The Obama administration is in the midst of doing something rather extraordinary. While most of the U.S. government and frankly, most major governments worldwide, are mired in a swamp of political paralysis, victims of their own inaction, the president and his national security team are engineering a profound, forward-looking, and rather remarkable change.
It is addressed directly in National Security Advisor Tom Donilon's column in today's Financial Times entitled "America is back in the Pacific and will uphold the rules." It has been manifested in the president's recent trip to Asia and it will be further underscored through Secretary of State Clinton's historic trip to Myanmar later this week.
Superficially, this shift can be and might be perceived to be what Clinton has called "the pivot" from the Middle East to Asia as the principal focus for U.S. foreign policy. But as Donilon's brief article effectively communicates, this shift is far more sweeping and important than has been fully appreciated.
In the beginning of the article, he writes that presidents must struggle to avoid become so caught up in crisis management that they lose sight of the country's strategic goals. Listing the astonishing array of crises President Obama has faced, Donilon then notes that he has nonetheless managed to pursue "a rebalancing of our foreign policy priorities -- and renewed our long-standing alliances, including NATO -- to ensure that our focus and our resources match our nation's most important strategic interests." Asia, he asserts, has become "the centerpiece" of this strategy.
As the article goes on it reveals dimensions of this pivot that have gotten less attention than the simple but nonetheless refreshing restatement of the Obama administration's recognition that -- to oversimplify for contrast's sake -- China is more important to America than Iraq. Because while Donilon writes of regional security agreements and the decision by the administration to embark on a "more broadly distributed, more flexible and more sustainable" defense strategy in the Pacific Basin, what is striking about the article is how often the words it uses and the subjects it references are economic in nature.
Donilon speaks of our priorities in the region as tying to "security, prosperity and human dignity." He defines security needs in terms of concerns about commerce and navigation. He talks about alliances as being "the foundation for the region's prosperity." And he makes a core point of saying that "As part of an open international economic order, nations must play by the same rules, including trade that is free and fair, level playing fields on which businesses can compete, intellectual property that is protected everywhere and market-driven currencies."
Establishing, observing and enforcing international rules are another core theme of the piece and of the statements that Obama, Clinton, Donilon, and others have regularly been underscoring.
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In this moment of national confusion and public despair with officials in Washington, variations on the following cry have often been heard, "Somewhere in the world there must be an American political leader with a vision of tomorrow, a focus on what is really important and an ability to translate rhetoric into success."
I'm pleased to report that there is. If it has escaped your attention it's because that politician has been on the other side of the world the past couple of weeks advancing American interests and the policies of the president with meaningful results and exceptional skill.
That politician is Secretary of State Hillary Clinton, who is just completing an around-the-world mission that has taken her from the economic frontlines of the eurozone crisis to the markets of tomorrow in Asia. The trip, obscured in the noise around the debt ceiling debate, has been a real triumph for the Obama administration and has revealed that many of its policies over the past two years are now bearing significant fruit. It has also revealed the State Department's deftness and bench-depth in dealing with an Asia agenda that is vastly more important in every respect than virtually anything that has been discussed inside the beltway for months.
Given that most trips by senior officials, even secretaries of state, are more often than not a series of pro forma efforts in diplomatic box-checking, the scope and results of the Clinton trip are worth noting. In Greece, she conveyed at a critical moment, America's unequivocal support for that country's economic recovery plan. When visiting Pakistan, the site of America's most difficult relationship, her performance was even hailed in the local press. The Pakistan Observer carried an article stating, "Drum roll for Hillary because she has hit a home run." Her India visit was also widely hailed producing progress on a number of fronts from counterterror cooperation to opening up investment flows between the two countries. More importantly, it also continued the important work that will be a central legacy of her efforts at State which is the elevation of the U.S.-India relationship to being a centerpiece of America's 21st century foreign policy.
