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TO HAVE an important job in Asia is to spend too much time in the air. The economic health of Hong Kong and Singapore is tied so strongly to the quality of their airports and their positions as transport hubs that both could justifiably use a rolling suitcase as their city logos. All this traffic has been handled by commercial airlines, which have been growing fast. In China alone, air traffic is expanding by 40% a year, according to Wang Changshun, the country's vice-minister for civil aviation, who was speaking on September 3rd at the Asian Aerospace Congress, a big industry conference taking place in Hong Kong. Things are picking up even in countries, such as Vietnam, that were aviation backwaters only a decade ago. Boeing and Airbus foresee total sales of 5,500-7,200 airliners in Asia in the next 20 years.

But left out from this Asian bonanza have been the makers of business aircraft—the $10m-55m machines that seat up to a dozen people and are the signature toys of American executives. That now appears to be changing, however, and like many business shifts in Asia it may be changing with extraordinary speed. Just as Mr Wang was offering his predictions, deals were unfolding not far away in a corner of Hong Kong's airport where a new hangar, the airport's second, opened for private jets.

Hong Kong's first private-jet hangar opened in 1998 to no demand. Five years ago there were only two planes in residence. Now there are 15, talks about more and plans for a third hangar. Just outside the new hangar's huge door, bosses from Dassault Falcon, Bombardier and Hawker Beechcraft were parked in the comfortable executive offices of their choicest planes as they received clients. When a Hawker was temporarily left empty with its door open, the wife of one of the region's billionaires stole up the ramp and posed in the aisle as her assistant snapped a picture—an auspicious sign for sales.

Boeing was there too, though it could not be bothered to send a display model. In May it announced the sale of a privately configured 787 Dreamliner, its newest plane ($153m without an interior). Unusually in the secretive world of private jets, the buyer is known: Joseph Lau, a property tycoon with interests in Macau, Hong Kong and China. One possible explanation for the announcement is that Mr Lau is thought to have plans for a business providing jets to Asian clients who, in the order of things, want to stay private.

Yet the creation of an Asian market for private jets faces many obstacles. America has 550 airports that can handle big commercial airliners, and perhaps 10,000 that can handle smaller planes. China, in contrast, has 126 airports, only 57 of which can handle private planes. Getting hold of landing slots is difficult. India is a bureaucratic nightmare. Japan requires two weeks' notice, which may be why Japanese firms love to use private planes, but only outside Japan: Toyota's corporate-aviation operation is based in California. There are cultural barriers, too. Manufacturers say that in the past Asian buyers have been sensitive about buying something as costly as a plane.

But the region's huge prosperity means things are changing. Landing slots, once impossible to get in China, can now apparently be had in a day. Indonesia, Malaysia, Singapore, Macau and Hong Kong are all happy to accommodate business jets, with South Korea providing a helpful way round the restrictions on direct flights between Taiwan and mainland China. Charter operators have begun to emerge in Macau, Shanghai and Beijing, among other places. And now that a few tycoons have planes, others want them. Indeed, it appears that the biggest problem today is supply, not demand. Dassault and Bombardier are taking orders for two to three years out, and Boeing says the soonest a new plane can be delivered is 2012.

HONG KONG keeps its top position in the Economic Freedom Index compiled by the Fraser Institute, a Canadian think-tank. The index ranks the policies of 141 countries according to how much they encourage free trade, both internally and with other territories. Countries with fewer taxes, strong property rights, low regulation and sound money score best. Britain and America tie with Canada for fifth place in the list. Germany is ranked 18th—on a par with El Salvador but above Japan. Most of the low-ranking countries are African, except Myanmar and Venezuela, which are both in the bottom ten.

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SINCE the toxic fallout from America’s subprime mess began to taint Japan’s own financial markets last month, it was possible to argue that if Japan was a victim, then at least it was a blameless one. Now, poor economic data at home have generated concerns about the country’s own economy. For the Bank of Japan, the past weeks come as something of a shock: anticipating a robust economy, it had planned to raise interest rates this summer on a path to “normalise” rates that had been set at zero until last year and that now stand at a mere 0.5%. Global credit-market turmoil, and now concerns about a slowing economy at home, have given the central bank no choice but to tear up its road map.

