economic clusters and migration mostly takes place within these—in line with the government’s urban planning. The most popular journeys con- nect big economic centres and their popu- lous but obscure satellite cities. The busi- est route was from Xi’an, where the Terra- cotta Army resides, to Xianyang, a city of 4m just 24km away. Travel during the chunyun will continue to evolve. China is starting to allow electric vertical take-off and landing aircraft for commercial use as part of its push for a “low-altitude economy”. One company based in Shanghai has started offering flights to nearby cities this year, allowing the well-off to take to the air for destina- tions just a short hop away. That would come as a relief to the fictional Mr Li. The sequel to “Lost On Journey” may one day feature not green-skinned trains chugging along the ground, but flying cars whizzing through the sky. ■ Days after → ← Days before Lunar new year 250 200 150 100 50 0 20 16 12 8 4 0 -4 -8 -12 -16 -20 2025 2021 2020 2019 2019 2026 2024 2026 Wuhan Changsha Xi’an Shanghai Zhengzhou Chongqing Shenzhen Beijing Guangzhou Chengdu 3 2 1 0 Distance, km 500 0 1,000 1,500 5 10 15 20 0 2020 Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hubei Hainan Fujian Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Xi’an Chengdu Chengdu Chengdu Chengdu Chengdu Chengdu Chengdu Chengdu Chengdu Chengdu Chengdu Chengdu Chengdu Chengdu Chengdu Shanghai Beijing Guangzhou Shenzhen Chongqing Zhengzhou Changsha Wuhan Heihe-Tengchong line Heihe-Tengchong line Heihe-Tengchong line Heihe-Tengchong line Heihe-Tengchong line Heihe-Tengchong line Heihe-Tengchong line Heihe-Tengchong line Heihe-Tengchong line Heihe-Tengchong line Heihe-Tengchong line Heihe-Tengchong line Heihe-Tengchong line Heihe-Tengchong line Heihe-Tengchong line Heihe-Tengchong line Heihe-Tengchong line Heihe-Tengchong line Heihe-Tengchong line Heihe-Tengchong line Heihe-Tengchong line Heihe-Tengchong line Inbound traffic Traffic between cities → Most chunyun travel is east of China's Heihe-Tengchong line Traffic on peak day of spring travel rush, Feb 22nd 2026 Traffic on peak day of spring travel rush, Feb 22nd 2026 T (five days after lunar new year), top 5% of routes by traffic Traffic volume, 20 days before lunar new year 2026=100 → The day of peak traffic before the new year is getting closer to the actual day Sources: Baidu Migration; The Economist Top cities, % of inbound traffic on Feb 22nd 2026 Journeys by distance during the pre-lunar-new-year peak, % C002 -- 36 of 80 -- 37 The Economist February 28th 2026 China Left holding the concrete ADECADE AGO, China was in the midst of a property boom. In Zhoukou, a fast-urbanising city in the country’s central plains, a property developer started a residential complex that promised “classic Chinese living”, full of greenery and next to good schools. Today, most of its high-rises and villas are concrete skeletons. The developer, Henan Zhongao Plaza, is bankrupt and its boss is in prison. In a few buildings a handful of hardy residents have moved in, but nearby flats stand empty; some are missing their windows. Welcome to a lanweilou, or a “rotten tail” building, a term that captures the idea of hopeful beginnings which end badly. Cha- guan recently visited the Zhongao development, trekking up dim staircases to see how China’s property crash is playing out—and, specifically, how it is affecting those who bought into the good life and landed far from it. “Of course we were optimistic. We thought there would be a lot of activity around here,” says Mr Guo, a middle-aged resident. “I’m someone who likes quiet, but this is too quiet,” chuckles Ms Li, his wife. Given how desolate the complex is, whoever comes home first often calls the other to report that they are safely back inside. At least they were able to move in. In some cases, Ms Li notes sadly, older homebuyers died before getting their keys. Similar fates have unspooled across China. Developers used to sell homes before construction to raise funds. When the property market tumbled five years ago, their financing dried up. According to Nomura, a bank, China had about 20m pre-sold, unfinished properties as of 2023. Chaguan’s back-of-the-envelope calcula- tion, based on average prices, is that a staggering 17trn yuan ($2.5trn) of household wealth is tied up in these idle projects—a little more than 10% of GDP. That is a very big drag on the econ- omy. But officials appear confident that, given enough time, they can guide the lanweilou to completion. Their unstated plan is to spread the cost as widely as possible and to stamp out any smoul- dering embers of discontent. Choosing to live in a lanweilou is quite unusual. In some ex- treme cases, desperate homebuyers have moved in before water and electricity are connected. In the Zhongao development util- ities have already been hooked up. But residents occasionally re- fuse to pay maintenance fees. The property-management firm, in turn, hits back. “The other day they just stopped the elevator,” Ms Li says. Eventually, the couple want to move to a better home. But they know that they will probably be stuck in Zhongao for years. “There’s not even a way to measure our home’s value. No one would ever want to buy it,” says Mr Guo. Slowly, the government is chipping away at the problem. In 2022 it introduced a baojiao lou, or “guaranteed delivery”, pro- gramme. Officials created a whitelist of pre-sold, unfinished de- velopments, and then used a mix of incentives and pressure to get banks to extend credit to complete construction. In total Chinese banks have already approved loans of more than 7trn yuan for whitelisted properties (though much has been for debt rollovers, not new funding). At Zhongao there are glimmers of hope. What used to be the showroom now functions as a debt-restructuring office. A repre- sentative of the former developer sits next to a wood-burning stove for warmth. His focus is on organising papers that docu- ment who bought which apartments. His team is working with the government to bring in new investors. “It is almost all in place, and we probably will restart construction later this year,” he says. Many people will be grateful to get the homes they have waited so long for. Generally, they have kept making mortgage pay- ments—defaulting was the alternative. A small number dared to stage open protests, though officials cracked down swiftly on those. Still, for some buyers, the prospect of completion has a bit- ter twist. They will end up taking delivery of homes that are worth much less—in some cases as much as 50% less—than what they paid. If the construction is never finished, they might at least have a chance to walk away from their mortgages. No refunds In Zhengzhou, about 200km from Zhoukou, one couple briefly be- came famous for posting videos online about their battle over a pre-sold home. Zhang Yiliang and Dong Lijun filed lawsuits to re- cover their investment. But the court ruled against them, judging that the housing project was close to completion. Chaguan visited the site. It is indeed nearly ready for residents and looks reason- ably attractive, albeit in the distant exurbs. On February 8th Mr Zhang and Ms Dong released yet another video, via back-up so- cial-media accounts (their main ones had been disabled). They do not want their flat. They want their money back. “Give us back our peaceful life,” Mr Zhang pleaded. “We shouldn’t have to clean up your mess any more.” If the couple prevail, they would get their downpayment back and escape an underwater mortgage. They could buy a new place for much less than their original property. But imagine the cascad- ing consequences for the government. There would be millions more just like them. It would cost far too much to compensate them all, and it would ensure that many lanweilou remain forever unfinished. The only real option, as far as the government is con- cerned, is to plod on with “guaranteed delivery”. In the Zhongao project office, the manager working to get that development back on track sums it up best. “Ordinary people are bearing the costs. It is the only way to do it,” he says. There will be no bail-out for developers and none for homebuyers either. In- stead, officials want to parcel out losses across the whole econ- omy. When the property sector boomed, everyone seemed to ben- efit. On the downside, it is a collective reckoning. ■ CHAGUAN The rotten tail of China’s property bust C002 -- 37 of 80 -- 38 The Economist February 28th 2026 Middle East & Africa A war in search of an objective Clausewitz wept AFTER TWO months of presidential threats, amid the largest air and naval build-up in the Middle East since the 2003 invasion of Iraq, Americans might have ex- pected Donald Trump to make the case for what may be an imminent conflict with Iran. Yet his state-of-the-union address on February 24th devoted just a few minutes to the subject. Not only that, he said Iran could avoid a fight if it simply uttered “those secret words: we will never have a nuclear weapon”. Never mind that Ali Khamenei, the Ira- nian supreme leader, has said those words many times before. They were even in the preamble to the nuclear deal Iran signed in 2015—the one Mr Trump tore up three years later. The president simply wants to hear them again, and the threat of war would dissipate. At least that was his position on one particular February evening. On other days he has said that America should strike Iran to punish the regime for killing protesters early this year, or to compel it to get rid of its missile arsenal, or to overthrow it entire- ly. His ultimate goal remains a mystery. If war comes, it will be a war in search of an objective. Never before has America amassed so much firepower with so little idea of how to use it. The most straightforward aim would be to use the threat of force to push Iran into a deal that restrains its nuclear ambitions. That has been a focus of American diplo- macy for two decades. Even when Mr Trump abandoned the 2015 agreement, known as the Joint Comprehensive Plan of Action (JCPOA), he did not scorn the idea of a deal with Iran; his goal, he said, was to negotiate a better one. That objective only became more urgent in the years that fol- lowed. By last spring the Islamic Republic had enriched more than 400kg of uranium to near weapons-grade, enough to make ten bombs if refined a bit further. Then came Mr Trump’s decision to launch strikes on three of Iran’s main nuc- lear facilities, the climax of the 12-day war between Israel and Iran in June. The pro- gramme was not “obliterated”, as he likes to boast. Iran still has a working nuclear re- actor and decades of accumulated know- how. But key elements are defunct. Its stockpile of highly enriched uranium is probably still buried beneath the rubble. Rafael Grossi, the head of the UN’s nuclear agency, said in October that Iran no longer appeared to be enriching any uranium. A third round of American-Iranian talks was scheduled for February 26th, after The Economist went to press. Even if the Irani- ans say Mr Trump’s magic words, that is the easy part: it is harder to flesh out the details of an arms-control agreement and decide how to verify Iran’s compliance. A deal does not seem imminent. The bigger problem, though, is that it no longer seems urgent. If Iran offers to limit uranium enrichment, it is proposing to stop doing something that it is not cur- DUBAI Most Americans have no idea what Donald Trump wants to accomplish in Iran → ALSO IN THIS SECTION 39 The limits of Iran’s repression 40 Ali Larijani’s ambitions 41 The unravelling of South Sudan ⏩ C002 -- 38 of 80 -- 39 The Economist February 28th 2026 Middle East & Africa ▸ ⏩ rently able to do. That is not much of a concession. It would be hard to sell such a deal to hawks in Washington, let alone to Israel. Even some supporters of the JCPOA now believe that a nuclear-only pact would squander America’s leverage and throw a lifeline to Iran’s embattled regime. The rest of Mr Trump’s possible goals range from insufficient to implausible. A comprehensive deal to restrict Iran’s mis- sile arsenal and end its support for Arab militias would be a monumental achieve- ment. But Iran seems reticent to discuss those issues, and Mr Trump has been ad- vised (correctly) that the regime will not yield under fire. Trying to topple it is un- certain and fraught with peril, as America’s experience in Iraq made clear. Most Americans are confused. A recent survey by The Economist and YouGov found that just 27% of Americans support a strike on Iran. Though Republicans are more supportive than the country as a whole, some of Mr Trump’s MAGA allies are baffled as to why the president is contem- plating the sort of Middle Eastern war he once campaigned against. Members of Mr Trump’s cabinet briefed top members of Congress on February 24th. Chuck Schum- er, the Senate minority leader, emerged in confusion. “If they want to do something in Iran, and who the hell knows what it is, they should make it public,” he said. Yet a string of recent media leaks sug- gests that Mr Trump’s aides are focused on tactical questions. Would a limited first strike make Iran more or less amenable to concessions? How much would a war drain America’s precious supply of air-defence interceptors? These are valid questions, to be sure—but it is odd to debate how a war should be fought before deciding why. Some of this confusion is uniquely Trumpy. The president tweets before he thinks and plays fast and loose with the facts; neither trait is conducive to running a war. Mr Trump backed himself into a cor- ner by warning the regime in January that he would retaliate for the killing of protes- ters. After his quick wins in Iran last sum- mer and Venezuela in January, he seems enamoured of military force; he is said to be frustrated that the current stand-off with Iran offers no easy options. Steve Witkoff, his diplomatic envoy, re- cently said that Iran could be “a week away” from enriching uranium to weap- ons-grade: “That’s really dangerous,” he told Fox News. Two days later Mr Trump said Iran’s nuclear programme had been “blown to smithereens”. Needless to say, both cannot be true. If the president’s ver- sion is accurate, there is no urgent threat to justify a big military campaign. Mean- while, if you take Mr Witkoff at his word, his boss is a liar, and there is little reason to believe a new strike on Iran’s nuclear facil- ities would be more decisive than the last. To be fair, though, Mr Trump is hardly the first American leader who struggled to identify a realistic goal in Iran. George W. Bush hoped that invading Iraq would di- minish Iran’s influence and destabilise its regime. It did the opposite. Barack Obama thought Iran might find a way to “share the neighbourhood” with America’s Arab al- lies, an idea that mostly angered said allies. Presidents have wanted to change Iran’s behaviour for almost half a century; none has worked out how to do so. ■ Iran’s regime The limits of repression IF IRAN’S RULERS thought that their crit- ics would be silenced by January’s car- nage, they have miscalculated. As soon as universities reopened on February 21st (they were closed on January 4th, amid the unrest, ostensibly because of the “cold”), campuses were filled with protests. For three consecutive days students, men and women alike, defied plainclothes bully- boys posing as classmates. Their courage has been matched by their radicalism. In Tehran University, a bastion of anti-mon- archist sentiment ahead of the shah’s over- throw in 1979, students chanted for the res- toration of the monarchy and waved its old flag. “This massacre created a nation,” says a doctoral student in Tehran. “People are more united than ever.” As in the shah’s final months, when his troops killed protesters, albeit in smaller numbers, grief has curdled into angry de- fiance. At memorials marking the 40th day after the slaughter of demonstrators, mothers led mourners in chants against “the dictator”. Most speak not of martyrs, the regime’s term, but of “mutilated flow- ers”. It is Ramadan, Muslims’ holy month of fasting, but some Iranians denounce not only the theocracy that terrorises them but the religion in whose name it rules. After the killing of thousands—perhaps tens of thousands—some Iranians wonder if violence, whether inflicted by America or improvised at home, could save them. Years of economic impoverishment and state repression and months of worries about impending war have fuelled a yearn- ing to see the regime gone at any cost. To prepare for the next slaughter, some are buying weapons. Bootleggers running home-delivery of alcohol now also peddle guns. “It is the most perilous moment in the Islamic Republic’s history,” says a cler- ic with ties to the family of the supreme leader, Ayatollah Ali Khamenei. Newspapers that once cleaved to the regime’s red lines now test them. Editorials openly decry the killings in January. One covered its front page with the names of the 3,117 officially acknowledged to have died. Another stamped the sun and lion emblem of the shah on its masthead. In pe- ripheral provinces dominated by non-Per- sian minorities talk of secession is grow- ing. Iranian analysts warn of emerging “ungoverned spaces”. For years, the fear of chaos and eco- nomic collapse tempered dissent. But now, for many Iranians, both have arrived. Infla- tion has put staples beyond reach. The state struggles to supply water, electricity and cheap petrol, central to its social con- Iran’s rulers are unsettled but are making few concessions What’s the newest grief? C002 -- 39 of 80 -- 40 The Economist February 28th 2026 Middle East & Africa ▸ tract. Internet restrictions hobble a once- vibrant digital economy. The loud thrum of the drums of war is fraying nerves. Many complain of sleepless nights and say only tranquillisers get them through the days. So far the regime has seen no big defec- tions. After Israel’s summer war thinned its upper ranks, its leaders prepared succes- sion plans. A leadership council stands rea- dy should the supreme leader be incapaci- tated. “The wicked brilliance”, as one Irani- an analyst describes it, of Mr Khamenei’s order to massacre the protesters is that the perpetrators and apologists from top to bottom must now stand or fall together. The student protests do not yet pose an existential threat. The regime may even welcome them as a safety valve. Newspa- pers are deemed to offer similar relief. A channel linked to an intelligence agency recently aired a debate among a monar- chist, a republican and a regime loyalist. Many of the tens of thousands detained after earlier protests have been released. But the coercive machinery of the state is still visible: pickup trucks mounted with guns wait in the streets. Inside the beyt, the supreme leader’s office, it is business as usual. Ideologues disqualify reformist can- didates from upcoming municipal elec- tions. Over-critical papers are banned. Rabble-rousers are rounded up. Iran’s leaders do not believe air strikes could destroy their sprawling, decentral- ised regime, even if they could take out in- dividuals. After all, Israel failed to unseat Hamas definitively with two years of pul- verising little Gaza flat. Iran is 4,500 times larger, strewn with mountain hideouts and far more heavily armed. America’s dispatch of two carrier strike groups to its shores has unnerved some within the regime, but some generals almost sound flattered. When America and Israel staged military exercises in the Red Sea, the Islamic Revo- lutionary Guard Corps (IRGC), Mr Khame- nei’s praetorian guard, sent its navy to briefly close the Strait of Hormuz and con- duct war games with Russia. Hoping, per- haps, to embroil America in another war, Russia is apparently providing Iran with la- ser-guided shoulder-borne missiles. And yet the prospect of a foreign attack combined with further domestic unrest is unsettling the regime. After talks in Gene- va on February 17th, relaxed Iranian nego- tiators suggested scheduling another round in a fortnight. The sabre-rattling has brought them back to the table, promising a fresh proposal, after barely a week. Some Gulf officials say Iran may accept limiting nuclear enrichment to a token level and curbs on missile transfers to proxies. It hopes that a deal could not only stave off the threat of attack, but bring sanctions re- lief to ease the economic pressure driving unrest. But the longer a deal remains un- done, the closer it comes to war. ■ Iran’s leaders Next in line? FORMALLY, IRAN has a leadership coun- cil primed to act should the supreme leader, Ali Khamenei, be killed or incapaci- tated. Under Article 111 of the constitution, the president, the head of the judiciary and a senior cleric would form a caretaker com- mittee. In practice, one man already seems to outrank them. Ali Larijani, secretary of the Supreme National Security Council, is shaping Iran’s strategy as the supreme leader slips in and out of view. “He’s re- placed Qassem Suleimani,” says Lynette Nusbacher, a British former intelligence officer, referring to the regime’s leading commander whom America assassinated in 2020. “He’s Khamenei’s eminence grise.” The constitution allows the supreme leader to delegate his powers to others. In recent years Mr Larijani, rather than the president, Masoud Pezeshkian, has repre- sented Mr Khamenei in dealings with Rus- sia, China and the Arab monarchies of the Gulf states. Before a recent round of nego- tiations with America, Mr Larijani trav- elled to Oman to set the regime’s terms. After the failure of Hizbullah, a militia backed by Iran in Lebanon, and other Shia proxies to deter Israel, Mr Khamenei again turned to Mr Larijani—telling a civilian, not the head of the Quds Force, the exter- nal arm of the Islamic Revolutionary Guard Corps (IRGC), to manage relations with Lebanon and Yemen. Many read it as a rebuke to the generals. He played such a key role in the January massacres that the Trump administration put him under sanc- tions by name. Few can match his reach across the re- gime. A professor of philosophy—his aca- demic speciality is Immanuel Kant—and a qualified mathematician, he is also steeped in clerical lineage. His father was an aya- tollah; his father-in-law was the Islamic revolution’s leading theoretician and right- hand of the founder of the Islamic Repub- lic, Ruhollah Khomeini; his brother Sadeq Larijani, another turbaned official, ran the judiciary for a decade. The man himself has occasionally led Friday prayers in Mr Khamenei’s stead. He served in the IRGC, held four ministerial posts and spent 12 years as speaker of parliament. He casts himself as a loyal but pragmat- ic conservative. He claims that during last summer’s war an Israeli phoned to give him 12 hours to leave Iran to avoid assassi- nation and that he hung up. Yet ambition flickers; he has thrice sought the presidency and may yet hold real presidential powers, unlike the subser- vient Mr Pezeshkian. Some think Mr Lari- jani’s sights are set higher still. The Islamic Republic has shed much of its clerical garb; even Mr Khamenei now prefers the secular-sounding “supreme leader” to “imam”. A successor in a business suit is no longer unthinkable. “It’s a wild card,” says Ms Nusbacher. Could Mr Larijani change the regime’s course? As culture minister and later head of state broadcasting, he hounded reform- ists and aired forced confessions. Yet hard- liners have never fully trusted him. He crit- icised their vote-rigging to ensure Mah- moud Ahmadinejad’s return as president in 2009. He has consistently favoured a nu- clear agreement and, as speaker, hustled through approval of the 2015 nuclear deal. Rivals circle. Mohammad Bagher Ghalibaf, the current speaker, may command deeper loyalties within the Guards and enjoys a close relationship to the supreme leader’s influential son, Mojtaba Khamenei. In two of his three runs at the presidency, hard- liners have barred him. Moreover, for all his establishment cre- dentials, his connections are, to hardliners, suspiciously far-reaching. Instead of the starched white shirts favoured by most se- nior Iranian officials, he wears loose black ones that owe something to Johnny Cash. And he has many relatives in the West. One nephew is an academic in Britain; a daughter taught in America until Iranian critics in exile forced her out of her univer- sity job because of her father’s position. And what if Mr Larijani were ever to as- cend to power, and was minded to normal- ise at home and abroad? It is far from clear that Iran’s fractious opposition—or its re- gime ideologues—would endorse his au- thority to do so. ■ Ali Larijani has become the Islamic Republic’s fixer—and a plausible heir C002 -- 40 of 80 -- 41 The Economist February 28th 2026 Middle East & Africa South Sudan The last days of Salva Kiir IT IS RARELY a good sign for a country’s international airport to run out of mon- ey. Yet that is what is happening in South Sudan. In January, the newly appointed di- rector of civil aviation ripped up an agree- ment on overflight fees. He ordered all in- ternational airlines passing through South Sudanese airspace to pay a company said to be linked to the president’s family. The airlines refused. Payments stopped. Now cash reserves at the airport in Juba, the capital, are dwindling. Fuel is scarce. Li- censed air-traffic controllers have left. The alarming state of South Sudan’s only international airport is a symbol of the country’s wider malaise. Conflict, par- ticularly in north-eastern Jonglei state, has escalated sharply in recent months (see map). Aid agencies say food is running short almost everywhere. Yet cocooned in the capital Salva Kiir, South Sudan’s first and only president since independence from Sudan in 2011, does not appear to be taking note. Close observers say the 74- year-old is ill. His dictatorial governing style is growing ever more erratic. South Sudan is a particularly egregious example of a country unravelling as its ageing auto- crat clings to power. The immediate crisis stems from the collapse of South Sudan’s unity govern- ment. It was formed in 2020 as part of an agreement between Mr Kiir and Riek Ma- char, his vice-president and longtime rival, and their respective ethnic groups, Dinkas and Nuers. The deal largely ended a civil war that cost perhaps 400,000 lives be- tween 2013 and 2018. Yet Mr Kiir refused to implement key terms, such as properly uni- fying the army and holding elections. In March 2025 he used clashes between the army and Nuer militias linked to Mr Ma- char as a pretext to arrest him. In Septem- ber Mr Machar was charged with murder, treason and crimes against humanity. Fighting between the army and Mr Ma- char’s forces has since spread. In January rebels seized territory and towns from the national army and briefly closed in on Bor, the state capital of Jonglei. In Jonglei alone violence has forced an estimated 280,000 people from their homes. In Bor, recent ar- rivals at a camp for internal refugees report brutal attacks on Nuer villages by govern- ment troops. “They do not discriminate,” says Nyabiel Pakam, a 35-year-old who was separated from her daughters when forced to flee in early February. Some of those ap- pearing at hospitals have amputated limbs, gunshot wounds or burns from aerial bombing. Aid workers speak of systematic sexual violence. The army claims it has beaten the re- bels back. “We are almost done,” says its spokesman, listing the names of bases and towns in the north recaptured in recent months. Officials in Bor say some refugees are returning home. But whether the government can reas- sert its authority across the country is doubtful. For one thing, the resources at the president’s disposal have shrunk. Civil war in neighbouring Sudan has curtailed South Sudan’s ability to export oil via the Red Sea (though an agreement with Su- dan’s warring parties in December enabled some flows to resume). Less oil money to spread around means Mr Kiir’s “big tent” approach for managing the unity govern- ment is falling down, argues Daniel Akech of the International Crisis Group, a think- tank in Brussels. Foreign-aid cuts have added to the squeeze. Mr Kiir’s base is thus narrower than it has ever been. It is not only Mr Machar’s Nuers who feel cut out. Close observers say these days the president’s inner circle barely extends beyond his own family. The company that hoped to collect the airspace overflight fees is also trying to take a cut from numerous other revenue streams. In August Mr Kiir appointed his daughter as a senior economic adviser, replacing Benja- min Bol Mel, until then the president’s pre- sumed successor. Three months later Mr Bol Mel was put under house arrest. The president’s frenetic reshuffling of officials in recent months suggests he trusts nobody. On February 23rd the fi- nance minister—the country’s eighth since 2020—was sacked after just three months in office. In January a man was appointed to an election panel. He was later found to have died five years ago. All this suggests “we are in the waning days of a regime that is falling apart,” notes a regional expert. Public frustration is growing. The World Bank estimates the economy may have shrunk by 30% in 2025 alone. A notice at the entrance to a government office in Juba warns visitors it cannot provide mon- ey for food, medical fees or other necessi- ties. Polling by the Friedrich-Ebert-Stif- tung, a German think-tank, found that twice as many South Sudanese said they felt unsafe in 2025 compared with the pre- vious year. The army, which has struggled to pay soldiers’ salaries for more than a year, suffers from sagging morale. Mr Kiir looks likely to cling on. For now, he can count on support from neighbour- ing Uganda, which has troops stationed on the outskirts of Juba. Opposition forces are too weak and divided to do much more than continue making rural areas ungover- nable. Mr Machar’s allies are mostly scat- tered abroad. His deputy, Nathaniel Oyet, says all they want is a “mediated solution” and a return to the peace deal. Yet plenty of would-be successors are in the wings, waiting for nature to take its course. “The successor will be decided by whoever hears about Kiir’s death first,” a senior politician told Joshua Craze, a Brit- ish researcher. “That’s why we are all com- peting for his attention. To say the death rites.” However bad South Sudan’s con- flicts are today, the looming succession battle looks set to make them worse. ■ BOR As the president’s regime unravels, it is taking the country down with it Juba Juba Juba Bor Jonglei SOUTH SOUTH SOUTH SOUTH SOUTH SOUTH SOUTH SOUTH SOUTH SSSSSSSSUDAN UDAN UDAN UDAN UDAN UDAN UDAN UDAN SUDAN C A R UGANDA KENYA KENYA ETHIOPIA D. R. CONGO D. R. CONGO D. R. CONGO 300 km Source: ACLED Violent events