King Snowden and the Fall of Wikileaks

The whistleblower refugee has dominated the media -- and displaced Julian Assange.

In 2013, Edward Snowden shone a spotlight into the darkest corners of American foreign policy, dealing a cataclysmic shock to the country's intelligence-gathering apparatus as its most clandestine methods and programs were splashed across front pages worldwide. Whether one reviles or reveres him, Snowden's disclosures were inarguably one of the biggest stories of the year, profoundly reshaping America's image and relations with friend and foe alike.

The impact of Snowden's revelations can be seen in the Global Conversation visualization I did for FP's December issue, which shows that he occupied a role in 2013's global news media coverage just slightly less important than President Barack Obama himself. In recognition of this impact, FP featured him first in its annual list of leading Global Thinkers, which prompted Wikileaks to both criticize the selection and blast FP's decision not to include the group's founder, Julian Assange.

Snowden's rise to global prominence was once viewed as Assange's path back into the spotlight, particularly as Wikileaks had helped him escape to Russia. Wikileaks' assistance was likely intended to tie their respective "brands" together and revive its global profile, making Snowden part of the stable of Wikileaks contributors. But that does not seem to have happened, and the Global Thinkers list is hardly the only data point.

Looking at Google Search Trends, we can see that Snowden has largely displaced Assange in the public interest, peaking over the course of two-and-a-half months this summer before settling into a steady state of popularity the last four months. By contrast, Assange only enjoyed a month-and-a-half of super-fame in 2011 and has largely faded from view (Benedict Cumberbatch biopic notwithstanding). Wikileaks itself has fared even worse, nearly vanishing from the global consciousness since Cablegate.

These timelines reflect global search patterns, yet they raise the critical question of what is driving Snowden's sustained attention and the fall of interest in Wikileaks.

It is true that, although the Cablegate disclosures embarrassed the United States, the classification level and sensitivity of the material Snowden downloaded and its details about the country's most critical intelligence-gathering efforts have captivated the global imagination. Like a serialized Tom Clancy novel, the steady trickle of new blockbusters has provided an eager public with an unprecedented "behind the scenes" view of the real world of spying.

But most of the world knows of Snowden, Assange, and Wikileaks through what they learn from the news media, and thus the evolving news portrayal of the three has a substantial impact on their respective public profiles. Has global media coverage of government leaks really recentralized around Snowden so much that it is now marginalizing Wikileaks and Assange?

In the diagram below, I have analyzed every global English-language news article monitored by the GDELT Global Knowledge Graph -- a massive compilation of the world's people, organizations, locations, themes, emotions, and events -- to identify all people mentioned in articles referencing Edward Snowden, Bradley Manning, Julian Assange, the National Security Agency, or Wikileaks. I then compiled a list of every person mentioned in each article and connected all names mentioned in the same article. I kept only names appearing more than 5 times, yielding a final network of 1,007 names with 4,909 connections among them.

This network diagram was then visualized using a technique that groups individuals who are more closely connected with each other, placing them closer to each other in the diagram, while placing individuals with fewer connections farther apart. Then, using an approach known as "community finding," clusters of people who are more closely connected with each other than with the rest of the network were drawn in the same color. The specific color assigned to each group is not meaningful, only that people drawn in the same color are more closely connected to one another. Together, these two approaches instantly clarify the macro-level structure of the network, teasing apart the clusters and connections among the newsmakers.

Edward Snowden can be seen as the central hub from which the rest of the network emanates, reflecting his central role in coverage of the last seven months. To his upper right in red is Barack Obama, while to his upper left in blue is Vladimir Putin. Red nodes largely reflect the U.S. side of the disclosures and their impact on U.S. interests, while blue primarily captures the Russian side. To Snowden's lower left in green is Julian Assange, with Bradley Manning in turn below him, also in green. This green cluster largely contains Wikileaks-specific names. The group of pink names at the bottom of the network are largely former administration officials and previous high-profile whistleblowers, while the light blue names at the top of the network are the reporters who have covered the NSA and Wikileaks stories the most extensively during this period. (An interactive version of this network is available here.)    

The structure of this network is quite fascinating in the clear segmentation between the world of Snowden; that of Manning, Assange, and Wikileaks; and that of previous whistleblowers. Russia's relatively light integration with the Snowden cluster shows that, while it provides him sanctuary, it has been highly successful at distancing itself from his disclosures, reaping the public relations bonanza of skewering the United States, while managing to avoid credit for enabling those disclosures. Most striking, however, is the small size and marginal role of the Wikileaks cluster and the way in which previous leakers are largely connected through this shrinking cluster, while reporters are nearly exclusively linked through the Snowden cluster. Snowden is largely displacing his predecessors, pushing them into an ever-more-marginal role.

It seems that Edward Snowden's path has diverged from that of Wikileaks and its founder Julian Assange in more than just their physical lives. As Snowden walks freely while Assange languishes under virtual house arrest, the whistleblower refugee that Wikileaks helped crown prince has become king of the news media while Assange and Wikileaks fall from the public eye.



The Year of the Horse

Why China's radical economic reforms in 2014 could bring new prosperity to hundreds of millions -- if Xi Jinping can ride out the bumps ahead.

After three decades of dramatic expansion and increasing imbalances, Beijing in 2014 will begin radically transforming its economy, with the goal of achieving sustainable long-term growth. Documents released after the Third Plenum, an important Communist Party meeting held in November, explained -- albeit vaguely -- the reforms that President Xi Jinping and Premier Li Keqiang proposed for China. These include liberalizing the currency and interest rate regimes, changing the allocation of credit in the financial system, spurring innovation, reforming land ownership and residency requirements, imposing a stronger rule of law, and perhaps even partially distributing state assets to households.

