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NEWSWEEK: International Editions: Highlights and Exclusives, December 10, 2007 Issue
Date:12/2/2007

COVER: Inside Putin's Circle. (Atlantic and Latin America editions). Moscow Bureau Chief Owen Matthews and Special Correspondent Anna Nemtsova report that Russia's real politics happens in and around the Kremlin, and it's a ruthless battle for money and influence. As Vladimir Putin prepares to step down (as he's constitutionally obliged to do), the clans that control the power of the Russian state are maneuvering frantically to protect their business empires-and, in some cases, their lives. Matthews and Nemtsova also report that the battle also involves ideological disagreements on economic and foreign policy, disagreements that will determine whether Russia emerges as a more or less autocratic, more or less open to free markets and Western influence.
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(Photo: http://www.newscom.com/cgi-bin/prnh/20071202/NYSU003 )

COVER: How Japan Lost Its Groove. (Asia edition). Tokyo Bureau Chief Christian Caryl reports that Japan, known for its innovative technological advancements and cutting-edge design, seems to have lost its edge in a long tale of Japanese innovation failures over the last two decades-a huge irony, given that Japan is a technological powerhouse. The crisis is in large part rooted in the country's peculiar corporate culture. Japan Inc. still remains dominated by big, vertically integrated dinosaurs with little maneuverability and a marked disinclination to creativity. One exception: Nintendo, the gaming company whose innovation has enabled it to break away from the competition. But Nintendo, like several of Japan's other more innovative companies, is based in Kyoto-far away from staid Tokyo.

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The Gates Keeper Deputy Washington Bureau Chief Dan Ephron, Senior Editor Michael Hirsh and Editor-at-Large Evan Thomas report that Defense Secretary Robert Gates is seen as the best insurance that the Bush administration will not leave a legacy of ashes in Iran. Gates gives the Washington foreign-policy establishment hope that the pendulum is swinging back, that it is possible to forge a foreign policy by consensus and common sense and not wishful thinking or righteous zeal.

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Same Old, Same Old. Special Correspondent William Underhill reports that Italy's political leadership is perennially far older than counterparts elsewhere. The country is now aging faster than any other in Europe, and more than half the population is over 40. The policies that emerge from this calcified system are what one might expect: lawmakers are slow to tinker with a pension system that swallows 15 percent of the GDP.

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Rough Justice. Guest columnist Daniel Pepper writes that Rwanda's experiment with a grass-roots court system-which draws on the country's tradition of village justice and is meant to offer a more organic, less retributive means of dealing with the horrendous past-isn't helping this traumatized land. "Its all part of the country's alternate, Gacaca system. Meaning 'justice on the grass,' Gacaca is a parallel court network set up by the government," he writes.

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The Sunni Civil War Baghdad Correspondent Larry Kaplow and Chief Foreign Correspondent Rod Nordland report that divisions are growing within the Sunni community-between the new tribal levies and old politicians, Baathists and anti-Baathists, fundamentalist mosque-goers and secular whiskey drinkers-that could affect reconciliation in Iraq. Shiite leaders warn they can't be expected to find common ground with Sunnis who cannot find it among themselves.

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Old Friends of Tehran. Special Correspondent Roya Wolverson reports that the U.S. economic sanctions against Iran may have the opposite of their intended effect, driving Iranian business further into the hands of aggressively mercantilist Chinese and Russian firms in search of lucrative contracts once dominated by the West.

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Roll Over, Monroe. Mexico City Bureau Chief Joseph Contreras reports on the waning clout of the U.S. in Latin America. Though the U.S. remains the region's largest trading partner by far, Russia, China and Iran are cutting deals, opening up new markets and building diplomatic ties in a region that the U.S. has long regarded as its natural sphere of influence.

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Dark Days for the Empire. Special Correspondent B.J. Lee and Hong Kong Bureau Chief George Wehrfritz report that Samsung, one of Asia's pre-eminent family empires, is at the vortex of a swirling corruption scandal set in motion by the group's former chief attorney. The scandal could impact the economy of the entire region and ignite a struggle over control of an empire worth up to $300 billion.

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Life's a Beach. Special Correspondent Mac Margolis reports after nearly two decades of slumber, the world's ninth largest economy is regaining its place as an emerging-market favorite. Once the world's biggest debtor, Brazil is now a net creditor, with $160 billion in foreign reserves.

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THE GOOD LIFE: Wrap It Up. Newsweek's annual holiday gift guide offers a tiny sampling of the items most coveted during this favorite time of year again: the season of indulgence.

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GLOBAL INVESTOR: Japan and Then Some. Guest columnist Peter Tasker, a founding partner of Arcus Investment, writes that today's rip-roaring bull market in Chinese stocks is dj vu of the late-1980s Japanese bubble all over again. "The similarities are striking," he writes. "We don't know when the pop will come, but there's no chance that the bursting of the Chinese bubble will be painless, for the Middle Kingdom or the rest of the world."

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WORLD VIEW: On Ability and Responsibility. The Middle East peace conference in Annapolis served as a reminder of how much power and prominence the U.S. still has in the Middle East. "Until now, their attempts to get involved in the Middle East have been creative but suffered from a lack of stamina and luck... Serious peacemaking requires insistence, persistence and a refusal to hide behind that old American mantra, 'We can't achieve peace if we want it more than the participants do'," writes Aluf Benn, diplomatic editor of the Israeli newspaper Haaretz. "If Bush really intends to fulfill his pledge of Palestinian statehood while in office, he will have to do much more than host an occasional conference."

http://www.newsweek.com/id/73238

THE LAST WORD: Anand G. Mahindra, CEO of India's $6 billion Mahindra Group. Mahindra has led the group in strategic acquisitions all the world over and now plans on taking advantage of the weak dollar to buy manufacturing plants in "bargain basement" America. "The biggest opportunity is to buy manufacturing assets in America, which is not a manufacturing country: its manufacturing is not competitive, its plants are shutting down, its manufacturing is going abroad. But fundamentally enough, the U.S. dollar plummeting makes the U.S. competitive again ... There's going to be a tsunami of investment in American manufacturing assets," he tells Assistant Editor Vibhuti Patel.

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