There seemed a measure of injustice to how Japan’s publicly traded financial markets were hit by credit troubles in the United States and Europe. Japanese financial institutions are bit-part actors in the subprime drama. Marked still by the bursting of Japan’s own credit bubble in 1990, companies and households have an aversion to borrowing. The amount of all corporate bonds outstanding in Japan, measured as a percentage of GDP, is close to the amount of subprime and other high-risk debt alone in the United States. Individuals’ aversion to risk is seen in an unnaturally high proportion of household wealth kept as cash or near-kin. As for the kind of financial innovation that had allowed risky debt in the United States to be cut, sliced and sold throughout the financial system as high-class fare: it has passed Tokyo’s sleepy markets by.

No matter: at the height of the August panic, the Nikkei 225 index had fallen by 16% from its July peak, and by 9% in a single week. Today, losses for the year are near 8%, and the once-safe shares of Japanese REITs—real-estate investment trusts—have taken a particular hammering. Shares in America, the source of the credit crisis, are still higher than at the beginning of the year—despite atrocious jobs figures for August released on September 7th that have raised the spectre of an American recession.

The convenient explanation until now for Japan’s stockmarket falls was that Western banks, hedge funds and others hit by worries about liquidity and demands from investors for their money back got rid of whatever was easiest to sell. That included the easily traded shares of Japan’s biggest companies. It also helps to explain a surge in Japan’s currency as higher volatility led many hedge funds to unwind their once-profitable positions in the carry trade, where people borrow cheap yen in order to invest in high-yielding currencies—the New Zealand dollar, for example.

Then came some dismal scraps of domestic economic news. The first, last week, was that capital spending, which has done most to haul Japan out of its long slump and underpin a steady if unspectacular recovery, had taken a hit. That led economists to expect a downward revision to GDP figures for the April-June period, but the scale of the revision on Monday September 10th still managed to shock: instead of growing by 0.5% compared with a year earlier, the government now says the economy shrank by 1.2%. Shares slumped on the news, with some analysts arguing that Japan is now in a bear market.

This may be overdoing things. For a start, Japan’s data is notoriously volatile: as if to prove the point, figures released on September 11th for machinery orders in July recorded a huge bounce. What is more, Japan has hit soft patches before in its five-year-old recovery. And while households have still not opened their wallets despite the predictions of so many economists, companies continue to make record profits. Indeed, on September 10th Nomura Securities, the largest brokerage, upgraded its profit forecasts for Japan’s biggest companies this financial year. If economists now argue that the risks to Japan’s economy are rising, most are far from predicting a full-blown recession—even if America tips into one.

Still, it leaves the Bank of Japan on the twin horns of growing problems in America and a softer economy at home—in addition, core consumer prices have fallen slightly for five months in a row. The central bank’s case for raising rates is that low rates risk unwelcome bubbles forming in various asset markets, while it feels almost a moral repugnance at the notion that cheap money rewards abysmal businesses more than well-run ones. The Bank of Japan looked all but certain to raise rates by a quarter-point in August, until the credit woes. Now a rate hike at the bank’s policy-board meeting next week also looks out of the question, while even a rise later this year is in doubt. The path to normalisation, the Bank of Japan is finding, is a long and tortuous one.

Christer van der Kwast svéd államügyész kedden lapunknak megerősítette: hazánkban is vizsgálatot kezdett, mégpedig a már eddig is vizsgált cseh szállal összefüggésben.

Mint júniusban már megírtuk, a botrányt egy svéd televíziós riport robbantotta ki, amely szerint cseh hivatalnokokat hárommilliárd svéd korona (27 milliárd forint) kenőpénzzel bírtak jobb belátásra. A csehek vásárlási szándéka végül lízing-üzletté alakult. Dél-Afrika az egyetlen ország, amely közvetlenül vásárolt a "griffmadarakból". A tervek szerint Ausztria is ezt tette volna, de végül a közös európai fejlesztésű Eurofighter mellett döntött. A gyanú szerint itt is előfordult vesztegetések ügyében parlamenti különbizottság folytat vizsgálatot Bécsben. A svéd riport gyanúba keverte Alfonz Mensdorff-Pouilly grófot, aki lobbistaként nyolcmilliárd dollár kenőpénzt kaphatott.