Whether or not the reforms succeed, analysts who predict that China is about to embark on a decade of 7 percent growth or more will almost certainly be proven wrong. Broadly speaking, either Beijing will successfully implement the reforms over the next two to three years, or political opposition will prevent it from doing so. If Beijing does not succeed, and if China's growth relies on the same mechanisms that have driven it over the past few years, China's economy will continue to grow at roughly 7-8 percent annually for perhaps two or three more years. During this time, however, debt levels will surge, and the risk of a financial crisis will ultimately cause growth rates to collapse. If China does not control its surge in debt, in other words, it will probably face either a financial crisis or a decade of economic stagnation well before 2020.

If Xi successfully executes the reforms -- and the steps he has taken to consolidate power will weaken political opposition, making this outcome increasingly likely -- the very nature of the reforms will cause growth rates to slow sharply, ultimately to below 3-4 percent. To believe, as many economists do, that successfully implementing reforms guarantees growth of 7 percent or more for the rest of this decade probably represents the greatest piece of confusion about China's adjustment. As the reforms are implemented, growth rates must drop sharply. In fact one can almost argue that the rate at which growth slows will give a fairly accurate indication of the pace of reform: the faster China slows, the better off it will be over the medium and long term.

Two important mitigating factors will limit the adverse social and economic impacts of the slowdown in growth from the roughly 10 percent boom of recent decades. Over the last 10 years, nearly 50 percent of the world's credit and money growth has occurred in China (indicating just how addicted Chinese growth is to debt.) If Xi can successfully implement reforms that increase the efficiency of investment and strengthen the services sector, lower growth will occur without the need for surging credit. This will result in a more rapid increase in Chinese wealth than occurred during the past decade, when investment in projects whose real economic value to China was less than the cost of the investment overstated real growth.

More importantly -- and contrary to those who believe slower growth will lead to social instability -- the reforms will change the way the benefits of growth are distributed. If successful, a disproportionate share of the benefits will be retained not by the state and the wealthy, as occurred over the past three decades, but by ordinary Chinese households. A drop in GDP growth, in other words, will not translate into an equivalent drop in the growth rate of median household income. Instead, if the reforms are successful, the income of ordinary Chinese should grow at roughly 2-3 percentage points faster than GDP. For the state sector and for the wealthiest segment of China's economic elite, however, slower GDP growth will result in much slower income growth, and perhaps even a contraction.

Why does successful reform necessitate a sharp drop in growth? There are at least two reasons. The first has to do with debt. One of the key drivers of reform is the need to contain the explosion in credit that has driven Chinese demand over the past few years. Instead of allowing debt to grow two to three times as fast as GDP, as it has over the past few years, Beijing must take steps to stabilize or even reduce this growth in debt. As China deleverages, fewer factories and bridges will be built, and fewer workers will be employed -- causing economic growth to immediately drop.

Yes, the reforms could increase the efficiency of investment. Instead of borrowing to invest in unnecessary infrastructure or manufacturing capacity, Chinese investors could begin to invest more in very productive areas like small and medium enterprises, or in the service industry. If the reforms are successful, the quality of Chinese investment will rise and the amount of productivity generated by each additional unit of debt will be higher. But to counteract the consequence of much slower credit growth, the reforms will have to immediately unleash truly extraordinary and historically unprecedented increases in productivity. This is within the realm of possibility, of course, but hardly plausible: It is difficult to find any case in history in which such a sharp slowdown in credit growth did not result in much slower economic growth.

Second, China's astonishing growth during the past three decades is the result of a system in which hidden transfers from the household sector subsidized growth. These transfers -- which include land and energy subsidies, nearly unlimited access to credit for state-owned enterprises, a relaxed attitude to environmental degradation, downward wage pressure, monopoly pricing power, an undervalued currency, and most importantly, artificially low interest rates -- are also at the root of the current imbalances. Once China rebalances its economy toward healthier and more sustainable sources of demand, the very processes that turbocharged growth will no longer do so.

By slowing credit growth and eliminating the hidden transfers that subsidized rapid growth, the reforms proposed during the Third Plenum will rebalance China's economy, eliminate its dangerous addiction to debt, improve the quality of growth, and strengthen the relative position of ordinary Chinese households within the economy -- but they cannot do so without substantially reducing China's economic growth rate in the near term. In fact, we will be able to judge the success with which Beijing implements reforms by measuring their impact on GDP growth. If China is able to impose an orderly adjustment quickly, growth rates will slow substantially for several years. GDP growth rates of 7 percent or higher, on the other hand, would suggest that credit is still rising too quickly and China has otherwise been unable to implement the reforms, in which case China is likely to reach debt capacity constraints more quickly.

The next few years are crucial for China -- and will require far more from Xi and Li than the past 20 years required from their predecessors. The reforms proposed after the Third Plenum are promising, but they will likely face substantial political opposition. Their implementation will upset the economic elite, who benefitted disproportionately from Chinese growth of the last three decades and who must consequently bear a larger share of the cost of adjustment. If these reforms are successfully executed, Xi will be hailed as the most important Chinese leader since Deng Xiaoping -- but however successfully Beijing executes the reforms, another decade of growth in the 7-percent range is almost impossible.