Understanding the Productivity Puzzle


January 21, 2017

Understanding the Productivity Puzzle

by Howard Davies

https://www.project-syndicate.org/columnist/howard-davies

Howard Davies, the first chairman of the United Kingdom’s Financial Services Authority (1997-2003), is Chairman of the Royal Bank of Scotland. He was Director of the London School of Economics (2003-11) and served as Deputy Governor of the Bank of England and Director-General of the Confederation of British Industry.

 

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In all major economies, the so-called productivity puzzle continues to perplex economists and policymakers: output per hour is significantly lower than it would have been had the pre-2008 growth trend continued. The figures are stark, particularly so in the United Kingdom, but also across the OECD. And while it goes without saying that economists have many ingenious explanations to offer, none has yet proved persuasive enough to create a consensus.

According to the UK’s Office for National Statistics, output per hour in France was 14% lower in 2015 than it would have been had the previously normal trend growth rate been matched. Output was 9% lower in the United States and 8% lower in Germany, which has remained the top performer among developed economies, albeit only in relative terms. If this new, lower growth rate persists, by 2021 average incomes in the US will be 16% lower than they would have been had the US maintained the roughly 2% annual productivity gain experienced since 1945.

The UK exhibits a particularly chronic case of the syndrome. British productivity was 9% below the OECD average in 2007; by 2015, the gap had widened to 18%. Strikingly, UK productivity per hour is fully 35% below the German level, and 30% below that of the US. Even the French could produce the average British worker’s output in a week, and still take Friday off. It would seem that, in addition to the factors affecting all developed economies, the UK has particularly weak management.

Some contributing factors are generally acknowledged. During the crisis and its immediate aftermath, when banks’ efforts to rebuild capital constrained new lending, ultra-low interest rates kept some firms’ heads above water, and their managers retained employees, despite making a relatively low return.

On the other hand, new, more productive, and innovative firms found it hard to raise the capital they needed to grow, so they either did not expand, or did so by substituting labor for capital. In other words, low interest rates held productivity down by allowing heavily indebted zombie companies to survive for longer than they otherwise would have done.

The Bank of England has acknowledged that trade-off, estimating that productivity would have been 1-3% higher in the UK had it raised interest rates to pre-crisis levels in the recovery phase. But they believe the consequences – slower income growth and higher unemployment – would have been unacceptable.

This argument has now been extended beyond the banking system, to the capital markets themselves. Critics of central banks have claimed that a sustained policy of exceptionally low interest rates, reinforced by huge doses of quantitative easing, have caused asset prices to rise indiscriminately. That has not only had adverse consequences for the distribution of wealth; it has also muted the ability of capital markets to distinguish between productive, high-potential firms and others that deserve to fail. According to this view, a rising tide lifts even fundamentally unseaworthy boats.

This argument has some explanatory power, though it says little about the value added by highly paid asset managers and whether they really are prepared to put their money to work simply on the basis of a monetary-policy effect on relative prices, paying no attention to individual companies’ strategies and performance. But the key question the argument raises is what to do about it.

Would it really have been preferable to tighten policy far earlier, to kill off weaker companies in the interests of improving productivity? The BoE has given an explicit answer, and the other major central banks implicit answers, to that question. They do not think so.

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http://www.institutionalinvestor.com/Article/3315202/The-Great-Divide-over-Market-Efficiency.html#.WUpY4elRPIU

A preferable approach to resolving the problem might be more vigorous use of the tools available to market regulators. These authorities tend to focus more on investor protection than on the allocational efficiency of the markets they oversee. Investor protection is important, of course, but as the Nobel laureate Eugene Fama put it, “the primary role of the capital market is allocation of ownership of the economy’s capital stock.”

A regulator focused on that objective would be especially rigorous in overseeing the transparent disclosure of information, and would seek to promote vigorous competition among companies and also, crucially for this objective, among investors. It should not be acceptable for asset managers to earn extravagant returns for following a market benchmark.

There are, no doubt, other dimensions to the productivity puzzle. Maybe we are not measuring output well. As developed economies become more service-based, our measures of output become less objective. In many service industries, outputs are effectively measured by inputs. Maybe we are not measuring enhancements in quality, which may mean that output increases are understated. Maybe we have reached a point at which the productivity boost from Internet-based technology has been cashed, and we need another technological leap to move forward again.