A Vadai Ágnes államtitkár vezette hazai vizsgálóbizottságnak elvileg még a héten kell letennie jelentését az asztalra, de az államtitkár engedélyt kért és kapott a miniszterelnöktől arra, hogy október 15-ig dolgozhassanak. Az Orbán-kormány 2001-ben mindenkit meglepő módon döntött a Gripen JAS gépek beszerzéséről, amelyek közül 11 van hazánkban, 2003-ban pedig a Medgyessy-kabinet úgy módosította a szerződést, hogy 80 milliárd forinttal növelte hazánk kiadásait.

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IN MARCH 1986 this newspaper celebrated “The Charm of Nuclear Power” on its cover. The timing wasn't great. The following month, an accident at a reactor at Chernobyl in Ukraine spread radioactivity over Europe and despair in the Western world's nuclear industry.

Some countries never lost their enthusiasm for nuclear power. It provides three-quarters of French electricity. Developing countries have continued to build nuclear plants apace. But elsewhere in the West, Chernobyl, along with the accident at Three Mile Island in Pennsylvania in 1979, sent the industry into a decline. The public got scared. The regulatory environment tightened, raising costs. Billions were spent bailing out lossmaking nuclear-power companies. The industry became a byword for mendacity, secrecy and profligacy with taxpayers' money. For two decades neither governments nor bankers wanted to touch it.

Now nuclear power has a second chance. Its revival is most visible in America (see article), where power companies are preparing to flood the Nuclear Regulatory Commission with applications to build new plants. But the tide seems to be turning in other countries, too. Finland is building a reactor. The British government is preparing the way for new planning regulations. In Australia, which has plenty of uranium but no reactors, the prime minister, John Howard, says nuclear power is “inevitable”.

Managed properly, a nuclear revival could be a good thing. But the industry and the governments keen to promote it look like repeating some of the mistakes that gave it a bad name in the first place.

Geopolitics, technology (see article), economics and the environment are all changing in nuclear power's favour. Western governments are concerned that most of the world's oil and gas is in the hands of hostile or shaky governments. Much of the nuclear industry's raw material, uranium, by contrast, is conveniently located in friendly places such as Australia and Canada.

Simpler designs cut maintenance and repair costs. Shut-downs are now far less frequent, so that a typical station in America is now online 90% of the time, up from less than 50% in the 1970s. New “passive safety” features can shut a reactor down in an emergency without the need for human intervention. Handling waste may get easier. America plans to embrace a new approach in which the most radioactive portion of the waste from conventional nuclear power stations is isolated and burned in “fast” reactors.

Technology has thus improved nuclear's economics. So has the squeeze on fossil fuels. Nuclear power stations are hugely expensive to build but very cheap to run. Gas-fired power stations—the bulk of new build in the 1980s and 1990s—are the reverse. Since gas provides the extra power needed when demand rises, the gas price sets the electricity price. Costly gas has therefore made existing nuclear plants tremendously profitable.

The latest boost to nuclear has come from climate change. Nuclear power offers the possibility of large quantities of baseload electricity that is cleaner than coal, more secure than gas and more reliable than wind. And if cars switch from oil to electricity, the demand for power generated from carbon-free sources will increase still further. The industry's image is thus turning from black to green.

Nuclear power's moral makeover has divided its enemies. Some environmentalists retain their antipathy to it, but green gurus such as James Lovelock, Stewart Brand and Patrick Moore have changed their minds and embraced it. Public opinion, confused about how best to save the planet, seems to be coming round. A recent British poll showed 30% of the population against nuclear power, compared with 60% three years ago. An American poll in March this year showed 50% in favour of expanding nuclear power, up from 44% in 2001.

Yet the economics of nuclear still look uncertain. That's partly because its green virtues do not show up in its costs, since fossil-fuel power generation does not pay for the environmental damage it does. But it is also because nuclear combines huge fixed costs with political risk. Companies fear that, after they have invested billions in a plant, the political tide will turn once more and bankrupt them. Investors therefore remain nervous.

How, then, to get new plants built? America's solution is to lard the industry with money. That is the wrong answer.

Nuclear and other clean energy sources do indeed deserve a hand from governments—but through a carbon tax which reflects the benefits of clean energy, not through subsidies to cover political risk. Exposure to public nervousness is a cost of doing business in the nuclear industry, just as exposure to volatile prices is a cost in the gas industry.