The focus on the U.S.-India relationship is, as the trip also revealed, part of an even broader reorientation of U.S. foreign policy under President Obama. This administration was the first in U.S. history to enter office acknowledging that China was America's most important international counterpart -- one that was both vital partner and challenging rival. But, rather than simply acknowledging this fact and focusing on that relationship, Obama, Clinton and their Asia team have systematically worked to establish a foundation for managing that relationship. What is more their choice was not kow-towing or bluster nor was it the blunt instrument of containment. Rather than have chosen what might be called broad engagement, deepening not only the relationship with Beijing and with potential counter-weights like India, but also systematically and often invisibly working to strengthen ties with many of the smaller countries in Asia.
The approach was clearly illustrated during several other stops on Clinton's trip. In Hong Kong on July 25, she delivered an address to the American Chamber of Commerce which was not only a model for a sweeping, specific, thoughtfully-argued policy address, but which revealed a clear vision for the future of America's relationship with China and the rest of the region. It did not hesitate to press the Chinese to abandon unfair economic practices and to embrace the openness healthy markets demand. It was effectively built around the enumeration of four core principles: markets be open, free, transparent, and fair. But it also underscored the mutual dependence at the center of the relationship and outlined a systematic strategy for how to build upon it. It did not stop there, however. It addressed as effectively as anything I have heard the nature of the current debt-ceiling debate in an effort-successful to date at ensuring continuing Asian market confidence. And it emphasized the importance the United States places on deepening ties elsewhere in Asia, from the Korea-U.S. trade agreement the administration is pushing hard to win passage of to links to ASEAN's rising economies. The full text of the speech is worth a read and appears here.
Prior to the visit to Hong Kong, Clinton attended the ASEAN Regional Forum in Bali, Indonesia, and actively engaged with not only many of the region's leaders but made real substantive progress on issues from re-opening conversations with North Korea to managing a constructive multi-national approach to addressing tensions in the South China Sea. These meetings were also a chance to advance the systematic strengthening of relations with all the region's players, including many that have often been overlooked by the United States. This process has over the past two years included both establishment of formal policy dialogues with many countries in the region and also work on issues from reform in Myanmar to those associated with the Mekong River delta area that have been an important part of the Obama team's Asia strategy.
Regional diplomats not only give Clinton high marks for her efforts and in particular for this trip, but they also cite her top lieutenants including Under Secretary of State Robert Hormats and Assistant Secretary of State Kurt Campbell. One of Washington's most respected senior diplomats specifically cited to me the contributions of Campbell in helping Clinton shape the regional strategy, in managing complex core relationships with China, Japan and Korea but recognizing the importance of other players as well. "He is the most effective assistant secretary of state for East Asia in modern memory," said the official. "No one else even comes close and I have high regard for many of them."
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On Friday, Richard Haass, president of the Council on Foreign Relations, wrote an article in the Washington Post titled, "Why Europe No Longer Matters." Today, Monday, the headline in the Wall Street Journal was "Europe Wrangles Over Greece," the top two headlines in the Financial Times were "Medvedev rules out poll tussle with Putin" and "Greek PM's plea for unity to tackle crisis," the top headline in the Washington Post was a story about NATO entitled "Misfire in Libya kills civilians" and the lead story in the New York Times was entitled "Companies Push for a Tax Break on Foreign Cash" which dealt with a key challenge in the age of global companies.
Haass, one of the canniest and most thoughtful U.S. foreign policy analysts around, was responding to Secretary of Defense Bob Gates's valedictory jabs at Europe concerning pulling their weight within NATO. The point of the Haass article was that Gates's comments were not just a coda on his time in office, but the end of a "time-honored tradition" which involves Americans tweaking our allies for shirking their global responsibilities. The piece made all the usual points: Europe's influence beyond its borders will decline, Asia is rising, the threats NATO was established to address have vanished to be replaced by new ones it is not very well-suited to meeting, etc.
The problem with the piece is that while Haass is right in terms of each of these points, I think he comes to the wrong conclusion.
The headlines in this morning's papers attest to the fact that Europe still very much matters today. In a tightly integrated global economy, Europe's economic fate impacts ours dramatically. An economic meltdown there around Greece or Spain could easily create a global economic crisis and send the United States into a precipitous and uncomfortable double dip.