But one key challenge for central banks, as we edge toward the normalization of interest rates, will be to develop a framework for thinking about the impact of monetary policy on the allocation of capital. The task is urgent, as the social and political implications of a prolonged period of no productivity or real wage growth may be very serious. Indeed, arguably they have been factors behind the political upheavals in the US and the UK already.

Trump’s Rogue America


June 7, 2017

Trump’s Rogue America

by Joseph E. Stiglitz

Dr. Stiglitz, recipient of the Nobel Memorial Prize in Economic Sciences in 2001 and the John Bates Clark Medal in 1979, is University Professor at Columbia University, Co-Chair of the High-Level Expert Group on the Measurement of Economic Performance and Social Progress at the OECD, and Chief Economist of the Roosevelt Institute. A former senior vice president and chief economist of the World Bank and chair of the US president’s Council of Economic Advisers under Bill Clinton, in 2000 he founded the Initiative for Policy Dialogue, a think tank on international development based at Columbia University. His most recent book is The Euro: How a Common Currency Threatens the Future of Europe.

https://www.project-syndicate.org/columnist/joseph-e–stiglitz

America will suffer under Trump. Its global leadership role was being destroyed, even before Trump broke faith with over 190 countries by withdrawing from the Paris accord. At this point, rebuilding that leadership will demand a truly heroic effort. We share a common planet, and the world has learned the hard way that we have to get along and work together. We have learned, too, that cooperation can benefit all.–Joseph E.Stiglitz

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America will suffer under Donald J. Trump

Donald Trump has thrown a hand grenade into the global economic architecture that was so painstakingly constructed in the years after World War II’s end. The attempted destruction of this rules-based system of global governance – now manifested in Trump’s withdrawal of the United States from the 2015 Paris climate agreement – is just the latest aspect of the US president’s assault on our basic system of values and institutions.

The world is only slowly coming fully to terms with the malevolence of the Trump administration’s agenda. He and his cronies have attacked the US press – a vital institution for preserving Americans’ freedoms, rights, and democracy – as an “enemy of the people.” They have attempted to undermine the foundations of our knowledge and beliefs – our epistemology – by labeling as “fake” anything that challenges their aims and arguments, even rejecting science itself. Trump’s sham justifications for spurning the Paris climate agreement is only the most recent evidence of this.

For millennia before the middle of the eighteenth century, standards of living stagnated. It was the Enlightenment, with its embrace of reasoned discourse and scientific inquiry, that underpinned the enormous increases in standards of living in the subsequent two and a half centuries.

With the Enlightenment also came a commitment to discover and address our prejudices. As the idea of human equality – and its corollary, basic individual rights for all – quickly spread, societies began struggling to eliminate discrimination on the basis of race, gender, and, eventually, other aspects of human identity, including disability and sexual orientation.

Trump seeks to reverse all of that. His rejection of science, in particular climate science, threatens technological progress. And his bigotry toward women, Hispanics, and Muslims (except those, like the rulers of Gulf oil sheikhdoms, from whom he and his family can profit), threatens the functioning of American society and its economy, by undermining people’s trust that the system is fair to all.

As a populist, Trump has exploited the justifiable economic discontent that has become so widespread in recent years, as many Americans have become downwardly mobile amid soaring inequality. But his true objective – to enrich himself and other gilded rent-seekers at the expense of those who supported him – is revealed by his tax and health-care plans.

Trump’s proposed tax reforms, so far as one can see, outdo George W. Bush’s in their regressivity (the share of the benefits that go to those at the top of the income distribution). And, in a country where life expectancy is already declining, his health-care overhaul would leave 23 million more Americans without health insurance.

While Trump and his cabinet may know how to make business deals, they haven’t the slightest idea how the economic system as a whole works. If the administration’s macroeconomic policies are implemented, they will result in a larger trade deficit and a further decline in manufacturing.

America will suffer under Trump. Its global leadership role was being destroyed, even before Trump broke faith with over 190 countries by withdrawing from the Paris accord. At this point, rebuilding that leadership will demand a truly heroic effort. We share a common planet, and the world has learned the hard way that we have to get along and work together. We have learned, too, that cooperation can benefit all.

So what should the world do with a babyish bully in the sandbox, who wants everything for himself and won’t be reasoned with? How can the world manage a “rogue” US?