involving government forces and rebel groups aligned with Riek Machar Jan 1st 2025-Feb 23rd 2026 Fatalities 20 70 Fleeing hell in a handcart C002 -- 41 of 80 -- 42 The Economist February 28th 2026 Europe Italy’s referendum Judging the judges ITALIAN GOVERNMENTS have often been at odds with the country’s courts. But with a referendum on reforming the ju- diciary due on March 22nd and 23rd, the animosity has seldom been so high—per- haps not since the late Silvio Berlusconi was claiming to be the victim of a conspir- acy by communist judges. Much of the ill will stems from rulings against the hard- line immigration policies of Giorgia Mel- oni, the prime minister, and her populist- right government. The most recent clash came on Febru- ary 18th, after a judge in Palermo ordered the state to pay €76,000 ($89,600) to Sea Watch, an NGO that rescues migrants in the Mediterranean. Ms Meloni said the de- cision left her speechless. The money is to compensate Sea Watch for costs related to the temporary seizure of one of its ships in 2019. The skipper had clipped a police ves- sel while trying to run a blockade off the Italian island of Lampedusa, where Matteo Salvini, head of the right-wing League and the interior minister at the time, had stopped her from docking. In the ensuing legal proceedings, the courts freed the skipper, dismissed the charges and ar- raigned Mr Salvini for allegedly slandering her. His trial was scotched by parliament. Mr Salvini is now deputy prime minis- ter, and the opposition says the referen- dum is a government attempt to punish judges and prosecutors for such rulings. Federico Gianassi, an MP for the centre-left Democratic Party who sits on the justice committee, says its aim is to “strike at them and humiliate them”. Critics compare it to efforts by populist-right governments in Hungary and America to weaken the rule of law. Yet these critiques are mostly mis- guided. The reform’s main flaw is that it distracts from the biggest problem of Ita- ly’s judiciary: its slowness. The target of the reform is Italy’s awk- wardly hybrid judiciary. The system is mostly adversarial, but has remnants of an older inquisitorial model where prosecu- tors and judges collaborate to discover the truth. They still form a single professional corps, known as the magistratura, or magis- tracy. They sit the same entrance exam and can sometimes switch between prosecut- ing and judging. Separating them has been a cause of the right ever since an earlier re- form in 1988 failed to do so. Mr Berlusco- ni’s claims to victimhood were nonsense, but the suspicion that judges unconscious- ly favour fellow-magistrates is reasonable. The proposed law would make prose- cutors and judges subject to different su- pervisory bodies (though answerable to the same disciplinary tribunal) and pre- vent career-switching. In fact, their paths were largely separated by legislation passed in 2022. Since then, only 1% per year have switched careers. Still, eliminating defendants’ fear that the odds are stacked ROME Giorgia Meloni takes on the courts that have frustrated her government → ALSO IN THIS SECTION 43 Ukraine’s drone killers 44 Slovakia, car king 44 France’s right-wing martyr 45 Siberia in wartime 46 Charlemagne: Luxury in doubt ⏩ C002 -- 42 of 80 -- 43 The Economist February 28th 2026 Europe ▸ ⏩ against them is worth doing. Other aspects are more questionable. Members of the two governing councils would be chosen by lot: two-thirds from the professions, with the remaining third coming from a list drawn up in parliament. That list would inevitably favour the go- verning majority. The vice-presidents of both oversight bodies would be selected from among the parliamentary nominees. Similar rules would apply to the disciplin- ary tribunal. It can be argued that random selection would produce watchdogs with less au- thority and perhaps less competence. Sup- porters retort that would be a small price to pay for breaking the grip of the correnti, politically aligned factions within the mag- istracy that have till now contested the elections to its governing body. As a scan- dal in 2019 revealed, at least some in the correnti were in cahoots with like-minded politicians to fix sensitive appointments. The reform would slightly erode the magistracy’s formal independence. But It- aly’s prosecutors would still be far freer than their French and German counter- parts, who are directly subordinated to jus- tice ministers. Italy’s government would still be unable to tell prosecutors what to investigate. And the judiciary would still have a constitutional assurance that it was “an independent branch of government”, not “subject to any other”. The most serious objection to the re- form is that it does not even attempt to ad- dress the Italian judiciary’s gravest pro- blems. Italy’s courts are absurdly slow, and its lawyers are expensive. That deters for- eign investment: companies fear being un- able to recover debts or resolve disputes within a reasonable time. It took an aver- age of 511 days to get a ruling at first in- stance in 2023, the latest year for which comparative data are available, according to a European Commission report. That was the third-longest wait in the European Union: only Greece and Hungary were worse. To wring a decision at third in- stance from the courts took more than 1,000 days, the most in any member state. As a proportion of the population, Italy had the fourth-highest number of lawyers in the EU but the seventh-lowest number of judges. Court fees for low-value claims were prohibitive: more than half their aver- age value. Since 2023, Italy has benefited from the largest share of the EU’s post- pandemic recovery fund, including €2.3bn to boost staffing levels in the justice sys- tem. In exchange, it has undertaken to in- troduce widespread changes. But there is still a long way to go. Polls suggest that, in next month’s ref- erendum, voters will approve the govern- ment’s reform bill. They should not expect it to bring them faster, cheaper or even necessarily better justice. ■ Ukraine’s drones Automated shootdown THEY CAN hardly believe it themselves. At a secret training range north of Kyiv, a group of volunteers are learning the ba- sics of drone shootdowns. The experiment attempts to revive the improvisational spir- it of the war’s first weeks. The part-time unit, which includes graphic designers, ac- tors, lawyers and a neurologist, feels more Dad’s Army than praetorian guard. But they feel they have a duty to defend their homes. “We’re preparing while we can,” says new recruit Oleksandra Azarkina, a former deputy minister for infrastructure. “We don’t know what tomorrow brings.” Ukraine’s defence against Shahed drones is a key front line of the war. Origi- nally Iranian, the modernised drones offer Russia a cheap, accurate substitute for missiles. Together with the lighter Gerbe- ra, often used as decoys or for reconnais- sance, they form the backbone of Russia’s campaign against Ukraine’s economy and power grid. For a long time Ukraine strug- gled to find countermeasures. Now that is changing, with interceptor drones emerg- ing as a cost-efficient defence. The drone the volunteers are test-driv- ing, Skyfall’s P1-SUN, is one of the three most popular models. It is somewhere be- tween a quadcopter and a mini-missile. Once a target is identified, the pilot takes off vertically, then pitches forward 90 de- grees so the drone’s bullet-shaped nose leads. It can reach speeds of 350kph, fast KYIV Ukraine is scaling up interceptor drones Float like a butterfly, Sting enough for Russia’s propeller-driven drones. A small charge is packed into the tip, but ramming is often sufficient. They work well provided it is not too windy or wet, and the skies are free of jamming. More advanced interceptors are semi- autonomous. The Merops drone, produced by a company founded by Eric Schmidt, Google’s former boss, needs only to be guided into visual range before engaging automatically. Crews rate it highly, despite problems scaling up. The front-runner is now the locally developed Sting (pictured), which at $2,000 costs less than half as much. Availability and cost remain the key questions, says Lieutenant Colonel Pavlo Verkhovod of the 25th Airborne Brigade: “There is little point in shooting down 100% of the drones if the interceptor costs more than the target.” Commanders say the cat-and-mouse game has produced capabilities that would overwhelm most Western armed forces. The Russians rework drones and tactics every few months. When Russian opera- tors realised that Merops drones attacked from below, using the sky to outline their targets, the Shaheds flew lower. Later they introduced manoeuvres every couple of minutes to trick algorithms. Engineers who study downed craft say the drones used Ukraine’s own cell-phone and WiFi networks for navigation, using inertial sys- tems to hop between nodes when jammed. Ukraine has had some success disrupting this, and Russia’s recent effort to shift to Starlink devices may have been a response. Even before Elon Musk cut Russian ac- cess to his satellites in early February, Uk- raine was turning a corner. In January, a year after interceptor drones were launched, it destroyed a record 1,704 Sha- heds—half of those launched. Some 70% of the interceptions used drones. The rest were downed by a more expensive mix of fighter jets, helicopters and missiles. The 412th Unmanned Systems Brigade, aka “Nemesis”, accounted for a sixth of the shootdowns. Operating outside the mili- tary bureaucracy, Nemesis has automated processes, from combat to paperwork. “We work as a startup,” says Lieutenant Colonel Artem Bilenkov, the unit’s chief of staff and a former financial analyst. “Fail fast, build new prototypes, test and scale— or put it in the box and move on.” Ukraine’s new defence-ministry team, led by a 35-year-old tech prodigy, Mykhailo Fedorov, is trying to extend that kind of model across the armed forces. At a press briefing on February 23rd, the minister pre- sented a three-part vision of how Ukraine might regain the battleground initiative. “Closing the skies” was his first priority. The other pillars—raising Russia’s rate of attrition and squeezing its economy—are designed to make Vladimir Putin’s war more obviously pointless. C002 -- 43 of 80 -- 44 The Economist February 28th 2026 Europe ▸ ⏩ Ukraine’s commanders are confident they can deal with this generation of Rus- sian drones. “The main issue is scaling,” says Lt Col Bilenkov. Yet few expect the en- emy to stand still. The armed forces have already faced the first experimental jet-po- wered drones, which at 400–500kph fly faster than the current interceptors. There are cases of Russian drones operating in small swarms. If these projects are scaled up, they will demand new answers. Oleksiy Honcharuk, a former prime minister and chair of Nemesis’s expert council, says drone power is growing expo- nentially. “Every year a drone halves in size or price, or doubles in range,” he says. Soon Shahed-type drones may not be weapons, but platforms from which to catapult smaller drones into cities. Russia already uses Shaheds to launch FPV (first-person view) drones near the front line. That will eventually require new defences, Mr Hon- charuk believes: walls of interceptor drones launching automatically on detec- tion, bypassing the need for teams of pi- lots. “It might sound like science fiction, but we are getting ready for it,” he says. “Europeans should be asking themselves if they are too.” ■ Slovakia’s car industry Intensive car ROBOTS OUTNUMBER employees by two to one at Porsche’s Smart Battery Shop, which opened in 2024 in the town of Horna Streda. Autonomous shuttles deliv- er parts to workstations, where robot arms assemble them into modules. These are turned into battery packs at a factory near Bratislava, Slovakia’s capital, for Volks- wagen Group (VW), Porsche’s parent com- pany, and fitted into electric Porsche Cay- ennes. Deliveries of the battery-powered SUV, made there alongside petrol and hy- brid models, will begin this year. Porsche is said to have invested around €1bn ($1.18bn) in the battery plant. It is not alone in choosing Slovakia. Western Euro- pean companies started looking eastwards three decades ago, trying to cut manufac- turing costs while staying close to their main markets. Slovakia was just as appeal- ing as bigger countries such as Poland and Romania. VW is now the country’s largest private employer. Last year it built 337,000 VWs, Audis, Porsches and Skodas there. In 2025 Slovakia manufactured nearly 1.1m vehicles, more than anywhere else in the world per head of population (see HORNA STREDA The world’s most auto-focused economy chart). The industry contributes a tenth of GDP and directly employs 170,000 people. Almost all the cars head abroad, making up around a third of Slovakia’s exports. It is about to grow bigger still. Volvo is spending €1.2bn on a plant for electric ve- hicles (EVs) that will be able to make 228,000 cars a year when it opens in 2027. Francesca Gamboni, head of industrial op- erations, notes the country’s skilled work- force, good infrastructure and supplier network. Nearly 400 firms serve the indus- try. Government subsidies help: Volvo got a handout of around €270m. The country’s industry has been little dented by the pandemic or the EU’s tight- ening of emission rules. Production in Europe has slumped by over a fifth since 2019; in Slovakia it has fallen only slightly. In part that is because of investment in the transition to EVs. Kia recently kicked off its European EV production at Zilina. Sales of pure battery models have not lived up to forecasts, but they still grew by nearly 30% in western Europe last year. They now make up nearly a fifth of sales. Slovakia’s heavy reliance on carmaking, however, makes it vulnerable to the indus- try’s ups and downs. All firms face the threat of cheap imported Chinese EVs, and are scrambling to stay competitive. Other countries are vying for investment. Gener- ous government incentives and abundant renewable energy have attracted battery- makers to Spain. Stellantis (whose biggest shareholder, Exor, part-owns The Econo- mist’s parent company) is expanding fast in Morocco, attracted by low wages and a free-trade agreement with the EU. Closer to home BYD, a Chinese EV be- hemoth, will soon open its first European plant in Hungary. Germany’s BMW also picked Hungary for a new factory for its EVs. BYD is building another plant in Tur- key, and is rumoured to favour Spain for a third. The biggest worry for any country re- lying heavily on foreign carmakers is that big global businesses invest where returns are the greatest. Slovakia is still in the run- ning, but the competition is revving up. ■ Motorheads Passenger-car production per 1,000 people, 2024 Top ten countries Sources: OICA; World Bank Slovenia Romania Spain Hungary Germany Japan South Korea Czech Rep. Slovakia 200 150 100 50 0 France Right-wing martyr THE FATAL beating of a 23-year-old nationalist in Lyon on February 12th is France’s “Charlie Kirk moment”, said Do- minique de Villepin. France’s far right, the former prime minister warned, would use the incident to portray itself as the victim of widespread violence, just as America’s populist right did last year after the assas- sination of Kirk, a MAGA activist. The com- parison is inexact. But the killing of Quen- tin Deranque looks set to damage the pop- ulist left and reinforce the populist right. Ahead of mayoral elections in March and a presidential vote in 2027, it also stirs fresh worries about political violence. Deranque, a student activist, died from brain injuries two days after the beating. Video footage showed what looked like an attack by a lynch mob. He was part of a group protecting a handful of “feminist and identitarian” protesters outside a uni- versity lecture by Rima Hassan, a Euro- pean parliamentarian for Jean-Luc Mélen- chon’s populist-left Unsubmissive France (LFI) party. Seven suspects, aged between 20 and 26, were placed under judicial in- vestigation on February 19th, six of them for “voluntary homicide”. The killing has exposed a sinister side to Mr Mélenchon’s political movement, which holds 71 seats in the 577-seat lower house. One of the suspects is Adrian Bes- seyre, who previously worked for Raphaël Arnault, an LFI deputy. Mr Arnault is the co-founder of Jeune Garde, an anti-fascist self-defence movement, which the interior ministry banned last year. Jacques-Elie Favrot, who was put under investigation for “complicity” in a homicide, was one of Mr Arnault’s parliamentary assistants. The killing has also upended France’s debate about political violence. The finger is usually pointed at neo-Nazi movements and ultra-nationalists. Research by Isa- belle Sommier, at the Paris-I Panthéon- Sorbonne University, shows that over 60% of political aggression over the past de- cade has been carried out by the far right. Mainstream political parties have long called for a “cordon sanitaire” around the populist right, including Marine Le Pen’s National Rally (RN), despite her party’s ef- forts to distance itself from extremists. Now, however, it is the RN that is call- ing for a cordon sanitaire around Mr Mé- lenchon’s party. Jordan Bardella, the RN’s president, has called LFI “a danger for our democracy”. To present themselves as up- PARIS France’s hard left is blamed over the death of a nationalist activist C002 -- 44 of 80 -- 45 The Economist February 28th 2026 Europe ▸ holders of democratic politics, RN leaders skipped a weekend rally in memory of the student dominated by ultra-nationalists. The RN is also calling out the hypocrisy of other parties of the left, including the So- cialists and the Greens, which teamed up with LFI at parliamentary elections in 2024. That awkward alliance has since split. The public does not seem ready to brush off the killing. One poll found that 73% considered it a sign that “political vio- lence is growing”. Ms Sommier’s research suggests this is partly true: she has classi- fied 2,300 acts of political violence over the past ten years, compared with 5,500 in the 30 years from 1986 to 2017. Nonetheless, deaths from political violence (not includ- ing terrorism) remain rare. Since 2022 there have been six—roughly the same yearly rate as between 1986 and 2017. Deranque’s killing has not gone unno- ticed abroad. Giorgia Meloni, Italy’s prime minister, called it a “wound” for Europe. Emmanuel Macron, France’s president, re- torted that other leaders should mind their own business. It also prompted a trans- atlantic spat. Charles Kushner, the Ameri- can ambassador in Paris and a friend of Donald Trump, failed to turn up to a sum- mons by France’s foreign minister, Jean- Noël Barrot. The American embassy had shared in French on X a State Department post stating that it expects “to see the per- petrators of violence brought to justice”. Mr Barrot denounced this as interference, and barred Mr Kushner from meeting any French ministers. The ban was reversed only after he called to make amends. ■ Siberia in wartime The north remembers IN THE PAGAN tradition of the Evenki, an indigenous people living in the Ole- neksk district of Russia’s far eastern Re- public of Sakha (Yakutia), red and black symbolise life and death. So at the head of a recent funeral procession in the village of Kharliakh, people carried a two-metre- high cross with diagonal red and black stripes. Behind the small crowd came a truck with a coffin, topped with a military cap. Igor Ivanov, a reindeer-herder, was killed 4,500km away in Ukraine. Mr Ivanov had enlisted as a contract soldier in the hope of earning enough money to buy a flat for his children, his daughter explains. But he fought for only a few months before being listed as missing in action. By the time his body was found, his son had also signed up and gone look- ing for his father. He too is now missing in action, and probably dead. Yakutia is bigger than Argentina but has a population of just 1m, half of them Yakuts, a Turkic people. Temperatures drop to -60°C in winter and soar to 40°C in summer. According to Mediazona, an in- dependent Russian news site, the region has lost over 2,500 dead in the war in Uk- raine. That is more than St Petersburg, Russia’s second city, which has five times as many people. Yakutia is rich in natural resources, pro- ducing a quarter of the world’s diamonds, and in human talent: in the 2010s it was one of the most exciting parts of Russia. It boasted a booming film industry (dubbed “Sakhawood”) that made its mark at festi- vals in Berlin and Seoul. Its IT firms includ- ed InDrive, a taxi app that lets passengers and drivers haggle, which became popular in Africa, Asia and Latin America. Mytona, a local developer, won a prize at the Inter- national Mobile Gaming Awards in 2019. Yakutsk, the capital, elected a local woman as mayor, beating the Kremlin-ap- proved candidate. It had its own indige- nous dissident: in 2019 Alexander Gabysh- ev, a shaman-warrior, set off for Moscow on foot to exorcise the dark forces of Vlad- imir Putin with a ritual in Red Square. He has been incarcerated in a psychiatric fa- cility for five years. The war came as a shock. An important independent news site, ykt.ru, shut down, saying it had “endured pressure for many years, but now the country is seriously closing itself off from the world”. Its own- er, Arsen Tomsky, the developer of In- Drive, moved his staff abroad. Mytona went to New Zealand. When mobilisation started in the autumn of 2022, some 400 Yakut women performed the traditional osuokhai round dance in Yakutsk’s central square, chanting “Let our children live”. They were quickly dispersed. Like others, people in Yakutia have adapted to war. They buy Chinese goods instead of Japanese ones and have learned to speak cautiously. Under new ownership, ykt.ru publishes entertainment and prop- erty listings rather than news. Sanctions caused Alrosa, a diamond-mining compa- ny, to close mines and cut charitable dona- tions, including funding for monitoring reindeer migration, which had helped herders prevent their domesticated rein- deer from coming into contact with wild ones. In 2024 Oleneksk lost a quarter of its herds when that happened. In Yakutsk recruitment posters are everywhere. Captured Ukrainian ar- moured vehicles, dragged clear across Rus- sia, are displayed in a park. In January a teenager climbed into one and was killed when a metal part fell on his head. In vil- lages women weave camouflage nets and send reindeer skins to the front lines. Yet despite the war, many who fled are coming back, drawn by the nature and an- cestral culture. “Thank God I was born in Yakutia,” says a local driver with a smile as he stops his SUV by a roadside wooden to- tem pole. Despite the frost, he puts his bare hands on it to receive its energy. ■ YAKUTSK The war in Ukraine has changed Yakutia, but not its core Popping down to the market C002 -- 45 of 80 -- 46 The Economist February 28th 2026 Europe The Golden Goose EUROPE’S ECONOMY may be as flaccid as a damp baguette, but you wouldn’t know it if you were window-shopping in the posher arrondissements of Paris. Say you are looking for a bone- shaped leather trunk designed to carry two bowls to dispense dog food, admittedly one of life’s lesser essentials. Louis Vuitton hap- pens to have just the thing, yours for a mere €15,000 ($17,700). Those on a tighter budget might opt for a Hermès rocking horse, probably no more necessary but a far sight cheaper at just €4,600. Feeling a bit broke? Settle for Christian Dior flip-flops, a snip at just €410—each. Unless Charlemagne’s fellow Europeans all won the lottery and forgot to tell him, something feels off. Who buys this stuff? The answer, for some years, has been: “not Europeans”. The luxu- ry industry that got its start selling fripperies to Milanese counts and Parisian mistresses now more often services Floridian proper- ty developers, Arab sheikhs or Chinese high-rollers instead. As a business trick, it is rather clever; Bernard Arnault, the founder of LVMH, purveyor of Louis Vuitton dog-food cases, vintage cham- pagne and other such un-necessities besides, was for a time the world’s richest man. But Europe’s continued dominance of the gilded trifles market (about 80% of global luxury brands come from there) tells you something about its lingering claim to cultur- al supremacy. It is, perhaps surprisingly, a place still able to be- stow cachet—for a price. Flogging luxury goods is one of the few fields of business in which Europe excels (if one excludes the crafting of regulation). In an ironic twist, an egalitarian continent with an ever-declining share of global GDP hosts an industry that thrives on inequality and bombastic money-making. For how many seasons more can this alchemy of aspiration endure? The trinkets Mr Arnault and his acolytes at Chanel, Prada and Rolex are flogging are not mere ornaments. Rather, they are slices of aspiration, of a European way of life—albeit one that exists largely in the imaginations of well-heeled foreigners. If Europe is an open-air museum, its most deep-pocketed visitors are made to exit through the Gucci gift shop. MAGA types may ridicule Europe for its supposed descent into a bacchanal of bureaucrats and boat- people. But they still crave the European imprimatur which they believe elevates bling from gaudy to classy. (Mr Arnault was one of few Europeans invited to the inauguration of Donald Trump last year.) China is swamping Europe with cheap industrial goods, but its economic elites are eager to distinguish themselves with im- ported Loro Piana calfskin loafers (€1,050). Once, plutocratic Chinese and Americans could tell them- selves that splurging on Saint-Laurent cufflinks or a Dior couture dress was a way to play-act at being a fancy Parisian. But this con- tention is now as out of date as shoulder pads. Your columnist knows plenty of fancy Parisians, none of whom carries dog-bone cases or gives any thought to owning a Dior dress. Relentless price rises have put many of the baubles flogged by Cartier or Fendi be- yond the reach of Europe’s affluent middle classes. The bedazzled South Koreans waiting in line at luxury stores near the Champs- Élysées have seemingly not noticed the absence of Europeans in those queues. Locals have better things to do. Even as luxury goods have become unattainable for those French and Italians meant to desire them, they have become near- ubiquitous for the foreign moneyed masses. Luxury houses sell the idea of scarcity, with hordes of publicists explaining that the years-long wait for a Birkin handbag is due to the lack of sufficient artisans to craft these pinnacles of refinement. This is a fairy tale stitched in fine silk. The luxury-goods industry has roughly tripled in size since 2000; its €358bn in annual sales—half a Walmart or Amazon, give or take—betrays how thoroughly mainstream sup- posed exclusivity has become. Fifty years ago, Louis Vuitton had but two outlets, both in France. These days it has two stores in Ningbo, China’s 34th-biggest city. Exclusive, moi? Perhaps one should laud Europeans, who saw a group of mugs willing to wait years for the right to buy a €50,000 Swiss watch and obligingly took their money. Once upon a time, the church in Europe sold indulgences to shorten the buyers’ stays in purgatory. Now luxury’s high priests sell trinkets meant to shorten their cli- ents’ stay in social obscurity. America exports F-35s. South Korea exports K-Pop. Europe has found a way to export self-worth. Cash for cachet There are worse scams than exploiting the inferiority complexes of the global have-yacht class. If aspiring billionaires are going to spaff thousands to fend off a mid-life crisis, why not make sure they buy European? Such hand-stitched bilking creates plenty of well-paid jobs. Europeans can make Chinese feel classy and si- multaneously finance their welfare states. Alas, there are signs the alchemy may not endure. Talk in the Monogram Industrial Complex is of a period of “normalisation”, a luxuriant way of saying sales are slipping. Mr Arnault is now only the world’s seventh-richest man, dethroned by a half-dozen Amer- ican tech bros. Some über-rich are spending more on luxury, for example splurging on tailored limited editions. But many are turn- ing to spending on experiences instead, says Luca Solca of Bern- stein, a broker. And posh hotels can be found far beyond Europe. More worrying yet is the idea that the global elite beyond Europe’s shores will one day flaunt their wealth without paying French or Italian firms a tribute for the privilege. A few American brands, from Coach to Ralph Lauren, have made inroads into the luxury world, albeit in its lower reaches. More recently Chinese purveyors of high-end frivolities have emerged with a patriotic pitch for locals to redirect luxury spending towards home-grown firms. Europe’s velvet tax on vanity may eventually be passé. ■ CHARLEMAGNE Luxury goods are Europe’s way to cash in on global status anxiety C002 -- 46 of 80 -- 47 The Economist February 28th 2026 Britain Heathrow expansion The runaway runway WHEN GEORGE OSBORNE was Brit- ain’s chancellor in the 2010s, he knew that the economy would not grow on a diet of spending cuts alone. It needed some pudding to go with the spinach: a totemic infrastructure project to show that the state was investing in the country’s future. For Mr Osborne, championing High Speed 2 (HS2) was the perfect choice for a sweet treat. The proposed railway line between London, Birmingham and the north would “change the economic geography” of Brit- ain, providing an “engine for growth”. Rachel Reeves, the current Labour chancellor, also inherited a tricky fiscal sit- uation in 2024. Never knowingly original, she responded by following Mr Osborne’s recipe. The greens this time were indigest- ible tax rises and the dessert was to be a third runway at London Heathrow airport. Both chancellors were right to prioritise in- frastructure. Better transport means ideas, people and goods reach each other more quickly, boosting productivity. The third runway, even more than HS2, seemed a no-brainer. For an open economy that trades in services and talent, every new flight path widens Britain’s reach. Yet efforts to build it have repeatedly failed, beaten back by furious opposition from west Londoners on noise and air-quality grounds. The airport is highly congested, with over twice as many flights per runway as competitors like Amsterdam Schiphol (which has six runways). Inaction threatens Heathrow’s status as a global hub. Any se- rious growth policy would deal with this. But HS2 is also a cautionary tale for what can go wrong with infrastructure pro- jects. The government’s proposals from 2012 said that the railway would open in 2026 and cost £33bn