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The Japanese nuclear crisis, though still unfolding, may, in a way, already be yesterday's news. For a peek at tomorrow's, review the testimony of General Keith Alexander, head of U.S. Cyber Command. Testifying before Congress this week and seeking support to pump up his agency budget, the general argued that all future conflicts would involve cyber warfare tactics and that the U.S. was ill-equipped to defend itself against them.
Alexander said, "We are finding that we do not have the capacity to do everything we need to accomplish. To put it bluntly, we are very thin, and a crisis would quickly stress our cyber forces. ... This is not a hypothetical danger."
The way to look at this story is to link in your mind the Stuxnet revelations about the reportedly U.S. and Israeli-led cyber attacks on the Iranian nuclear enrichment facility at Natanz and the calamities at the Fukushima power facilities over the past week. While seemingly unconnected, the stories together speak to the before and after of what cyber conflict may look like. Enemies will be able to target one another's critical infrastructure as was done by the U.S. and Israeli team (likely working with British and German assistance) targeting the Iranian program and burrowing into their operating systems, they will seek to produce malfunctions that bring economies to their knees, put societies in the dark, or undercut national defenses.
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It says something about Gary Locke's tenure as secretary of commerce that it is clearly a promotion for him to have been named to an ambassadorial post and sent to the other side of the world. It also says something about the post he is being offered -- ambassador to China -- by far the U.S. government's most important diplomatic posting in the world. Locke is an excellent choice for the new job and will undoubtedly excel in the role. In fact, there is really only one thing the Obama administration can do to make this smart appointment even better: It can not appoint a replacement for Locke.
Locke is a soft-spoken, detail-oriented, thoughtful, lawyerly fellow, which is not surprising given that in addition to being the former governor of Washington, he is also a lawyer. As a Chinese-speaking, trade-smart Chinese-American from a state with important export ties to China and having the stature that comes of cabinet and state governor posts, he's an ideal choice for the Beijing job.
His tenure as commerce secretary was muted because his particular skill set was not particularly suited to being a cheerleader for U.S. industry. He has no bombast in him, and for a politician he is singularly devoid of the hail-fellow-well-met gene. But beyond his personal traits, one of the reasons he struggled as commerce secretary was that the Commerce Department itself is such a mishmash of agencies with competing missions that the reality is that the vast majority of people who have led the agency have disappeared without a trace into its bowels.
Frankly, it should be considered a destination of choice by the folks over at the federal witness protection program.
President Obama and those closest to him -- including one of the few people who have ever successfully led the Commerce Department and then gone on to bigger and better things, White House Chief of Staff Bill Daley -- recognize this and have very wisely and none too soon undertaken a review of whether or not to restructure the agency along with the other white elephants, redundancies, and lost causes of the federal bureaucracy. The effort is being led by former business exec Jeff Zients, deputy director of the Office of Management and Budget, and as a former management consultant, CEO, and very successful entrepreneur, an ideal choice for the mission.
While it is reported that Locke himself only heard of the president's intention to announce the initiative to rationalize the structure of departments including his own a few minutes before the announcement was made, the idea is a sound one that should be well-received by both parties in the current atmosphere of frugality -- or at least expressed frugality -- in Washington.
What Obama should do is appoint an acting commerce secretary to serve as a place holder. (Perhaps appointing Zients into a kind of caretaker role to oversee the change would be a good step. An analogy is the role Elizabeth Warren is currently playing re: the Consumer Financial Protection Bureau.) Putting someone new and "permanent" in the existing commerce job would a.) Immediately create an opponent to any meaningful restructuring and b.) Be quite tough if they knew there was a serious effort to dismantle the agency afoot. Then, the president and his team should take the steps that have been obviously called for by many of us who have worked at the Commerce Department and on the economic side of the U.S. government for years. They would include:
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While it is too early to assess the long-term outcomes of the uprising in Egypt, there are nonetheless a number of important conclusions to which we can reasonably come.