Germany’s Chancellor Angela Merkel gave the right answer when, after meeting with Trump and other G7 leaders last month, she said that Europe could no longer “fully count on others,” and would have to “fight for our own future ourselves.” This is the time for Europe to pull together, recommit itself to the values of the Enlightenment, and stand up to the US, as France’s new president, Emmanuel Macron, did so eloquently with a handshake that stymied Trump’s puerile alpha-male approach to asserting power.

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“…the rest of the world cannot let a rogue US destroy the planet. Nor can it let a rogue US take advantage of it with unenlightened – indeed anti-Enlightenment – “America first” policies”– Dr. Joseph E.Stiglitz, Columbia University

Europe can’t rely on a Trump-led US for its defense. But, at the same time, it should recognize that the Cold War is over – however unwilling America’s industrial-military complex is to acknowledge it. While fighting terrorism is important and costly, building aircraft carriers and super fighter planes is not the answer. Europe needs to decide for itself how much to spend, rather than submit to the dictates of military interests that demand 2% of GDP. Political stability may be more surely gained by Europe’s recommitment to its social-democratic economic model.

We now also know that the world cannot count on the US in addressing the existential threat posed by climate change. Europe and China did the right thing in deepening their commitment to a green future – right for the planet, and right for the economy. Just as investment in technology and education gave Germany a distinct advantage in advanced manufacturing over a US hamstrung by Republican ideology, so, too, Europe and Asia will achieve an almost insurmountable advantage over the US in the green technologies of the future.

But the rest of the world cannot let a rogue US destroy the planet. Nor can it let a rogue US take advantage of it with unenlightened – indeed anti-Enlightenment – “America first” policies. If Trump wants to withdraw the US from the Paris climate agreement, the rest of the world should impose a carbon-adjustment tax on US exports that do not comply with global standards.

The good news is that the majority of Americans are not with Trump. Most Americans still believe in Enlightenment values, accept the reality of global warming, and are willing to take action. But, as far as Trump is concerned, it should already be clear that reasoned debate will not work. It is time for action.

The Criminal 45th POTUS?



May 17, 2017

The Criminal 45th POTUS?

http://www.nytimes.com

After the revelations of the past 24 hours, it appears that President Trump’s conduct in and around the firing of the F.B.I. Director, James Comey, may have crossed the line into criminality. The combination of what is known and what is credibly alleged would, if fully substantiated, constitute obstruction of justice. It is time for Congress and a special counsel in the executive branch to conduct objective, bipartisan inquiries into these allegations, together with the underlying matters involving Michael Flynn and Russia that gave rise to them.

First, the facts. On January 26, Sally Yates, then the acting Attorney General, informed the White House that Mr. Flynn had apparently lied about his conversations with the Russian Ambassador. The next day, President Trump hosted Mr. Comey for a private dinner, during which he allegedly asked Mr. Comey repeatedly whether he would pledge his “loyalty” to him, which Mr. Comey declined to do.

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Sally Yates–Acting Attorney-General

On February 14, the day after Mr. Flynn’s resignation as National Security Advisor, President Trump allegedly held Mr. Comey back after a meeting to say that Mr. Flynn had done nothing wrong and that, “He is a good guy. I hope you can let this go.” Mr. Comey declined to drop the investigation, going on in March to confirm before Congress that it was ongoing, and later requesting greater resources from the Department of Justice to pursue it.

Finally, on May 9, President Trump fired Mr. Comey. We were first told he did so because Mr. Comey bungled the F.B.I.’s investigation into Hillary Clinton’s email. Two days later, President Trump changed his story: “In fact, when I decided to just do it, I said to myself, I said, ‘You know, this Russia thing with Trump and Russia is a made-up story. It’s an excuse by the Democrats for having lost an election that they should have won.’” The day after that, President Trump threatened Mr. Comey on Twitter, warning him against leaking to the press.

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Any one of these facts or allegations, by itself, likely would not constitute obstruction of justice. After all, as the F.B.I. Director himself stated, the President has the undisputed power under the Constitution to hire and fire members of his administration in the normal course of government business.

But what he cannot do is exercise that power corruptly, to spare himself or those associated with him, like Mr. Flynn, from scrutiny and possible criminal liability. To do so would run afoul of a series of federal statutes that define the crime of obstruction of justice. They are variations on the theme that anyone who “corruptly” or by “any threatening letter or communication” tries “to influence, obstruct, or impede, the due administration of justice” will be subject to criminal penalties.