in 2011 prices (or $53bn). Since then, two of its three legs have been cancelled on cost grounds and the remaining London–Birmingham seg- ment has been delayed to the late 2030s. Costs are now set to exceed £100bn. There are early signs at Heathrow of the problems that plagued HS2. The pro- ject’s deadlines look fanciful. The govern- ment wants to grant planning approval by 2029, with the runway operational by 2035. But legal challenges are inevitable—both after the government publishes its Airports National Policy Statement this summer and once a planning decision is taken. La- bour has tried to speed things up by limit- ing opportunities for judicial review, but it has stopped short of more radical steps— such as Heathrow-specific legislation— that could prevent challenges altogether. More worrying is cost. Heathrow Air- port Limited (HAL), the site’s operator, in- tends to privately fund the project, recoup- ing costs through charges on airlines. (Lord Deighton, who chairs The Econo- mist Group, until recently also chaired Heathrow’s expansion is on track to be eye-wateringly expensive. This is not inevitable → ALSO IN THIS SECTION 48 A new top mandarin 49 Special educational needs 50 Bagehot: Paranoia politics ⏩ → Read more at: Economist.com/Britain — Reform’s economic policy — Teenage footballers C002 -- 47 of 80 -- 48 The Economist February 28th 2026 Britain ▸ ⏩ HAL.) It estimates that the airport’s expan- sion and modernisation will cost £49bn in 2024 prices. That’s enough to build about 40 hospitals, making it one of the costliest airport expansions ever. It’s already the second-most expensive major airport in the world for passengers (see chart). Inter- national Airlines Group, which owns Brit- ish Airways and operates 60% of Heath- row’s flights, backs the runway only if it costs £30bn or less. Jonathan Sullivan, from IAG, warns that the current plan could double landing fees (already £26 per person, versus Gatwick’s £13). Heathrow’s CEO recently claimed the extra fee would be £15, though was unclear about its scope. The obvious question is why laying just over two miles of asphalt costs billions. For answers, look to HS2, which faced many of the same cost pressures. Both projects in- volve building in dense London. The air- port is boxed in by homes and roads, with less than half the space of its main Euro- pean rivals. Land acquisition was estimat- ed in 2014 to cost at least £4bn. It’s now probably more. The runway must also be built over one of the busiest parts of the M25, London’s ring road, which carries more than 200,000 vehicles a day. Further costs arise from Britain’s scle- rotic planning system, where the least rele- vant stakeholder can block proceedings to get their pound of flesh. HS2 has been rid- dled with such pay-offs, including a £100m tunnel to protect bats. Heathrow is at risk of following a similar path. Paperwork costs associated with planning applica- tions alone are on track to exceed £1bn. Over £700m was previously earmarked for noise insulation in neighbouring homes. But the biggest reason for both pro- jects’ high costs lies in their tendency to gold-plate requirements, a curiously Brit- ish disease when it comes to big infrastruc- ture projects. HS2 was primarily intended to boost capacity, but a desire for speed led to unnecessarily expensive viaducts and tunnels. HAL’s plans are similarly bloated. The marmalade-dropper is £1.3bn for two car parks, but the biggest example of lav- ishness comes from the proposal to build new terminal buildings and revamp exist- ing ones, which accounts for £27bn of the £49bn total. Andrew Light, an aviation fi- nance consultant, singles out the plan to build multiple new terminals—linked by shuttles—as particularly expensive. The deeper problem is that both pro- jects are structured to discourage cost con- trol. Contractors on HS2 are paid a share of total costs, incentivising them to spend more, while officials lack the expertise to challenge them. Heathrow has similar flaws. As a privately owned company with considerable market power, HAL is regulat- ed by the Civil Aviation Authority (CAA), which determines how much the airport can charge. HAL is currently allowed to earn a regulated return on its investment— so the more it spends, the higher its profits. As Mr Sullivan puts it, “HAL’s incentive is to make this as expensive as possible.” The CAA is consulting on whether to change its approach for the third runway, with a decision due in summer. Airlines are eager for more competition. Surinder Aro- ra, the billionaire owner of several sur- rounding hotels, has pitched himself as an alternative developer. HAL argues that in- troducing a rival operator would mean years of delay. While they may be right, change is needed. A start would be to beef up the CAA, bringing in top commercial talent to scrutinise costs. A bolder approach would be to let an independent body define what needs to be built, rather than HAL. That body could commission HAL—or a rival—to construct different parts. Separating design from de- livery would curb the misaligned incen- tives that encourage gold-plating. Estab- lishing such a body might take a few months, but it would be worthwhile. With- out it, costs will spiral further. Even if air- lines could make the economics work, pas- sengers would face decades of overcharg- ing. The country has suffered one pricey pudding in HS2. It can ill afford another. ■ Sky high International airports, charges per passenger, 2024, Auckland=100 Source: Jacobs 100 80 60 40 20 0 Seoul Dubai Paris CDG London Gatwick Singapore Amsterdam New York JFK Frankfurt London Heathrow Auckland M4 M4 M4 M4 M4 Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals Terminals 5555555555555555555555555555555555555555555555555 222222222222222222222222222222222222 44444444444444444444 M25 M25 People People People People People People People People People People People People People People People People People People People People People People People People People People People mover mover mover mover mover New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway New runway 2 km 2 km 2 km 2 km 2 km 2 km 2 km 2 km 2 km *By Heathrow Airport Limited Sources: Heathrow; OpenStreetMap Heathrow Airport, proposed expansion*, 2025 Expansion area New or remodelled terminal buildings New taxiways Whitehall Alpha Romeo TO UNDERSTAND WHAT Sir Keir Starmer sees in Dame Antonia Romeo, his new cabinet secretary, take the 576- word memo she sent to Britain’s senior civ- il servants on February 23rd. Written in the imperative mood, item one of four was “de- livery and results”. “Focus intensely on get- ting stuff done, taking the initiative, and achieving outcomes,” she wrote. “Remove barriers, don’t create them…Be clear on ob- jectives, what success looks like, and re- lentless in scrutinising performance.” For her part, she wrote: “I will back you when you take appropriate risks and make diffi- cult calls. That is the deal.” No previous cabinet secretary has been appointed to such controversy. As Britain’s consul-general in New York in 2016-17, she faced allegations of bullying and improper use of expenses. A Cabinet Office inquiry found “no case to answer”, but Sir Simon McDonald, a former head of the Foreign Office, attempted to nix the appointment, declaring that if she were the candidate, “the due diligence has some way still to go.” Her supporters and critics agree that she is adept at embracing her ministers’ agendas, and willing to be abrasive in pur- suit of them. The dispute is whether that approach is counterproductive, or the medicine Whitehall needs. It is a gamble the prime minister is will- ing to take. His administration is stalling. He complains that institutional “levers” are unresponsive; policies are agreed on and then left to drift. On February 12th he ousted Sir Chris Wormald, a low-profile figure, as Britain’s most senior civil servant after little over a year into a tenure that once might have lasted closer to a decade. Dame Antonia, by contrast, promises (in item four of her memo) to inject “energetic, visible leadership”. She echoes Sir Keir’s enthusiasm for technology to transform Whitehall: in her new office a copy of “The Thinking Machine”, a profile of the chip- maker Nvidia by Stephen Witt, is found alongside the works of Peter Hennessy, a historian of Whitehall. Critics raise two doubts. The first is that, for all Sir Keir’s vague talk of “rewir- ing the state”, he has struggled to define what that means in either theory or prac- tice. The state’s size and function are in- herently political questions that only he can answer. Running the old system hotter may not be enough. The second is that getting stuff done is Britain’s new cabinet secretary wants to “get stuff done” C002 -- 48 of 80 -- 49 The Economist February 28th 2026 Britain ▸ only one part of the job of cabinet secre- tary. They are also the steward of a 550,000-strong civil service and the prime minister’s most senior adviser. The role combines two frictional ideas of the civil service: that it is there to serve ministers, but also to speak “truth to power” in the national interest. Critics question whether Dame Antonia is sufficiently candid with her bosses: the biggest disaster of her ca- reer, the botched privatisation of the pro- bation service, saw the scheme driven through clear warnings that it might fail. More delicate matters now await: re- moving Andrew Mountbatten-Windsor from the royal line of succession and the release of thousands of papers relating to Peter Mandelson, a former ambassador. One Whitehall-watcher summarises the test: “She totally gets on ministers’ agenda. Does she give them solid advice?” Her supporters argue that she has a knack for turning politicians’ vague aspira- tions into enumerated plans and following them up ruthlessly. “It is not a comfortable existence for people who are ‘talkers’,” says one fan. “She will make sure things happen and people are on the hook for making them happen.” Others are more sceptical of her record of delivery, and whether that scepticism is borne out matters. It is not merely that if she fails in “getting stuff done”, Sir Keir is unlikely to be re-elected. Something bigger is at stake: the legitimacy of Britain’s 170- year-old model of a permanent, apolitical civil service. Politicians across the spec- trum doubt its capability; Reform UK, a populist-right party, promises a DOGE- style purge. It is a moment of acute jeopar- dy. If Dame Antonia falls short, rather than being followed by a softly spoken member of the old guard, her successor could well be an outsider wielding a chainsaw. ■ Wherefore he chose Romeo Special educational needs The right way to do welfare reform AS ANNOUNCEMENTS GO, it was un- derstated. Much of the white paper had already been trailed before the educa- tion secretary, Bridget Phillipson, set out her plans for England’s schools on Febru- ary 23rd. Even so, the launch—at a school assembly in Peterborough—marked a sig- nificant moment. The paper promises more use of AI in schools, increased fund- ing for poorer pupils and reforms to how schools are run, but these barely featured in her speech. The defining question in English education today is how to support children with special educational needs and disabilities, or SEND. It may also prove to be the one area of reform which shows how Labour should, and could, govern. More than 1.7m children in England, about one in five pupils, have some form of SEND. Their needs range from difficulties with communication and learning to phys- ical disabilities, sensory impairments and mental-health conditions. Over the past decade the services meant to support them, including teaching assistants and speech-and-language therapists, have been cut back. Increasingly, the only way for parents to secure help for their child is by getting them approved for an educa- tion, health and care plan (EHCP), which comes with a legal right to generous fund- ing. The number of children with EHCPs has doubled since 2015 to nearly 500,000. The result is a system that incentivises conflict. Schools and parents are pushed to battle for EHCPs to unlock even basic help, inverting a system that was designed to re- serve such plans for children with the most severe needs. Cash-strapped local authori- ties, which fund the plans, have incentives to resist them and to throw up barriers. Meanwhile the costs of this flawed model have continued to spiral. Councils are pro- jected to spend £14.8bn ($20bn) on SEND in 2025-26, triple what they did in 2015-16. Labour has, uncharacteristically, decid- ed to confront the growing crisis. From 2030 EHCPs will be reserved for children with the most complex needs alone. Two additional, lower tiers of support plans for children with less severe needs will replace the all-or-nothing model. These plans will still carry legal force and require schools to make reasonable adjustments, such as pro- viding laptops for children with dyslexia or sessions with specialists. As part of the overhaul, the government has pledged to earmark £4bn over three years to help mainstream schools cater better to chil- dren with special needs. Another pledge is to create 50,000 new places in special state schools. That should reduce reliance on private special schools for children whose EHCP requires them to receive non-mainstream education. A priv- ate special-school place currently costs, on average, two-and-a-half times as much as a state-funded one, according to the Insti- tute for Fiscal Studies, a think-tank. Not everyone is persuaded. Teachers’ unions worry that £4bn is insufficient to make up for years of cuts. And while fund- ing for extra specialists is welcome, it’s un- clear where these extra hands will come from, given staff shortages. Some parents, especially of children who struggled in mainstream schools, are wary of a renewed push for inclusion, having been let down before. In her speech Ms Phillipson tried to reassure them. “Parents, please hear me,” she said, insisting that the reforms were about improving, not removing support. Cynics will also point out that the main reforms will not begin until 2030. Such a foot-dragging timetable has echoes of La- bour’s approach to adult social care, where it has ducked and postponed difficult de- cisions. For Avnee Morjaria of IPPR, anoth- er think-tank, such comparisons are unfair: unlike adult social care, it’s not the deci- sion that has been kicked long, just the im- plementation: “I don’t think there’s a way of doing it faster.” Given how fiercely par- ents fought for their children’s rights, a successful transition would always require a phased introduction of the new system while gradually winding down the old one. The Labour government has balanced these considerations carefully and shown surprising political deftness, compared with its previous flat-footed attempts at re- forms. Last year it was forced into a humili- ating and damaging retreat over welfare re- form, when its own backbenchers accused ministers of sacrificing the most vulner- able to fix the public finances. Given the sensitivity of SEND, and the weakness of the prime minister, Sir Keir Starmer, many feared a repeat. This time, however, the party looks more united. In part, this is because the issue doesn’t divide MPs along clear left-right lines in the way that the government’s rhetoric around “benefit scroungers” did. But min- isters also seem to have learned from the welfare debacle. They delayed the SEND reforms to consult with parents, charities and think-tanks (and then leaked them). Ms Phillipson and Georgia Gould, a junior minister, spent hours with sceptical MPs. A broader backlash could still come, as could legal challenges. But for now, this mix of broad consultation, public candour, and longer-term planning suggests that Labour may have finally discovered how to govern in a more constructive way. ■ Labour’s handling of a notoriously tricky issue offers hope C002 -- 49 of 80 -- 50 The Economist February 28th 2026 Britain The paranoid style in British politics THE fiRST golden age of paranoia came in the 1970s. It was a decade in which everyone in Britain from the prime minister down believed malign forces were at work. Harold Wilson, the former prime minister, was by turns a KGB plant or a soon-to-be victim of a secret-service coup, depending on who was asked. Re- actionary colonels plotted while revolutionary sects marched through trade unions. Enemies were within and without, above and below. A second golden age of paranoia is happening right now. Al- most half of British voters believe that the statement “a secret group of people is responsible for making all major world deci- sions, such as going to war” is definitely or probably true, points out More In Common, a pollster. From left to right, rich to poor, almost every Briton will at some point reach for a complicated, conspiratorial explanation when a simpler and more likely one is at hand. The “paranoid style”, as it was dubbed by Richard Hof- stadter, an American historian, is back in fashion. Settle in for a focus group in one of Britain’s fading towns to see how. Corruption has become the guiding frame for how peo- ple interpret politics, says Sacha Hilhorst of the London School of Economics, who spent years researching Mansfield, a former min- ing town in Nottinghamshire. How else to explain why a once- prosperous town is on its uppers? Politicians are “on the take”, “lining their pockets”, “on that game”. Covid? A means to privatise the NHS. Those football pitches in town that were turned into houses? Someone must be benefiting. Corruption talk has become so common, it is akin to the weather, an uncontroversial ice-break- er. Bonds of class replaced by the shared experience of being vic- tims of a thieving, corrupt elite. If paranoia blights the “left-behind”, it also stalks the “well- ahead”. When Middle England rebelled against Britain’s vote to leave the EU, it opted for the wildest explanations—bot networks and Russian interference—rather than a broadly Eurosceptic country taking the chance to leave the European club when it was offered. Conspiratorial thinking ran through the “Follow Back Pro-EU” movement, points out Morgan Jones, the author of “No Second Chances”, an entertaining history of the campaign for a second referendum. At the height of the Brexit farrago, the queen appeared wearing blue and yellow headwear. It was seized on by believers as a symbol of the monarch’s opposition to leaving the EU. A rich, well-educated slice of England sincerely believed that Elizabeth II was communicating to them through a hat. Paranoia permeates Britain’s elites. Josh Simons, a Labour min- ister in the Cabinet Office, was in charge of Labour Together, a Sir Keir Starmer-supporting think-tank, when the Sunday Times found out it had not declared £730,000 ($907,000) in donations. The future minister paid £36,000 to APCO, a reputation-manage- ment company, to investigate how the story came about. The think-tank sent its findings to the National Cyber Security Centre (NCSC), arguing it was the victim of a Russian hack. Other ave- nues, such as the idea that it was bog-standard leaks from within a movement prone to blood feuds, were overlooked. The NCSC did not open an investigation. If it was the Russkies, Britain’s security services are surprisingly unbothered. At this point, it is normal to begin a lament; to decry how soci- ety’s bonds have frayed and that the borders of reality have blurred. True, Britain has become a land where people lunch alone, staring at a phone full of people who agree with whatever they think, however mad it may be. Perhaps it was only now-shat- tered taboos that kept people’s wackier thoughts in their heads. In this way, paranoid people are to be pitied. “We are all sufferers from history, but the paranoid is a double sufferer, since he is af- flicted not only by the real world, with the rest of us, but by his fantasies as well,” wrote Hofstadter in his essay. Paranoia has its uses. To be paranoid is to be “a member of the avant-garde who is capable of perceiving the conspiracy before it is fully obvious to an as yet unaroused public”, argued Hofstadter. He meant it almost sarcastically. In the case of Peter Mandelson, it becomes complimentary. A combination of left-wing internet posters and the Financial Times repeatedly asked why Lord Man- delson had maintained a long and affectionate relationship with Jeffrey Epstein, the billionaire financier and child-sex offender. The batch of emails that finished off the peer was merely a spark on kindling piled high by Britain’s main business newspaper and people with screenshots from “The Simpsons” as their profile pic- ture. When people did clock the scandal, they were livid. People think I’m insane because I am frowning all the time Better to think of paranoia as a necessary symptom, or part of an immune system kicking into action. In “Strange Days Indeed”, a tremendous history of the conspiracy-addled 1970s, Francis Wheen argued that the paranoid style was “not a constant but an episodic phenomenon which coincides with social conflict and apprehensions of doom”. During the 1970s, Britain was riven by tales of treason and plot because an old order was dying and the fight to forge a new one was afoot. The country is groping its way towards a new settlement today. It is messy and mad. Paranoia is a consequence of living through an age of consequence. After all, the opposite of paranoia is not cool-headed analysis but apathy. Anyone who thinks Russia is behind all Britain’s ills is deranged; anyone who thinks it is behind none is a fool. Britain’s departure from the EU was so needlessly idiotic, it is little wonder people constantly rake over its cause. Voters are right to demand an explanation for why the public realm is so degraded, rather than accept it. Apathy is something Britain cannot afford. Para- noia is what it costs to care. ■ BAGEHOT It has its uses C002 -- 50 of 80 -- 51 The Economist February 28th 2026 International Muslim opinion Who speaks for the Islamic world? WHETHER SPEAKING to a small group or a mass rally, Recep Tayyip Erdo- gan, Turkey’s president, often appears to have a bigger audience in mind than the people right in front of him. A talk he gave in mid-February, on the eve of Ramadan, the Muslim holy month, seemed addressed in parts not to the 80 provincial governors who had convened at his palace in Ankara, but to the world’s nearly 2bn Muslims. “May the umma not be crushed by the divi- sions that have lasted for ages,” he said, re- ferring to the global community of Mus- lims. “If only we cling tightly to our broth- erhood, to our brothers, to our faith and to our dreams, then, by the permission of Al- lah, there will be no trap we cannot break.” The umma has no spokesperson. Since the death of the Prophet Muhammad in 632, the Muslim world has not had an un- disputed leader or paramount religious au- thority. Like Buddhism or Christianity, it is divided not only into many nationalities, but also many sects. Most Muslims do not share a common language, even though many learn the Koran in Arabic. Mr Erdo- gan was speaking Turkish—a language un- derstood by only a small sliver of Muslims. The idea that an “imagined Muslim pub- lic” is clamouring for someone to speak on its behalf is a fiction, says Cemil Aydin of the University of North Carolina. Testing, testing Yet a few politicians seem to be audition- ing for the job. Mr Erdogan has gained a following abroad, and appealed to devout voters at home, by taking up the cause of downtrodden Muslims around the world. Iran’s supreme leader, Ayatollah Ali Kha- menei, goes further, casting himself as a leader of resistance to the oppression of Muslims. Others, such as Muhammad bin Salman, Saudi Arabia’s crown prince, em- phasise modernity and moderation, rather than religious zeal. All have their follow- ings—and their detractors. But new survey data from Arab Barometer, a research net- work, and other polling, suggest that Mr Erdogan’s approach is the most appealing to Muslims around the world. Mr Khamenei often casts today’s strug- gles in sacred hues. As an American arma- da massed off Iran’s shores, he wore a ring to a scriptural study group inscribed with a Koranic verse recalling Moses’s delive- rance from the mighty Pharaoh and the drowning of the vast and godless Egyptian army in the Red Sea. But Mr Khamenei, a Shia, has relatively little influence among Sunnis, who make up between 85% and 90% of the world’s Muslims. What is more, the Iranian regime’s frequent, violent re- pression of protests at home has dimin- ished his appeal. Even fellow Shias, in countries like Lebanon and Iraq, seem to be cooling on the ageing ayatollah. Some Sunnis see Ahmed al-Sharaa, Syr- ia’s rebel-leader-turned-president, as a more credible defender of their faith. He led an Islamist insurgency against the largely secular regime of Bashar al-Assad, so his religious convictions are not in doubt. In fact, by overthrowing a regime ANKARA AND ISLAMABAD There are many contenders, but Turkey’s president leads the pack → ALSO IN THIS SECTION 53 The Telegram: A bet on hope ⏩ C002 -- 51 of 80 -- 52 The Economist February 28th 2026 International ▸ backed by Shia Iran and by defeating mili- tias representing minority sects such as Alawites and Druze, Mr Sharaa has de- lighted many in Syria’s Sunni majority. Lots of Sunnis in Lebanon and Iraq, who worry their Shia compatriots will sideline them politically, are also thrilled by his success. According to unpublished recent polling, Mr Sharaa commands broad sup- port in Jordan and Saudi Arabia as well. Mr Sharaa’s youth, his natty dress sense and his unusual mix of Islamism and prag- matism may all be bolstering his populari- ty. So, too, may his novelty. But the near- impossible task of patching up a physically devastated and politically divided country on a shoestring budget may quickly sully his reputation. Prince Muhammad is also a young lead- er presiding over rapid change—with vast- ly greater resources. Although he is reviled by many Westerners for his role in the mur- der of a Saudi journalist, he is a much more popular figure around the Muslim world. Fully 87% of Syrians, 68% of Moroccans and 58% of Jordanians have a positive opinion of the his role in the region, ac- cording to Arab Barometer (see chart). Of the 12 world leaders the Lowy Institute, an Australian think-tank, asked Indonesians about in 2021, he was the most popular, with 57% of respondents expressing confi- dence that he would “do the right thing” in world affairs. More sporty than spiritual Prince Muhammad does not spend much time talking about religion. Unlike previ- ous Saudi rulers who trumpeted their role as custodians of Mecca and Medina, the two holiest sites in Islam, he shows little interest in religious or moral leadership. He never claims to speak for the umma, an- alysts say, or to pose as the champion of oppressed Muslims. He is popular within Saudi Arabia for loosening religious stric- tures and promoting secular pastimes such as music and sport. On the bombing and blockade of Gaza, an emotive topic throughout the Muslim world, the prince has been extremely cir- cumspect, trying not to whip up public opinion in Saudi Arabia or elsewhere. “When he engages religion, it’s more in the vein of emphasising the importance of moderation and pluralism and coexis- tence,” says Peter Mandaville, author of “The Geopolitics of Religious Soft Power”. “But in terms of his global profile, he is more excited about things like venture capital, innovation and glitzy conferences.” Mr Erdogan, in contrast, seldom passes up an opportunity to denounce Israel’s conduct in Gaza. His government has is- sued arrest warrants for much of Israel’s cabinet on charges of genocide and crimes against humanity. He was similarly out- spoken in his support for the Arab spring in 2011. Indeed, that is when his popularity in the Arab world appears to have peaked, although it remains high. Arab Barometer’s data suggest that Mr Erdogan has long been the most popular leader in the Middle East. He also seems to be well-liked in other parts of the Muslim world, although the polling is thinner. A survey by Gallup in 2017 put Mr Erdogan’s net favourability in Indonesia and Paki- stan, the two most populous of the world’s roughly 50 Muslim-majority countries, at +45 and +27, respectively. Support for Mr Erdogan is also widespread in the Turkic world, which stretches from Azerbaijan to Xinjiang, in western China, and among Muslims in Europe, including the 4m or so people of Turkish origin living in France, Germany, and the Netherlands. When Mr Erdogan visited Pakistan in 2020, its prime minister at the time, Imran Khan, quipped that Mr Erdogan was so popular there he could “clean sweep” a Pakistani election. Mr Assad, the blood- thirsty Syrian despot Mr Sharaa recently overthrew, is said to have once joked that Mr Erdogan was more popular in Syria than he was—a statement that was almost certainly true. At first blush, Mr Erdogan’s popularity is surprising. Turkey is a secular state and its president has no religious authority, al- though Mr Erdogan has made a career of opposing doctrinaire secularism and championing Turkey’s pious heartlanders over its urban elite. What is more, his re- cord is chequered: he has hollowed out Turkey’s democracy, locking up political opponents, cowing the media and purging the bureaucracy and armed forces of sus- pected enemies. He has also mismanaged the economy, presiding first over runaway inflation and now over punishing interest rates intended to curb it. His popularity within Turkey has been waning. Mr Erdogan’s foreign admirers are ap- parently willing to overlook his misguided policies and growing authoritarianism. Much of their admiration may in fact stem from the perception of Turkey as a prospe- rous democracy with close ties to Europe—all qualities that Mr Erdogan has undermined, notes Gonul Tol of the Mid- dle East Institute, an American think-tank. Travelling salesman Yet there is also substance to Mr Erdogan’s appeal. His longevity in office (he has run Turkey for over 20 years, first as prime min- ister and then as president) has given him the opportunity to visit almost every Mus- lim-majority country, including war-torn places like Afghanistan. When he went to Mogadishu, the capital of Somalia, in 2011, he was the first leader from outside Africa to visit in nearly 20 years. Even minuscule spots like Brunei and Kosovo have not been forgotten. It presumably helps that Turkish firms are big investors in much of Africa and Central Asia, among other plac- es. Mogadishu teems with Turkish aid workers, businesspeople, and teachers. Mr Erdogan is willing not just to show up, but also to take up causes dear to these