It may be that fears of nuclear power are overblown: after all, the UN figure of around 4,000 eventual deaths as a result of the Chernobyl accident is lower than the official annual death-rate in Chinese coal mines. Yet there are good reasons for public concern. Nuclear waste is difficult to dispose of. More civil nuclear technology around the world increases the chance of weapons proliferation. Terrorists could attack plants or steal nuclear fuel. Voters will support nuclear power only if they believe that governments and the nuclear industry are doing their best to limit those risks, and that such risks are small enough to be worth taking in the interests of cheap, clean energy.

One of the reasons why the public turned against nuclear power last time round is that it found itself bailing the industry out. It would be wrong, not just for taxpayers but also for the industry, to set up another lot of cosy deals with governments. The nuclear industry needs to persuade people that it is clean, cheap and safe enough to rely on without a government crutch. If it can't, it doesn't deserve a second chance.

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IN AMERICA a phenomenon might claim to have entered mainstream culture only after it has been satirised on “The Simpsons”. Google has had that honour, and in a telling way. Marge Simpson types her name into Google's search engine and is amazed to get 629,000 results. (“And all this time I thought ‘googling yourself' meant the other thing.”) She then looks up her house on Google Maps, goes to “satellite view” and zooms in. To her horror, she sees Homer lying naked in a hammock outside. “Everyone can see you; get inside,” she yells out of the window, and the fumbling proceeds from there.

And that, in a nutshell, sums up Google today: it dominates the internet and guides people everywhere, such as Marge, to the information they want. But it also increasingly frightens some users by making them feel that their privacy has been intruded upon (though Marge, technically, could not have seen Homer in real time, since Google's satellite pictures are not live). And it is making enemies in its own and adjacent industries. The grand moment of Marge googling herself, for example, was instantly available not only through Fox, the firm that created the animated television show, but also on YouTube, a video site owned by Google, after fans uploaded it in violation of copyright.

Google evokes ambivalent feelings. Some users now keep their photos, blogs, videos, calendars, e-mail, news feeds, maps, contacts, social networks, documents, spreadsheets, presentations, and credit-card information—in short, much of their lives—on Google's computers. And Google has plans to add medical records, location-aware services and much else. It may even buy radio spectrum in America so that it can offer all these services over wireless-internet connections.

Google could soon, if it wanted, compile dossiers on specific individuals. This presents “perhaps the most difficult privacy issues in all of human history,” says Edward Felten, a privacy expert at Princeton University. Speaking for many, John Battelle, the author of a book on Google and an early admirer, recently wrote on his blog that “I've found myself more and more wary” of Google “out of some primal, lizard-brain fear of giving too much control of my data to one source.”

Google itself has been genuinely taken aback by such sentiments. The Silicon Valley company, which trumpeted its corporate motto, “Don't be evil”, before its stockmarket listing in 2004, considers itself a force for good in the world, even in defiance of commercial logic. Its founders, Larry Page and Sergey Brin, and Eric Schmidt, its chief executive, have said explicitly and repeatedly that their biggest motivation is not to maximise profits but to improve the world.

Such talk can make outsiders wince. Book and newspaper publishers, media companies such as Viacom, businesses which depend on Google's search rankings and a lengthening queue of others are tired of moralising sermons. Some feel their own livelihoods are threatened and are suing Google. Even some employees (called “Googlers”) or former employees (“Xooglers”) are cynical. Google is “arrogant” because it feels “invincible”, says a Xoogler who left to run a start-up firm. The internal attitude towards customers, rivals and partners is “you can't stop us” and “we will crush you”, he says. That “kinder, gentler” image is “mythology” and, he reckons, Google gets away with it only because of its impressively high share price.

That share price has quintupled since 2004, making Google worth $160 billion. The company has not yet had its tenth birthday. Yet Piper Jaffray, an investment bank, expects it to have revenues of $16 billion and profits of $4.3 billion this year. With so much money pouring in sceptics say it is easy to ignore shareholders and talk about doing good instead of doing well. But what happens when earnings fall short of Wall Street expectations or some other disaster strikes? Yahoo! and other rivals have gone through such crises and been humbled. Google has not.