The operative word here is “corruptly.” It means “an improper purpose,” or one that is “evil” or “wicked.” There is no precise formula for defining it; those involved in the administration of justice must continually wrestle with its interpretation.

Here, the evidence strongly suggests that the president acted corruptly. That starts with the demand for loyalty from Mr. Comey, the account of which the White House disputes. That demand can reasonably be understood to mean that Mr. Comey should protect Trump and follow his bidding, rather than honoring his oath to follow the evidence. It is also an implicit threat: Be loyal, or you will be fired.

When Mr. Comey did not seem to take the hint, Mr. Trump made his meaning crystal-clear on February 14: Let the investigation go, and let Mr. Flynn go, too. The president denies this as well, of course, as he has denied so much else that has proven to be true. Who are we to believe: Mr. Comey, who would have no reason to accuse the President of obstruction of justice, and who has apparently preserved meticulous notes of his conversations? Or the President, who fact-checkers have demonstrated has told more lies in less time than any other modern occupant of the Oval Office?

While Mr. Trump might have been within his rights to fire Mr. Comey, this pattern of demands to protect himself and Mr. Flynn, followed by retaliation when the demands were not met, if proven, is a textbook case of wrongful conduct. Add to this the fact that Mr. Flynn was already offering testimony about the Russia connection in exchange for immunity from prosecution, and Mr. Trump’s clumsy attempt to dissemble the cause of the firing, and it is clear that a cover-up was afoot.

Finally, Mr. Trump topped things off with his tweeted threat to Mr. Comey; witness intimidation is both obstruction of justice in itself, and a free-standing statutory offense.

Taken together, this evidence is already more than sufficient to make out a prima facie case of obstruction of justice — and there are likely many more shoes to drop. Mr. Comey reportedly took notes on all of his encounters with the president. If what has emerged so far is any indication, this is unlikely to offer much comfort to Mr. Trump.

And there remains the core question of the President’s motives. Is he withholding his taxes because they show evidence of “a lot of money pouring in from Russia,” as his son once stated, or do they show no such thing, as his lawyers claim? Why is Mr. Trump so fervently protecting Mr. Flynn: out of loyalty to a friend, or because Mr. Trump fears what that friend would say if he received immunity?

We have previously called for Congress to set up an independent 9/11-style commission on the Russia and Flynn investigations, and for the Department of Justice to appoint a special prosecutor. This appointment is necessary because Congress can’t actually prosecute anyone who may have committed crimes, including obstruction of justice, in connection with the Trump-Russia matter. This week’s revelations about the president, the most powerful man in the country, emphasize the need for these independent structures to be erected and to encompass these new allegations.

At least for now, we need not address the question, fully briefed to the Supreme Court during Watergate, but never resolved, of whether a special prosecutor could indict the President; as with Nixon, the question may again be obviated by other events, like the House initiating impeachment proceedings and the President resigning.

In the meantime, the House and Senate must continue their existing investigations and expand them, with the Judiciary Committees of both bodies immediately beginning hearings into the president’s abuse of power. Congress must be prepared to follow the evidence wherever it may lead.

Richard W. Painter, a Professor at the University of Minnesota Law School, is the Vice Chairman and Norman L. Eisen is the Chairman of Citizens for Responsibility and Ethics. They were chief White House ethics lawyers for Presidents George W. Bush and Barack Obama, respectively.

The End of the Left/Right Divide?


May 13, 2017

The End of the Left/Right Divide?

by Ian Buruma*

http://www.project-syndicate.org

*Professor of Democracy, Human Rights, and Journalism at Bard College. He is the author of numerous books, including Murder in Amsterdam: The Death of Theo Van Gogh and the Limits of Tolerance and Year Zero: A History of 1945.

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Marine Le Pen defeated by Ensemble,la France

After the French Revolution of 1789, deputies in the National Assembly who supported the revolutionary gains sat on the left, while those who opposed them and hankered after the old order of monarchy and church congregated on the right. Hence the political terms “left” and “right.” Many commentators on the French presidential election have pointed out that these categories no longer fit contemporary politics in France – or, indeed, anywhere else. Emmanuel Macron prides himself on being neither right nor left.

Marine Le Pen, whose National Front is associated with the far right, disagrees: to her, Macron, who was a minister in a Socialist government, is a leftist. But, like Donald Trump, it was Le Pen who ran as the “voice of the people,” whereas Macron, like Hillary Clinton, was depicted as a puppet of bankers, cultural elites, and international plutocrats.