First, something profound has changed. It did not change because of the uprising in Tahrir Square. It changed and the uprising was the result; the power has shifted in the region. We have passed a generational and technological tipping point. While the dinosaurs cling to the levers of power in virtually every country in the greater Middle East, the under 30 majority is now the great force to be reckoned with. While the establishment has done almost everything conceivable to keep them down from denying them education to curtailing the spread of information technologies to gutting the economies, nonetheless, new information sources and technologies and ways of connecting and collaborating seeped in to these societies through every one of the cracks spreading across the Ozymandian edifices of the elite.
These changes are irreversible. They are seen in the cell phones that even the poorest carry with them, in the broadcasts of Al Jazeera, in the burgeoning Twitter feeds, the apps young Arabs create to provide work-arounds every time a government tries to curtail Internet access, and even in the technological use of some of the region's worst players.
These changes have remade the social and political fabric of the region. What they have yet to do is what they have done everywhere else in the world and that is to fuel economic change.
That is the second inescapable conclusion we need to consider. The great challenges before this under-30 majority are economic, they are about opportunity. They are not about Israel or battles between Shiites and Sunnis or tribal divisions. Those problems still fester, but the unifying challenge for this generation is even more basic: They need jobs. They crave opportunity. And the failure of their leaders to provide them with these basic sources of sustenance and dignity is what has fueled the revolutions of 2011.
A corollary to this conclusion is that we in the United States have been sending the wrong people with the wrong approaches to solve the wrong problems in this region for decades. The problems of this region will not be solved by negotiators or generals. They require investors and entrepreneurs and educators. To the extent that we can contribute, we must do so by supporting the creation of economic opportunity. It is a massive undertaking but it is the only true peacemaker.
A third conclusion is related to the second, however. The role for the U.S. government in all this is very, very limited. We would do well to redirect what aid we provide to address this core challenge of creating jobs for the under-30s. We would do well to put our best economic minds in charge, perhaps even appointing a special economic envoy of real stature. But the only people who can ultimately solve this problem are in the Middle East. In fact, in the hierarchy of those who can help, if the people of the Middle East are first and by far foremost, it is the people of Europe, not the United States who must be second. They are the natural economic neighbors of the region and they must answer the question whether they want those under-30s employed in the Middle East or seeking employment in Europe. After the Europeans, it may even be the Chinese or Indians and others dependent on oil in the region and closer to its problems who should take more prominent roles in helping to solve the problem than the United States, which is a lightening rod and has problems of our own at home.
A fourth conclusion is that the hardest part is clearly still ahead of us. Egypt must make the transition to democracy and that means the military must really step aside after six months. Friends of mine who have met with them believe they understand the implications of the political earthquake that has taken place during the past month and that they will do so. But there are dinosaurs among their leaders so it is by no means a sure thing. Even beyond establishing a democracy is actually keeping one, and beyond that is addressing successfully the economic challenges alluded to above. Further, there are the problems of all the other countries of the region. They will be difficult to handle but we in the United States need to be confident enough in our core beliefs to let them work them out among themselves. There will be fights and setbacks and people we don't like will periodically gain the upper hand. But give me a duel between two guys armed with the Internet, Facebook, and Twitter feeds and let one offer the people the 11th Century and another offer the 21th and I know who I will bet on.
Finally, my fifth conclusion is that of all the big challenges ahead for U.S. foreign policy associated with this period of upheaval, the greatest by far lies with Israel and the Palestinians. Personally, I am not sure why the Palestinians have not yet unilaterally declared independence. The world would surely support them. But imagine what would happen if, perhaps on the road to such a declaration perhaps following it, a hundred thousand Palestinians took to the streets peacefully demanding real self-determination. With memories of Tahrir Square fresh in the minds of the world, how could the Israelis respond as they might have in the past? On what side of history would they appear to be as President Obama might put it? And in that vein, on what side of that history would President Obama and the United States want to be?