Google's success still comes from one main source: the small text ads placed next to its search results and on other web pages. The advertisers pay only when consumers click on those ads. “All that money comes 50 cents at a time,” says Hal Varian, Google's chief economist. For this success to continue, several things need to happen.

First, Google's share of web searches must remain stable. Thanks to its brand, this looks manageable. Google's share has steadily increased over the years. It was about 64% in America in July, according to Hitwise. That is almost three times the volume of its nearest rival, Yahoo!. In parts of Europe, India and Latin America, Google's share is even higher. Only in South Korea, Japan, China, Russia and the Czech Republic does it trail local incumbents.

Second, Google must maintain or improve the efficiency with which it puts ads next to searches. And here its dominance is most impressive. In a recent analysis by Alan Rimm-Kaufman, a marketing consultant, it took a whopping 73% of the budgets of companies that advertise on search engines (versus 21% and 6%, respectively, for Yahoo! and Microsoft). It charged more for each click, thanks to its bigger network of advertisers and more competitive online auctions. And it had far higher “click-through rates”, because it made these ads more relevant and useful, so that web users click on them more often.

Perhaps most tellingly, advertisers do better with Google. Mr Rimm-Kaufman found that Google's ads “converted” more often into actual sales, which tended to be larger than those originating from Yahoo! or Microsoft. This is astonishing, given that Yahoo! has just spent a year on an all-out effort, codenamed Panama, to close precisely these gaps.

But even lucrative “pay-per-click” has limits, so Google is moving into other areas. It is trying (pending an antitrust inquiry) to buy DoubleClick, a firm that specialises in the other big online-advertising market, so-called “branded” display or banner ads (for which each view, rather than each click, is charged for). And Google now brokers ads on traditional radio stations, television channels and in newspapers of the dead-tree sort.

Sceptics point out that with each such expansion, Google reduces its profit margins, because it must share more of the revenues with others. If a web surfer clicks on a text ad placed by Google on a third-party blog, for instance, Google must share the revenue with the blogger. If Google places ads in newspapers or on radio stations, it must share the revenues with the publisher or broadcaster.

Yet Google does not look at it that way. Its costs are mostly fixed, so any incremental revenue is profit. It makes good sense for Google to push into television and other markets, says Mr Varian. Even if Google gets only one cent for each viewer (compared with an average of 50 cents for each click on the web), that cent carries no variable cost and is thus pure profit.

The machinery that represents the fixed costs is Google's secret sauce. Google has built, in effect, the world's largest supercomputer. It consists of vast clusters of servers, spread out in enormous datacentres around the world. The details are Google's best-guarded secret. But the result, explains Bill Coughran, a top engineer at Google, is to provide a “cloud” of computing power that is flexible enough “automatically to move load around between datacentres”. If, for example, there is unexpected demand for Gmail, Google's e-mail service, the system instantly allocates more processors and storage to it, without the need for human intervention.

This infrastructure means that Google can launch any new service at negligible cost or risk. If it fails, fine; if it succeeds, the cloud makes room for it. Thus Google can redefine its goals almost on a whim. Its official strategy recently became “search, ads, and apps”—the addition being the apps (ie, software applications). Sure enough, after a string of acquisitions, Google now offers a complete alternative to Microsoft's entrenched Office suite of programs, all accessible through any web browser. A new technology, called Google Gears, will make these applications usable even when there is no internet connection. And Google is hawking these applications not only to consumers but also to companies. Ultimately it does so because, thanks to its supercomputer, it can.

With Google's cashflow and infrastructure, the freedom to do anything it fancies gives rise to constant rumours. Often, these are outrageous. It used to be conventional wisdom that Google would build cheap personal computers for poor countries. This turned out to be nonsense, because Google does not want to make hardware. Now there is talk of a “Gphone” handset. This is also unlikely because Google is more interested in software and services, and does not want to alienate allies in the handset industry—including Apple, which shares board directors with Google and uses Google software on its iPhone.

Sometimes the rumours are both outrageous and true. Google is experimenting with new ways of bringing broadband connections to consumers, by blanketing parts of Silicon Valley with Wi-Fi networks. It is planning to enter an auction for valuable radio spectrum in America, and thinking of radically new business models to make money from wireless data and voice networks, perhaps a free service supported by ads.