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So what do left and right still mean, if anything at all? There is little doubt that something shifted in the last decades of the twentieth century. Left-wing parties began to lose – in some countries more quickly than others – their base in the industrial working class. Redistribution of wealth became gradually less important than the social emancipation of ethnic and sexual minorities. The old alliance between intellectual idealists and trade unions gave way to rainbow coalitions of intellectuals, non-whites, feminists, and gays.

Meanwhile, right-wing parties, like the Republicans in the United States, paid lip service to the social conservatism, and sometimes outright bigotry, of less privileged voters in rural and provincial areas, while doing what was best for big business once they were in power.

What was good for big business – international cooperation, pan-national institutions, and openness to immigration – was not always against the interests of the evolving left-of-center parties. Big business benefited from cheap labor, and the left favored multiculturalism.

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The EU gets a reprieve from France’s Emmanuel Macron

It made some sense, then, that European social democrats frequently ended up in coalition governments with moderate pro-business conservatives or Christian Democrats. This trend was boosted by the collapse of the Soviet empire, because Western liberal democracies no longer had the same pressing need to counter the Communist model with egalitarian arrangements of their own. The electoral successes of Bill Clinton in the US and Tony Blair in the United Kingdom had much to do with their deliberate tilts towards the pragmatic, neoliberal, business-friendly center.

In this respect, distinctions between left and right have indeed collapsed. The old idea of a left representing the downtrodden proletariat against the interests of big business and the bourgeoisie is gone. One reason why the British Labour Party is in such disarray is that it is led by a man, Jeremy Corbyn, whose politics haven’t changed since the 1970s.

But the traditional distinction between left and right is not simply economic. There has been a deeper divide within the National Assembly in France, defined by that between the Dreyfusards and the anti-Dreyfusards in the 1890s, or Léon Blum’s Popular Front and the Action Française in the 1930s. This division still holds in the age of Macron and Le Pen.

Defenders of the French Republic, who took Liberty, Equality, and Fraternity seriously, thought of citizenship as a legal concept, not one based on blood and soil. They believed in institutions more than in hallowed traditions, and in internationalism rather than chauvinism. Captain Alfred Dreyfus, the Jewish officer falsely accused of treason in 1894, was such a polarizing figure in France because his opponents saw him as symbol of national decadence, of a nation whose sacred identity was being diluted by alien blood.

Anti-Semites, and others with a blood-and-soil view of society, invariably see “cold-hearted bankers” (Le Pen’s term for her opponent in the presidential debate) as the enemy of “the real people…the ordinary, decent people” (Nigel Farage’s words at a campaign rally for Donald Trump in Mississippi). In this sense, Macron, who was indeed once a banker for Rothschild, and who believes in open borders and international institutions, is a man of the left. And Le Pen, the champion of La France profonde, the “real France” of rural Christians and angry white people who believe that to be French and Muslim is a contradiction in terms, is a true descendant of the anti-Dreyfusards and the Action Française.

Macron managed to defeat Le Pen this time around. But the social-democratic left is still in a state of crisis. The UK Labour Party is moribund. The Dutch Social Democrats were wiped out. And Trump, an ignorant narcissist with no political experience, managed to become President of the US by whipping up popular resentment against educated elites, bankers, foreigners, immigrants, and international institutions.

The problem for social democrats nowadays is how to survive if large numbers of underprivileged people turn right instead of left. Is it possible for a new alignment to be forged? Can the growing gap between rich and poor bring at least some of the white working class back into the same tent as immigrants and other minorities? Is another New Deal feasible? How might this be reconciled with the interests of internationalist businessmen and bankers?

The crisis on the right, however, is no less serious. Trump may have surrounded himself with Goldman Sachs alumni and corporate titans, even as he claims to serve the interests of the common people. And many Republicans still cling to him in the hope of achieving their policy goals. But he has effectively hijacked the old conservative party of business and internationalism. Will his brand of chauvinistic, nativist populism be able to coexist with the kind of capitalism that thrives on continued immigration, freedom of movement, and global institutions?

While France has dodged the xenophobic bullet this time, the dust has not yet settled. Left and right may be in flux, but the old divisions that emerged after 1789 are still there, perhaps more than ever. Macron is full of good intentions. But if his politics fail, the latter-day anti-Dreyfusards will be back with a vengeance.