Until now, the fact that Israel was the region's only democracy was its "get out of jail free" card. It was used to excuse ... or attempt to excuse ... a multitude of sins. For this reason, no Arab military offensive could be as effective in undermining Israel's strategic advantages as real democracy taking root elsewhere in the region. The Netanyahu administration would be flummoxed if people power came to the West Bank and Gaza. They would be cast involuntarily with the dinosaurs. They would have no pages in their playbook indicating how to handle this. They would have very few good choices.
Actually, they would have only one. They would have to get out of the way. They would have to do what Mubarak did. They would have to step within the 1967 borders and let the Palestinians begin the job of building Palestine. And they would have to hope that the United States, Europe, and the rest of the world helped the Palestinians do it because once that happens, it will be of the utmost importance for Israel that its new neighbor produce real opportunity for its people ... because we have seen the alternative and it, for this generation who have both nothing and nothing to lose will not be contained by the tactics or the rhetoric of the past.
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While the attention of the media is largely devoted to looming storm clouds over the Middle East, it may well be that the next tempest to shake the world may in fact be expected in your teapot. Not to mention your shopping cart. And your gas tank.
In fact, while the uprisings in the Middle East may well be harbingers of historic change in the region, they are also a direct result of another set of factors that could conceivable eclipse them as the big story of the year for 2011: rising global commodity prices. In Tunisia, Egypt, Yemen, and Jordan among the most notable complaints of protestors has been the skyrocketing food prices.
As noted here, that fact is part of a vicious circle that is worrying markets. Bad global grain crops last year produce unrest in the Middle East this year. That in turn pushes up energy prices due to concerns about disruptions in energy flows. That in turn pushes up food prices further as something like 30 or 40 percent of the cost of most food products is related to energy costs associated with processing, packaging, and transportation.
But that's not the whole story. Look at the headlines coming out of China this week about a spreading and significant drought that is likely to further negatively impact food supplies and push up prices. Look at the other headlines about Chinese and Brazilian concerns about inflation. Or the headlines from today (and many recent days) about how inflation worries are depressing stock prices.
In fact, among the very few people who are not that worried about inflation is U.S. Fed Chairman Ben Bernanke who, testified Wednesday, said that while it may be a problem for the emerging world, "inflation is expected to persist (in the United States) below the level Federal Reserve policymakers" feel they have to worry about it. Of course, just because he doesn't worry about inflation here in the United States, doesn't mean Americans aren't going to feel the pinch if food and fuel prices go up. In a rough economic environment like this one for many Americans that squeeze will be particularly acute ... and included in that group are the politicians who will hear the howls of their constituents if prices get above the level average people feel is fair to them. Furthermore, if inflation in places like China, Brazil, or elsewhere in the emerging world causes them to tighten their monetary policies or it negatively impacts real growth, there could be meaningful negative knock-on consequences for the United States.
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While it is often ruefully noted that you can't pick your relatives, there is an expectation in life that you can pick your partners. Barack Obama is discovering that when you are president of the United States, that's just not the case.
In fact, if there is one theme that runs through every corner of the Obama presidency it is that he has been forced into partnerships that are so complex, difficult, and undependable that it must leave him yearning for the relative simplicity of good old fashioned enmities. This was illustrated yesterday as the president made the short walk across Lafayette Park to visit the U.S. Chamber of Commerce, symbolic headquarters of the U.S. business community, a group with which the president has come to realize he must work more closely going forward.
But in and amid all those complicated relationships, which are the most difficult? Naturally, there are many ways to measure this but we'll stick with one: Which among the most difficult are most likely to blow up in his face during the next two years?
Here's the verdict:
This, the most important international bilateral relationship, is both difficult and likely to be relatively stable because it is so complex. There is so much economic co-dependency here that the political issues are likely to work themselves out. Over the next two years trade and currency tensions may grow, but it is unlikely that either side will flirt with a big blow up prior to the 2012 leadership change in China or the presidential elections that same year in the U.S.
