The war between Hamas and Israel is unlikely to spill over into the global economy, Treasury Secretary Janet Yellen told delegates at the annual meetings of the International Monetary Fund (IMF) and World Bank, in Morocco.
Despite the initial volatility in global financial markets on Oct. 9, investors have largely dismissed concerns that the latest conflict in the Middle East will impact the international economy, pricing in various scenarios.
Ms. Yellen does not think the events will result in anything "very significant" for the global economic outlook.
"While we are monitoring potential economic impacts from the crisis [in Israel], I’m not really thinking of that as a major driver of the global economic outlook," she said. "Thus far, I don’t think we’ve seen anything suggesting it will be very significant."
In her prepared remarks to the IMF roundtable, Ms. Yellen championed America's commitment to strengthen the fund and advocated more support for the organization as economic shocks "often hit low-income countries the hardest."
"The IMF’s continued relevance depends on its ability to adapt its policy advice and provide lending that will support countries’ efforts to restore macroeconomic stability," she said.
Gita Gopinath, the IMF's first deputy managing director, told Bloomberg TV on Oct. 11 that it is still too early to determine if the war between Israel and Hamas will exacerbate inflation pressures and hamper global growth.
“If it turns into a wider conflict, and that causes oil prices to go up, that does have an effect on the economies,” Ms. Gopinath said in an interview with the business news network.
“That’s usually one of the channels through which we see that affecting global numbers.”
Also appearing in Morocco this week, IMF chief economist Pierre-Olivier Gourinchas noted that the global economy is “limping along, not sprinting.”
The IMF forecasts that the global economy will expand 3 percent this year and 2.9 percent in 2024.
Concern Over War's Length
Other economists warn that the longer the war goes on, there will be worries that it will threaten the worldwide economic outlook.
"All eyes clearly remain on the tragic scenes out of Israel, and there is deep concern over what’s to come. Likely this story goes quiet for a while, but it’s clearly far from over. More likely the beginning in fact, given the voices out of Israel," wrote ING strategists in a research note.
"Even if it remains localized, there will be concern that it becomes much bigger and more dangerous."
Ultimately, it will depend on how far the conflict intensifies and extends, says Heritage Foundation economist Peter St Onge.
"For the real economy, everything depends on how far the conflict spreads. If it is contained, we will get drama and markets but little on the real economy,” Mr. St. Onge explained in his daily commentary posted to X.
“If, on the other hand, regional powers and the United States are drawn into a deeper war, we could be looking at oil dealing a catastrophic hit to inflation, which would drive the Fed to pull out all the stops and hike interest rates to economy-crushing levels we have not seen since [former Fed Chair] Paul Volcker," he wrote.
On the market front, the leading U.S. benchmark indexes have risen around 2 percent in the last week. The fear trade quickly dissipated after sending traders into safe assets like the greenback and U.S. Treasurys.
The U.S. Dollar Index (DXY), a gauge of the greenback against a basket of currencies, fell below 106.00. Treasury yields also slipped to their lowest levels in about two weeks. Gold, a conventional haven asset during volatile times, has held steady in recent sessions, inching back toward the $1,900 mark.
An oil facility on Khark Island off Iran's coast, on March 12, 2017. (Atta Kenare/AFP via Getty Images)
Iran and Oil
The U.S. government has not linked Tehran to the events of this past week. However, Ms. Yellen warned that nothing is "off the table" if Iran is found to have supported the assault on Israel.
Still, Washington has not made any decisions on renewed economic sanctions on the Iranian regime.
"I wouldn’t take anything off the table in terms of future possible actions, but I certainly don’t want to get ahead of where we are on that," she said.
Last month, the White House released $6 billion in frozen Iranian crude oil assets, transferring the funds from South Korea to an account in Qatar as part of broader efforts to ease tensions with Iran.
Sen. Tim Scott (R-S.C.) has called for a Senate Banking Committee hearing with Ms. Yellen and a federal investigation into the release of the $6 billion.
"In the face of evil, we must use every tool, weapon, and economic sanction available to provide for our nation's security and the security of Israel," said Mr. Scott in a statement.