places, positioning himself as a spokesman for the Muslim world’s grievances. On that visit to Somalia, he called for more to be done to relieve a deadly famine. While in Pakistan (and on several subsequent ap- pearances at the UN) he criticised India for its conduct in Kashmir, a territory divided between India and Pakistan. In much the same vein, he has inveighed against Isla- mophobia in Europe, the persecution of the Rohingya in Myanmar and China’s mistreatment of its Uyghur minority. “He is seen as a strong and brave leader, stand- ing up to the West, and speaking on issues close to Muslims,” says Mushahid Hussain, a former Pakistani senator. Mr Erdogan cultivates this image, regu- larly claiming to speak on behalf of Mus- lims everywhere. “In a multipolar world, the Muslim world needs to become a pole in its own right,” he proclaimed at a meet- ing of the Organisation of Islamic Co-op- eration last year. “Our biggest problem is lack of unity.” Mr Erdogan is not exactly a unifier. His government has stoked conflicts all over the Middle East, from Libya to Iraq. But it has also made grand gestures of solidarity, most notably by taking in more than 3m Syrian refugees (not all of them Muslim) during that country’s long civil war. An im- pressive 69% of Syrians have a positive opinion of Mr Erdogan. More recently Tur- key has mooted a defence agreement with Pakistan and Saudi Arabia, which pundits describe as a “Muslim NATO”. Other leaders, such as Mr Sharaa, may come to rival Mr Erdogan’s popularity. Tur- key’s troubles may end up tarnishing his reputation. But as flawed as Mr Erdogan is, he, more than anyone, has the ear of the Muslim world. ■ Dearly beloved Views of Muslim leaders’ foreign policies, 2025, % responding good* Source: Arab Barometer *Rated “very good” or “good” Lebanon Iraq Palestine Tunisia Syria Jordan Morocco 100 80 60 40 20 0 Ayatollah Ali Khamenei (Iran) Muhammad bin Salman (Saudi Arabia) Recep Tayyip Erdogan (Turkey) (Turkey) (T C002 -- 52 of 80 -- 53 The Economist February 28th 2026 International The Stubb plan to save the world IF A BOAT carrying heads of state ever sank in a tempest, staying close to President Alexander Stubb of Finland would be a shrewd move. Mr Stubb has shipwreck survivor written all over him. He is tall, lithe and dauntingly fit, coming second for his age group after secretly entering a Finnish triathlon last summer. As important, Mr Stubb, 57, has built his political career around can- do optimism and a refusal to panic. In these troubled times, his fellow world leaders have noticed, and approve. Though his Nordic country has just 5.6m people, this unflap- pable Finn is a fixture at crisis summits of Western leaders. Presi- dent Donald Trump is a texting buddy, hailing Mr Stubb for his golfing skills and for “powerful” good looks. When leaders of mid- size countries lament a world dominated by America, China, Rus- sia and other bullies, Mr Stubb stands out for insisting that middle powers can look after themselves. This confidence was on display at the World Economic Forum in Davos. After Canada’s prime minister, Mark Carney, blamed America and other great powers for a “rupture” in the post-1945 order, Mr Stubb took a more up- beat line. He declared that Europe could “unequivocally” defend itself against Russian aggression, with the confidence of a man whose homeland twice fought off Stalin’s armies. He expressed confidence that ties of mutual dependence still bind America and Europe, despite Trump-administration “curveballs”. In part, fizzing with positive energy is Mr Stubb’s political brand. This columnist has watched the Finn professionally for 20 years, since Mr Stubb was first elected a member of the European Parliament. In a Euro-legislature filled with has-beens and medi- ocrities, Mr Stubb stood out for his brains, his ambition and his genius for self-promotion. An undergraduate education in South Carolina, initially on a golf scholarship, left him a devoted Atlanti- cist as well as a devotee of European integration: a rare combina- tion. In between cultivating Brussels power players, hyperactive Mr Stubb dashed off a regular column in English for Finnair’s in- flight magazine, judging passengers on Finland’s national airline to be an influential and captive audience. Columns might opine on lessons that Europe could learn from America, or on the eti- quette of nudity in saunas. Each was adorned with a photograph of Mr Stubb, variously doing one-handed push-ups, practising his golf swing or tossing golden leaves to celebrate autumn. His Fin- nair columns continued even after he left Brussels to become his country’s foreign minister and then prime minister. Mr Stubb’s refusal to despair also reflects a sincere philosophy. In writings and interviews he has long sounded sure that it is pos- sible to reason with most people, including foreign leaders, most of the time, by appealing to their rational self-interest. This year he published “The Triangle of Power: Rebalancing the New World Order”. In this book-length manifesto he sets out his plan for agreeing on a new international order which can accommodate the clashing values and shared interests of three competing blocs. These consist of a Global West of liberal democracies led by America, a Global East of autocracies led by China and Russia, and the largest bloc, a Global South of countries that are weary of being lectured by European and other rich-world powers. Mr Stubb’s solution involves listening more to African, Asian, Latin American and Middle Eastern countries which, he says, hold the global balance of power. He would give such countries seats at the top tables of global governance, starting with the UN Security Council, whose five permanent members he would dou- ble while ending single-nation vetoes. He would stress trade over aid. He suggests that Finland, a country that never had colonies, may find it easier than some Western powers to earn a hearing. The Stubb plan emphasises understanding how even the most alarming foreign leaders see the world. He chides Western com- mentators for calling Russia’s president, Vladimir Putin, “crazy”. Recalling his own meetings with the Russian, he calls Mr Putin “well prepared, analytical, strategic and composed”. At the same time, Mr Stubb, a staunch defender of Ukraine, agrees that Mr Pu- tin’s imperial ambitions make it folly to trust him. Three meetings with China’s Communist Party boss, Xi Jin- ping, have left Mr Stubb oddly confident that China is led by men who lack the history-fuelled revisionist zeal of Russia’s rulers. He predicts that China will reassess its friendship after peace comes to Ukraine, and, noting the high costs of Mr Putin’s “senseless” war, will rethink any ambitions to take Taiwan by force. Hope is not a strategy In an interview for “Inside Geopolitics”, a video show published by The Economist, Mr Stubb concedes that his strategy reflects “a lit- tle bit of hope” that foreign leaders “will be reasonable”. He canni- ly downplays his influence on Mr Trump. He calls America’s presi- dent a man guided by a bleakly zero-sum worldview, who some- times listens to Mr Stubb’s warnings about Russia. “If I can plant one idea out of ten, that’s good.” Since completing his book, he has become less sure that America is ready to lead a united West. Revealingly, Mr Stubb’s optimism is linked to a conviction that today’s disruptions are temporary. “I think it’ll take another five years for the world order to settle,” he suggests. “In the middle of the storm we just have to stay calm.” In a shipwreck, those are words of comfort. Storms do end and blue skies return. Yet today’s disorder looks more enduring than a squall. There is reason to fear that a full-blown revolution is coming, targeting the liberal order whose fundamental values Mr Stubb seeks to preserve. If rising powers are more resentful or fanatical than he believes, the future he describes will not arrive. In anxious times, it is no wonder that Finland’s thoughtful, stay-calm president has earned global re- nown. But his plan is a bet on hope, not a guarantee of survival. ■ THE TELEGRAM Alas, not every foreign leader is as reasonable as Finland’s President Alexander Stubb C002 -- 53 of 80 -- 54 The Economist February 28th 2026 Business Private equity Barbarians at the nail salon THE DAY starts in one of the loud, dark studios run by Solidcore, a Pilates- inspired fitness chain. Your correspondent, balancing on top of a sliding platform, dut- ifully performs plank holds and cross- legged lunges as her energetic instructor cheers her on. Having worked up an appe- tite, she heads to Maman, a chic, French- style eatery. Next comes a facial at Hey- Dey, where a beautician beams light across this correspondent’s face in order to give her skin a more youthful glow. As e-commerce gobbles up a growing share of consumer spending on goods, service businesses such as these have been taking over America’s shopping streets and strip malls. Customers working remotely visit them to break up their day with a workout or a coffee. Because they spend more time at home, they are also investing in their property’s upkeep, spending more on landscapers and the like. Technology underlies these trends: the internet has made online shopping and remote work possible. But it is not the only force trans- forming small business in America. Each outlet this reporter visited, on the shop- ping street closest to her house, is owned by a private-equity (PE) firm. When many think of PE, they think of takeovers of big companies such as RJR Nabisco, a consumer-goods conglomerate, in the 1980s or Toys “R” Us, a retail stal- wart, in the 2000s. But such mega-deals now reflect only a small part of what the industry does. Today 85% of PE invest- ments are in firms with fewer than 500 staff. Over the past few years the industry has been hoovering up small service-prov- iders, from coffee shops and nail salons to pest controllers. In 2016 PE firms owned two of America’s ten biggest car-wash chains. They now own all ten. In the year to June 2025, PE accounted for half of all acq- uisitions of air-conditioning contractors. Local service-providers are attractive to PE because they are largely internet-proof. “Amazon can’t wash your car, they can’t work out for you, they can’t deliver your coffee,” says Scott Romanoff of Franchise Equity Partners, a PE firm. Often a handful of such businesses are acquired and merged into a chain. Some may find this alarming. The cari- cature of PE is that it loads companies with debt and sacks staff indiscriminately, res- ulting in juicy short-term profits but dete- riorating service and, in the most egre- gious cases, failure of the business. Its app- roach is to “suck money out of [a company] until it collapses”, Elizabeth Warren, a sen- ator, declared in a video posted online in November. Few ideas unite Gavin New- som, governor of California, and President Donald Trump—but taking PE down a peg WASHINGTON, DC PE is taking over America’s small businesses. Consumers should rejoice → ALSO IN THIS SECTION 55 The Sphere goes global 56 China’s mining star 57 Fake meat in trouble 58 The war on PDFs 58 Anthropic v the Pentagon 59 Bartleby: The magic of Tony Robbins 60 Schumpeter: CEO-councilmen ⏩ C002 -- 54 of 80 -- 55 The Economist February 28th 2026 Business ▸ ⏩ is one of them. In January both proposed measures to ban the industry from pur- chasing single-family homes. PE investors are not saints; there are plenty of examples of portfolio companies being gutted by their owners in pursuit of a quick buck. Yet to believe that, by and large, the industry is a poor steward of the businesses it acquires is to misunderstand the strategy of investors who rely on being able to sell their portfolio companies after a few years in order to return money to their backers. Those they sell to—a larger company, investors in public markets or another PE fund—are hardly fools. Indeed, many small businesses will emerge from PE ownership as bigger, more profitable firms that do better by their customers. Nobody doubts PE’s penchant for bor- rowing and its willingness to wield the axe. Yet it is difficult to find compelling evid- ence of widespread ill effects. Perhaps more than 20,000 American businesses are owned by PE. Of these, just 75 went bank- rupt in 2024, according to the Private Equity Stakeholder Project, a non-profit watchdog. The most rigorous studies find that, even with more debt, PE-backed firms are no more likely to default than others. Academics have examined whether PE undermines businesses in more insidious ways without causing outright collapse. A 2021 paper by Atul Gupta of the Wharton School of the University of Pennsylvania and his co-authors looked at the impact of PE ownership on nursing homes. Patients admitted to them are not a healthy bunch: on average, one in six will die in the facility or within three months of discharge. But Mr Gupta and his co-authors found that, for patients covered by Medicare, a govern- ment programme for the elderly, the chance of death in the short term was 11% higher if the nursing home they went to was owned by PE. The higher mortality risk appeared to occur as a result of cuts to nursing staff, which increased the risk of injuries, pressure sores—and death. Yet the case is not closed. A paper from last year by Ashvin Gandhi of the Universi- ty of California and his co-authors shows the importance of competition in shaping how PE owners behave in the nursing- home industry. In less competitive markets they found similar effects to Mr Gupta, but in highly competitive markets PE-backed homes were likely to have higher staffing ratios and better ratings than others. Caution over PE’s incursion into the care sector is understandable. PE firms now run at least 5% of America’s nursing homes, offer around 10% of available plac- es in child-care centres and own about 12% of dental surgeries. The care sector is rife with information asymmetries that un- scrupulous PE bosses could exploit. Youngsters at child-care centres and resi- dents of nursing homes are often unable to communicate anything about the quality of their care. And even lucid adults are rarely in a position to determine whether they need a costly MRI scan or root canal. But customers have less reason to worry at Pilates studios or smoothie bars; those unhappy with their instructor or their açai bowl can go elsewhere. In some cases, the financial firepower provided by a PE backer may be just what a small business needs to thrive, especially when it is trying to compete against big incumbents. A 2009 paper by Alexander Popov of the European Central Bank and Peter Roosenboom of the Erasmus Univer- sity of Rotterdam concluded that the rate of new business formation in industries with steep barriers to entry is significantly higher in countries with more PE invest- ment relative to GDP. Carried up The experience of Solidcore shows how PE ownership can transform a small business for the better. Bryan Myers, its boss, says he knows that “private equity gets a bad rap,” but he points out that Solidcore would be a fraction of the size it is now without its backers (the chain is owned by L Catterton, a PE firm focused on consum- er industries). At the outset, Solidcore could grow only by reinvesting its profits, which meant opening around five studios a year. The rate more than doubled after it first took PE money in 2017. The other advantage Mr Myers points to is expertise. In 2021 Solidcore’s PE own- ers helped it to conduct a price-elasticity study, which showed that its memberships didn’t make sense “unless you were going to come here literally every day of the week”. So it reduced the price of a member- ship relative to paying for single classes. “It completely upended our business model,” says Mr Myers. Recurring membership fees now make up 60-70% of revenue, up from just 20% before the change. Solidcore’s staff share in its success. Coaches are paid a flat fee plus a percent- age of the revenue their classes gener- ate—a strategy intended to motivate train- ers. Senior coaches can reportedly make around $100 an hour if their class is full. The upheaval of retail landscapes over the past decade or so has required exten- sive adaptation. In America, where PE money is plentiful, investors have rushed to take advantage of the opportunity to replace goods retailers with service busi- nesses. The vacancy rate in American retail spaces is around 4%. Across Europe, where PE funding is less abundant, the figure has lingered higher for longer; in much of Brit- ain, vacancy rates are double or triple the level in America. Consumers may grumble about getting their lattes or facials from a business owned by PE. The alternative may be empty shopfronts. ■ Entertainment Going global WIND BLOWS, leaves whirl in the air and smoke fills the auditorium as Dorothy and Toto are whisked away by a giant tornado. The audience in the steeply banked 18,000-seat arena gasp and clap as the movie—Warner Bros’ “The Wizard of Oz”, remastered with the help of artificial intelligence—plays out on the 15,000- square-metre screen all around them. The Sphere, a monumental orb-shaped attrac- tion in Las Vegas, has quickly become the hottest ticket in Sin City. Now it is ramping up plans to go global. At first the giant ball looked like a giant balls-up. The Sphere was assembled over five long years that included the covid-19 pandemic. When it opened in September 2023, the final price tag for the building was $2.3bn, nearly double what its owner had originally predicted. What is more, steep operating costs meant that the losses kept piling higher. But earlier this month the attraction’s parent company, which is controlled by the Dolan family, delivered news that caused investors to cheer louder than the audience at “Oz”. In the final quarter of 2025, rev- enue for the Sphere shot up by 62% year on year; an operating loss of $108m in the same period in 2024 narrowed to $7m. The barnstorming quarter happened even though Las Vegas had a difficult year in 2025, with fewer tourists visiting the city. Investors are bullish: the share price of LAS VEGAS The Sphere is taking its success in Sin City to the rest of the world A whale of an investment C002 -- 55 of 80 -- 56 The Economist February 28th 2026 Business ▸ ⏩ Sphere Entertainment (which also owns a declining TV business) has nearly trebled since last summer. The futuristic building’s success rests in part on the rekindled charms of an 86- year-old film. “The Wizard of Oz”, souped up for the giant screen and aided with “4D” effects like vibrating seats, has sold more than 2.2m tickets since it opened in Aug- ust, generating $290m in revenue. Between live concerts by the Eagles, the Backstreet Boys and others, the Sphere has jammed in matinees and early-evening showings of “Oz”, putting on 245 screenings in the latest quarter, up from 190 performances of other shows a year earlier. The Sphere’s bosses are courting other movie rights- holders, hopeful that another big hit might draw even larger crowds. Making those shows is expensive: re- mastering “Oz” cost more than $100m. The costs would be easier to swallow if the res- ulting product could be shown in more places. Indeed, that is now the plan. A proposed Sphere in Abu Dhabi is nearing the end of its pre-construction phase. Last month the company announced a third Sphere, in National Harbor near Washing- ton, DC, due to open within four years. It has hinted at more announcements to come. Curry Baker of Guggenheim Part- ners, an investment firm, expects that another Sphere will be announced this year and one or two more in 2027. The cost of the whopping buildings remains problematic. Depreciation and amortisation gobbled up 30% of revenue for the Las Vegas Sphere in the final quar- ter of last year. One answer is a new financ- ing model. The Emirati Sphere will be funded entirely by the Abu Dhabi depart- ment of culture and tourism, which will pay a franchise fee and royalties to the Sphere’s parent company. The National Harbor Sphere is backed by $200m in pub- lic and private contributions. Another strategy is to downsize. The National Harbor Sphere will have a third of the capacity of the Las Vegas attraction, and is reportedly aiming to come in at less than half the cost. Littler, cheaper Spheres could make them viable in markets smaller than Las Vegas. Will more places want one? Hundred- metre-high globes wrapped in bright LED screens are exciting things to visit, but they are not everyone’s idea of a good neigh- bour. Two years ago the mayor of London rejected a proposed Sphere in the densely populated neighbourhood of Stratford in the city’s east, citing worries about light pollution. (The mayor of Tees Valley, northern England’s answer to Las Vegas, sportingly offered to host one instead, but was inexplicably snubbed.) “Oz” has made the Sphere a smash hit in Las Vegas. But new trials will await when it is not in Nevada any more. ■ Zijin Mining Blast off IN 1993 OFFICIALS in Shanghang county, in the south-eastern Chinese province of Fujian, enlisted Chen Jinghe, a geologist, to lead an effort to develop a local gold mine. So was born Zijin Mining. Mr Chen, who retired this year, would go on to turn the company he led into a global giant. Worth around $150bn today, it is the world’s fourth-most-valuable mining busi- ness. The soaring price of gold (of which it is the sixth-biggest producer) and copper (for which it ranks fifth) has led its market value to rocket upwards by 150% over the past year. Much of Zijin’s growth has taken place in the past decade, as the company has fol- lowed an ambitious strategy of global expansion. Its mining operations now span 18 countries across most parts of the world (see map). Between 2015 and 2025 it poured $26bn into capital expenditures and made $15bn-worth of acquisitions (see chart on next page). In January it announced its big- gest deal yet, to buy Allied Gold, a Canadi- an miner, for $4bn. Zijin has set itself the goal of ranking among the world’s top three producers of both copper (which accounts for two- thirds of the net value of its assets) and gold (which makes up a quarter) by 2028. To that end, in February it released a prod- uction plan to boost its output of the two minerals by as much as a half over the next three years, and expand its output of lithi- um more than ten-fold. The company has a solid record of hitting such targets. Execu- tives who have worked with the miner say that its operations are strikingly efficient. As Western policymakers seek to loosen China’s chokehold over various minerals, Zijin’s success illustrates how difficult their task will be. Zijin has “gone where others won’t go”, says James Whiteside of Wood Mackenzie, a consultancy. Even in 2016, when copper prices were at their lowest since the global financial crisis amid a commodity down- turn, the company was acquiring stakes in copper mines in the Democratic Republic of the Congo that others were selling off. As it bought up mines, Zijin often expand- ed their production several times over. Around half of its mining of both copper and gold now takes place outside China. It has helped that the quality of ore at its overseas sites has typically been higher than at home. The company has also expanded bey- ond just digging up dirt. It has built a vast refining and smelting business that gener- ates about a quarter of its operating profits. Many Western miners have shied away from these activities. Mineral processing is dirty, complex and typically not very prof- itable. Even when prices for minerals fall, operators must pay to keep their process- ing sites running because it is very expen- sive to switch them off and on again. For Zijin, however, its vertical integra- tion has paid off. Because the profitability of processing is tied to the quality of the ore being used, Zijin’s acquisition of top- The stunning rise of China’s most audacious miner China Russia Australia Papua New Papua New Papua New Papua New Papua New Guinea Guinea Guinea Guinea South Africa Eritrea Eritrea Eritrea Eritrea Ghana Ghana Serbia Serbia Serbia Serbia Serbia Serbia Serbia Argentina Peru Colombia Guyana Guyana Guyana Suriname D.R. Congo D.R. Congo D.R. Congo D.R. Congo D.R. Congo D.R. Congo D.R. Congo D.R. Congo D.R. Congo Mongolia Kazakhstan Tajikistan Tajikistan Tajikistan Tajikistan Tajikistan Kyrgyzstan Kyrgyzstan Kyrgyzstan Kyrgyzstan Kyrgyzstan Kyrgyzstan Kyrgyzstan Kyrgyzstan Copper Gold Other Lithium Not just a gold-digger Zijin Mining project locations, 2026 Source: Zijin Mining C002 -- 56 of 80 -- 57 The Economist February 28th 2026 Business ▸ grade mines around the world has made refining and smelting more lucrative for it than others. By constructing facilities at many of its overseas mines for the initial stages of processing, the company is also able to ship semi-processed rock back to China for further treatment, saving on transport costs. Zijin also processes cop- per and gold supplied by other miners, providing greater economies of scale. Many of the end products—typically cop- per cathodes and gold bars—are then sold by Zijin’s trading arm. Creating such a sprawling business has not been cheap. To fund its expansion, Zijin has had to borrow heavily. In 2010 the ratio of its debt to its assets was 21%; in the first half of 2025 the figure was 38%, far higher than for the big Western miners. To support further investments, in September the company consolidated its internation- al gold mines into a subsidiary and listed a roughly 15% stake in the unit in Hong Kong, raising HK$25bn ($3.2bn). Another challenge for the company has been managing its environmental impact. In 2010 a toxic leak from a wastewater pond at a mine in Fujian province contam- inated the nearby Ting River, damaging Zijin’s local reputation. More recently, villagers in Bor, Serbia, have complained of environmental damage caused by Zijin’s mine there (the company has denied the allegations). Such criticisms may eventual- ly lead politicians abroad to start resisting the company’s expansion. Moreover, Zijin has lately found itself in the geopolitical crossfire. The Chinese state does not hold a majority interest in Zijin, as it does in many of the country’s other big miners, but Shanghang county has maintained a sizeable stake, raising questions about the company’s indepen- dence. Last year it was added to the Amer- ican government’s “entity list” for allegedly benefiting from forced labour in China’s Xinjiang region (which the company has denied). That makes it difficult to do busi- ness with American firms. There is plenty, then, to keep Mr Chen’s successor busy. ■ Staking claims Zijin Mining, $bn Sources: FactSet; S&P Capital IQ *Estimate 10 8 6 4 2 0 25 20 15 2010 Completed acquisitions Capital expenditure * Food choices Much at steak THE PLANT-BASED burger once had investors licking their lips. In 2019 Beyond Meat, a maker of beef-free patties, went public at a market value of almost $4bn. The following year sales of plant- based meat in America surged by 45%, to $1.4bn. Countless startups joined the feast. Even some meat companies had a nibble at the business. More recently, however, investors have lost their appetite. Sales of plant-based meats are in decline. Beyond is now worth less than $400m. Its revenue shrank year on year in each of the first three quarters of 2025, and probably again in the final three months. The share of American adults who say they regularly eat the stuff has stayed in the single digits, according to polling by YouGov for The Economist. Meanwhile, meat sales are booming. What happened? Many in the industry argue that it is undergoing a correction, not a collapse. But they acknowledge several problems. One is price. Even as the cost of meat has soared, a result of shrinking herds and more expensive animal feed, it remains cheaper than plant-based imitations, thanks in part to farming subsidies. A pound of beef mince from Walmart, Amer- ica’s biggest grocer, sells for $7.43; an alter- native from Impossible Foods, a rival to Beyond, costs $9.04. Another is taste. Some plant-based meat is still “awful”, admits Mark Cuddi- gan, the boss of This, a British meat-free company. One bad experience can put a curious consumer off for good. Fake meat has also been embroiled in America’s culture war. Robert F. Kennedy junior, the health secretary, champions slogans such as “Eat Real Steak”. Interest in “whole” food is on the rise. Proponents of animal meat argue that the fake stuff is full of fat, salt and ultra-processed junk. Impossible acknowledges that some of its products contain more sodium than raw, unseasoned meat. Such a comparison “isn’t set on a level playing field”, it argues, as few people eat meat that way. The chewier problem for plant-based- meat companies is that their products are classified as ultra-processed foods, a result of their long ingredient lists and produc- tion processes. Health-conscious consum- ers are now wrongly equating plant-based burgers with potato chips and Oreos, arg- ues David Welch of Synthesis Capital, which invests in food tech. Enthusiasm for high-protein and high- fibre diets might prove friendlier to plant- based-meat companies. Peter McGuin- ness, Impossible’s boss, suggests that many of its products contain more of each than is found in animals. Both Impossible and Beyond now display their products’ protein content prominently on their pack- aging. Impossible recently partnered with a maker of protein-dense bread and pasta, while Beyond (which last year dropped the “Meat” from its name) has expanded into beverages, launching a flavoured sparkling water touting 20g of protein per can. Some companies are also experiment- ing with half-meat, half-plant burgers. Sceptics may ask who would want to eat such a product, but Tim Dale of Food Sys- tem Innovations, a research group, points out that potential customers include par- ents looking to sneak vegetables onto their children’s plates. Investors may now be warier of plant- based meat, but some are placing bets instead on the cultivated variety, grown in a lab from the cells of animals. Unhelpful- ly, a few American states have passed or proposed bans on the production and sale of cultivated meat, but insiders point to progress at the federal level. In Britain it has received clearance as pet food. Cultivated meat faces the familiar hur- dle of cost. But Nick Cooney of Lever, a venture-capital firm, reckons that whereas plant-based meat has been dogged by the perception “that it’s a ‘fake’ thing”, cultivat- ed products could find their way to super- markets’ meat aisles. Uma Valeti, boss of UPSIDE Foods, a cultivated-meat firm, sees the next decade as the time to prove that his industry can scale up, rather than rush to have “everything available all at once”. Move