Paranoia in the skies

Questions are rising about all the clutter in the sky. [View in browser]( [Bloomberg]( Suddenly, everyone is looking up and seeing a lot of clutter in the sky. The move by the US to shoot down an alleged Chinese surveillance balloon (Beijing says it was collecting weather data) flying at high altitude in American airspace a week ago has raised questions about what else is floating around and where it might have come from. Under pressure for taking days to go public about the balloon’s presence as it drifted over the US, the White House is now racing to demonstrate that officials are scanning the skies and keeping Americans safe. Key reading: - [US Takes Out Fourth Object in Eight Days, Raising New Questions]( - [China Says US Balloons Trespassed Over 10 Times Since Early 2022]( - [Pentagon Says Latest Shootdowns Result From Increased Caution]( - [US Hasn’t Ruled Out Alien Origins for Latest Objects Shot Down]( - [China Insists Balloon for Civilian Use as US Makes Spy Case]( That means any ping on a radar has fighter jets scrambling to take a look. They have shot down at least three other, much smaller, objects, although President Joe Biden’s administration says it does not even know what these things are or where they came from. The frenzy of activity, coupled with a lack of detail, threatens to sow panic among Americans that the skies are littered with devices peering at them. The reality is we simply don’t know. As Democratic Congressman Jim Himes pointed out, “there is a lot of garbage up there.” It is at least exciting fodder for UFO enthusiasts (“aliens” is trending on Twitter). And there is a bigger risk. The lack of detail from officials allows speculation to flourish that all the objects were Chinese surveillance devices. Friction between the US and China has already spiked over the first balloon. Beijing is now claiming US balloons “trespassed” over its territory more than 10 times since the start of 2022. While these devices have probably been used for many years, on and off, largely escaping public attention, right now the atmosphere, to pardon the pun, is tense. The meeting between Biden and President Xi Jinping in Indonesia late last year was designed to put a floor under ties between the world’s two biggest economies and strategic powers. The hope had been to get officials speaking more and working on common interests. The longer there’s a lack of clarity on these unidentified flying objects, the narrower the window to make that goal possible. — [Rosalind Mathieson]( Sailors recover the high-altitude balloon off the coast of South Carolina on Feb. 5. Photographer: Petty Officer 1st Class Tyler Thompson/US Navy If you’re enjoying this newsletter, [sign up here](. And Coming Soon: Understand power in Washington through the lens of business, government and the economy. Find out how the worlds of money and politics intersect in the US capital. [Sign up now for the new Bloomberg Washington newsletter](, delivered Mondays, Wednesdays, and Fridays. Global Headlines Tightening vise | The European Union is set to propose new [sanctions]( to further restrict Russia’s ability to support its war in Ukraine. As [Alberto Nardelli]( and [Ewa Krukowska]( report, the measures will include extensive export bans on items identified in Russian weapons deployed in Ukraine and target heavy vehicles. The package would also zero in on Moscow’s drone sector and imports of unmanned aircraft from Iran. - Click [here]( for our rolling coverage of the war in Ukraine. German inefficiency | Chancellor Olaf Scholz’s Social Democrats fell to their [worst]( ever result in Berlin elections yesterday, raising the possibility that his party could lose control of the city-state for the first time in more than two decades. The opposition Christian Democrats placed first in a rerun election shaped by anger over issues including transport chaos, a lack of affordable housing and a city government seen as incapable of addressing voter needs. Britain’s National Health Service is in [crisis.]( For a host of medical practitioners, scientists, tech firms and politicians, the NHS – the UK’s biggest employer – has finally reached a tipping point after 75 years, and the time has come to remake it. Not friends | Last week’s [spat]( between French President Emmanuel Macron and Italian Prime Minister Giorgia Meloni over a dinner with Ukraine’s leader underscored a deep chasm between them. Macron sees Meloni as an Italian equivalent of French populist Marine Le Pen. For Meloni, the French leader is just the kind of arrogant elitist that she has vowed to bring down, [Chiara Albanese]( and [Samy Adghirni]( report. Best of Bloomberg Opinion - [US’s ‘Domain Awareness Gap’ Goes Beyond Balloons: Niall Ferguson]( - [Rising Violence in Myanmar Demands a Western Response: Editorial]( - [Tax Havens Cast a Long Shadow on Adani: Andy Mukherjee]( Judicial power | Israeli President Isaac Herzog warned that the country is [on the verge]( of “constitutional and social collapse” over a plan by Prime Minister Benjamin Netanyahu’s government to reduce the power of the judiciary. In a rare prime-time speech yesterday, Herzog reflected widespread concern that the proposal is so radical it raises doubts about the future of Israel’s democracy, its appeal to foreign investors and ties to allies. - Netanyahu pledged to convene the [security cabinet]( to prepare for “broader action” against perpetrators and supporters of terrorism in East Jerusalem and the West Bank. Explainers you can use - [What the Balloon Saga Tells Us About China’s Spying: QuickTake]( - [Climate Pledges of Leading Global Companies Don]([’]([t Add Up: Study]( - [Remote Work Costs Manhattan More Than $12 Billion a Year]( Exit stage left | [Peronism](, the political movement that has dominated Argentine politics since the 1940s, is known for its flexibility. But with inflation near 100% and poverty surging, that adaptability looks stretched way beyond its limits. As [Patrick Gillespie]( reports, coalition infighting and a collapse in support for the movement’s pre-eminent leader, Cristina Kirchner, brings a profound sense that defeat is looming in October’s elections, leaving Peronism in sharp, perhaps even permanent, decline. Bloomberg TV and Radio air Balance of Power with [David Westin]( on weekdays from 12 to 1pm ET, with a second hour on Bloomberg Radio from 1 to 2pm ET. You can watch and listen on Bloomberg channels and online [here](. News to note - France’s government is open to more [concessions]( on its plan to raise the retirement age, its spokesman said, hinting at a bigger work-from-home push after labor unions threatened to bring the nation to “a halt.” - Philippine President Ferdinand Marcos Jr. said he’s open to a potential reciprocal [military access]( agreement with Japan if it would protect his country’s fishermen and its maritime territory. - Australia’s $92 billion coal export sector suffered another blow after billionaire Clive Palmer’s Waratah Coal [withdrew]( an appeal to open what would have been the country’s biggest mine. - Ex-Foreign Minister Nicos Christodoulides was elected [president]( of Cyprus yesterday, and said he wanted to secure “reunification as soon as possible” of the divided Mediterranean island. Thanks to the 46 people who answered the Friday Pop quiz and congratulations to Jerry Moskowitz, who was the first to identify Pakistan as the country through which millions of dollars are being smuggled into Afghanistan. And finally ... It’s been nearly a year since Russia invaded Ukraine, but shoppers in Moscow can still get hold of western-made [products]( like Activia yogurt and Oral-B electric toothbrushes. Some goods are left over from the pre-war era, but as [Dasha Afanasieva]( and [Daniela Sirtori-Cortina]( report, many continue to be supplied by American and European companies with outposts in the pariah state. A woman shops at a supermarket in Moscow in January. Photographer: Natalia Kolesnikova/AFP/Getty Images Follow Us Like getting this newsletter? [Subscribe to Bloomberg.com]( for unlimited access to trusted, data-driven journalism and subscriber-only insights. You received this message because you are subscribed to Bloomberg's Bloomberg Politics newsletter. 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