China is likely to be the U.S. most important international counterpart in the decade ahead but Russia remains the wildcard among the major powers. Stephen Cohen summed it up well on "Morning Joe" this morning: Russia's the biggest country in landmass, the leader in energy output and it has all those nuclear weapons. It also has a massive Muslim population, related challenges in its near abroad, memories of empire and what might politely be called a mischievous streak when it comes to international challenges. Oh, and it is undergoing a demographic meltdown and it is suffering from a divided less-than-dependably friendly political leadership. It's at the bottom of this list primarily because of the "next two years" focus of our metric.
Israel is the United States' most dependable friend in the Middle East and a vital ally. That said it is also facing massively unsettling changes from within and without that are creating enormous pressures on its political leaders. The Bibi-Barack marriage was never exactly made in Heaven but as the Israelis face demographic pressures at home, the Hezbollah take-over of Lebanon, instability in Jordan and Egypt, the prospect of a nuclear Iran, growing international pressure to cut a deal with the Palestinians and seeming growing inability of the Palestinians to cut a deal due to their own internal divisions ... what was difficult is going to get any easier. While many expect Netanyahu to offer his own concessions and a roadmap to progress sometime soon, there is real concern even among his supporters whether he can go far enough to break the logjam in the peace process. If he can't, pressure will build in this already fraught partnership.
Egypt nudges out Israel only because it is so volatile right now and we don't know where the current unrest now heading into its third week is likely to head. One thing we do know, there are almost no circumstances in which the relationship will be easier for the United States. If there are massive reforms, a more pluralistic Egypt will be harder to deal with than an autocracy with a fairly dependable ally at the helm. If the current regime holds, they will never trust the U.S. in the same way as they did prior to this crisis.
6. Democrats in the Congress
Will Rogers said, "I'm not a member of any organized party, I'm a Democrat!" And as far as we know he never sat at a cocktail party between bickering leaders like Nancy Pelosi and Steny Hoyer or Harry Reid and Chuck Schumer. (Although, Pelosi clearly had a little celebratory sip of champagne last night to celebrate the departure of Jane Harmon, a longtime thorn in her side.) Pick an issue from fighting the deficit to rationalizing our regulatory framework to investing in energy infrastructure, you'll find both Obama's biggest supporters and some of his most difficult opponents in his own party.
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The agenda for the state visit was dominated by trade and economic issues. The world was recovering from a recent global economic crash. There was a certain tension because the visitor had strong autocratic tendencies and according to some, imperial ambitions. He had also regularly made statements that could be interpreted as hostile to U.S. and Western influences in his country. The U.S. president, who had once enjoyed enormous popularity, was mired in the difficulties of working with a fractious Congress and poisonous political divides across the country. His main job was nation building at home but he increasingly found he had to take time to address international concerns. In the end, the best outcome the visit could produce was some limited progress on trade deals, allowing the visitor more access to a U.S. market that was vital to his country's growth.
While it sounds familiar, that is the story of the first visit of a foreign head of state to the United States. It took place in 1874. The visitor was King David Kalakaua of Hawaii. The U.S. president was Ulysses S. Grant. The signing of the trade deal -- which focused primarily on agricultural commodities -- was considered a big triumph back home in Hawaii although ultimately the king was better known for his energetic world travels, for the decline in the power of the Hawaiian monarchy that took place during his reign, that he was Hawaii's last king and for the fact that during his reign he oversaw the revivals of hula dancing and surfing.
Thus the echoes with the visit of China's president Hu Jintao to the United States this week are only distant ones. Nonetheless, there is something in this visit that compels a look backward to that first state visit of a foreign leader to Washington. Because this is the first time in the comparatively short history of such visits that any visiting leader has been seen by a substantial number of Americans as representing a rising power that might soon eclipse the United States.
Even during the visits of Soviet leaders who were seen to be at the helm of the world's other superpower, there was always a perception among Americans that we were the ones with history on our side and also that should it come to conflict that either we would win or that both sides would lose. Further they were never seen as a real economic rival. But look at recent polling data. A Pew Study released last week showed that almost half of all Americans see China as already being the world's leading economic power while fewer than a third of Americans see the United States in that role. An Allstate/Heartland survey last month showed the same thing and also suggested that at least as many Americans feel China will be the leader in 20 years as believe the United States will rebound.