too fast, and the alternative-meat business may again end up in a stew. ■ NEW YORK The fake-meat industry is in trouble Bloodied C002 -- 57 of 80 -- 58 The Economist February 28th 2026 Business ⏩ WHEN ADOBE introduced the port- able document format (PDF) in 1993, a consultant from Gartner called it “the dumbest idea I’ve ever heard in my life”. Users would have to twiddle their thumbs waiting for the megabyte- sized files to download over their dial- up internet, then wait again for their PCs to render them. The software- maker’s board wanted to kill the pro- ject. But as sharing digital files became essential, the PDF triumphed—partic- ularly after the Internal Revenue Ser- vice, America’s tax authority, started using it for its forms. Today more than 2.5trn PDFs float in the ether. But will the format survive the AI revolution? PDFs still have drawbacks. They are a pain to view on a smartphone. Copy- ing data from them is fiddly. Software tools that read screens for blind people struggle with PDFs. The file type, which Adobe relinquished control over in 2008, is also a vehicle for malware: a fifth of email-based cyber-attacks utilise PDF attachments, according to Check Point, a cyber-security firm. Lately another source of criticism has emerged. The large language mod- els underpinning generative AI are often bamboozled by PDFs, reading a page set in columns from left to right rather than top to bottom, say, or get- ting confused by headers and footers. Trouble parsing PDFs is one of the reasons AI chatbots occasionally “hal- lucinate”, generating nonsense. Enter the disrupters. Startups such as Factify are on a mission to build a new file type that is better suited to the technology. Matan Gavish, its boss, talks of his “megalomaniac” vision of displacing the PDF. Yet Duff Johnson, head of the PDF Association, protector of the format, argues that the fault lies not in the file type but in ourselves. He contends that there is no reason developers cannot build bots that are able to use PDFs. The AI assistant embedded in Acrobat, Adobe’s PDF reader, is designed to do precisely that, notes Leonard Rosen- thol, the software firm’s PDF guru. Google, a leader in AI, has rolled out a tool for developers using its Gemini models that makes it easier to ingest PDFs. The format’s reign is not over yet. Software Attachment issues Will the PDF survive in the age of AI? AI on the battlefield Court-martialling Claude PETE HEGSETH, America’s secretary of war, is taking a my-way-or-the-highway approach to the use of artificial intelli- gence on the battlefield. On February 24th he gave an ultimatum to Anthropic, maker of the Claude family of models: if it did not agree to terms set by the Pentagon on us- age of its AI for military purposes, it would face severe penalties. It is not the first time this administration has picked a fight with a company that fails to follow its orders. But Anthropic has leverage. The showdown took place during a meeting at the Pentagon between Mr Heg- seth and Dario Amodei, Anthropic’s boss. Among AI labs, Anthropic was the first to do classified work for the Department of War (DoW), via a partnership with Palantir, a data firm, and Amazon Web Services, a cloud provider. But it also has clear red lines when it comes to the use of its models for national security. In negotiations with the DoW, it has insisted that Claude must be used neither for mass domestic surveil- lance nor for autonomous weapons. The restrictions have put it at logger- heads with Mr Hegseth, who has stipulat- ed that companies providing the Pentagon with AI models must give it carte blanche to do with them what it likes, provided the actions are lawful. At the latest meeting with Mr Amodei, Mr Hegseth vowed to ter- minate Anthropic’s contract by February 27th if the AI lab did not agree to his terms. A senior Pentagon official said that if Anthropic did not “get on board” with the DoW’s conditions, it would risk being lab- elled as a supply-chain risk, and that the government could invoke the Defence Production Act (DPA), which gives the president authority to oblige companies to do national-security work. Anthropic’s main contract with the DoW is worth no more than $200m, a trif- ling sum for a firm that generated an annu- alised $14bn of revenue in February. But it cannot take the stand-off lightly. Barring all of the Pentagon’s suppliers from using Claude would have a much bigger impact on the AI lab. It is a measure usually res- erved for companies linked to hostile pow- ers. As for the DPA, it has been invoked in recent emergencies such as the covid-19 pandemic, but is rarely brandished in such an adversarial way That the Pentagon is threatening such drastic measures, however, indicates its reliance on Anthropic. Dangling the DPA suggests that the DoW is reluctant to rip Claude out of its systems. That is because Anthropic’s model is seen as one of the best available, according to former defence officials with ties to Silicon Valley. Could the stand-off create an opening for rival labs with fewer qualms? OpenAI, Anthropic’s nemesis, has been slower to seize the opportunity to work with the DoW. Its models are used by Microsoft, with which it was once joined at the hip, for highly classified defence work, but OpenAI is not a party to the contract. Some contestants in a competition to build voice-activated drone-swarming technolo- gy for the Pentagon are using the lab’s models, but again its involvement is indi- rect. Its only formal contracts with the DoW are for unclassified work, and the use of its models for national-security purpos- es is considered on a case-by-case basis. Fears of militarising AI run deep at both Anthropic and OpenAI. The pair are also alert to the risk of losing their brainy AI researchers, many of whom come from abroad and may not share the Trump administration’s ideology. By contrast, Elon Musk, who previously warned against “killer robots”, appears to have shed his compunctions. SpaceX, his rocket and satellite company, and xAI, his model-maker (with which SpaceX is merg- ing), are said to be competing together in the Pentagon contest to make drone- SAN FRANCISCO The Trump administration has gone to war with Anthropic War-fighter C002 -- 58 of 80 -- 59 The Economist February 28th 2026 Business ▸ IF YOU HAVE gone to church as a non- believer, or watched a tedious sport like cycling with people who are fanat- ical about it, you will know what it is like to be a cynic at a Tony Robbins event. You will be bored, but also fascinated. You will feel a bit superior, and also wonder whether you are the one who is missing the point. Mr Robbins is probably the most famous life coach on the planet. On a promise of helping people live “extraor- dinary lives”, he claims to have reached an audience of 100m over his 45-year career. His clients include Serena Wil- liams, Hugh Jackman and Marc Benioff. He writes books and hosts podcasts. He fills stadiums with immersive events, delivering motivational sermons while his followers whoop and do firewalks. And earlier this year, he threw open the virtual doors for a free, three-day online event called the “Time to Rise Summit”. It could also have been called “Time to Enter the Marketing Funnel”. In the days leading up to the event, registrants get emails telling them that just signing up has “set them apart as a leader”. That was easy, you think. The clock is count- ing down to what will be a launchpad to “unstoppable growth and transform- ation”. Blimey, you think. And for just a small fee you can join the Gold Card Experience, which, among other things, promises you access to an “intimate” Zoom channel with no more than 1,000 other people. Unstoppable growth and transformation is probably enough for now, you think. On the first day, you join a YouTube channel where tens of thousands of people are already online and waiting for the event to start. The screen shows inspirational messages like “Discover the Adventure that Comes from Becoming More Every Day” and “You Don’t Rise To The Level of Your Goals, You Rise to the Level of Your Decisions”. Each word makes sense but as the sentence unfolds, you are less and less sure what it means. Your fellow participants have no such doubts. The chat window fills with mes- sages. “Let’s gooooo people,” “SUPER EXCITED” and “I still have no sound.” When the countdown ends, someone who has had far too much caffeine an- nounces that 1.2m people have signed up to attend. A personal trainer appears to conduct a couple of warm-up exercises. The camera cuts away occasionally to show devotees who are watching the event on Zoom; they are presumably Gold Card Experience members. People are frantical- ly jumping up and down in their living rooms. It’s totally baffling—like watching the Moonies do a HIIT session. And then, finally, the man himself is there. Mr Robbins may be 65 but his phys- icality is central to his appeal. He is excep- tionally tall. He works out and wants you to know it. His teeth are like limestone cliffs. His voice rasps and his veins bulge. He seems to be a product of deep geo- logical time: the megalosaurus of moti- vation. The chat window is a sea of emojis. “i love u tony!!!” says someone. “I want to change everything,” says anoth- er, which seems a little unfocused. And then he’s off and running, growl- ing into the camera. He tells anecdotes that he has plainly told many times before, including how he cured a woman of her phobia of snakes in ten minutes. He talks about pattern recognition and the hero’s journey and testosterone surges and the lessons of the Wizard of Oz. He says things like “Someday leads to a town called nowhere,” and “If you want to take the island, burn the boats.” There is even a deeply unconvincing soundtrack of cheering and applause. You shake your head as the chat window explodes with more heart emojis. Still, what Mr Robbins says matters far less than how he says it. He is genu- inely engaging. He often seems to be on the verge of tears when he tells his stor- ies. He acts as if the audience is right there with him, encouraging the watch- ing hordes to make some noise, clapping along weirdly as dance music blares, asking for shows of hands. He smiles as if he really means it. Above all, he keeps going and going. He talks for almost three hours straight on day one, and does the same thing again the next day and the day after that. And just when you think that must be it, an email arrives to say that Tony will be doing a fourth bonus day of rising. These displays of stamina strengthen the faith of disciples and raise a nagging question in your mind: if this is all nonsense, why is he so damned energetic and why do I feel so tired? You may not buy what Mr Robbins is selling. But you cannot deny that he sells it extremely well. BARTLEBY The megalosaurus of motivation Watching Tony Robbins, the world’s best-known life coach, do his thing swarming technology. Grok, xAI’s model, is “on board” for use in classified settings, says a Pentagon official. Google, having scrapped restrictions on the use of AI for defence purposes in 2024, is also taking on contracts for classi- fied and unclassified work with the Penta- gon. That is a striking reversal for the Silicon Valley giant. In 2018 it was forced to relinquish a Pentagon contract called Project Maven, which used machine learn- ing to analyse footage from drones, after an internal revolt at the company. Since the Project Maven days, the mood in Silicon Valley has become more pro- Pentagon. But that saga carried lessons for both sides that are worth remembering. For tech firms, it may be unrealistic to think that they can control how their tech- nologies are used on the battlefield. They can urge caution, but it is constitutional oversight of the armed forces that ulti- mately determines how wars are fought. And for the DoW’s part, demanding unfettered access to technologies with the potential for extreme lethality requires building a bedrock of trust. That can be eroded if these technologies are used for actions of dubious legality. Controversial decisions such as strikes against civilian drug-smuggling boats in the Caribbean have raised concerns in Silicon Valley about how autonomous weapons systems could be misused in the future. If Mr Heg- seth is not careful, he may jeopardise his access to more than just Claude. ■ C002 -- 59 of 80 -- 60 The Economist February 28th 2026 Business Arise, CEO-councilmen RUNNING A BIG American company today requires bosses to master the art of high politics. Matters of state, trade and war are ordinary boardroom chatter. Consider Mark Zuckerberg, Meta’s self-styled Augustus. He attended Donald Trump’s inaugu- ration, contributed to the president’s ballroom fund and has pur- chased a pile of his own in the capital. Meta touts the use of its technology by American armed forces and, earlier this year, Mr Zuckerberg appointed Mr Trump’s former deputy national secu- rity adviser as his vice-chair. Yet some of Mr Zuckerberg’s most pressing problems look parochial by comparison. A proposed wealth tax in California cooked up by a health-care union might explain his interest in another property, in Florida. This month Mr Zuckerberg testified about the risks social media pose to children in a county court in Los Angeles. Meta’s grand plans to build data centres have, like those of its competitors, met opposition in anonymous municipal buildings from locals worried about electricity prices. Then there are the state-level artificial-intelligence laws which the firm hopes to bend to its will by spending $65m on lobbying. Mr Zuckerberg must not only play the CEO-statesman, but increasingly the CEO- councilman, too. The rule of ever larger companies by ever smaller bodies of political authority has two causes: political disintegration and technological acceleration. In the absence of federal rules, five states have passed broad laws regulating the use of AI in the priv- ate sector. At least 16 more are working on them. The hundreds of AI-related bills introduced by states conflict on everything from how AI-generated content must be labelled to how quickly local authorities should be informed if the technology puts all human- ity at risk. Makers of self-driving cars face a similarly eclectic mezze of laws. California, where robotaxis are now a common sight, has assigned two different bodies to regulate them. When the Department of Justice held an inquiry into the health of interstate commerce last year, complaints came not only from America’s sexiest industries, but also some of its least allur- ing. Debt-collecting laws in New York and Massachusetts under- mine national banking supervision, bristled the American Bankers Association. The Pistachio Growers association was apoplectic about conflicting definitions of ultra-processed foods. The Nat- ional Chicken Council clucked that the single market was at risk. They would say that. Still, it is striking how often Mr Trump’s deregulatory plans are met with efforts to do the opposite in min- iature. Federal trustbusters have reduced their scrutiny of merg- ers; in response, blue states have built antitrust regimes of their own and are challenging deals they disapprove of. Mr Trump is trying to gut the body responsible for consumers’ financial protec- tion; its spirit lives on in New York, which now wants to regulate “buy now, pay later” lenders. MAGA-world loves prediction mar- kets such as Polymarket and Kalshi; states want to smother them with local gambling laws. (Native American tribes that rely on in- come from casinos are also after them.) Sometimes bosses can flee to warmer climes. Ringing a bell in New York to list a company incorporated in Delaware before spending the proceeds in California was once the American entre- preneurial dream. But the dominance of New Delafornia is less secure today. Miami, which offers lower taxes and better weather than New York, is rising as a financial centre. More than a dozen publicly traded firms have reincorporated away from Delaware (mostly to Nevada) since Elon Musk kicked off after a court in the First State rejected his pay in 2024. Mr Musk also reincorporated his unlisted companies, including SpaceX; last summer Andrees- sen Horowitz, the world’s largest venture-capital firm, encouraged the startups in its portfolio to do the same thing. If California does adopt its radical tax plans, which would impose a 5% levy on bil- lionaires, an exodus of the roughly 200 of them who live there would be likely. Mostly, though, American companies doing business across many states are stuck with a regulatory system that is developing some disturbing similarities to Europe. California, like Germany, is the traditional economic engine. Again like Germany, it insists on imposing its ideas on everyone else—including plenty of bad ones. Not only is it among the states insisting on a greater role in antitrust enforcement. Its size has ensured its data-privacy laws and stringent disclosure rules on pay and climate are, in effect, national policy. A new state of the union The comparison may strike some American bosses as absurd, even insulting, given how many of them have imbibed Mr Trump’s distaste for the land of fine art and fines. They argue that the White House will soon sue states’ AI laws out of existence, as it promised to do in December, and Congress will pass a compre- hensive bill on self-driving cars. Perhaps. But if history is any guide, inefficient restrictions on interstate commerce can last a while: railroads operated for decades before they came under federal supervision in 1887, and interstate banking was truly per- mitted only in 1994. Few chief executives are well-suited to their new responsibil- ities. Dealing with 50 regulators demands far more attention than dealing with one. The way tech bosses in particular talk about the future of AI indicates that they will struggle with a populism which brings them closer to the populus. Still fewer will enjoy it. Invite the boss to lunch with a retired general and he will clear his afternoon, whatever the topic of discussion. Collar him to talk about a new state law or crusading attorney-general, and he will fast-rope from the window. ■ SCHUMPETER America’s bosses worry too much about geopolitics and not enough about local politics C002 -- 60 of 80 -- 61 The Economist February 28th 2026 Finance & economics Trade wars After IEEPA THE MOMENT was historic. On Febru- ary 20th America’s Supreme Court struck down Donald Trump’s signature policy. The president claimed the Interna- tional Emergency Economic Powers Act (IEEPA) of 1977 let him slap any tariffs he wanted on anyone for any length of time. The justices ruled 6-3 that Congress did not hide in IEEPA “a delegation of its birth- right power to tax within the quotidian power to ‘regulate’”, as Chief Justice John Roberts wrote in the majority opinion. Looking solely at America’s changing tariff rates, tomorrow’s trade historians may miss the ruling altogether. Within hours of the decision Mr Trump invoked Section 122 of the Trade Act of 1974, to levy 10% tariffs on all imports for 150 days from February 24th. The next day he said he would raise the level to 15%, the highest the law permits. Before the justices weighed in, America’s effective tariff rate was 13.7%, es- timates the Yale Budget Lab. Swap IEEPA for Section 122 tariffs of 15% and this edges down to 12.2% (see chart 1 on next page). By comparison, the figure was 2-3% before Mr Trump took office for the second time in January 2025. If they dig beneath this superficial sta- bility, however, future chroniclers of global commerce will mark February 20th as the start of a period of turmoil possibly even more chaotic than what Mr Trump un- leashed on “Liberation Day” last April. That is because, first, the Supreme Court stayed silent on what to do about refund- ing duties that the government collected illegally, setting up another legal fight. And, second, the latest authorities Mr Trump is asserting—or is about to assert— will also be challenged in court. While the lawsuits play out, uncertainty will persist, and so will the economic drag of all the trade-warmongering. The government has collected perhaps $180bn in IEEPA tariffs. Over the past year 1,800 companies—including Goodyear, a tyre-maker, and Costco, a retailer—have filed lawsuits to protect their right to a re- fund should the Supreme Court overturn them. They are now owed this money, equivalent to roughly 5% of the profits companies generated in America last year, or 0.6% of GDP—plus interest, compound- ed daily at an annual rate of 6-7%. Despite this rising bill, the administra- tion will not make life easy for refund-seek- ers. It may be hoping that some will be shamed into forgoing claims because they had passed the tariffs on to consumers. Goldman Sachs, a bank, estimates that by the end of last year around 60% of the ta- riffs’ cost was being borne by shoppers through higher prices. Others may prefer not to anger a president who has used the power of his office to go after his perceived enemies in business, law and elsewhere. WASHINGTON, DC Thought a Supreme Court ruling would put an end to tariff chaos? Think again → ALSO IN THIS SECTION 62 Does AI lift productivity? 63 Dodgy AI economics 64 The welfare states of America 65 What next for capital controls 66 Buttonwood: Churning markets 67 Free Exchange: A Chinese food puzzle ⏩ C002 -- 61 of 80 -- 62 The Economist February 28th 2026 Finance & economics ▸ ⏩ Trading partners which have struck deals with America, offering concessions to secure lower tariff rates and Mr Trump’s grace, face a similar dilemma. Because Sec- tion 122 must be applied indiscriminately, trade partners clobbered by IEEPA, like China and Brazil, come out ahead (see chart 2). Those which negotiated better terms, like Britain and the European Un- ion, are up in arms. Some are likely to stay quiet. Others won’t. “A deal is a deal,” de- clared the European Commission in a statement after Mr Trump said he would raise the levies from 10% to 15%. Everyone will await more legal wran- gling. Rick Woldenberg, the toymaker whose company, Learning Resources, was the lead plaintiff in the IEEPA case, is scathing about the White House’s re- sponse. “I wonder what process the US government went through between dinner on Friday and breakfast on Saturday to de- termine that 10% would not solve the na- tional emergency they discovered. It’s a sham,” he fumes. “That’s $100bn of tax that is highly questionable.” Like IEEPA, Section 122 is an untested instrument from the disco era. It applies in the event of “fundamental international payments problems”, such as “large and se- rious” balance-of-payments deficits or “an imminent and significant” depreciation of the dollar. The dollar has indeed weakened in the past year—but partly as a result of Mr Trump’s tariffs, so using its slide to jus- tify their reimposition seems like a stretch. And the decline is anyway within historical norms. The administration has more wrig- gle room with the hazier concept of bal- ance-of-payments deficits. This was a big- ger concern when the world was moving away from fixed exchange rates in the 1970s. Still, the courts may defer to the ex- ecutive branch on what constitutes a crisis. There is another reason for trade part- ners and companies to hold their breath. Section 122 tariffs expire after 150 days un- less Congress agrees to extend them. This looks like a nonstarter with the midterm elections around the corner in November. So when this authority lapses, Mr Trump will try to recreate it using other tools, no- tably Section 301 of the Trade Act of 1974 and Section 232 of the Trade Expansion Act of 1962. These allow for country- and sector-specific tariffs, like those levied against China during his first term or on steel and aluminium imports more recent- ly, and stand on firmer legal ground. Both also require formal investigations to be launched before tariffs are levied, making them cumbersome to use. If the adminis- tration’s probes look frivolous, that will in- vite more lawsuits. Mr Trump is hoping that his relentless pursuit of tariffs will persuade companies to build factories in America. But that is complicated, expensive and makes little sense in uncertain times like these. Much easier to hire trade lawyers to constantly optimise customs arrangements and rede- fine the origin of goods. The “first sale” rule, for instance, lets importers pay duties on the price charged by the original manu- facturer rather than the middleman. “Duty drawback” rules allow companies to offset tariffs against equivalent goods that they then export. Goods can be shuffled around cross-border supply chains to alter the le- gal country of origin. Mark Truchan of PwC, an accounting and tax-advisory firm, says that such strategies could save firms between 10% and 50% of their tariff bill. All this constitutes a less-than-ideal mix for the American economy. The tariff refunds, which would flow straight to busi- nesses’ bottom lines, and marginally lower tariffs, which amount to a tax cut, may add up to a stimulus worth 0.7% of GDP. They come alongside separate tax refunds cour- tesy of Mr Trump’s One Big Beautiful Bill Act, passed last year. Some of this stimulus will, though, be offset by the uncertainty that keeps importers guessing and deters firms from hiring and investing. Trade law- yers will stay busy. Everyone else will just be exhausted. ■ The meek shan’t inherit the Earth United States, effective tariff rate, % Selected countries Source: Global Trade Alert  Brazil Britain India Taiwan South Korea Vietnam Japan Germany Canada China Mexico 40 30 20 10 0 42 67 87 115 131 136 147 159 410 434 42 67 87 115 131 136 147 159 410 434 503 15% global tariff (Section 122) Before SCOTUS (IEEPA) Goods exports to US, 2024, $bn Same same but different US, effective tariff rates*, % 2026 Source: Yale Budget Lab *After accounting for substitution by consumers and businesses  Section 122 expires 15% 10% No IEEPA/Section 122 Pre-SCOTUS decision 2022-24 average 14 12 10 8 6 4 2 0 Section 122 imposed at: AI and productivity Everywhere but the statistics ARTIfiCIAL INTELLIGENCE is advanc- ing at startling speed. The latest mod- els can now complete complex, time-eat- ing tasks with little human supervision. This month one of OpenAI’s models helped derive a new result in theoretical physics. No wonder an essay declaring that “Something Big is Happening” and, in recent days, a blog post of a similar tenor (see box on next page), have gone viral. Is something big happening to the economy, too? Scott Bessent, America’s treasury secretary, predicted last year that AI would soon start “biting”—by which he meant lead to noticeable improvements in productivity. Kevin Warsh, President Do- nald Trump’s nominee to lead the Federal Reserve, is counting on an AI-driven pro- ductivity boom to help tame inflation. A puzzle in America’s macroeconomic data appears, at first glance, to suggest that Messrs Bessent and Warsh are right. The economy grew by a brisk 2.2% in 2025, according to data released on February 20th. Yet hiring slowed sharply over the same period. Employers added only about 15,000 jobs a month on average—equiva- lent to annual employment growth of just 0.1%. This combination suggests that each worker is generating more output. The evidence of substantial, AI-fuelled productivity gains, however, is thin. Real GDP grew at an annualised rate of just 1.4% in the fourth quarter of 2025 (though a gov- ernment shutdown was partly to blame). There is little evidence that artificial intelligence has boosted output much C002 -- 62 of 80 -- 63 The Economist February 28th 2026 Finance & economics ▸ ⏩ And the recent gap between growth in out- put and employment is not especially un- usual. Since 1950 it has been at least two percentage points in nearly one-third of years. Although official figures have yet to be released, an estimate based on real GDP growth and aggregate hours worked sug- gests productivity growth of about 1.9% in 2025. That would be just below the long- run average of 2% or so and far short of the improvements made during the internet boom of the 1990s and 2000s (see chart 1). Moreover, the gap between output and employment growth could be caused by many factors. Much of America’s recent GDP growth reflects a surge in investment, chiefly in AI infrastructure. Jason Furman of Harvard University estimates that some 90% of GDP growth in the first half of 2025 came from spending on data centres and related capital investments (though such calculations do not deduct imported capi- tal goods, such as chips). Measures that ad- just for investment-driven output tell a similar story: research from the Federal Reserve Bank of San Francisco finds that underlying productivity gains, once the ef- fect of such investment is excluded, are close to zero. Dynamics in the jobs market point in the same direction. Tighter immi- gration policy has reduced labour-force growth, lifting average productivity by re- moving many workers in relatively low- productivity sectors like farming and con- struction. A sharp decline in temporary employment has had a similar effect. How would economists know if AI con- tributed to higher productivity? Broadly, they need to examine three things: how widely the technology is adopted, how in- tensively it is used and how much it boosts output when applied to individual tasks. Adoption is starting to rise (see chart 2 on next page). A tracker by Alex Bick of the Federal Reserve Bank of St Louis and col- leagues estimates that 41% of American workers used generative AI at work in No- vember 2025, up from 31% a year earlier. Other surveys have reached similar conclu- sions. Jon Hartley of Stanford University and his colleagues estimate that usage rates rose from roughly 30% at the end of 2024 to 36% a year later. Yet adoption alone says little about how AI influences productivity. Intensity of use also matters. Mr Bick found that only about 13% of working-age adults use it eve- ry day. The share of total work hours in- volving generative AI remains small, hav- ing risen from 4.1% in late 2024 to just 5.7% by mid-2025. Most usage consists of dis- crete tasks rather than wholesale automa- tion. OpenAI’s data suggest its models are mostly used in workplaces for writing as- sistance and information queries. An- thropic’s Claude is used mainly to help people write computer code. When AI is used, the benefits can be large. In 2023 Shakked Noy and Whitney Zhang of the Massachusetts Institute of Technology found that using ChatGPT re- duces completion times for writing tasks by nearly 40%. In a study of consultants at the Boston Consulting Group, Fabrizio Dell’Acqua of Harvard Business School and his co-authors found AI-driven pro- ductivity improvements of 12–25% on