“We should be signaling strength—not leniency—when it comes to Iran. That’s why now is the time to pass my Solidify Iran Sanctions Act and send the message that Iran should not expect U.S. sanctions to lapse." (Since then, the United States and Qatar, where the money was held, re-froze the assets.)
Energy markets mostly shrugged off the geopolitical strife following a 4 percent rally to start the trading week, despite the potential consequences for oil prices if Iran is found to have played a role in Hamas’ attacks on Israel.
West Texas Intermediate (WTI) crude oil futures plunged about 2 percent on Oct. 11, to about $84 per barrel.
Brent, the international benchmark for oil prices, also slumped around 2 percent, to $86 a barrel, on London's ICE Futures exchange.
At the Pump
Gasoline prices also have not felt the effects of the war 5,600 miles away. According to the American Automobile Association (AAA), the national average for a gallon of gas is $3.66, down 3 percent from a week ago.
The problem is that investors are largely ignoring the supply risk, says Phil Flynn, senior market analyst at The PRICE Futures Group.
"It is clear the impact on oil and the risk to supplies is still incredibly high," he wrote in a note. "The market is going to have to get more comfortable that the imminent risk to supply is not going to go away in an already tight global oil market."
This year, Iran’s crude exports and production have returned to their highest levels since 2018. But as many as 500,000 barrels per day of Iranian crude could be removed from the economy, according to S&P Global Commodity Insights analysts.
While the White House wants more oil traveling through the global energy market, the situation in the Middle East could “override” this desire, they added.
"Before the war, U.S.-Iranian tensions had eased, which facilitated higher Iranian oil exports. Iranian crude oil production increased 500,000 b/d from March to September 2023—to 3.1 million b/d from 2.6 million," the analysts wrote.
"[President] Biden will be under pressure to enforce sanctions and curtail Iranian export revenue. This is a challenging situation for the Biden administration, which wants more oil on the market, not less. The attacks on Israel could override the oil issue," they added.
In the United States, market observers have been paying close attention to the Strategic Petroleum Preserve (SPR).
As a chorus of Wall Street experts sounds the alarm about oil prices surpassing $100 per barrel again due to geopolitical uncertainty, some are wondering if the current administration could tap into the nation's emergency stockpiles.
Following a six-week build in the SPR in August and September, replenishing efforts have stagnated in the last three weeks. The SPR stands at 351.28 million barrels, equal to approximately 17 days of supply.
In this specific predicament, U.S. officials have to choose a strategy to deliver the aid without the perception of benefiting Hamas, a group the U.S. and Israel both classify as a terrorist organization.
When aiding people in war zones, you can’t just send money, a development strategy called “cash transfers” that has become increasingly popular due to its efficiency. Sending money can boost the supply of locally produced goods and services and help people on the ground pay for what they need most. But injecting cash into an economy so completely cut off from the world would only stoke inflation.
So the aid must consist of goods that have to be brought into Gaza, and services provided by people working as part of an aid mission. Humanitarian aid can include food and water; health, sanitation and hygiene supplies and services; and tents and other materials for shelter and settlement.
Due to the closure of the border with Israel, aid can arrive in Gaza only via the Rafah crossing on the Egyptian border.
The U.S. Agency for International Development, or USAID, will likely turn to its longtime partner on the ground, the United Nations Relief and Works Agency, or UNRWA, to serve as supply depots and distribute goods. That agency, originally founded in 1949 as a temporary measure until a two-state solution could be found, serves in effect as a parallel yet unelected government for Palestinian refugees.
USAID will likely want to tap into UNRWA’s network of 284 schools – many of which are now transformed into humanitarian shelters housing two-thirds of the estimated 1 million people displaced by Israeli airstrikes – and 22 hospitals to expedite distribution.
Since Biden took office, total yearly U.S. assistance for the Palestinian territories has totaled around $150 million, restored from just $8 million in 2020 under the Trump administration. During the Obama administration, however, the U.S. was providing more aid to the territories than it is now, with $1 billion disbursed in the 2013 fiscal year.