Beyond its attempts to expand into new markets, the big question is how Google will respond if its stunning success is interrupted. “It's axiomatic that companies eventually have crises,” says Mr Schmidt. And history suggests that “tech companies that are dominant have trouble from within, not from competitors.” In Google's case, he says, “I worry about the scaling of the company.” Google has been hiring “Nooglers” (new Googlers) at a breathtaking rate. In June 2004 it had 2,292 staff; this June the number had reached 13,786.

Its ability to get all these people has been a competitive weapon, since Google can afford to hire talent pre-emptively, making it unavailable to Microsoft and Yahoo!. Google tends to win talent wars because its brand is sexier and its perks are fantastically lavish. Googlers commute on discreet shuttle buses (equipped with wireless broadband and running on biodiesel, naturally) to and from the head office, or “Googleplex”, which is a photogenic playground of lava lamps, volleyball courts, swimming pools, free and good restaurants, massage rooms and so forth.

Yet for some on the inside, it can look different. One former executive, now suing Google over her treatment, says that the firm's personnel department is “collapsing” and that “absolute chaos” reigns. When she was hired, nobody knew when or where she was supposed to work, and the balloons that all Nooglers get delivered to their desks ended up God knows where. She started receiving detailed e-mails “enforcing” Google's outward informality by reminding her that high heels and jewellery were inappropriate. Before the corporate ski trip, it was explained that “if you wear fur, they will kill you.”

Google is a paradise only for some, she argues. Employees who predate the IPO resemble aristocracy. Engineers get the most kudos, people with other functions decidedly less so. Bright kids just out of college tend to love it, because the Googleplex in effect replaces their university campus—with a dating scene, a laundry service and no reason to leave at weekends. Older Googlers with families tend to like it less, because “everybody, even young mums, works seven days a week.”

Another Xoogler, who held a senior position, says that by trying to create a “Utopia” of untrammelled creativity, Google ended up with “dystopia”. As is its wont, Google has composed a rigorous algorithmic approach to hiring, based on grade-point averages, college rankings and endless logic puzzles on whiteboards. This “genetic engineering of their workforce,” he says, means that “everybody there is a rocket scientist, so everybody is also insecure” and the back-stabbing and politics are reminiscent of an average university's English department.

Then there is the question of what all these people are supposed to do. “We kind of like the chaos,” says Laszlo Bock, the personnel boss. “Creativity comes out of people bumping into each other and not knowing where to go.” The most famous expression of this is the “20% time”. In theory, all Googlers, down to receptionists, can spend one-fifth of their time exploring any new idea. Good stuff has indeed come out of this, including Google News, Gmail, and even those commuter shuttles and their Wi-Fi systems. But it is not clear that the company as a whole is more innovative as a result, as it claims. It still has only one proven revenue source and most big innovations, such as YouTube, Google Earth and the productivity applications, have come through acquisitions.

In practice, the 20% time works out to be 120% time, says another Xoogler, “since nobody really gets around to those projects for all their other work.” The chances of ideas being executed, he adds, “are basically zero.” What happens to the many Googlers whose ideas are rejected? Once their share options are fully vested they consider leaving. The same phenomenon changed Microsoft in the 1980s, when allegedly T-shirts popped up saying FYIFV (“Fuck you, I'm fully vested”). Already some are going to even “cooler” start-ups, such as Facebook or Twitter.

This week George Reyes, Google's finance chief, said he would retire. At 53, he is a multi-millionaire. Mr Reyes has maintained the company's policy of not providing guidance to Wall Street on future earnings, although his comments on growth prospects have moved its share price.

Besides the slow risk of calcification that comes with growth, there is also the risk that Nooglers will dilute Google's un-evil values. Worse, Google might inadvertently pick up a rogue employee, as the late Barings Bank notoriously did with Nick Leeson. Indeed, Google is fast becoming something like a bank, but one that keeps information rather than money. This applies equally to its rivals, but Google is accumulating treasure fastest. Peter Fleischer, Google's privacy boss, argues that the risk of a malicious or negligent employee leaking or compromising the data, and thus the privacy of users, is minimal because only a “tiny” number of engineers have access to the databases and everything they do is recorded.