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It is clear that the memo that went out to the media from Echo Chamber Central Command this morning was "the visit of President Hu to Washington will be presented in terms of China's growing threat."
In paper after paper headlines blared and reporting backed up the message. Some of the stories focused on the nature of the economic threat. Notable among these were the Financial Times's front page piece on how China's influence was being enhanced by dramatic increases in its lending to the developing world -- lending that now surpassed that of the World Bank. Inside the FT there was more including a well-researched and compelling piece by Geoff Dyer, David Pilling and my long-ago colleague from Institutional Investor Magazine, Henny Sender called "A strategy to straddle the planet." The thrust of the piece was also that China is using its trade flows to build links and leverage worldwide in an effort to shape the rules and set the priorities for the international economy. There was also an excellent accompanying piece on the potency and problems associated with China's almost $3 trillion in hard currency reserves. The Washington Post had an in-depth look at the frustrating times that Wisconsin's Manitowoc Company was having in its dealings in China… echoing a piece in the New York Times about the uncomfortable deals trading technology for market access that General Electric has embarked on. In both cases the point was: while China is an appealing market, the Chinese are hard to deal with and seem likely to pose long-term threats as an economic rival.
On the security threat posed by China, we had an op-ed in the Wall Street Journal called "The New Era of U.S. China Rivalry" by Princeton professor Aaron Friedberg. The conclusion of the article: "Hu Jintao's visit may mark the end of an era of relatively smooth relations between the U.S. and China." The lead editorial in the Journal: "Dealing With an Assertive China." In the Times, Helene Cooper had a good piece (and not just because it quoted me) on the tougher posture adopted by the Obama administration called "For Chinese President's Visit, U.S. to Take a Bolder Tack" and another lead editorial which echoed that of the Journal in concluding, "State dinners and 21-gun salutes are ephemeral. What will earn China respect as a major power is if it behaves responsibly. That must be Mr. Obama's fundamental message."
The guts of the piece included statements like "(China's) overconfidence is clear. It has been aggressively pressing its claims to disputed islands in the East and South China Seas. The military's rising influence is troubling." And in the next paragraph: "For a country that claims to be a global power, it is still shirking its responsibilities. … For a major player, it can also be remarkably petulant."
It may seem unremarkable to Mr. Hu's delegation that the Journal and the Times are so aligned in their views. Americans who know them often to be polar opposites know better. (The Washington Post also had its lead editorial in roughly the same place:
China's would-be reformers face an ugly contrary current, seemingly centered in the military, that has been pushing a belligerent foreign policy, including toward the United States… Mr. Hu's visit offers the opportunity for the United States to make clear that a liberalizing China will be far more welcome as it rises as a world power than one that continues to deny its citizens freedom and the rule of law."
While normally such a convergence of views in the press should be a warning sign, this is one of those rare cases in which even the experts believe what they are reading. Oh sure, there are debates about the tone with which one should address the threat (there is still a school-marmish quality to some of the pieces advocating that the United States lecture the Chinese) or whether or not the United States is in a position to do that any longer (Francis Fukuyama's piece in the FT suggests we've lost ground). But in my conversations with diplomats from around the region during the past couple of weeks, there has been a recurring theme that China is engaged in a sweeping, systematic effort to extend its influence and flex its muscles.
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You can tell a lot about a major summit between world leaders by what happens in the weeks leading up to it. That's when staff scurry around trying to nail down "deliverables" -- agreements that might be signed, initialed, announced, dusted off, and signed again, that sort of thing -- and fine tune the optics of the upcoming meeting. Tensions are typically defused in advance. Good news is often played up to produce a positive mood.