Abenomics: A Success?


May 2, 2017

Abenomics: A Success?

by The Financial Times

https://www.ft.com/content/62cc7d40-2e65-11e7-9555-23ef563ecf9a

When a policy is applied for more than four years, and consistently fails to produce the intended result, it is tempting to declare it a failure. Critics of Japan’s economic stimulus declare exactly that. They are wrong. So-called Abenomics has not failed, and it should be sustained, not abandoned.

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Critics of Prime Minister Shinzo Abe’s economic policy, which aims to combine monetary and fiscal stimulus with structural economic reforms, make a simple case. Abenomics began in the spring of 2013. It was supposed to revive growth and end two decades of on-and-off deflation. Four years later, the Bank of Japan’s preferred measure of inflation is up by 0.1 per cent on a year ago. It follows, the critics say, that the medicine has not worked.

It has indeed proved hard to ignite inflation in Japan. Since the financial crisis, low inflation has been a problem everywhere, from the US to the eurozone to the UK. But the simple diagnosis of failure ignores how much Abenomics has achieved, the difficult backdrop to these achievements, and the reality that the stimulus was much smaller than its critics imagine. Growth, running at an annualised 1.2 per cent, has been well above Japan’s underlying rate every year save 2014. The unemployment level is at a 22-year low of 2.8 per cent — and that figure understates how tight Japan’s jobs market has become. Every shop and restaurant in Tokyo seems to have a “positions vacant” sign, and many are scrapping 24-hour opening to save labour. Yamato Transport, the country’s largest logistics company, is raising prices for the first time in 27 years in a deliberate attempt to cut volumes to a level its network can handle. Rather than cutting costs, chief executives spend their time working out how to hire and retain staff.

After more than two decades when labour was cheap and abundant, Japanese companies are finding ways to cut back, reducing their lavish service standards rather than raising prices. But this can only go so far. Japan is primed for inflation. The struggles of the stimulus must also be weighed against the global economic backdrop. The plunge in 2014 in commodity prices, followed by the 2015 slowdown in emerging markets, leading to a sharp appreciation of the yen, were a terrible environment in which to generate inflation. Only with the election of Donald Trump as US president, and the subsequent rally in the yen above ¥110 to the dollar, is the global economy once again a support. Of all the obstacles to success, the worst was self-inflicted: a 2014 rise in consumption tax from 5 to 8 per cent. In theory, Abenomics involved a fiscal stimulus. In reality, this only ever happened for a brief time, in 2013. Over the past four years, Japan has significantly tightened fiscal policy. The predictable result was to halt momentum towards higher prices.

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Recently, the Abe government has realised its mistake and loosened the purse strings a little. It should continue to do so, ignoring foolish and arbitrary fiscal targets, until inflation finally does pick up. There have been policy failures over the past four years, but they all involved too little Abenomics, not too much. To break Japan’s deflationary mindset for good may take several more years. Workers are slow to demand higher pay and employers are reluctant to offer it. But that does not mean the effort to restore inflation has failed. Rather, it has made significant progress, in a difficult environment, where the policy’s champions often failed to act when needed. The prize is a revived Japanese economy.

 

ASEAN Chair and President of the Philippines Rodrigo Duterte to meet Donald Trump


May 1, 2017

Today's WorldView

by Ishaan Tharoor

ASEAN Chair and President of the Philippines Rodrigo Duterte to meet Donald Trump in Washington DC

Over the weekend, the White House announced that President Trump had invited President Rodrigo Duterte of the Philippines for a visit to Washington, following what was deemed a “very friendly conversation” over the phone between Trump and his counterpart in Manila.

Despite the close ties between the United States and the Philippines, the move surprised Trump’s critics and allies. In his 10 months in power, Duterte has become one of Asia’s most controversial leaders. He has presided over a vicious drug war that has seen thousands killed by extrajudicial hit squads — encouraged, say critics, by Duterte’s explicit orders. Last week, a Filipino lawyer filed a complaint at the International Criminal Court, accusing Duterte and 11 other Filipino officials of mass murder and crimes against humanity. (Duterte has shrugged off the filing and said it will not deter his campaign.)

The complaint takes into account the killings of 9,400 people stretching back to 1988, when Duterte became the Mayor of the southern city of Davao and began making his reputation as a tough guy willing to do anything to crack down on crime. “The situation in the Philippines reveals a terrifying, gruesome and disastrous continuing commission of extrajudicial executions or mass murder,” read the complaint. An estimated 8,000 people have been killed since Duterte became President last summer (2016).