real- istic professional tasks. A broader review by Maria del Rio-Chanona of University College London and her colleagues re- ports average productivity gains of 15–30% in real-world settings. Taking all three factors into account, a back-of-the-envelope calculation suggests AI has so far made only a modest impact on productivity. Combine the increase in working hours spent using generative AI with how much it improves efficiency, and you get a boost of about 0.25-0.5 percent- age points to productivity growth over the past year. This calculation is almost cer- tainly too generous. It assumes that all Stasis quo United States, non-farm business productivity, five-year average annual growth, % *Estimate Sources: Bureau of Labour Statistics; The Economist  3 2 1 0 25* 24 20 10 2000 90 80 70 1960 AS STOCKS WOBBLED in the last week of February, some found a cause in a note by Citrini Research, a firm of equity analysts. It imagined a world in 2028 in which artificial intelligence had ren- dered a lot of white-collar work obso- lete—along with firms from American Express to DoorDash and much of the software industry. The note went viral. But its economics are shaky. In Citrini’s near future, output keeps growing, “driven by AI agents that don’t sleep, take sick days or require health insurance”, while consumer spending collapses: workers have no jobs and no incomes to spend. “Economic pundits popularised the phrase ‘Ghost GDP’: output that shows up in the national accounts but never circulates through the real economy.” Economists have been here before. In the early 19th century David Ricardo, a financier, and Thomas Malthus, a clergy- man, debated the possibility of a “gener- al glut”. Grain prices were falling and industrial output surging, but workers were visibly unemployed. A surge in output was seemingly matched by an absence of spending power. There was too much of everything all at once. Ricardo thought such a thing impos- sible. It violated Say’s Law, that “produc- tion creates its own demand”. How does a farmer buy textiles? He produces food and swaps it: real output is the income with which to buy something else. Only a “partial glut” was possible. One sector (say software today) might produce so much that its prices collapse and its workers lose jobs, but that should allow another to purchase more. Some people and firms lose and others win, but that is the nature of economic disruption. Yet economy-wide recessions do happen. Later economists, such as John Maynard Keynes, pointed out that mon- ey could get in the way. Production and consumption do not have to be simulta- neous: a firm can make something, sell it and then hold on to the cash. A general glut was therefore possible. Perhaps this time the owners of AI companies will simply sit on the cash their bots gener- ate. But that would be deflationary, rather than lead to the surge in nominal GDP Citrini predicts. Unemployment would indeed rise, but GDP would fall. Is this a plausible future? It doesn’t look that way. If anything AI companies are desperate to redeploy cash to build more data centres, not to hoard it, even though big productivity gains are elusive so far (see previous article). Many in- vestors worry that AI companies will run out of funding. And policymakers have tools of stimulus—interest-rate cuts, bond-buying and handouts—with which to fight demand slumps. It is unlikely that an AI take-off would bring about an economy that lacks spending. Equity research Too much of a good thing A research note goes viral but gets its economics wrong C002 -- 63 of 80 -- 64 The Economist February 28th 2026 Finance & economics ▸ ⏩ time saved is redeployed productively, and that workers neither shirk nor produce lower-value output. Early evidence points to a messier reality. Some studies suggest workers spend more total time working when using AI, others that the technology is sometimes used to generate low-quality “slop” that requires editing or verification. All this signals a deeper flaw in the ar- gument that AI is powering a productivity boom. Such improvements are usually made not just when workers use a new tool more often, but also when firms reorganise production around it. Early factories be- came only a bit more efficient when steam engines were replaced with electric mo- tors; the real revolution came decades later after floor plans were redesigned to make the most of electric power. More recently, productivity growth was a disappointment for years after personal computers became widespread. It sped up only once firms adopted business models that exploited the technology to its full potential. Much of America’s productivity revival in the 1990s came not from Silicon Valley but from retail, where computers transformed logistics and inventory management. There is little sign that AI has reached a similar stage. A recent study by Ivan Yotzov of the Bank of England and others found that executives spend only about one and a half hours a week using AI. Nine out of ten senior managers see no measurable im- provement in labour productivity. The or- ganisational rewiring, in other words, has barely begun. Something big may indeed be happening with AI itself. For now, it re- mains largely invisible in the macroeco- nomic data. ■ Robot evolution United States, companies using AI*, % of total Selected industries, February 2026 Source: Census Bureau *Survey of around 200,000 businesses  50 30 10 40 20 0 Total Total Total Total Total Total Accommodation and food services Accommodation and food services Accommodation and food services Accommodation and food services Accommodation and food services Accommodation and food services Accommodation and food services Accommodation and food services Accommodation and food services Accommodation and food services Accommodation and food services Accommodation and food services Accommodation and food services Accommodation and food services Accommodation and food services Accommodation and food services Accommodation and food services Accommodation and food services Accommodation and food services Accommodation and food services Accommodation and food services Accommodation and food services Accommodation 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Information Information Information Information Information Information Information Information Expecting to in the next six months Currently Social policy The welfare states of America IMAGINE A HARD-UP family. The mother has given birth to her second child. The government paid for her prenatal care, the birth and her newborn’s medical expenses. She will get four-fifths of her wages during five months of maternity leave and her hus- band will take three paid months off, both under a government scheme. Later they can count on subsidised child care and child tax credits. By the time her infant son is off to nursery her daughter will be three and can enroll in state-funded pre-kinder- garten. Either parent losing their job would be bad, of course, but not catastrophic: un- employment benefits would replace much of their wages for a while. If things got real- ly dire, they could get food assistance. It all sounds like France or Germany— certainly not America, with its low taxes and skimpy social programmes. It is in fact available to families earning around $50,000 a year in Massachusetts. More than a dozen other states, including big ones like California and New York, also of- fer citizens a European-style bargain of higher taxes and generous welfare. Wel- come to the welfare states of America. When William Beveridge invented the welfare state in Britain in the 1940s, he sought to slay the “five giants”: want, dis- ease, ignorance, squalor and idleness. He devised a safety-net of child allowances, maternity leave, unemployment insurance, disability payments, universal health care and old-age pensions. In contrast to other Western democracies, America’s federal government is wholly responsible only for state pensions (Social Security) and health care for the elderly (Medicare). It contrib- utes to child tax credits (a lot), plus health care for the poor and food assistance (a fair bit, through Medicaid and SNAP, respec- tively). On maternity leave it is, well, mum. As a result, provision of services varies greatly from state to state, as do citizens’ tax bills. A poor single mother in munifi- cent Minnesota would receive around $10,000 in cash and food subsidies—twice what she would get in Arkansas. Half of all births in New York are paid for by Medic- aid, compared with just a third in Wyo- ming. The weekly unemployment benefit offered in Massachusetts is roughly six times as generous as in New Jersey. The tax burden—including state and federal taxes—borne by New Yorkers is around 33% of state GDP, a level far closer to Brit- ain or Canada than to the slender 23% of GDP handed over by Texans or Georgians. America’s welfare states often with- draw support sooner than in Europe. After a year on the dole a Californian will get less than 10% of their typical wage, com- pared with an average of nearly 40% in the OECD club of mostly rich countries. Basic paid family leave in the 13 states that man- date it lasts about 12 weeks. Even topped up with another 6-12 weeks, as the most generous states allow, that is far less than the 50 or so weeks common in Europe. But while they last, some of the schemes are as generous as European ones. In the first few months after losing their job, Americans get benefits worth ov- er half their wages, leaving them better off than laid-off Austrians, Finns or Brits. Be- cause American paid-leave programmes replace a bigger share of mothers’ wages, the equivalent number of fully paid weeks available to mothers is similar to that in WASHINGTON, DC It has plenty of European-style social programmes—just not federal ones C002 -- 64 of 80 -- 65 The Economist February 28th 2026 Finance & economics ▸ ⏩ other rich countries (see chart). By this measure, New Jersey’s support is about as cushy as France’s, Massachusetts is close to Britain and California beats Australia. States are learning from successful ex- periments in other “laboratories of democ- racy”, just as fans of federalism have long envisaged. Studies of California’s paid- leave scheme found that it improved breastfeeding rates, led to more infants getting vaccines and fewer ending up in hospital, and even lowered the number of children living in poverty. It also appears not to damage women’s labour-market tra- jectories or hurt their employers’ profits. Later adopters also learned from Cali- fornia’s mistakes. For instance, California initially set wage-replacement rates so low that poor families could not afford to forgo work, notes Maya Rossin-Slater of Stan- ford University. They were raised perma- nently only last year. One lesson for other states was thus to offer generous reim- bursement from the start, especially for low-wage workers. California’s scheme is not being copied solely because it works. Many states are emulating it because they are fed up wait- ing for a federal solution from a gridlocked Congress. This is an understandable im- pulse. But it also creates problems. For one thing, in an age of national politics, with regional newspapers in decline, voters pay little attention to what happens at state level. One in three cannot name their go- vernor, according to polls. This means less democratic accountability and more room for graft and fraud. Minnesota may have lost up to several billion dollars to scams involving covid-19 relief and Medicaid. Citizens’ lack of awareness also means take-up is lower than it could be—and overall outcomes less beneficial. Some six years after California introduced paid leave, half of workers had not heard of it. Participation has risen slowly and is still far from universal, says Ms Rossin-Slater. A lot depends on an employer’s goodwill. When she looked at firms which offered similar jobs and paid similar wages, she found lots of variation in adoption. State programmes have one other big drawback. Because all states bar tiny Ver- mont are required by law to balance their budgets, they can struggle to maintain generous spending on safety-nets during economic downturns, when tax revenues plummet. Yet that is precisely when their citizens’ lot is at its most precarious. This leaves states at the mercy of the federal government. Amid deep recessions Uncle Sam does bring succour: covid-19 stimulus packages provided lots of extra money to states, in part to top up unemployment benefits. But such relief is often temporary, leaving states in a bind once it has gone. If states exploit the largesse to cut income taxes, as many did during the pandemic, the bind is all the more agonising. None of this seems to be dissuading states from turning more European. The number offering paid family leave, for ex- ample, has quadrupled since 2017, when just three did. Around a third of Ameri- cans—114m people—now live in states with such support. In the past five years another nine have introduced voluntary paid-leave schemes for employers. They include unprogressive places like Florida and Texas. New mothers in Paris, Texas, do not have it as good as their counterparts in the French capital. But they are no longer oceans apart. ■ Motherhood premiums Full-pay-equivalent weeks of maternity leave, 2026 or latest Sources: Bipartisan Policy Centre; OECD; state government websites; The Economist *American state leave includes typical disability allowance 20 15 10 5 0 Ireland Massachusetts Britain Minnesota New York Belgium California New Jersey France Canada Australia Deglobalisation The capital exception GLOBALISATION HAS had a tough de- cade. Tariffs and export controls have impeded the flow of goods. Immigrant- bashing politicians have discouraged the flow of people. What about the movement of capital? It is controversial, even among economists. They fear that, unfettered, it can amplify speculation, distort exchange rates and expose countries to mismatches between local assets and dollar liabilities. Even in America, which imports more cap- ital than any other country, influential thinkers have contemplated taxing bond purchases by foreigners to keep the dollar competitive. In this era of nationalism, has capital become less cosmopolitan? One way to answer the question is to add up all the foreign assets of the world’s economies. These reached $227trn in 2024, according to Gian Maria Milesi-Ferretti of the Brookings Institution, a think-tank, and his colleagues. That was equivalent to 204% of global GDP, compared with 201% in 2007. By this yardstick, the globalisation of capital has stagnated like that of trade. But it is what economists call a de facto measure of openness, capturing outcomes rather than instruments or intentions. Fac- tors besides capital controls shape the flow of money across borders, just as factors be- sides tariffs dictate the volume of trade. So have the fetters been tightened or loosened? Measuring trade barriers is hard because they take many guises: tariffs, quotas, tariff-rate quotas, plus things like safety standards. Measuring capital con- trols faces similar difficulties. Undeterred, economists affiliated with the IMF have come up with some new yardsticks. All are based on one of the fund’s oldest publications, the Annual Report on Ex- change Arrangements and Exchange Restric- tions, a sizzling read since 1950. It divides transactions into dozens of subcategories, asking if foreigners can freely buy the country’s bonds, if residents can open for- eign-currency bank accounts, if exporters must surrender dollar earnings to the gov- ernment, and so on. The first gauge, the Financial Account Restrictiveness Index (FARI), developed by Chikako Baba and her co-authors, simply reports the fraction of subcategories that face some restriction. It shows that capital controls receded between 1999 and the early 2010s, when the European sovereign-debt crisis rocked some previously open economies. Coun- tries like Cyprus capped deposit with- drawals. Emerging ones like Costa Rica decried inflows of “hot money”. As emer- gency measures were lifted, worldwide curbs fell again from 2016 to 2019, even as populist nationalism was on the march (see chart). Lately controls have staged a modest comeback: 41 countries have in- creased the breadth of their restrictions since 2019. Russia tightened controls after it invaded Ukraine. Argentina reimposed el cepo (the clamp) to stem a currency crisis. FARI is simple and objective, so the IMF can update it regularly and release it freely. HONG KONG Financial flows have flattened off—but not because of stricter controls FARI but no farther Financial Account Restrictiveness Index* 0=fully open, 1=fully closed Source: IMF *Degree of capital-account restrictions across 181 countries 0.42 0.40 0.38 0.36 0.34 0.32 23 20 15 10 05 2000 ↓ More open C002 -- 65 of 80 -- 66 The Economist February 28th 2026 Finance & economics ▸ INVESTORS WAKING from a stupor that began on New Year’s Eve might question whether they had missed any- thing. For all the recent geopolitical drama, the S&P 500 share index of big American firms sits almost exactly where it did at the end of 2025: just shy of a record high. Beneath the surface, how- ever, the churn in America’s financial markets has been furious. A panic about what artificial intelligence will do to business models has prompted software firms’ stock prices to tumble: they are a third below a recent peak last year. On February 23rd IBM’s slumped by 13%, owing to vague worries about what AI means for the tech veteran. It is not just software companies that investors worry will be disrupted by the rise of AI agents and “vibe coding”. Waves of share-price volatility have rippled through sectors as varied as logistics and commercial real estate. After a blog post on February 22nd by a research firm imagined a future in which AI produces widespread lay-offs without lifting productivity, the shares fell in some firms it mentioned, such as Amer- ican Express (in finance) and Door Dash (in food delivery). So far the losers’ losses have been offset by winners’ gains. Investors have clamoured for “HALO” stocks (heavy assets, low obsolescence): energy and commodities firms, sturdy utilities and sellers of consumer staples. Tech compa- nies making the hardware that powers AI have boomed. The share price of San- disk, which makes memory chips, has more than doubled this year. The fragile balance between winners and losers is not guaranteed to hold, since investors still know little about how AI will eventu- ally reshape businesses. You can gauge the extent of the tur- moil in a few ways. One is to look at the stockmarket’s dispersion—expected dif- ferences in movements of individual stocks, measured by the price of options. It is higher today than it has been for 98% of the time in the past decade. This mea- sure tends to jump when investors are rapidly pricing in new economic realities. Usually, that involves the headline equity index soaring or plunging, as when the covid-19 lockdowns began in March 2020 or as tariffs sowed panic last April. Investors’ reassessment is evident in debt markets, too. Last summer risky bonds issued by American tech firms yielded some three percentage points more than Treasuries—about the same spread as for “junk” bonds more broadly, regardless of the issuer’s sector. Today investors are demanding more compensa- tion from tech borrowers. Their bonds yield five percentage points more than Treasuries—a similar spread to that during the tariff panic. The rest of the market has barely budged. The consequences in markets for le- veraged loans and private credit, which are heavily exposed to tech and business- services firms, are likely to be more severe. Matthew Mish of UBS, a bank, thinks defaults on such debt could jump by 2.5 and 4 percentage points, respec- tively, by late 2026. If disruption is more severe, the rise in defaults would be twice as large. Private-credit investors are already taking fright. Many big funds faced outflows in late 2025. On February 18th Blue Owl permanently restricted redemptions from its fund for retail investors, to give it time to sell assets. The share prices of several listed private- investment giants, such as Ares, Black- stone and KKR, have sunk. It seems unlikely that things will calm down soon. Novel applications of AI are bound to emerge, so investors will have to continually update their views of which business models will be disrupted and how severely. And if AI turns out to be far less revolutionary than many now believe, that would hammer the share prices of some of the world’s biggest firms, such as Nvidia. Roiling markets could in turn hinder the development of AI. “If losses spike too quickly and to sufficiently high levels in loan markets, the tightening in credit and financial conditions could be severe,” Mr Mish points out. If firms find it harder to borrow, they will build the infrastructure needed for AI more slowly. Investors with broad equity exposure, meanwhile, might see their luck run out. The firms that make the most money from AI could end up being unlisted ones, such as Anthropic or OpenAI. Moreover, no rule specifies that every losing sector must be perfectly balanced by a winning one. With investors reas- sessing every business model under the sun, do not bet on the stockmarket staying calm on the surface either. BUTTONWOOD Disruption and dispersion AI is prompting investors to reassess every business model under the sun A second index, developed by Wenjie Li, another IMF economist, uses a dash of judgment to rate the intensity of controls on a five-point scale. Going by this Fin- Open index, Bhutan had the most closed capital account in the world in 2022 (the latest year available). Entirely open econo- mies ranged from rich financial havens (Andorra and Panama) to Liberia, a desper- ately poor country that lives up to its name in its treatment of foreign capital. The two biggest emerging economies, India and China, are less open than aver- age—and less than expected for their level of development. Only four economies are both richer than China and less open: Ar- gentina, Aruba, the Bahamas and Russia. None is an obvious economic soulmate. India and China are also among the most active tinkerers with controls. Ac- cording to Ms Baba and colleagues, China has made over 150 tweaks since 1999 and India more than 300, second only to Ar- gentina. Most of these fiddles have with- drawn restrictions. Thus two of the world’s biggest economies remain gradual global- isers. They are less open than most, but more open than they were. This could produce a paradox. Mea- sures of financial openness that reflect economic scale may level off not because economies are becoming less open, but be- cause less open economies are becoming a bigger chunk of the world economy. Is cap- ital becoming less globalised? De facto, maybe. In truth, no. ■ C002 -- 66 of 80 -- 67 The Economist February 28th 2026 Finance & economics Acute Engel DURING THE Spring Festival holiday, which this year lasted from February 15th to 23rd, China regroups and regathers. People cross the country on fast trains to join their families, watch dancing robots on TV and hand out red packets of crisp bank- notes to younger relatives. But above all, they gather to eat. In a ca- fé in Fuzhou, a southern city, locals and tourists ate cheesecake and drank kombucha. One customer ordered wontons wrapped in “swallow skin” sheets, which mash together sweet-potato starch and pounded pork. “I really like eating,” said Yu Huan, another customer, who works in fashion in Shanghai. “It’s one of the ways I obtain happiness.” This year the National Bureau of Statistics (NBS) got into the spirit of things by revealing, for the first time, exactly how much Chinese consumers spend on food. The number emerged from a revision of the consumer-price index. The new weights imply that food (excluding dining out, booze and tobacco, with which it is of- ten mashed together) accounted for 17.2% of household consump- tion last year. The equivalent figure for America was less than 8%. These percentages confirm China’s passion for food. But they also have a less comforting implication. China may be far ahead of America in dancing robots and high-speed trains, but it still lags far behind on one of the oldest measures of economic develop- ment: Engel’s law. It states that as their income increases, people devote a smaller share of it to sustenance. This regularity, disco- vered almost 170 years ago by Ernst Engel, a German economist, is one of the “most enduring relationships in economics”, according to Richard Anker of the University of Massachusetts, Amherst. It can be used to predict food spending. But it can also be used in reverse, to infer incomes. Other things being equal, Engel de- clared, the share of outlays devoted to food is “the best measure of the material standard of living of a population”. Engel discovered his measure in data painstakingly collected by others. Edouard Ducpétiaux, a Belgian jurist, tabulated the budgets of 199 households across all nine provinces of his country in the 1850s. Frédéric Le Play, a pioneering sociologist, gleaned similar figures from 36 families across Europe, gaining their confi- dence through praise, small gifts and “interesting conversation”. Ducpétiaux and Le Play had “delivered the pearls”, admitted Engel, “but not the string”. What tied the data together was the consistent relationship between dosh and nosh that he spotted. Reviewing the law 150 years later, Mr Anker found the link was still easy to discern across over 200 countries. Even China’s NBS takes it seriously. “The Engel coefficient”, it said last year, is an “impor- tant indicator for measuring the standard of living of residents”. Several economists trust this measure more than they trust China’s official income figures. In 2014 Emi Nakamura and Jón Steinsson of the University of California, Berkeley, and Miao Liu of Boston College used Engel’s finding to cast doubt on the coun- try’s growth and inflation statistics. They compared households in 2006 with those that reached a similar income two years later. They discovered that the later households were still devoting sub- stantially more of their budgets to food. Perhaps they were not quite as prosperous as the official figures claimed. Engel’s law is also a source of concern for Adam Wolfe of Ab- solute Strategy Research, a consultancy. He points out that the of- ficial Engel coefficient (which includes spending on cigarettes, al- cohol and dining out, as well as food) has mysteriously stopped falling, despite China’s reported growth. These items accounted for 29.3% of consumption in 2025, the same as eight years before. This “violation” of Engel’s law, Mr Wolfe argues, suggests that China has suffered a “severe development setback”. But Engel’s law has a wrinkle: dining out. When people eat at a restaurant, café or stall, they are not just buying food. They are also paying for the cooking, washing-up and ambience. Mr Anker once did his own fieldwork to quantify this point. He bought noo- dles and steamed buns in street markets in Xi’an, a city in western China. He also patronised McDonald’s and Outback Steakhouse in Massachusetts. Rather than eat the dishes, he weighed their in- gredients, then estimated their cost. He calculated that the Chi- nese street food cost up to 30% more than a similar meal at home. McDonald’s cost 150% more. The steak: 233% extra. Yu’s law If restaurant meals are included in calculations of Engel’s law, the weight of food spending may be overstated. But excluding them poses the opposite danger. Awkwardly, the NBS did not disclose this month how much the Chinese spend on dining out. Nor did it provide a narrower measure of food consumption, excluding din- ing out, for the years before 2025. That makes it hard to know whether eating out has been propping up the Engel coefficient. Figures from Wind, a financial-data platform, provide a clue. They show that restaurants and other “catering services” rose from 5% of consumption in 2017 to 7.4% in 2024 (the latest figure available). Such numbers can also be deducted from the official Engel coefficient to arrive at a narrower measure of past food spending. This calculation suggests that food’s weight was as high as 20.7% in 2017, well above the 17.2% for 2025 that the NBS has just revealed. In other words, if dining out is subtracted, food’s weight in Chinese consumption has continued to fall. The country has not broken Engel’s law after all. In Fuzhou, Ms Yu provides corroboration. She came to visit res- taurants not family. She has tried seafood hotpot, peanut soup and local fish balls. “Food makes up the biggest part of my budget,” she confesses. But that’s no economic setback. She is limited less by her wallet than by her stomach. “As one person, I can’t eat that much,” she says. “So that’s why I stayed for five days.” ■ FREE EXCHANGE Does China violate one of the world’s most venerable economic laws? C002 -- 67 of 80 -- 68 The Economist February 28th 2026 Science & technology Artificial intelligence I can show you the world PROJECT GENIE, an experimental artifi- cial-intelligence model released by Google in January, is a jaw-dropping tech- nical achievement. Give the tool a prompt—an image, say, or a brief snippet of text—and it will generate an interactive world for the user to explore. Type in a straightforward request, and the result is a realistic simulation. Start with a painting by Georges Seurat, by contrast, and you can wander through a Sunday in the park in perfect pointillist style. Project Genie may feel like a video game, but its makers claim it is something much more profound. They call it a “world model”, an essential tool to help AI systems make sense of the complex, unpredictable physical spaces into which many will even- tually be put to work. The company argues that a future where humanoid robots pop to the shops to pick up ingredients before cooking dinner, or self-driving cars navi- gate country roads, would not be possible without world models. The concept dates back to a 1943 book by Kenneth Craik, a Scottish psychologist who suggested that organisms carried a “small-scale model” of the world inside their head, to test hypotheses on before carrying them out in reality. Having some grasp of how the world works is a neces- sary step before making plans about how to change it. Without one, any living thing would be forced into a purely reactive life—flinching from pain, reaching for food, and little more. Giving that same ability to AI systems was a promising area of research as far back as the 1990s, before large language models (LLMs) sucked away the world’s at- tention. Now that attention is back. There are three main approaches