The United Nations Relief and Works Agency is a U.N. organization. It’s not run by Hamas, unlike, for instance, the Gaza Ministry of Health. However, Hamas has frequently undermined UNRWA’s efforts and diverted international aid for military purposes.
Humanitarian aid professionals regularly have to contend with these trade-offs when deciding to what extent they can work with governments and local authorities that commit violent acts. They need to do so in exchange for the access required to help civilians under their control.
Similarly, Biden has had to make concessions to Israel while brokering for the freedom to send humanitarian aid to Gaza. For example, he has assured Israel that if any of the aid is diverted by Hamas, the operation will cease.
This promise may have been politically necessary. But if Biden already believes Hamas to be uncaring about civilian welfare, he may not expect the group to refrain from taking what they can.
Security best practices
What can be done to protect the security of humanitarian aid operations that take place in the midst of dangerous conflicts?
Under International Humanitarian Law, local authorities have the primary responsibility for ensuring the delivery of aid – even when they aren’t carrying out that task. To increase the chances that the local authorities will not attack them, aid groups can give “humanitarian notification” and voluntarily alert the local government as to where they will be operating.
Under the current agreement between the U.S., Israel and Egypt, the convoy will raise the U.N. flag. International inspectors will make sure no weapons are on board the vehicles before crossing over from Arish, Egypt, to Rafah, a city located on the Gaza Strip’s border with Egypt.
The aid convoy will likely cross without militarized security. This puts it at some danger of diversion once inside Gaza. But whether the aid convoy is attacked, seized or left alone, the Biden administration will have demonstrated its willingness to attempt a humanitarian relief operation. In this sense, a relatively small first convoy bearing water, medical supplies and food, among other items, serves as a test balloon for a sustained operation to follow soon after.
In that case, the presence of U.S. armed forces might provoke attacks on Gaza-bound aid convoys by Hamas and Islamic jihad fighters that otherwise would not have occurred. Combined with the mobilization of two U.S. Navy carrier groups in the eastern Mediterranean Sea, I’d be concerned that such a move might also stoke regional anger. It would undermine the Biden administration’s attempts to cool the situation.
On U.N.-approved missions, aid delivery may be secured by third-party peacekeepers – meaning, in this case, personnel who are neither Israeli nor Palestinian – with the U.N. Security Council’s blessing. In this case, tragically, it’s unlikely that such a resolution could conceivably pass such a vote, much less quickly enough to make a difference.
Topher L. McDougal does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.
“The majority of wound infections often manifest themselves immediately postoperatively, so close followup should take place […]”
Credit: 2023 Barbarewicz et al.
“The majority of wound infections often manifest themselves immediately postoperatively, so close followup should take place […]”
BUFFALO, NY- October 20, 2023 – A new research perspective was published in Oncoscience (Volume 10) on October 4, 2023, entitled, “Diagnosis and management of postoperative wound infections in the head and neck region.”
In everyday clinical practice at a department for oral and maxillofacial surgery, a large number of surgical procedures in the head and neck region take place under both outpatient and inpatient conditions. The basis of every surgical intervention is the patient’s consent to the respective procedure. Particular attention is drawn to the general and operation-specific risks.
Particularly in the case of soft tissue procedures in the facial region, bleeding, secondary bleeding, scarring and infection of the surgical area are among the most common complications/risks, depending on the respective procedure. In their new perspective, researchers Filip Barbarewicz, Kai-Olaf Henkel and Florian Dudde from Army Hospital Hamburg in Germany discuss the diagnosis and management of postoperative infections in the head and neck region.
“In order to minimize the wound infections/surgical site infections, aseptic operating conditions with maximum sterility are required.”
Furthermore, depending on the extent of the surgical procedure and the patient‘s previous illnesses, peri- and/or postoperative antibiotics should be considered in order to avoid postoperative surgical site infection. Abscesses, cellulitis, phlegmone and (depending on the location of the procedure) empyema are among the most common postoperative infections in the respective surgical area. The main pathogens of these infections are staphylococci, although mixed (germ) patterns are also possible.
“Risk factors for the development of a postoperative surgical site infection include, in particular, increased age, smoking, multiple comorbidities and/or systemic diseases (e.g., diabetes mellitus type II) as well as congenital and/ or acquired immune deficiency [10, 11].”