None of this seemed to faze the White House. In the readout of the phone call, the only mention of Duterte’s astonishing record of violence seemed to be a positive one. It said that the two leaders “discussed the fact that the Philippines is fighting very hard to rid its country of drugs, a scourge that affects many countries around the world.”

White House Chief of Staff Reince Priebus did his best to evade the thrust of the question when asked on ABC’s “This Week” if human rights were no longer a concern for the Trump Administration.

“Absolutely not,” responded Priebus. “It doesn’t mean that human rights don’t matter, but what it does mean is that the issues facing us, developing out of North Korea, are so serious that we need cooperation at some level with as many partners in the area as we can get.”

Mourners carry the coffin of a person shot dead by unidentified gunmen north of Manila on April 8. (Francis R. Malasig/European Pressphoto Agency)

Mourners carry the coffin of a person shot dead by unidentified gunmen north of Manila on April 8. (Francis R. Malasig/European Pressphoto Agency)

The importance of securing strong Filipino support in dealing with North Korea is highly debatable. But administration officials indicated that the overture to Duterte may be part of a broader and much-needed mending of fences.

“The White House statement could be seen as implicit support, but perhaps is better understood as offering common ground for engaging with Duterte,” said Natalie Sambhi, a Research Fellow at the Perth USAsia Center in Australia, to The Post.

U.S.-Filipino relations took a turn for the worse last year, Duterte’s first in office and the final one for Barack Obama.

“The relationship between the United States and the Philippines soured under President Barack Obama, who criticized Duterte’s bloody war on drugs,” reported my colleagues. “Not one to take criticism lightly, Duterte snapped at Obama on a few occasions, telling him to ‘go to hell’ and, at one point, using the Tagalog phrase for ‘son of a bitch’ or ‘son of a whore’ when addressing the then-U. S. president. In September, Obama canceled a meeting with Duterte, whom he called a ‘colorful guy.‘ ”

(Obama is hardly the sole target of Duterte’s notoriously salty language: He used similar words for Pope Francis, too, and has sparked global headlines with rape jokes, admiring references to Adolf Hitler, boasts about mass killing and an insistence at one point that he would eat the livers of suspected terrorists. Even Trump was on the receiving end: “Donald Trump is a bigot, I am not,” Duterte told the Associated Press last year.)

The tensions saw Duterte publicly drift toward China. In a speech in Beijing last year, he told his Chinese audience that “I’ve realigned myself in your ideological flow.” He has inked billions of dollars of deals with China, Japan and other countries in the region. As my colleague Emily Rauhala wrote earlier this year, Duterte is playing an opportunistic game, wooing all whom he can as part of a new “independent” foreign policy. But, as Rauhala noted, his efforts fly in the face of public opinion and the country’s political establishment, which largely backs the United States and is wary of Chinese expansionism in the South China Sea.

Duterte is shown the way by Chinese President Xi Jinping before a signing ceremony in Beijing in 2016. (Ng Han Guan/Associated Press)

Duterte is shown the way by Chinese President Xi Jinping before a signing ceremony in Beijing in 2016. (Ng Han Guan/Associated Press)

The other lens through which to view Trump’s invitation to Duterte is that of the American President’s apparent penchant for strongmen. While the European Union called for an investigation into the referendum last month that conferred vast new powers upon Turkish President Recep Tayyip Erdogan, Trump was the first Western leader to congratulate Erdogan on his victory. He also hosted Egyptian President Abdel Fattah al-Sissi, a coup-plotting former army man whose regime carried out a ruthless crackdown on Islamists and dissidents. No matter the geopolitical scenario, Trump seems to have a genuine affinity for men of action who brook little dissent.

“If Duterte were not immune as Head of State, he would be barred from admission into the United States,” noted John Sifton, the Asia Director of Human Rights Watch, in an emailed statement. “Existing U.S. laws and policy prohibit visas and entry to persons against whom credible allegations of gross human rights abuses have been made.”

Sifton goes on: “The invitation is an abomination, just as Trump’s invitation to Sissi was an abomination, and although his personality traits would seem to make it impossible, Trump should be ashamed of himself. By effectively endorsing Duterte’s murderous ‘war on drugs,’ Trump has made himself morally complicit in future killings.”