being explored to build world models. One natu- ral starting-point is AI video generators. Generating a coherent video depends on simulating a coherent world—if the laws of reality change between frames, the output would be nonsensical. Such rudimentary world models can fill in details of the world beyond what they have been fed: give one a picture of a maze and it will be able to draw a route through it; present it with a photo of hands holding a jar and it will accurately model the movements re- quired to open it. Project Genie is the culmination of this approach. Its usefulness becomes appar- ent when one imagines pairing it with a different AI—a robotic shopkeeper, say— that is trying to learn how to operate in the physical world. The billions of hours of training data essential for such a task would be much harder to obtain from the real world than from a model that can sim- ulate the environment. And, if the simula- tions are accurate enough, the system can use the data to train itself. But even the most realistic video of the world cannot capture every detail that a person would pick up on. The broken freezer at the back of the shop causing the To become more useful, AI systems need to know their environments → ALSO IN THIS SECTION 69 Blood tests to detect cancer early 70 The complexity of Stone Age signs 71 Well Informed: Should you fibremaxx? ⏩ C002 -- 68 of 80 -- 69 The Economist February 28th 2026 Science & technology ▸ ⏩ fresh fish to rot is not caught on camera, for example, nor is the associated smell. Even objects that are not directly visible are beyond it. Generate the contents of one aisle, for example, and the neighbour- ing ones do not exist for the model until the user enters them. That makes it harder to simulate complex environments, or let multiple users move in the same model. Another approach to building world models, therefore, seeks to create full 3D environments rather than 2D simulations. Fei Fei Li, a computer scientist at Stanford University, is leading an approach she calls spatial intelligence. In her view, world models must be interactive, multimodal (capable of interpreting prompts) and con- sistent. Video-based systems can clear the first two hurdles but balk at the third. Pro- ject Genie, for instance, runs for a maxi- mum of 60 seconds before its simulations start fraying at the edges. Dr Li’s startup, World Labs, has built a world model called Marble that can create digital versions of 3D worlds which are in- ternally consistent and complete. That means it is possible to, for instance, have several users inside the same world. What’s more, spaces are not hallucinated afresh each time the user looks around; in- stead, they are created in their entirety from the off. World Labs is pitching its product to architects, who could use it to dream up a space and explore it virtually before sending it to a 3D printer. Yann LeCun, Meta’s former chief AI sci- entist, thinks world models can be built in a different, less literal, way. To him, focus- ing on real spaces is a distraction. After all, many AIs will have to navigate virtual maz- es such as HR systems or legal documents rather than physical spaces such as shops. He believes that giving AIs the tools to consistently model environments of both kinds is an important step towards making them useful. In his view, an AI could use an LLM to interact with such a world model in order to help it carry out tasks, whether in the real world or on a computer. That approach, called a Joint-Embed- ding Predictive Architecture (JEPA), would allow an AI to simulate complex features of the real world. Existing world models fo- cus on what is just about to happen, rather than events that might (or might not) hap- pen in the distant future. Humans think ahead all the time: gauging the weather be- fore deciding whether to leave the house with an umbrella; factoring in the risks of being late for an important meeting when choosing which train to catch; and so on. Crucially, these decisions can be made quickly, without needing to visualise every single second of the day. Current world models have no such shortcut. Dr LeCun has been exploring the po- tential of a JEPA system since 2022, and in November 2025 he left Meta to work on this problem full time. His startup, Ad- vanced Machine Intelligence, plans to turn his ideas into reality, starting with a part- nership with Nabla, a health-tech startup. He says the goal is a system which uses its own world model to work out “what se- quence of actions will optimally accom- plish a task that I’m setting”. But what if these complicated ap- proaches are superfluous? If existing gen- erative AI systems can already do useful things in the real world, then maybe they already contain some kind of world model within them. That’s the view of Ilya Sut- skever, an OpenAI cofounder, and many of his former colleagues still at the lab. Train- ing a large language model is, he said in 2023, no more than “learning a world mod- el”. Compressing all the information con- tained on the internet down into a few hundred gigabytes of numbers is possible only if a system “learns” the underlying principles behind that information. A new fantastic point of view There is some evidence he may be right. In 2023 a language model trained on a list of moves in the game Othello was shown to have reflected the board state within its own neural network—even though it had never seen an Othello board nor been taught the rules of the game. It was a de- tailed enough representation that the re- searchers could identify specific parts of the neural network that stored the colour of individual pieces. That meant they could make specific tweaks to change its perception of the game, an unprecedented level of control over an LLM’s calculations. Bigger language models are likely to have more complex world models inside— if only researchers could find them. An- thropic, an AI lab, has been leading re- search into “interpretability” of its Claude models, finding clusters of artificial neu- rons that correspond to anything from feelings of guilt to the Golden Gate bridge. And reaching in and changing them, as in the Othello example, causes correspond- ing changes to the subsequent behaviour of those models. That suggests the sys- tems aren’t simply stringing words togeth- er: they have a consistent understanding of physical features in the real world, which they draw on to answer questions. It sounds suspiciously like what you would expect from an internal world model. Not everyone agrees. LLMs, Dr Li ar- gues, are just “wordsmiths in the dark”. Be- ing able to use language to describe the world, she says, does not mean they have a grounded understanding of it. Like a stu- dent who has only read about a foreign country, there’s a missing piece of knowl- edge that can’t be patched with books, she says. Whichever approach will prove most effective, there is little doubt that AI is about to pay the real world a visit. ■ Oncology Rich veins GRAIL IS AN American biotech compa- ny with an ambitious goal: to develop a blood test for the early detection of over 50 types of cancer. It will not be easy. On February 19th the company announced that its test, called Galleri, had fallen at its latest hurdle. Over the course of a three- year trial that involved 142,000 people aged between 50 and 77, half were screened with Galleri in addition to the usual tests rec- ommended for their age. The hope was that it would spot enough early-stage can- cers to reduce the number of late-stage cancer diagnoses. It did not. The news was a big blow for advocates of the technology. But the full results of the trial, expected to be released in May, could paint a more nuanced picture; Galleri may be more useful in spotting certain types of cancer among certain types of people, for instance. At the same time, GRAIL’s com- petitors are busy developing alternative blood tests that may be more sensitive than Galleri. Whether the early detection they promise can lead to improved survival rates remains a contested question. The principle behind cancer-spotting blood tests is relatively simple. Some, like Galleri, analyse DNA fragments shed by cancer cells, whereas others look for pro- teins or metabolites that those cells pro- duce. Cancerguard, a rival test developed by Exact Sciences, an American company, combines multiple approaches. Can one-stop blood tests for cancer one day improve survival rates? Beautiful but deadly C002 -- 69 of 80 -- 70 The Economist February 28th 2026 Science & technology ▸ ⏩ Galleri, which has been on the market since 2021, has been the most widely used—and studied—of these tests. Its po- tential was on full display in October 2025, when GRAIL announced the results from a trial with 23,000 people aged 50 or older. Galleri spotted around 40% of the cancers that were diagnosed over the next year (of which half were early-stage) and usually identified the right part of the body. At the same time, it missed 60% of cancers and generated plenty of needless scares. It threw up a cancer “signal” in about 1 in 107 participants, and roughly two in five of those alarms proved to be wrong. The company’s other trials suggest a more optimistic interpretation of these re- sults: that patients were simply not fol- lowed for long enough after they were test- ed. In a trial of 6,000 patients in England who were referred for various cancer inves- tigations because of worrying symptoms, a third of presumed false alarms were diag- nosed with cancer when they were fol- lowed for an additional 15 months. This suggests the test was detecting some can- cers before they were advanced enough to be spotted by standard methods. Another challenge facing test designers is that early detection may not necessarily save lives. A crucial factor, and something that is still unknown about the new multi- cancer tests, is whether they predominant- ly spot tumours that need treatment, rather than the slow-growing, harmless type that is best left alone. Some prostate cancers, for example, would kill the men who have them only if they live well beyond the age of 100. Find- ing such harmless cases on tests and scans—whether by accident or through routine screening—is the bane of cancer medicine. Doctors cannot always say with certainty which are in that category, so usually treat them, just in case, with sur- gery, radiation and so on. In November 2025, the expert commit- tee that reviews evidence on screening tests for England’s National Health Ser- vice (NHS), recommended against univer- sal use of PSA, a blood test for prostate can- cer. For every two lives extended thanks to the test, the committee found, around 20 men are likely to be overdiagnosed with harmless tumours and 12 will undergo treatment of a type that often results in harms such as impotence or incontinence (to say nothing about the unnecessary anxiety). Instead, the PSA test was recom- mended only for men at high risk, such as those with a mutation in the BRCA gene. Another complication is that, for rea- sons not well understood, some cancers are more lethal than others even if found early. A trial of a blood test for ovarian can- cer called CA125, conducted by England’s NHS from 2001 to 2011, showed how this can play out. Even though the blood test spotted more early cases, the lethality of the cancer meant it did not save lives. According to GRAIL, this month’s find- ings suggested a “favourable trend” in the results for some types of cancer later in the trial. If that holds up, the balance of harms and benefits associated with using Galleri is likely to be different for each of the can- cers it looks for. That makes the adminis- tration of the test a decision to be taken carefully. There are additional dilemmas, too: patients with a fatal cancer may not benefit from an earlier diagnosis, but such knowledge could help researchers improve their knowledge of early-stage cancers. That will not be the end of the story. “GRAIL’s technology is somewhat outdat- ed now,” says Anna Schuh, who leads mo- lecular diagnostics research at Oxford University’s Department of Oncology. Galleri examines fragments of DNA in the blood for signs that chemical tags have been added to them, altering which genes are switched on and off, a process known as methylation. Galleri’s way of doing so destroys most of the DNA, limiting what can be gleaned from a sample. Scientific advances reported by several academic groups in the past three years, however, may soon lead to more sophisti- cated and powerful tests, says Dr Schuh. In addition to using less destructive ways to identify methylation, some new methods scan the entire genome for cancerous changes in the DNA code. New tests also analyse patterns in the physical features of DNA fragments that may hold clues about the presence of cancer. Such multi- pronged approaches, supported by artifi- cial-intelligence tools to assist with data analysis, hold promise. If they can be turned into reliable tests, they may well help identify which cancers need prompt action and which do not. ■ Archaeology Signs of things to come ASYSTEM OF caves in the Swabian Jura, a mountain range in what is now south- west Germany, offers archaeologists a win- dow onto the life of the first anatomically modern Europeans. Between 43,000 and 34,000 years ago, the inhabitants of these caves created a cornucopia of artefacts: specialised tools and jewellery; figurative art; flutes whittled from bone and ivory; and miniature figurines of megafauna both real and imagined. Many of these artefacts are adorned with what archaeologists call “signs”—geometric markings such as dots, lines, crosses and stars—the meaning and purpose of which remain unknown. Christian Bentz, a linguist at Saarland University, and Ewa Dutkiewicz, an ar- chaeologist at the Museum of Prehistory and Early History in Berlin, aimed to bring some clarity to the matter. In a paper pub- Marks left by Stone Age humans are surprisingly complex Barely scratching the surface C002 -- 70 of 80 -- 71 The Economist February 28th 2026 Science & technology ▸ MOVE OVER protein: eating more fibre (or fibremaxxing, as it is known on TikTok) may be the hottest new dietary trend of 2026. Extra fibre appears in everything from frozen pizza dough to unhealthy soft drinks. Are those extra grams worth chasing? Fibre is a carbohydrate found in the cell walls of plants. It comes in many varieties, most of which are not easily digested. This has benefits: by remaining whole in the stomach and gut, fibre stops digestive enzymes from reaching foodstuffs that are rapidly broken down, such as sugar and fat, preventing too much from being absorbed by the body. What’s more, some fibre is water-soluble and forms a thick gel in the gut. This gel traps some harmful compounds—such as the artery-clogging cholesterol found in bile—ensuring more ends up in the toilet than in your blood. Even insoluble fibre has its uses, adding bulk to bowel movements and reducing constipation. Further benefits occur in the colon, where various types of beneficial gut bacteria turn fibre into, among other things, molecules known as short-chain fatty acids (SCFAs). Some SCFAs provide energy to the cells that form the lining of the colon, the barrier between pathogens in the gut and the bloodstream. Recent research shows that SCFAs also help the body regulate its metabolism and appe- tite, and even keep the immune system from overreacting. The net effect is wide-ranging health benefits. Studies that ask people about their diets consistently show that the more fibre they eat, up to 25-30g a day, the lower the risk of cancer, diabetes and heart disease. Whether benefits contin- ue to accrue at higher doses is less clear. One risk of being laser-focused on fibre intake, though, is that people may get those 30g from an imbalanced diet. Two slices of bread, for example, can have as much fibre as a serving of broc- coli or spinach (about 2.5g), simply be- cause wheat is one of the most fibre- dense crops. Half a loaf of wholemeal bread can get you close to the recom- mended daily amount of fibre. The bread, however, lacks many of the vita- mins, minerals and antioxidants that are present in the greens, and also contains less of the soluble kinds of fibre. A more sensible way to increase fibre intake is eating a mix of plant-based foods. A research review by the World Health Organisation, published in 2023, found that the health benefits from eating more fruit and vegetables in- crease up to 800g a day, at which point they level off. (Official recommendations stick to the more realistic goal of five portions a day, or roughly 400g.) Those who consume a varied diet will easily hit 30g of fibre per day—as well as a good mix of vitamins, minerals and protein. The research on fibre’s long-term health benefits is based on the natural kind found in whole foods. There are no comparable data for the extracted or synthetic types of fibre—such as inulin (extracted from chicory root) or cellulose (extracted from wood pulp or cotton)— commonly added to processed foods, which makes them a riskier proposition. If you’ve ingested below 10g per day most of your life, start slowly, says Giana DiMaria, a dietitian at New York Med- ical College. Her advice is to increase intake by 3-5g every few days, starting with fibre that has already been partially broken down (such as that found in smoothies or cooked vegetables) which the body finds easier to digest. Even for regular fibre-eaters, though, drinking plenty of water is a must: it helps reduce bloating and constipation. Well Informed Are you getting enough fibre? If you’re eating plenty of whole foods, you probably are lished in PNAS, they reveal not only that these ancient carvings were applied in an intentional, systematic manner but that they were complex enough to have the po- tential to convey information. What’s more, say the authors, they are as informa- tion-dense as the system of marks that closely preceded the advent of writing some 5,000 years ago. To reach their conclusions, the re- searchers digitised sign sequences made on 260 artefacts recovered from the Swabi- an caves. They then used a combination of linguistic and machine-learning tools to extract a statistical fingerprint for the signs. This captured not only basic fea- tures such as how often a given sign was re- peated, but also how reliably certain pat- terns of signs recurred. So that the signs could be compared with other marking systems, the research- ers also ran their tools on a database of 89 modern languages in 16 scripts as well as examples from three eras of proto-cunei- form script, a system that originated in Mesopotamia around 3,300BC. Proto-cu- neiform script holds a special status in hu- manity’s history as it would eventually evolve into cuneiform, the first known form of writing (defined by linguists as the use of marks to represent speech). Drs Bentz and Dutkiewicz found that the sign sequences from the caves bear no resemblance to modern writing. Unlike the latter, they exhibit a high degree of repeti- tion and a low information density. The sign sequences are, therefore, unlikely to represent the languages spoken by the hu- mans who made them. But there was a twist. The researchers also found that the signs’ statistical fingerprint significantly overlaps with that of the earliest proto-cu- neiform scripts. Moreover, the similarity between them is greater than that between the latter and modern writing. The results imply that the complexity of human-made markings remained roughly unchanged for tens of thousands of years. Then, in the space of a few centuries, the first true writ- ing system emerged. Many hypotheses have been proposed for why these engravings were made: some say they were counting devices and calen- dars; others claim they logged prey migra- tions. This latest paper cannot answer this question on its own, but does provide valu- able clues. It shows that dots appear on fig- urines of lions and humans, for example, but not on tools. Ivory figurines, mean- while, are the most information-dense. When it comes to resolving a 40,000-year- old mystery, no detail is too small. ■ We're hiring: Applications are open for the 2026 Richard Casement internship. The successful candidate will spend three months with us in London writing about science and technology. More details at: economist.com/casement2026 C002 -- 71 of 80 -- 72 The Economist February 28th 2026 Culture Pop music Down with the Kids WHO MADE the second-highest-sell- ing album in the world last year? (There are no prizes for correctly guessing who claimed the top spot—it was Taylor Swift.) You may be tempted to name a pop juggernaut such as Lady Gaga or Justin Bieber. Country-music fans might opt for Morgan Wallen. Lovers of Latin music might volunteer Bad Bunny, the star of the Super Bowl half-time show. All those answers are wrong. The right one is Stray Kids, a South Korean boyband. You might find this perplexing, because Stray Kids sounds like a clothing line or an after-school club. Chances are you cannot name one of their hits, never mind hum one of their punchy dubstep- and electron- ic-inflected tunes. But there are millions of people across the world who can. Stray Kids are fully fledged superstars. The band has more than 10.5bn views on YouTube and almost 2bn likes on TikTok. Fans have spent some 21m hours—roughly equivalent to 2,400 years—feasting on a track called “God’s Menu” on Spotify. In November “DO IT” became their eighth album or EP (extended play) to reach number one on the Billboard 200 chart. It is a feat not even BTS, another K-pop group with far superior name recog- nition, have accomplished. Stray Kids’s recent stadium tour, “dom- inATE”, lived up to its name, with revenues of almost $200m. A concert film was re- leased in cinemas at the beginning of Feb- ruary. For one weekend, it was the highest- grossing movie in the world. The band is not an overnight success. The eight members had been working on their skills as singers, rappers and dancers in K-pop’s intensive training system long before they joined the band in 2017. That year a reality-television show chronicled Stray Kids’s transformation from a gaggle of novice, nervous youngsters—during shows members would drop their micro- phones and mess up the words—into a well-oiled entertainment machine. The show was a canny marketing technique; their debut single, “Hellevator”, was re- leased to coincide with its broadcast. But the group’s global breakout came later, in 2020, with the release of “God’s Menu”, a cacophony of sirens, thudding beats and aggressive vocals. (Throughout, the members mimic the sound of gun- shots: “DU DU DU DU DU DU”.) The music video, displaying sharp dance moves and even sharper editing, went viral. Stray Kids’s success is not the result of child’s play. They have prospered for two reasons. One is a defiantly original sound. From the start Stray Kids eschewed the ef- fervescent tunes preferred by their K-pop rivals in favour of something much rowdi- er. (Some call it “noise music”, which does a disservice to the catchy hooks and tune- ful bridges.) The frenetic trap-pop style This is the biggest band you’ve never heard of → ALSO IN THIS SECTION 73 A family’s escape from Nazism 74 Hannibal Lecter’s appeal 74 Why Gen Z loves line dancing 75 Pokémon: a monster hit at 30 76 The Communist takeover in China ⏩ C002 -- 72 of 80 -- 73 The Economist February 28th 2026 Culture ▸ ⏩ made them outliers, but over time has won them admirers. Stray Kids’s followers— around 75% of whom are female, according to Chartmetric, a music-data firm—find it thrilling. “We made it on our own,” the band declares. “We do what we wanna do.” This is all by design. In 2017 Bang Chan, the group’s leader, selected each member himself from the trainees at JYP Entertain- ment, a record label. Normally it is music executives who put bands together and it can result in groups that lack chemistry. But Bang Chan picked performers who suited his boisterous style. For instance, Felix, a rapper, has a deep, gravelly voice that lends a distinctive texture to songs. And whereas other K-pop groups may be assigned tracks by their label, leading to variations in style across albums, Stray Kids write most of their music themselves. Three members, working as a group called 3RACHA, handle the music production. Their songwriting approach is guided by recurring “melodic symbols” within tracks, Changbin, one member, has said. Fans can repeat these leitmotifs even if there is a language barrier. Watch “dominATE” and you will see hordes of women screaming “LA-LA-LA-LA” or “MANIAC” on beat. The other reason for their success is Stray Kids’s relationship with those fans. For though their music is gritty, their pub- lic image is anything but. The band mem- bers wear makeup and paint their nails. They sport designer clothes. (It is a miracle their concert outfits did not precipitate a global shortage of rhinestones and se- quins.) Stray Kids demonstrate a more pro- gressive kind of manhood, says Ray Seol of Berklee College of Music. “It’s the Korean way of masculinity…it’s very different from the Western way,” Mr Seol says. “Fans love to see this kind of stuff.” The members also cultivate an air of au- thenticity. (K-pop fans are attuned to en- gagement they feel is “fake” or done at the behest of a record label.) The group regu- larly chats with fans online via livestreams, with special broadcasts for birthdays and other major events; Stray Kids also take fans behind the scenes, sharing songs-in- progress. This creates a sense of proximity and allows fans to feel that they have a di- rect relationship with their idols. Stray Kids chat about their feelings, particularly feelings of anxiousness. In the “dominATE” film every single member talks to the camera about one insecurity or another. Hyunjin says it took him a long time to accept that being vulnerable was acceptable, to realise that “A wounded blade of grass smells sweeter.” This sensitive side comes out in their music. Their lyrics express the concerns of young listeners starting to make their way in the world. (A large majority of the fan- base is aged 13-24.) “My Pace” talks about the perils of comparing yourself with others. “Grow Up” reassures listeners that they are “doing fine”: “Even adults make mistakes.” Nicole Ohiomah-Paul, a teen- age fan from London, says that she “didn’t really like to show [her] emotions” for fear of seeming weak. But Stray Kids have taught her that it “is part of who we are. We’re human.” Stray Kids exemplify a generational di- vide that has long existed in culture. Since the dawn of popular music, parents have been perplexed by what their offspring bop along to in their bedrooms. This has been heightened with the advent of streaming, as listeners can access tracks written by anyone, anywhere. The scale of Stray Kids’s success dem- onstrates just how much the media land- scape has changed in the 21st century. In decades past, television shows, radio sta- tions and newspapers were music’s king- makers: they decided which acts were worth exposure and listeners’ time. They could boost careers or throttle them. That is no longer the case: “Consumers are the new broadcasters,” says Will Page, a former chief economist at Spotify. Stray Kids have had relatively little attention from traditional outlets, but they have still won fans from Seoul to Sydney and São Paulo. “We make the rules,” the band as- serts on “MEGAVERSE”, and “our music echoes through the galaxy.” ■ Family memoirs The lucky ones TWO DECADES ago, in 2006, Sir Michael Moritz passed out during a meeting at Sequoia Capital, the venture-capital firm he ran. (It helped fund Silicon Valley titans such as Google and YouTube.) He had blood cancer, caused by “an errant gene” more common among Ashkenazi Jewish men—meaning Jews with central- and eastern-European ancestry—than in the general population. A doctor said he would not live to see 70. But he has and, like many people with more time behind them than ahead, he began exploring his past. The result is “Ausländer” (Outsider), an exceptionally finely observed, engagingly written family history and memoir of dislo- cation. The book opens with a family tree that will look familiar to Ashkenazi Jewish readers, with many branches lopped off suddenly in the early 1940s. Sir Michael was lucky: his maternal grandparents and his parents, Alfred and Doris, fled Nazi Germany and the horrors of the Holocaust for Britain. He was born in Cardiff in 1954. He delves into his late parents’ characters with a novelist’s sensitivity and patience. Alfred and Doris were an unlikely pair with little in common, thrown together by circumstance and shared history. She was a lover of art and music; she was also bellig- erent and spiky. When her grand-daughter asked her about her favourite decade, she snapped: “What do you mean, ‘Which de- cade?’ They were all terrible.” Alfred was a reserved academic, fond of puzzles, kneading bread and sewing his own bow ties. He excelled at following rules and, after winning a scholarship to Merton College, Oxford, became a profes- sor and academic dean. “The first exami- nation my father had failed,” quips Sir Mi- chael, was naming his favourite Beatle. But Alfred’s rise was not easy. Along with 27,000 other Italian and German men over 16, he was interned as an “Enemy Alien” on the Isle of Man. A tutor, in rec- ommending him for a position with the British armed forces, paid him the fero- ciously backhanded compliment of having “none of the qualities which create preju- dice against his race”. Neither considered themselves “survi- vors”, a term they reserved for other peo- ple—such as a cousin who walked from Auschwitz to Mandatory Palestine, or a friend who had given birth to her daughter on a coal train from Auschwitz to Malthau- sen. They “thought of themselves as one- time escapees. Then they thought of them- selves as British.” But like everyone, they carried their pasts with them and transmit- ted them to their children. As Sir Michael explains: “The more I delved into my par- Ausländer: One Family’s Story of Escape and Exile. By Michael Moritz. Profile Books; 320 pages; £20. To be published in America by Pegasus Books in September; $29.95 The vanished Vaterland C002 -- 73 of 80 -- 74 The Economist February 28th 2026 Culture ▸ ⏩ ents’ pasts, the more I had a sense that I was exploring the sources of inherited de- spair—conveyed unwittingly from one generation to another.” Yet Sir Michael seems given more to feeling out of place than despairing. He feels neither Welsh, British nor Ameri- can—despite living in California since 1976—and speaks with a measured trans- Atlantic accent. He empathises with (and has started a foundation to help) poor stu- dents, but knows it would seem disingen- uous to say so in his “Italian suit, custom- made shirt and suede loafers with a chauf- feured car waiting”. He feels deeply Jewish, but has not belonged to a synagogue in 50 years. Donald Trump’s popularity impelled him to apply for German citizenship, which both of his sons obtained. Sir Michael has produced an outstand- ing examination of how tragedy reverber- ates across generations. “Ausländer” joins a growing list of books written by children of the Nazis’ victims, including “Maus”, Art Spiegelman’s seminal graphic novel, as well as Daniel Finkelstein’s “Hitler, Stalin, Mum and Dad” and Ariana Neumann’s “When Time Stopped”. As survivors die—a report estimates that 70% will have passed away by 2035—and taboos against Nazism weaken, such works keep the Holocaust’s memory alive. They remind the world where antisemitism leads. ■ Villains Hungry eyes THE MOST compelling villains embody an unnerving duality: they attract al- most as much as they repel. From the mo- ment Hannibal Lecter appeared in “Red Dragon”, a psychological-horror novel of 1981, readers were captivated by the char- acter. Since then, the psychiatrist-turned- cannibal has featured in three more novels, five films and a TV series. In a new book Brian Raftery tries to explain the antihero’s grisly allure: what is it about Lecter that proves so delectable? Mr Raftery’s book offers a range of an- swers, not all of them convincing. Lecter’s terror comes “not from the way he indulges his dark urges—but in the way he’ll expose you to your own”. (Few have watched “The Silence of the Lambs” and realised they are a frustrated cannibal.) “Lecter is so naked- ly what he is,” proffers Brian Cox, who was the first to play Lecter on screen. (This is true of many people.) “We feel murderous things,” suggests Sir Anthony Hopkins, Lecter’s most famous portrayer: the char- acter forces viewers to “acknowledge that we have those parts of ourselves”. (The same could be said of any horror villain.) A more intriguing suggestion is that Lecter rose to fame in the 1980s and 1990s, when public fascination with serial killers was growing, but before podcasts and the internet gave true-crime obsessives enough material to last lifetimes. Lecter is also urbane, charming and witty: he would be an enjoyable dinner companion, at least until he decided your thigh looked better than the chicken’s on his plate. Two other factors account for Lecter’s longevity. One is Sir Anthony. In 1991 he won the Oscar for Best Actor for his perfor- mance in “The Silence of the Lambs”. The film showed Lecter imprisoned in a dunge- on, called on by the FBI for help to catch another serial killer. Sir Anthony was still, poised and unblinking; his speech was pre- cise and his accent refined. The effect was equally chilling and mesmerising. The other is scarcity. In “Red Dragon” and “The Silence of the Lambs”, Lecter was a supporting character. (Sir Anthony’s Oscar-winning turn required just 16 min- utes of screentime.) This made him enig- matic, as did his lack of back story. He in- sisted that “Nothing happened to me. I happened. You can’t reduce me to a set of influences.” Lecter blossomed in viewers’ and readers’ imaginations. But Hollywood’s philosophy is “more is more”. Subsequent books, films and the TV show made Lecter the protagonist and ex- plained his gruesome origins. The expo- sure bled him of his mystery. He became a bitchy gourmet with that most common of things: a troubled past. Yawn. Change the channel and pass the fried earlobes. ■ Hannibal Lecter: A Life. By Brian Raftery. Simon & Schuster; 336 pages; $30 and £20 Want his recipe for liver and fava beans? American culture New stomping grounds IT IS A frigid mid-week evening in New York; snow has been pushed into large mounds on the pavement. But inside Des- ert 5 Spot, a Western-themed bar in Brook- lyn, a group of 20-somethings is bringing the heat. Two instructors, going by the names Spitfire and Sugarfoot, guide the crowd through a line dance called “Texas Time”. It is carried out to the tune of “Good Luck, Babe!”, a pop song by Chap- pell Roan, an American hitmaker, and the participants twirl, hop and strut in their cowboy boots. “When we open the doors at six o’clock there’s a line of people wait- ing to get in,” Chase Manhattan, the bar’s moustached entertainment director, shouts over the music. Line dancing is no longer the preserve of far-flung cowboys. When Desert 5 Spot started to host line dances around a year ago, only a handful of people showed up, Mr Manhattan recalls: now tickets sell out. Daily line-dancing classes at SCUFF, an- other organisation, are consistently full. In New York there is a gathering happening almost every night. Across America Google searches for line dancing have been steadily climbing since 2020, peaking last year. A decade ago the perception of line dancing was that it was “corny and dorky and honky and stu- pid”, says Sean Monaghan, who co-found- ed Stud Country, a queer line-dancing event, in Los Angeles in 2021. Today people see it as “sexy”. Pop stars such as Sabrina Carpenter have incorporated line dances into their music videos. What explains the step change? It helps that Americana is in vogue. Brands includ- ing Ralph Lauren, Christian Louboutin, Louis Vuitton and Prada have released clothing and accessories inspired by the cowboy aesthetic. Neo-Western dramas are having a revival on screen, too, and country music is surging in popularity, boosted in recent years by albums from Beyoncé, among others. In 2025 the genre was streamed 122.5bn times in America, ac- cording to Luminate, an analytics firm, be- hind only pop, rock, hip-hop and R&B. Line dancing is also a stomping success on social media. There are millions of vid- eos of line dancing online, showing young and old alike doing the boot-scootin’ boo- gie. Several first-timers to Desert 5 Spot say they discovered the event on Instagram and TikTok. And the dances themselves, which are quicker and shorter than other NEW YORK Why Gen Z is falling into line dancing C002 -- 74 of 80 -- 75 The Economist February 28th 2026 Culture ▸ types of choreography, suit the pace of on- line short-form video well. You can see a particular move or section of a dance “done twice...in less than 30 seconds”, says Mackenzie Katz, who recently launched another line-dancing event in Manhattan. Line dancing’s distinct etiquette chimes with the habits of the young in other ways, too. Most events prohibit drinks on the dancefloor to prevent party- goers from slipping over. It is a policy that might seem counterintuitive for a bar— Desert 5 Spot charges an entry fee in an- ticipation of the shortfall—but is poten- tially attractive to Gen Z patrons. Just 50% of Americans aged 18-34 reported drinking alcohol last year, according to Gallup, down from 59% in 2023. “A lot of our crowd either don’t drink at all or don’t really drink that much,” observes Spitfire. Instead, young folk come to line-danc- ing bars in search of a different kind of high. Bylie is a 24-year-old regular at Des- ert 5 Spot; she comes alone, seeking com- munity in the crowd. There is something about the synchronised scuffing and shuf- fling that dancers seem to find intoxicating in a socially atomised age. At Stud Country “People scream and holler, and the energy just gets really loud,” observes Mr Mona- ghan. “There’s just this connection that you feel with the people around you.” Toe- ing the line has never been such fun. ■ Japanese culture Creature comforts THE MONSTERS are everywhere. A group of bushy-tailed Eevee frolic on the grass; a Diglett pokes its mole-like head out of the ground; grinning yellow Pi- kachu climb up trees. Visit PokéPark Kan- to, the first permanent Pokémon theme park, which opened in Tokyo on February 5th, to catch more than 600 Pokémon (short for “pocket monsters”). Fans are thrilled: tickets for the park’s first three months sold out immediately. The enthusiasm reflects Pokémon’s cul- tural clout, three decades after its launch. When the first Pokémon video games were released in Japan in February 1996, few ex- ecutives expected it to become a global craze. Yet “Pokémania” quickly spread: to- day the Pokémon Company has sold nearly 500m video games and over 75bn trading cards, as well as broadcasting an anime se- ries to around 190 countries. Pokémon is the highest-grossing media franchise in the world, according to Guin- ness World Records, with total revenues of $150bn—more than Star Wars or Marvel. Pokémon GO, an augmented-reality app, enjoys around 30m active monthly users. Top players battle it out in the annual Po- kémon World Championships, and collec- tors pay monster sums to acquire trading cards. On February 16th a rare Pikachu card sold for a record-breaking $16m. Pokémon was created by Tajiri Satoshi, a Japanese designer who grew up in the suburbs of Tokyo. As a child he was ob- sessed with collecting insects, but urban development quickly swallowed nearby fields and ponds. Mr Tajiri hoped Pokémon would allow children to explore and collect creatures in a digital world, even as the nat- ural one disappeared. (In this he was suc- cessful: a study in 2002 found that eight- year-old children in Britain knew more about Pokémon than common wildlife.) In the first Pokémon anime Ash (or Sa- toshi in Japan) and his best friend Pikachu, a mouse with the ability to generate elec- tricity, catch, battle and tame monsters. The franchise blends two Japanese sensi- bilities, observes Mizuko Ito, a cultural an- thropologist at the University of Califor- nia, Irvine. One is kawaii, or cuteness, which the Pokémon display through their wide-eyed innocence. The other is otaku, or geek culture, in which fans enjoy cata- loguing creatures’ appearance and traits. Pokémon was a “Rosetta stone” that unlocked Japanese storytelling for West- ern audiences, argues Roland Kelts, a pop- culture expert in Tokyo. The franchise cleared a path for subsequent hits such as Digimon and today’s booming anime in- dustry. Officials of the country’s “Cool Ja- pan” initiative, which was launched in 2010 to boost cultural exports, have long sought to emulate the franchise’s success. There are several reasons for its popu- larity. One is that Pokémon offers fans a richly realised world they can immerse themselves in. There are over 100 video games and 1,000 episodes of anime as well as umpteen films, trading cards and all sorts of plushies and merchandise. Chil- dren quickly became attached to the char- acters: when the first Pokémon film, “Mewtwo Strikes Back”, was released in America in 1999, pupils developed the “Po- kéflu”, feigning illness so they could bunk off school and watch the film. The second is that Pokémon appeals just as much to adults as kids. Most collec- tors of rare Pokémon cards and players of Pokémon GO are grown-ups. The environ- mentally minded see the richness of the real world reflected in the franchise, its fantastic beasts emblematic of real ani- mals. “Pokécology”, a pop-up at the Natu- ral History Museum in London, examines how Pokémon “interact with their environ- ments and adapt to habitats from deep for- ests to shadowy caves”. Tickets for the show, which runs until April, are sold out. Other adults simply find them ador- able. Small and fuzzy, Pokémon are some of the most harmless monsters around. At Pokémon Centre Mega in Tokyo, Hannah, a 30-something tourist from Australia, clutches a plushie and says the franchise is “cute and nostalgic”. Pokémon “inspire a sense of calm and comfort”, says Patrick Galbraith of Senshu University in Tokyo. And they make for endearing digital pets players can tame and train. Therein lies the appeal of Pokémon: it is for “every age, every gender”, as Mr Gal- braith puts it. You can take it seriously or revel in its silliness; play the games with your children or with friends; favour the in- nocent Jigglypuff or the fierce Charmele- on. As the fans flocking to PokéPark show, Pokémon has managed to catch ’em all. ■ TOKYO How Pokémon took over the world It is not hard to Pika-choose a favourite C002 -- 75 of 80 -- 76 The Economist February 28th 2026 Culture Political change Red in tooth and claw “COMMUNISM WAS never popular in China,” Frank Dikötter argues in his new book, “no more so than in Finland or in the United States.” It was “brought to the population at the barrel of a gun”. Be- hind that barrel was the hand of the Soviet Union, without which victory would have been impossible. After the second world war, Soviet intervention transformed Chi- na’s Communist Party from a battered, marginalised guerrilla force into a heavily armed military machine. Read histories approved by the party and a different picture inevitably emerges. In those tellings, when the party was founded in 1921, it harnessed widespread public discontent with the country’s chaot- ic rule by competing warlords and the oc- cupation of its territory by foreign powers. It survived attempts to crush it by the Na- tionalists, who gained nominal control in the late 1920s, and staged a heroic “Long March” in the mid-1930s to set up a base in Yan’an. It played a crucial role in defeating the Japanese in 1945 and overthrew the cor- rupt and brutal Nationalists four years lat- er at the end of a civil war. Mr Dikötter, a Dutch-born historian of modern China, laments that in scholarly volumes and popular books, the party’s version of events is reflected all too often. He may overstate the degree to which ac- counts of the party’s rise favour its “fairy- tale” view. Works such as Jung Chang’s “Wild Swans” (1991) and her subsequent “Mao, the Unknown Story” (2005), co-au- thored with Jon Halliday, offer devastating critiques of the party’s ruthlessness and deceptiveness before it seized power. So do more academic books, such as “Mao: The Real Story” (2012) by two American- based scholars, Alexander Pantsov and Steven Levine, who, like Mr Dikötter, draw extensively from Soviet archives. But Mr Dikötter’s account is not a fam- ily history like “Wild Swans”, nor a biogra- phy. It is a systematic dissection of the par- ty in its formative years. It argues that far from a “triumph of great social forces un- leashed and harnessed by the Commu- nists”, the party’s victory in 1949 was the re- sult of a “very traditional pursuit of power” and “the amoral application of military strategy”. Communist forces survived on “loot and ransom”, recruited bandits, trad- ed opium and, in the civil war, used many unarmed civilians as human shields. For evidence of this, Mr Dikötter traw- led through well over 300 volumes pro- duced in the 1980s by party archivists. They contain documents from the pre-1949 period and are intended for “in- ternal” use only, meaning they cannot be read by ordinary members of the public. The volumes, however, have found their way abroad, where Mr Dikötter says that historians have made only “sporadic” use of them. One reason for this, he speculates, is that they show how peripheral the party was in China’s history until the end of the second world war, when the Soviets began tipping the scales. Before 1940 the percent- age of party members among China’s pop- ulation was comparable to the scale of Communist membership in America, says Mr Dikötter, and may have been inflated. With a little help from their friends Before the end of the war, Soviet support for Chinese Communists often appeared half-hearted. Soviet leaders saw the ruling Nationalist Party, or Kuomintang (KMT), as vital to their efforts to keep Japan at bay. They urged both sides to co-operate in re- sisting Japan’s invasion of China. Mr Di- kötter says Mao Zedong (pictured) pre- ferred to keep his forces out of harm’s way so they would be able to fight the KMT. Soviet calculations changed when Ja- pan’s defeat appeared imminent in 1945. As Japan’s occupation of Manchuria, in Chi- na’s north-east, crumbled, Stalin sent near- ly 1m troops into the industrial region. They seized control of major cities and ports and set about stripping the region of valuable industrial assets. Soviet troops denied the KMT access to Manchuria and China’s leader, Chiang Kai-shek, “was in no position to quarrel with Stalin”, says Mr Dikötter. When the Soviets withdrew in 1946 they allowed Mao’s guerrillas, who had infiltrated Manchuria, to fill the vacu- um and take control of vast quantities of abandoned Japanese weapons. Even at this point, the party’s defeat of the KMT was by no means assured. The Americans, however, gave the Commu- nists another leg-up. General George Mar- shall, sent by President Harry Truman to mediate in the China conflict, believed the Communists were “merely rural reformers who could help shape a democratic China”, Mr Dikötter argues. Marshall pressed Chiang to hold back his army and arrange a truce. The resulting four-month ceasefire gave the Communists crucial time to build up their army with Soviet help. The mili- tary balance shifted completely. If there is a weakness in this account of the party’s rise, it is that it leans heavily on official sources. The party’s archives pro- vide valuable evidence of the atrocities its members committed—for example, in the early 1930s, when they admit that interro- gations of suspected opponents of Mao “relied wholly on torture”. But such snip- pets are not a complete picture, and it was extremely hard in those chaotic and dan- gerous times for foreign journalists to in- vestigate. Mr Dikötter does much to de- mystify events based on the sources avail- able. But much fog remains. ■ Red Dawn Over China. By Frank Dikötter. Bloomsbury Publishing; 384 pages; $33 and £25 A new book lays out how China’s Communist Party seized power in 1949 An expert in crowd control C002 -- 76 of 80 -- 77 The Economist February 28th 2026 Economic & financial indicators Gross domestic product Consumer prices Unemployment Consumer prices Unemployment Current-account Budget Current-account Budget Interest rates Currency units % change on year ago % change on year ago rate balance balance rate balance balance rate balance balance 10-yr gov't bonds change on per $ % change latest quarter* 2026† latest 2026† % latest quarter* 2026† latest 2026† % latest quarter* 2026† latest 2026† % % of GDP, 2026† % of GDP, 2026† latest, % year ago, bp Feb 26th on year ago % of GDP, 2026† % of GDP, 2026† latest, % year ago, bp Feb 26th on year ago % of GDP, 2026† % of GDP, 2026† latest, % year ago, bp Feb 26th on year ago % of GDP, 2026† % of GDP, 2026† latest, % year ago, bp Feb 26th on year ago United States . United States . 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Indonesia ‰.… Indonesia ‰.… Q4 Š.” ‰. †.‰ Š.” ‰. †.‰ Jan 2.8 ….Ž Aug§ -‹. -†.„ Š.… -…†.‹ -‹. -†.„ Š.… -…†.‹ -‹. -†.„ Š.… -…†.‹ -‹. -†.„ Š.… -…†.‹ „Š,””Š -.” „Š,””Š -.” Malaysia Š.† alaysia Š.† Q4 †.• ‰.„ „.Š †.• ‰.„ „.Š Jan 2.0 .Ž Dec§ .† -†.‰ †.‰ -Ž.‹ .† -†.‰ †.‰ -Ž.‹ .† -†.‰ †.‰ -Ž.‹ .† -†.‰ †.‰ -Ž.‹ †.•Ž „†.Š Pakistan †.” akistan †.” 2025** na †.‰ ‰.• na †.‰ ‰.• Jan 5.0 Š.Ž 2025 -‹.• -….… „„.Š ††† -”†.‹ ”Ž ‹.„ „„.Š ††† -”†.‹ ”Ž ‹.„ „„.Š ††† -”†.‹ ”Ž ‹.„ Philippines †.‹ Philippines †.‹ Q4 .… ….‰ .‹ .… ….‰ .‹ Jan 2.2 ‰.‹ Q4§ -.Ž -‰.• ‰.Ž -‹.‹ -.Ž -‰.• ‰.Ž -‹.‹ -.Ž -‰.• ‰.Ž -‹.‹ -.Ž -‰.• ‰.Ž -‹.‹ ‰”.‰ ‹.Š ‰”.‰ ‹.Š Singapore Š.Ž e Š.Ž Q4 •.” .Ž „.… •.” .Ž „.… Jan 1.4 .‹ Q4 „….Ž ‹. .‹ -•†.‹ „….Ž ‹. .‹ -•†.‹ „….Ž ‹. .‹ -•†.‹ „….Ž ‹. .‹ -•†.‹ „.Š ‰.‰ „.Š ‰.‰ South Korea „.‰ orea „.‰ Q4 -„.„ .‰ .‹ -„.„ .‰ .‹ Jan 1.8 ….„ Jan§ ….Ž -.… †.‰ ”‰.‹ ….Ž -.… †.‰ ”‰.‹ ….Ž -.… †.‰ ”‰.‹ ….Ž -.… †.‰ ”‰.‹ „,…” ‹.† „,…” ‹.† Taiwan „.” aiwan „.” Taiwan „.” T Q4 †.Š Š.Ž ‹.” †.Š Š.Ž ‹.” Jan 1.5 †.… Jan †.† ‹.” „.… -„Ž.‹ †.† ‹.” „.… -„Ž.‹ †.† ‹.” „.… -„Ž.‹ †.† ‹.” „.… -„Ž.‹ †„.† ….” †„.† ….” Thailand .‰ Thailand .‰ Q4 ”.• . -‹.” ”.• . -‹.” Jan 0.4 ‹.” Dec§ .• -….‰ „.” -‰„.‹ .• -….‰ „.” -‰„.‹ .• -….‰ „.” -‰„.‹ .• -….‰ „.” -‰„.‹ †„.„ •.” †„.„ •.” Argentina †.† rgentina †.† Q3 „.„ †.‹ †.… „.„ †.‹ †.… Jan 28.6 Š.Š Q3§ -.‹ ‹.… na na -.‹ ‹.… na na -.‹ ‹.… na na „,†Ž• -….„ Brazil „.• azil „.• Q3 ‹.… „.• ….… ‹.… „.• ….… Jan 4.0 ‰.„ Dec§‡‡ -.• -”.„ „†.… -„• -.• -”.„ „†.… -„• -.• -”.„ „†.… -„• -.• -”.„ „†.… -„• ‰.„ „.„ Chile „.Š Chile „.Š Q3 -‹.Š . .• -‹.Š . .• Jan 3.0 •.„ Dec§‡‡ -.‹ -„.” ‰.† -”Š.‹ •‰” Ž.Ž -.‹ -„.” ‰.† -”Š.‹ •‰” Ž.Ž -.‹ -„.” ‰.† -”Š.‹ •‰” Ž.Ž -.‹ -„.” ‰.† -”Š.‹ •‰” Ž.Ž -.‹ -„.” ‰.† -”Š.‹ •‰” Ž.Ž Colombia . Colombia . Q4 ‹.‰ .” ‰.… ‹.‰ .” ‰.… Jan 5.7 •.‹ Dec§ -.” -Š.‰ „†.… ” -.” -Š.‰ „†.… ” -.” -Š.‰ „†.… ” -.” -Š.‰ „†.… ” †,”‹… „„.… Mexico „.• exico „.• Q4 †.‰ „.… †.• †.‰ „.… †.• Jan 3.7 .Š Dec -‹.‰ -†.• •.” -„‹„ „”. „Ž.† •.” -„‹„ „”. „Ž.† •.” -„‹„ „”. „Ž.† Peru †. eru †. Q4 -‹.Š .” „.” -‹.Š .” „.” Jan 1.6 Ž.” Jan§ „.… -.‰ ‰.• -Š….‹ „.… -.‰ ‰.• -Š….‹ „.… -.‰ ‰.• -Š….‹ „.… -.‰ ‰.• -Š….‹ †.†Š Ž.• †.†Š Ž.• Egypt ‰.† gypt ‰.† Q3 †Ž.… ‰.† „„.Ž †Ž.… ‰.† „„.Ž Jan 10.8 Š. Q4§ -„.• -Š. †. -„…„ -„.• -Š. †. -„…„ -„.• -Š. †. -„…„ -„.• -Š. †. -„…„ …•.‹ ‰.… …•.‹ ‰.… Israel †.” srael †.” Q4 ….‹ ….• „.• ….‹ ….• „.• Jan 1.9 †.„ Dec .„ -†.Ž †.• -‰†.‹ †.‹Ž „‰.Ž †.• -‰†.‹ †.‹Ž „‰.Ž †.• -‰†.‹ †.‹Ž „‰.Ž Saudi Arabia ….‰ abia ….‰ 2025 na ….‰ „.• na ….‰ „.• Jan 1.9 †.… Q3 -†.… -…. na na -†.… -…. na na -†.… -…. na na †.”‰ nil South Africa .„ frica .„ Q3 .‹ .‹ †.… .‹ .‹ †.… Jan 3.4 †„.… Q4§ -‹.„ -….… ”.• -” „‰.• „Š. ”.• -” „‰.• „Š. ”.• -” „‰.• „Š. Source: Haver Analytics *% change on previous quarter, annual rate †The Economist Intelligence Unit estimate/forecast §Not seasonally adjusted ‡New series **Year ending June ††Latest † months ‡‡†-month moving average §§‰-year yield †††Dollar-denominated bonds Note: Euro-area consumer prices are harmonised Markets % change on: % change on: Index one Dec 31st Index one Dec 31st In local currency Feb 25th week 2025 Feb 25th week 2025 United States S&P 500 ,. . .€ 500 ,. . .€ 500 ,. . .€ S&P 500 ,. . .€ S&P United States NAS Comp ‡ˆ, €‡. .‰ -. NAS Comp ‡ˆ, €‡. .‰ -. NAS Comp ‡ˆ, €‡. .‰ -. China Shanghai Comp , Œ.‡ . .€ , Œ.‡ . .€ , Œ.‡ . .€ China Shenzhen Comp ‡,Œ.ˆ ‡.€ ‰.€ Shenzhen Comp ‡,Œ.ˆ ‡.€ ‰.€ Shenzhen Comp ‡,Œ.ˆ ‡.€ ‰.€ Japan Nikkei 225 €‰,€‰ˆ. ‡.€ . €‰,€‰ˆ. ‡.€ . €‰,€‰ˆ. ‡.€ . Japan Topix ˆ,‰ˆ.‡ . ‡.Œ Britain FTSE 100 ,‰. . ‰.‰ ,‰. . ‰.‰ ,‰. . ‰.‰ Canada S&P TSX ˆ, ‡Œ.ˆ ‡.‡ Œ. ˆ, ‡Œ.ˆ ‡.‡ Œ. ˆ, ‡Œ.ˆ ‡.‡ Œ. Euro area EURO STOXX 50 , Œˆ.ˆ . . EURO STOXX 50 , Œˆ.ˆ . . EURO STOXX 50 , Œˆ.ˆ . . France CAC 40 ‰,€€. .€ €. ‰,€€. .€ €. ‰,€€. .€ €. Germany DAX* ‡€, Œ€. -. ‡.‰ DAX* ‡€, Œ€. -. ‡.‰ DAX* ‡€, Œ€. -. ‡.‰ Italy FTSE/MIB Œ, Œ. .Œ €. FTSE/MIB Œ, Œ. .Œ €. FTSE/MIB Œ, Œ. .Œ €. Netherlands AEX ,ˆ. . ‰.ˆ AEX ,ˆ. . ‰.ˆ AEX ,ˆ. . ‰.ˆ Spain IBEX 35 ‰, . . .Œ ‰, . . .Œ ‰, . . .Œ Poland WIG ‡Œ,Œ . . . . . . . Russia RTS, $ terms , € . .‡ ˆ. , € . .‡ ˆ. , € . .‡ ˆ. Switzerland SMI ˆ,ŒŒ. .‡ €.ˆ SMI ˆ,ŒŒ. .‡ €.ˆ SMI ˆ,ŒŒ. .‡ €.ˆ Turkey BIST ˆ,‰. -ˆ.‡ ‡‡. Australia All Ord. ,ˆ€. .ˆ ˆ.‰ ,ˆ€. .ˆ ˆ.‰ ,ˆ€. .ˆ ˆ.‰ Hong Kong Hang Seng ‡,Œ€.Œ .‡ . Hang Seng ‡,Œ€.Œ .‡ . Hang Seng ‡,Œ€.Œ .‡ . India BSE ‰‡,‡Œ. - .Œ -ˆ.€ Indonesia IDX ‰,ˆ‡‡.‡ . -ˆ.‰ . -ˆ.‰ . -ˆ.‰ Malaysia KLSE ,ŒŒ.‰ . . KLSE ,ŒŒ.‰ . . KLSE ,ŒŒ.‰ . . Pakistan KSE ,‡.ˆ -‰. -€. KSE ,‡.ˆ -‰. -€. KSE ,‡.ˆ -‰. -€. Singapore STI €,Œ.Œ . Œ.‰ . Œ.‰ . Œ.‰ South Korea KOSPI ,‰ˆ. .€ . KOSPI ,‰ˆ. .€ . KOSPI ,‰ˆ. .€ . Taiwan TWI ˆ€, ˆ. €. ‡‡.ˆ ˆ€, ˆ. €. ‡‡.ˆ ˆ€, ˆ. €. ‡‡.ˆ Thailand SET ,€ . ˆ. ‡.ˆ Argentina MERV ‡,Œ,‰Œ. ‡.‰ -‰.‡ MERV ‡,Œ,‰Œ. ‡.‰ -‰.‡ MERV ‡,Œ,‰Œ. ‡.‰ -‰.‡ Brazil BVSP*  ,‡Œ. ‡.‰ ‰.Œ BVSP*  ,‡Œ. ‡.‰ ‰.Œ BVSP*  ,‡Œ. ‡.‰ ‰.Œ Mexico IPC Œ , . . . Egypt EGX 30 , .ˆ -. Œ.‡ , .ˆ -. Œ.‡ , .ˆ -. Œ.‡ Israel TA-125 , ˆ. -‡. ‡. Saudi Arabia Tadawul ,‰Œ. -‡.‰ ˆ. Tadawul ,‰Œ. -‡.‰ ˆ. Tadawul ,‰Œ. -‡.‰ ˆ. South Africa JSE AS ‡,Œ‡. ˆ. . JSE AS ‡,Œ‡. ˆ. . JSE AS ‡,Œ‡. ˆ. . World, dev'd MSCI ,€Œ‰. .‰ ˆ.ˆ MSCI ,€Œ‰. .‰ ˆ.ˆ MSCI ,€Œ‰. .‰ ˆ.ˆ Emerging markets MSCI , . ˆ. €. MSCI , . ˆ. €. MSCI , . ˆ. €. US corporate bonds, spread over Treasuries Dec 31st Basis points latest 2025 Investment grade  ˆ High-yield ˆ ˆ€ Sources: LSEG Workspace; Moscow Exchange; Standard & Poor's Global Fixed Income Research *Total return index Commodities The Economist commodity-price index The Economist commodity-price index The Economist % change on =  Feb 17th Feb 24th* month year Dollar Index All items . .
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,. . . Brent $ per barrel . .€ .€ -. . .€ .€ -. . .€ .€ -. Sources: CME Group; LME; LSEG Workspace; NOREXECO; NZ Wool Services; S&P Global Commodity Insights; Thompson Lloyd & Ewart; USDA *Provisional For historical indicators data, visit economist.com/economic-and-financial-indicators C002 -- 77 of 80 -- 78 The Economist February 28th 2026 Philippe Gaulier WALKING PENSIVELY to his class, adjusting his glasses, he wondered what he would teach that day. He was never sure. It was easier to decide on his look—a lurid jacket from anywhere, baggy trousers from somewhere, a broken down hat, a mess of fa- cial hair—than to predict how his students would behave. He had told them to come in a costume in which they would feel ridicu- lous: as Obélix, or a cardinal, or a cow. But would they make him laugh? Almost certainly not. At the back of the bare hall he settled with a stony look. It would take him no more than a second to judge each would-be clown. It was in the eyes, that spark. Or lack of it. To heighten the suspense, he would softly beat the tambour on his lap. Then would come the verdict, a growl of his Frenchified English: “Bor- ing!” “’Orrible!” “Like a vacuum cleaner!” “Like overcooked spa- ghetti!” “This is so, so shit!” A plastic turd could be produced and waved for emphasis. Or simply, as a student burst out smiling from behind the curtain, not uttering a word yet, he would cry “Suivant!” “Next!” Other clowning masters called this the via negativa, learning through a barrage of insults. Philippe Gaulier preferred to call it torment. (He scorned all teachers of theatre except his own mas- ter, Jacques Lecoq, and Bertolt Brecht. Kandinsky, quel imbécile!) But the torment principle was excellent. He loved to say horrible things; he got that from his mother. And insults helped you pro- gress. If you were told you were good, you stopped trying. But if you kept failing, you had to dig deep to improve. Facing crises made you strong. It was good to cry, and fine to be bad even time after time. Everyone was bad at some point. The cardinal sin, the unforgivable, was to be boring. Like a pharmacist (his paternal grandfather was one. A really boring guy). Or a hairdresser. No one who was happy being boring should try to be a clown. They should count out pills all day or suggest he should comb his moustache. His students were allowed to be bad. But to break the balls of innocent people with tedium, no. With this firm conviction he had set up his school at Étampes, near Paris, in 1980. He ran it for 42 years in various places, and it became world-famous. Sacha Baron Cohen, Roberto Begnini, Helena Bonham Carter and Emma Thompson all came, and Hilla- ry Clinton visited once to interview him. About 90 students a year attended. Auditions were simple: just “Name? Cheque?” (€2,300 a term, for two years, and he had never asked for one kopek from the French government.) If he didn’t like someone, or if they were not polite, he kicked them out. Voilà, c’est tout. He taught two particular aspects of clowning, le jeu (the game), and le buffon (the buffoon). In le jeu students learned again how to be children, from tentatively finding a playmate (complicité) to glo- riously romping around. They played musical chairs, grandmoth- er’s footsteps, tag. They gave bisous to each other and gazed into each other’s eyes, opening up, not laughing. (After five seconds, anyone looked ridiculous.) For a whole day they wore red noses to find their inner idiot. Egos were sent to the slaughterhouse; in- stead, students had to discover their own unique, secret absurdity deep inside themselves. But he never asked what that was. It was secret, not to be told to anyone, just like the notebooks ranged around his flat in which he wrote down his dreams. In le jeu, clowns were innocent, marvellous fools. They tried to mimic adults and hoped to be loved for it. Buffons were quite dif- ferent. They got laughs by mocking other actors and, cleverly, get- ting ignorant audiences to laugh at themselves. His own list of people to be mocked without limit were teachers, police, the army, politicians, Germans, the bourgeoisie, racists, fascists and the Catholic church. Germans because at his birth, in 1943, they were occupying Paris. The bourgeoisie because his father, a doctor and salaud bourgeois, had named him Philippe after General Pétain, the worst of fascist collaborators. Teachers because his gym instruc- tor had made the boys march about like soldiers, until one day, aged eight, he had belted him and been expelled. The army be- cause during national service he was frequently locked up for not wearing his beret straight. And all law-makers and law enforcers because he was a dyed-in-the-wool anarchist, a May ’68 guy whose happiest times had been spent building street barricades and stoning the police. His school also offered courses in more traditional theatre: neutral mask, Greek tragedy, Shakespeare and Chekhov. Tragedy had been his first love, but every time he played it people laughed. This failing, and failing again, and failing better (as Sam Beckett wrote) continued for two years after he joined Lecoq’s theatre school in Paris. Then he found his true metier was clowning, and stayed to teach for ten years more. Not that he always liked what Lecoq did, all that mime-movement and technique. His own method (if he had one) was lightness, pleasure, play. He also felt actors should pretend more blatantly, relish performing; after all, theatre was not real. After leaving Lecoq he toured for a decade in a two-hander, “Les Assiettes”, which involved smashing 200 plates onstage every night. He found himself free, breaking things. Dozens of theatre companies (most famously the Théâtre de Complicité) were inspired by his school, and most of his students ended up adoring him. He never expected that. Nor did he care. He taught theatre; they could do what they liked with it. But he hoped he had also brought them beauty and joy. Beauty, because anyone was beautiful who was gripped by the pleasure of life. Joy because, as the ego cracked, light and freedom came in. That was what he was aiming at. If his actors did not arrive onstage as bu- oyant as a child, without baggage, wanting to eat the world, they had failed. Then it was “Boring!” “’Orrible!” and, to the beat of his solemn drum, “Adios immediately! Money back!” ■ OBITUARY The world-famous clowning teacher died on February 9th, aged 82 C002 -- 78 of 80 -- To find out more, scan here or visit: economist.com/critical-thinking-course Reason with rigour Ask smart questions and make better business decisions with our new critical-thinking course In the AI age, it is essential to capitalise on human advantage in business. 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