Continue reading the paper: DOI:https://doi.org/10.18632/oncoscience.589
Correspondence to: Florian Dudde
Keywords: surgical site infection, head and neck surgery
Oncoscience is a peer-reviewed, open-access, traditional journal covering the rapidly growing field of cancer research, especially emergent topics not currently covered by other journals. This journal has a special mission: Freeing oncology from publication cost. It is free for the readers and the authors.
To learn more about Oncoscience, visit Oncoscience.us and connect with us on social media:
A year after the Supreme Court struck down President Biden’s student loan forgiveness plan, he presented a new scheme to the Department of Education on Tuesday. While it is less aggressive than the prior plan, this proposal would cost hundreds of billions of taxpayer dollars, doing more harm than good.
As the legendary economist Milton Friedman noted, “One of the great mistakes is to judge policies and programs by their intentions rather than their results.”
Higher education in America is costly, and this “forgiveness” would make it worse.
Signing up for potentially life-long student loans at a young age is too normalized. At the same time, not enough borrowers can secure jobs that offer adequate financial support to pay off these massive loans upon graduation or leaving college. These issues demand serious attention. But “erasing” student loans, as well-intentioned as it may be, is not the panacea Americans have been led to believe.
Upon closer examination, the President’s forgiveness plan creates winners and losers, ultimately benefiting higher-income earners the most. In reality, this plan amounts to wealth redistribution. To quote another top economist, Thomas Sowell described this clearly: “There are no solutions, only trade-offs.”
Forgiving student loans is not the end of the road but the beginning of a trade-off for a rising federal fiscal crisis and soaring college tuition.
When the federal government uses taxpayer funds to give student loans, it charges an interest rate to account for the cost of the loan. To say that all borrowers no longer have to pay would mean taxpayers lose along with those who pay for it and those who have been paying or have paid off their student loans.
Let’s consider that there will be 168 million tax returns filed this year. A simple calculation suggests that student loan forgiveness could add around $2,000 yearly in taxes per taxpayer, based on the CRFB’s central estimate.
Clearly, nothing is free, and the burden of student loan forgiveness will be shifted to taxpayers.
One notable feature of this plan is that forgiveness is unavailable to individuals earning over $125,000 annually. In practice, this means that six-figure earners could have their debts partially paid off by lower-income tax filers who might not have even pursued higher education. This skewed allocation of resources is a sharp departure from progressive policy.
Inflation remains high, affordable housing is a distant dream, and wages fail to keep up with soaring inflation. Introducing the potential of an additional $2,000 annual tax burden at least for those already struggling, mainly to subsidize high-income earners, adds insult to injury.
Furthermore, it’s vital to recognize that the burden of unpaid student loans should not fall on low-income earners or Americans who did not attend college. Incentives play a crucial role in influencing markets.
By removing the incentive for student loan borrowers to repay their debts, we may encourage more individuals to pursue higher education and accumulate debt without the intention of paying it back. After all, why would they when it can be written off through higher taxes for everyone?
The ripple effect of this plan could be far-reaching.
It may make college more accessible for some, opening the floodgates for students and the need for universities to expand and hire more staff, leading to even higher college tuition. This perverse incentive will set a precedent that will create a cycle of soaring tuition, which would counteract the original goal of making higher education more affordable.
While the intention behind President Biden’s student loan forgiveness may appear noble (in likelihood, it is a rent-seeking move), the results may prove detrimental to our nation’s economic stability and fairness. And if the debt is monetized, more inflation will result.
Forgiving student loans will exacerbate existing problems, with the brunt of the burden falling on lower-income Americans. Instead of improving the situation, it will likely create an intricate web of financial consequences, indirectly affecting the very people it aims to help. But that is the result of most government programs with good intentions.
Vance Ginn, Ph.D., is president of Ginn Economic Consulting, chief economist or senior fellow at multiple state thinks across the country, host of the Let People Prosper Show, and previously the associate director for economic policy of the White House’s Office of Management and Budget, 2019-20. Follow him on X.com @VanceGinn.