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Council on Foreign Relations Daily News Brief
January 7, 2014
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Top of the Agenda

Top of the Agenda: Yellen Confirmed as Next Fed Chair

The U.S. Senate confirmed Janet Yellen as the chair of the Federal Reserve on Monday in a vote of 56 to 26. She will be the first woman to lead the nation's century-old central bank (NYT). As the Fed's vice-chair, Yellen advocated for extraordinary measures to revive the U.S. economy. Though unemployment still hovers at 7 percent, her task upon succeeding outgoing chair Ben Bernanke next month will be to gently roll back those stimulus policies, many economists say (AP). After beginning the so-called taper of Fed asset purchases last month, Bernanke ends his eight-year tenure with an upbeat outlook for the economy while acknowledging the U.S. recovery "clearly remains incomplete" (FT).


"Ms Yellen will no doubt be conscious that a similarly benign outlook was mooted before Mr Bernanke's ascent to the Fed chairmanship in 2006. Economists were still talking about the 'great moderation,' though the 'great credit crunch' was only 18 months away, subsequently to be followed by the greatest financial crisis of all time. It is an unpalatable fact of central banking life that there is always a crisis, as well as a bunch of hostile folk on Capitol Hill, lying in wait. The only question is whether the lurking monster hits you or your successor," writes John Plender in the Financial Times.

"An acceleration in housing hinges on the Federal Reserve's ability to successfully match the pace of future interest rate increases to an improving job market. Home sales won't be dented by higher mortgage rates if brisk hiring and a falling unemployment rate lift homebuyers' income and confidence. For the Federal Reserve to gracefully unwind its extraordinary monetary stimulus policies is no small order, but it is doable, and the most likely outcome," writes Mark Zandi in this CFR Expert Roundup on predictions for the global economy in 2014.

"Women head central banks in Russia, Israel and South Africa. They have claimed prestigious prizes for research, including the Nobel and the John Bates Clark medal for the most outstanding economist under age 40. Now, with Janet Yellen about to become the first female chief of the Federal Reserve, it looks like a golden era for women economists has arrived. But the high-profile gains contrast with college economics departments, where women remain a minority at every level of the profession," writes Brenda Cronin in the Wall Street Journal.


CFR's Global Conflict Tracker

The Center for Preventive Action's Global Conflict Tracker is an interactive guide to U.S. conflict prevention priorities in 2014. It provides an up-to-date overview of each ongoing or potential conflict featured in the most recent Preventive Priorities Survey and features additional background information. Take a look.

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Migrant Boat Tests Australia's Hard Line on Asylum

A boat with forty-five mostly African asylum seekers was reportedly given life jackets and communications equipment by the Australian navy before being escorted out of Australia's territorial waters (Jakarta Post). This is believed to be the first time the government of Prime Minister Tony Abbott has acted on a pledge to crack down on migrants, a source of tension in Indonesian-Australian Relations (Sydney Morning Herald).

CHINA: Air pollution is responsible for 350,000 to 500,000 premature deaths in China every year, according to an article in the medical journal The Lancet cowritten by former health minister Chen Zhu. Though lower than previous estimates, this is one of the issue's most high-profile official recognitions (SCMP).

CFR's Elizabeth Economy discusses environmental activism in China.



India, Japan to Strengthen Defense Ties

The Indian and Japanese defense ministers, meeting in New Delhi on Monday, agreed to strengthen their countries' defense ties. Both countries are wary of China's assertive behavior (Times of India).

INDIA: Federal prosecutors and an attorney representing Indian diplomat Devyani Khobragade, whose arrest in New York last month chilled U.S.-Indian relations, agreed late Monday to waive a deadline for indictment. The postponement defused tensions as New Delhi said it had unearthed legal violations by U.S. diplomatic personnel there (WaPo).



Fighting Among Syrian Opposition Factions Expands

Rebel groups' offensive against the al-Qaeda-affiliated Islamic States of Iraq and Greater Syria (ISIS) widened Monday to the eastern city of Raqqa, where some activists said ISIS had largely been evicted (NYT). Amid the intra-opposition fighting, government forces reportedly killed ten civilians in an air strike in Aleppo province (AP).

CFR's Elliott Abrams criticizes the Obama administration's Syria policy in the Weekly Standard.

IRAQ: As Baghdad tries to reassert its authority over parts of Anbar province taken over by ISIS militants, the White House said Monday it was accelerating arms sales, including surveillance drones and Hellfire missiles, to Iraq (BBC).



CAR Crisis Worsening, Security Council Told

The Central African Republic is on the brink of catastrophe, UN political affairs chief

Jeffrey Feltman told the Security Council on Monday. In addition to some 750 casualties in the capital of Bangui, he said, about half the population is displaced or needs assistance (al-Jazeera). The Security Council authorized an African-led peacekeeping force in December.

This Backgrounder explains the role of the UN Security Council in crisis management and peacekeeping operations.

SOUTH SUDAN: As cease-fire talks got underway in the Ethiopian capital of Addis Ababa, China highlighted its role in mediation efforts as Chinese foreign minister Wang Yi began a four-nation African tour (AFP).



Ski Accident Sidelines Merkel

German chancellor Angela Merkel was injured in a skiing accident during a Christmas vacation and will have to rest for three weeks, her spokesman said Monday. The announcement comes near the start of her third term, which has been marked by a fractious coalition, and will force her to cancel foreign travel and official appointments (Reuters).

CZECH REPUBLIC: Three parties agreed to form a center-left coalition on Monday under which Social Democrat leader Bohuslav Sobotka will become prime minister. The previous, center-right government was dissolved after a spying and corruption scandal came to light, prompting a snap election in October (Deutsche Welle).



Land Victory for Brazilian Indigenous Rights Activists

Brazilian law enforcement officials this week will begin evicting loggers, ranchers, and others who have settled land belonging to the endangered Aw√° tribe after human rights NGOs and international celebrities pressured the government to protect the land (Guardian).



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