What We’re Watching: Hungarian referendum, Iran water protests, US-Germany make pipeline deal

Hungary to hold referendum on LGBT law: Rightwing Prime Minister Viktor Orbán says there is no problem with a new Hungarian law that limits what schools can teach about homosexuality and transgender issues. But the EU and human rights activists say the bill discriminates against LGBT people, and Brussels has threatened disciplinary action against Budapest. Orbán is pushing back, arguing that the EU is trampling the rights and preferences of the Hungarian people — and to prove it, he has announced a popular referendum on the law. The date hasn't been set, but expect the vote to be a major flashpoint ahead of next year's general elections, when the avowedly "illiberal" Orbán will face a challenge from the liberal mayor of Budapest, Gergely Karacsony, who beat an Orbán ally to win city hall in 2019.

Iran's water crisis: For almost a week, people in Iran's Khuzestan province have been protesting over water shortages as result of droughts, soaring temperatures, and power outages that have knocked out water pumping stations. And there's a long back story: Khuzestanis complain they haven't had drinkable tap water since the 1980s, when most infrastructure was destroyed during the Iran-Iraq War, because the Shia government of Iran has neglected investing in this Sunni-majority province. In recent days, the Tehran has deployed the army and the Islamic Revolutionary Guard Corps to bring water tanks. President Ebrahim Raisi — who's barely a month into the job — wants to nip the current crisis in the bud before things go from bad to worse in Khuzestan, a region with separatist tensions fueled by Shia discrimination that holds 80 percent of Iran's oil and 60 percent of its natural gas.

Nord Stream 2 is on: After years of disagreement over the proposed Nord Stream 2 pipeline, the US and Germany have reached an agreement that opens the way to construction of the project, which would bring gas from Russia to Western Europe under the Baltic Sea. Great news for German Chancellor Angela Merkel, who needs more Russian natural gas for the German economy, as well as to help her country — and the wider EU — attain net zero carbon emissions by 2050. It's also a big win for Vladimir Putin: Russia will gain even more leverage with the Europeans as the pipeline will double the amount of gas it now sells them. Bad news for US ally Ukraine, which Russia will be able to cut off from gas that transits overland through Ukrainian territory whenever Moscow wants to pressure Kyiv, without affecting European customers. Meanwhile, US President Joe Biden has chosen to give Europe a bone in order to restore damaged ties under the Trump administration, at the expense of domestic blowback over Ukraine and Russia.