Activists participate in the January 6 Candlelight Vigil for Democracy at Union Square in front of the US Capitol in Washington, US, last week. EPA
Activists participate in the January 6 Candlelight Vigil for Democracy at Union Square in front of the US Capitol in Washington, US, last week. EPA
Activists participate in the January 6 Candlelight Vigil for Democracy at Union Square in front of the US Capitol in Washington, US, last week. EPA
Activists participate in the January 6 Candlelight Vigil for Democracy at Union Square in front of the US Capitol in Washington, US, last week. EPA


The US can stop another coup attempt before it's too late


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January 09, 2022

Last week marked the anniversary of the January 6 attack on the US Congress. It was commemorated by Democrats, including a hard-hitting speech by President Joe Biden. Republicans, except for the brave but isolated Rep Liz Cheney, were nowhere to be found.

Democrats compare January 6 to 9/11 or Pearl Harbour, while mainstream Republicans such as Senator Lindsey Graham largely dismissed it as overblown. But as we now know for certain, it was the culmination of a concerted effort over many weeks by Donald Trump and his supporters to overthrow the election and perpetrate the first coup d'état in US history.

Former US vice president Dick Cheney walks with his daughter Liz Cheney, vice chair of the House panel investigating the January 6 US Capitol attacks, in the Capitol Rotunda in Washington last week. AP Photo
Former US vice president Dick Cheney walks with his daughter Liz Cheney, vice chair of the House panel investigating the January 6 US Capitol attacks, in the Capitol Rotunda in Washington last week. AP Photo

History teaches that a failed coup, especially when essentially unpunished, invariably gives rise to subsequent coups, and that successful coups usually build upon earlier, unsuccessful ones.

What's crucial about the failed coup, the January 6 violence and the apparent comfort of most Republicans with them, is that they are the logical culmination of a long-developing but rapidly sharpening attack on the US state by the political right.

Mr Trump and his followers are often characterised as nationalists. They are certainly nativists and many are white supremacists. Though they call themselves patriots, they are bitterly opposed to the US government, the actual Constitution, and most aspects of current US society and culture.

The so-called patriots attacking the American state expressed the same irrational double-think when they attacked the Capitol police on January 6, while waving pro-police and "thin blue line" banners, used to show solidarity with the police.

Many among the January 6 mob even claimed they were attacking Congress to "defend the Constitution". Yet they sought to intimidate and frighten elected officials into abandoning the law and the Constitution.

Mob attacks are the exact antithesis of democracy and the rule of law, which are established precisely to prevent the assertion of power through organised violence.

The underlying premise of the failed coup and attack on Congress is the myth, now apparently accepted by most Republican voters, that the 2020 election was a fraud. This “big lie” means the US government is illegitimate and fraudulent and democracy is a cruel joke. It is hard to imagine a more unpatriotic or anti-American stance. Alarmingly, a “big lie” upends worldviews and insidiously persists long after its initial proponents have vanished.

Anti-state rhetoric was a mainstay of the Trump era. The former president attacked almost all core American institutions, not just elections, but also the FBI, CIA, the justice department and military leadership. His terrible relations with these “power ministries” was arguably a fatal weakness.

His fans, including some radical members of Congress and television manipulators such as Tucker Carlson, insist the January 6 attack was somehow orchestrated by the FBI.

This offensive, not aimed against political opponents but at the state itself, is the key to comprehending how dangerous and pernicious the current right-wing agenda in the US has become.

Both right-wing extremists like fascists and left-wing radicals like Leninists share the tactic of attacking, tearing down or hollowing out state institutions as they accumulate power. They then create a set of parallel institutions that operate outside state structures and beyond the rule of law, through which most real power is projected into society.

In addition to the obvious Nazi and Bolshevik historical examples, this pattern can be seen today in countries like Iran and Venezuela. When Mr Trump's close ally and campaign manager Steve Bannon described himself as a "Leninist", this is exactly what he meant.

Mr Trump is a master of anti-state rhetoric. He denounces anything he doesn't like as the work of "the deep state", even though the US does not have a deep state, just a government. Mr Bannon constantly boasts about planning to "dismantle the administrative state", even though administration constitutes almost everything any state does.

Familiar slogans of Mr Trump's movement – “build that wall”, “drain the swamp”, “lock her up” – identify no protagonist. It is not that the state should act on these demands, (none of which will ever actually be accomplished, as both demagogue and followers fully understand), but that somebody should somehow deal with them.

These slogans were largely concocted by firms like Cambridge Analytica, the British data analysis company hired by Mr Trump's 2016 US presidential campaign. And being performative without agency, the chants point to the loss of power by the state rather than government action. Such mantras in their sinister aspirations and warnings of crises communicate that the state is incapable of meeting their demands. Emergencies are the key tactic. Mr Trump loved emergencies, frequently declaring them where they didn’t exist. He even tried to postpone the 2020 election due to a public health emergency.

The Nazi political theorist Carl Schmitt noted that a lawless and authoritarian movement can transform a rule-of-law state by declaring emergencies, putting in place supposedly temporary and exceptional measures to deal with them, and extending them indefinitely.

The rise of armed white supremacist militias in US society, often strongly supportive of Mr Trump, creates the prospect of such parallel sources of power. Two of the largest and most dangerous gangs, the Proud Boys and Oath Keepers, were key participants in the January 6 insurrection. By attacking Congress and the police, they were effectively challenging state authority, seeking to use violence to replace the rule of law with their own will.

The insurrection failed, and with it the final gambit in the attempted coup. Mr Trump and his allies failed to create the constitutional crisis they hoped would somehow allow him to stay in power. Instead, Congress ratified the election results later that day.

Yet the response of the state thus far has been woefully inadequate. Many foot soldiers of the insurrection have received mainly light prison sentences. But none of the planners and authors of the insurrection, and, more importantly, the attempted coup, have been held to account in any meaningful way.

As Ms Cheney put it, Mr Trump has “gone to war with the rule of law” and if he's not winning, he's not exactly losing either.

All this surely invites another such attempt. Unfortunately, the past year suggests that the Trump movement has correctly identified a set of major structural and constitutional weaknesses in the US system, and although they failed in their coup attempt, they also completely got away with it.

The American state does not appear particularly effective in asserting the rule of law and acting decisively to ensure there is no repetition of the coup attempt – especially not one that, building on the lessons of the past, might have a much better chance of success.

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

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Updated: January 10, 2022, 4:27 AM