But the privacy problem is much subtler than that. As Google compiles more information about individuals, it faces numerous trade-offs. At one extreme it could use a person's search history and advertising responses in combination with, say, his location and the itinerary in his calendar, to serve increasingly useful and welcome search results and ads. This would also allow Google to make money from its many new services. But it could scare users away. As a warning, Privacy International, a human-rights watchdog in London, has berated Google, charging that its attitude to privacy “at its most blatant is hostile, and at its most benign is ambivalent”.

At the other extreme, Google could decide not to make money from some services—in effect, to provide them as a public benefit—and to destroy data about its users. This would make its services less useful but also less intrusive and dangerous.

In reality, the balance must be struck somewhere in between. Messrs Schmidt, Page and Brin have had many meetings on the subject and have made several changes in recent months. First, says Mr Fleischer, Google has committed itself to “anonymising” the search logs on its servers after 18 months—roughly as banks cross out parts of a credit-card number, say. This would mean that search histories cannot be traced to any specific computer. Second, Google says that the bits of software called “cookies”, which store individual preferences on users' own computers, will expire every two years.

Not everybody is impressed. The server logs will still exist for 18 months. And the cookies of “active” users will be automatically renewed upon expiry. This includes everybody who searches on Google, which in effect means most internet users. Then there is the matter of all that other information, such as e-mail and documents, that users might keep in Google's “cloud”. Mr Schmidt points out that such users by definition “opt in”, since they log in. They can opt out at any time.

As things stand today, Google has little to worry about. Most users continue to google with carefree abandon. The company faces lawsuits, but those are more of a nuisance than a threat. It dominates its rivals in the areas that matter, the server cloud is ready for new tasks and the cash keeps flowing. In such a situation, anybody can claim to be holier than money. The test comes when the good times end. At that point, shareholders will demand trade-offs in their favour and consumers might stop believing that Google only ever means well.

FOREIGN direct investment will increase markedly from 2007 to 2011, according to a report released on September 5th by the Economist Intelligence Unit. In 2007, global inflows are set to reach $1.5 trillion, above the record total of $1.4 trillion in 2000. Asia looks rosy to investors, despite political risks. China is the most attractive market, with forecast yearly inflows of $86.8 billion over the five-year period, the third-biggest global recipient. Inflows into India will grow, but to just $20.4 billion, thanks in part to inflexible labour laws and poor infrastructure. And Asia's biggest economy, Japan, punches far below its economic weight, with inflows of $13.3 billion a year. Cultural factors are a big hurdle. Many companies resist foreign takeovers for fear of harsh restructuring, and foreign investors say they struggle to find managerial talent.

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WITH the Rugby World Cup tournament starting in Paris this weekend, President Nicolas Sarkozy has appropriately continued his act as a political fly-half, starting another flamboyant attack with the ball emerging from yet another scrum. His latest move has converted the 18-month impasse over the merger of Suez and (largely) state-owned Gaz de France (GDF) into a typically French solution. The two companies will now merge as equals, while Suez floats off two-thirds of its environment division. In much the same way as he darted in to solve the Franco-German power struggle at Airbus immediately after his election, so Mr Sarkozy has shown his ability to loosen another industrial knot.

The French state will go from owning 80% of a medium-sized energy company to holding 35% of a new global energy giant. GDF Suez, as it will be called once shareholders rubber-stamp the deal, will be the leading gas company in Europe and the global leader in liquified natural gas. The merged group also owns nuclear power stations in Belgium and has strong positions in America, Brazil and the Middle East.

Suez boss Gérard Mestrallet and GDF president Jean-François Cirelli will run the combined company jointly—at least to begin with. The pair had been quietly plotting a merger for years, but French politicians were afraid of trade union opposition to anything that smacked of privatisation of the state utility. So they kept a lid on the pair’s plans. But a hostile merger bid from Italy’s Enel group in February 2006 changed the scene. France’s then prime minister Dominique de Villepin unveiled the merger as an act of economic nationalism cooked up to fend off the Italians, who wanted Suez for its nuclear business and were planning to break up and sell off the rest. Mr de Villepin’s government laboured long and hard to persuade its supporters in parliament to back the plan, only to find it delayed and then caught up (because rules about employee consultation had been breached) in the general paralysis that afflicts France during presidential election campaigns.

