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Brazilian presidential candidate Jair Bolsonaro. Photo: Mauro Pimentel/AFP/Getty Images

It feels like the Cold War is back. States are engaging in shadowy extrajudicial killings on foreign soil, even as the world watches the rise of authoritarian strongmen like Rodrigo Duterte, in the Philippines, and Jair Bolsonaro, in Brazil.

What's happening: Bolsonaro handily won the first round of presidential elections last week and is expected to similarly win the runoff on Oct. 28. Brazil's stock market jumped 6% at Monday's open, greeting the election result with glee, although it then fell back in line with global stock-market losses.

  • Bolsonaro, who served in the military during the Brazilian junta, first came to international prominencein 1993, when he attacked "irresponsible democracy" in front of the national parliament and proclaimed that he was "in favor of a dictatorship."
  • If Bolsonaro becomes president, expect more bloodshed and less democracy in Brazil. Also, expect the kind of pro-business economic policies that have been meet with the resounding approval of the Wall Street Journal's editorial page.
  • The chart of the Chilean stock exchange under the Augusto Pinochet dictatorship below shows that markets are gruesomely amoral. Bolsonaro knows that one of the most effective ways of holding on to power is to keep the capitalists on his side.
Expand chart
Adapted from Girardi et. al., 2018, "Institution shocks and economic outcomes: Allende’selection, Pinochet’s coup and the Santiago stock market"; Chart: Andrew Witherspoon/Axios

Driving the news: Big business also loves China and (at least until this week) Saudi Arabia. Neither country has ever had democracy, and both are major human rights abusers.

  • The list of bigwigs appointed to a major new Saudi advisory board includes (for the time being) venture capitalist Marc Andreessen, Uber founder Travis Kalanick and Dow Chemical's former CEO Andrew Liveris.
  • The seeming murder of Washington Post columnist Jamal Khashoggi, however, has touched a nerve within the global elite that Saudi Arabia's war crimes in Yemen did not.
  • The big Saudi "Davos in the Desert" conferencescheduled for later this month is seeing a raft of desertions, including Richard Branson, Steve Case and Dara Khosrowshahi, the CEO of Uber, in which the Saudi sovereign wealth fund is a major shareholder. Jim Yong Kim, the World Bank president who c0-founded Partners in Health, has also pulled out.
  • Financial attendees, on the other hand, seem to be less squeamish about consorting with the Saudi regime. Still attending, as far as we know (but probably secretly hoping that the conference will end up being canceled): TPG's David Bonderman, JPMorgan's Jamie Dimon, BlackRock's Larry Fink and, of course, Treasury Secretary Steven Mnuchin.

The bottom line: It's very easy to proclaim oneself a believer in "responsible capitalism." But when forced to make a choice, business tends to stick with anything that looks profitable.

  • Very few businesses are actually cutting ties with Saudi Arabia. Pulling out of a single conference is relatively easy virtue-signaling.
  • If businesses do change their minds about projects there, it's more likely to be because of expropriation risk than it is to be a triumph of high-minded democratic idealism.

Go deeper

Parkland shooting victims' families settle suit with school district

A makeshift memorial outside Marjory Stoneman Douglas High School in Parkland, Florida, on Feb. 14, 2020. Photo: Matias J. Ocner/Miami Herald/Tribune News Service via Getty Images

Families and survivors of a 2018 mass shooting at a high school in Parkland, Fla., reached a $25 million settlement in their lawsuit against the Broward County school district Monday, per the South Florida SunSentinel.

Why it matters: The deal was reached in the suit over the massacre at Marjory Stoneman Douglas High after the school district won a Florida Supreme Court ruling that could have capped damages at $300,000 in total without approval from the state legislature, AP notes.

Texas Republicans pass new congressional maps in their favor

Photo: Matthew Busch/Bloomberg via Getty Images

The Texas House voted 84-59 late Monday to approve new congressional district maps that reduce the number of districts with Black and Hispanic majorities, per the Texas Tribune.

Why it matters: The legislation comes after recent census figures found Texas' growing diverse population doesn't bode well for Republicans, who then worked to protect incumbents with the redrawn maps.

2 hours ago - World

North Korea's military fires another ballistic missile into sea

A woman in Seoul, South Korea, walks past a television image if North Korean leader Kim Jong-un. Photo: Jung Yeon-je/AFP via Getty Images

North Korea's military fired at least one ballistic missile into the sea off its east coast on Tuesday, per multiple reports.

Why it matters: Pyongyang's latest in a series of recent missile launches happened hours after U.S. officials emphasized their commitment to restart negotiations on North Korea's nuclear weapons program, which have stalled since talks broke down during the Trump administration, AP notes.

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