So this political industrial mess was always going to be an early test for the president. Mr Sarkozy’s prime minister François Fillon said in June that he would come up with a way out of the impasse, but nothing happened. Instead the pint-sized president met Mr Mestrallet last week and emerged with the outlines of a deal. Up until Thursday evening Mr Mestrallet had been resisting any concessions, saying that Suez would not shed the environmental business that accounted for about a third of its profits. That he gave way to Mr Sarkozy is another sign of the power of the presidency once an energetic incumbent decides to interfere.

Two waves of privatisation in the 1980s and 1990s partly dismantled the edifice of nationalised industry built after the second world war and extended in the early 1980s by the Socialist president, François Mitterrand. But the French state still has extensive holdings in industrial companies, ranging from carmaker Renault to France Telecom and Air France. On one count, no less than a tenth of the French economy is accounted for by firms with a state involvement, and state-owned companies employ about 1.3m workers, making them a powerful political force when jobs are at risk.

Mr Sarkozy’s first months in office show a mixed picture. He has pressed ahead with reforms of the labour market and signalled business-friendly changes in taxation. He accepts that France must adopt modern ideas such as Anglo-Saxon capitalism and globalisation. On the other hand, he continues to bleat about the European Central Bank allowing the euro to remain strong against the dollar and he seems intent on pursuing a traditionally Gaullist policy of intervention in business when he thinks it would suit the French national interest, in areas such as energy, aerospace and defence. Investors and other European governments should brace themselves for more lively scrums.

Reuters

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AS A piece of political theatre, one could not help admiring it. Without any warning George Bush popped up in Iraq on Monday September 3rd, accompanied by his defence secretary, Robert Gates, his secretary of state, Condoleezza Rice, as well as the commander of America’s forces in Iraq, for a meeting with the country'st prime minister, Nuri al-Maliki.

The choice of venue was significant. It took place in an American airbase some 120 miles (around 180km) west of Baghdad, in the heart of Anbar province. Until a few months ago such a trip would have been extremely risky if not impossible: Anbar was the crucible of the Sunni uprising against America’s presence in Iraq, and as dangerous a spot as you could find anywhere in the country. Mr Bush’s trip was designed to emphasise his claims that the “surge” of some 30,000 extra troops into Iraq—the reinforcements were directed at Baghdad, its periphery and at Anbar—is finally starting to show results.

The visit is part of the fuss that surrounds a report on the progress of the surge that the American commander, General David Petraeus, is expected to deliver to Congress next week, probably on September 11th, the sixth anniversary of the terrorist attacks on New York and Washington, DC. Ostensibly, the purpose of the meetings was to allow Mr Bush a final chance to assess the evidence before deciding, once the report is issued, what the direction of American policy should be thereafter. In reality he has said so often that he has no intention of withdrawing from Iraq that any substantial change of policy looks highly unlikely. Rather, the trip is aimed more at wavering Republicans, and even a few wavering Democrats, in the hope that they may moderate demands for an early American exit.

Anbar is worth some celebration. Partly because of growing revulsion at atrocities committed by al-Qaeda against “collaborators”—sometimes including children—and partly because of a more robust American presence, Sunni leaders there have turned against al-Qaeda's mainly non-Iraqi fighters. The level of attacks, both against American troops and against Iraqi civilians, has dropped substantially. That said, it was still impossible for Mr Bush to venture outside the vast and mightily-guarded desert airbase, just as he could not have visited any part of Baghdad outside the protected Green Zone. Even though the number of attacks in Baghdad has fallen off sharply, it remains a horribly dangerous place by any standards other than Iraq’s own.

Another reason for the visit lies in the luring of Mr Maliki, who leads a Shia-dominated government, to visit Sunni Anbar. While General Petraeus will have a certain amount of good news to report on the military front, he will not be talking to Congress alone next week. Also testifying will be Ryan Crocker, America’s ambassador to Iraq. He will have to admit that there has been extremely limited progress on the political front. Hopes of seeing an Iraqi government that brings together Shia and Sunni have consistently been frustrated.

Mr Bush and his team have tried everything they can, including both cajoling and insulting Mr Maliki, to get him to form a more representative government, and the meeting in the desert doubtless saw another push in that direction. But the prime minister heads a fractious coalition which opposes making the sort of concessions, particularly on government structures and the division of oil revenues, that the Sunnis would want to see before agreeing to join in. Mr Bush's flying visit will have made headlines, but is unlikely to alter anyone’s views.