That's just what has been happening in the run up to the visit of China's President Hu Jintao to Washington. The Chinese foreign minister blew through town last week, meeting with the likes of Hillary Clinton and Tom Donilon and allowing both sides to test out their language about how important the relationship is while also testing thrusts and parries on currency policy. Our North Korea envoy Stephen Bosworth went to Beijing to seek progress on cooperatively managing the vexing Mr. Kim. Secretary of Defense Bob Gates is in China right now seeking (unsuccessfully thus far) to reboot military cooperation that broke down in the wake of last year's decision to sell more arms to the Taiwanese.
At the same time, as is also typical with such a visit, we have members of Congress like Senator Chuck Schumer (D-NY) flexing their muscles and warning that China had better adopt "fairer" currency policies or else. And sometimes we have seen other actions designed to send messages to the rest of the world to place the upcoming meeting in context -- or at least international actions that cast an important light on the upcoming meeting whether intentionally or otherwise.
Read these tea leaves and you can tell a lot about the largely formal high-level summit to come. In fact, these pre-summit periods are actually where the real work usually gets done with the most important summits typically being so carefully orchestrated that it's almost impossible for anything to actually spontaneously occur out of them.
So, what have we learned? Here are a few highlights:
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Bill Clinton once noted that nuclear weapons were North Korea's only cash crop. It was a wry and on-target observation that underscores a critical point. There is clearly a method to the madness of Kim Jong Il and the regime he leads.
After this week's revelations about North Korea's latest nuclear initiative followed by today's exchange of fire between North Korean and ROK troops, it would be easy to suggest that the country is once again going through one of its periodic bouts of irrationality. And by any traditional calculus of behavior, it is hard to deny that a small, impoverished nation frittering away scarce resources on a giant military despite the fact that there is zero chance they could ever defeat their principal adversary seems nuts.
But that would only be the case if the value of that military were measured in traditional, abstract terms. If this measurement is balanced in the context of the North Korean leadership's political needs, it makes more sense. Maintaining a confrontational stance with the South provides a rationale for an authoritarian state and a reason to have the forces in place to maintain that state. It also provides a useful distraction from the utter failure to create a healthy economy within the country.
Furthermore, every time North Korea flexes its muscles, threatens its neighbor, or violates international law it gains stature unavailable to it via any other means. Think about it: North Korea has a GDP smaller than Costa Rica, roughly the half the size of that of say, the Sudan.
Finally, every time the North does one of these things, the response of the rest of the world actually, brings about benefits. After the "official condemnations" die down and the sanctions are proved to be ineffective -- as they inevitably are when pitched against a country in which the will or discomfort of the people does not exactly drive the political system -- North Korea gets a reward of some sort, a deal, an aid package, energy supplies, food. Best of all, the rest of the world accepts its word on vital matters even though North Korea has never ever kept its promises.
As they say in my part of Pyongyang, "such a deal." Is it any wonder that Kim Jong Il continues to turn to his nuclear program to be his main cash crop, to make "lunacy" his country's principal export?
This is not to minimize the risk from the North. Actually, it underscores that it is likely to remain and fester for the foreseeable future. In fact, some observers see this week's events as an effort by Kim Jong Il to provide "victories" for his son and heir apparent, Kim Jong-Eun. The fact that the unveiling of the sophisticated "astonishingly modern" (see today's FT story "Kim Jong Il Plays His Aces") uranium enrichment facilities are seen as yet both a coup for the North and a shocking intelligence failure for the United States and our allies already puts it in the win column. The fact that the exchange of gunfire today was met with communiqués and deep restraint (thus far) suggests it too may end up in the plus column for the dear leader and his clique.
These events may also ultimately be seen as wins for Kim on two other levels. First, the nuclear facility almost certainly required international collaboration. If it turns out that support came in part from, say, Pakistan, already suspected of helping the Koreans develop a nuclear ballistic missile capability, it would be deeply embarrassing and awkward for the United States. Next, the fact that the United States and South Korea are really hamstrung on this issue, almost entirely dependent on the Chinese to put real pressure on the Koreans, makes this issue yet another that underscores how the balance of power has shifted away from Washington -- even with almost 40,000 troops on the ground in South Korea and North Korea a top diplomatic priority for the administration.
In short, call Kim strange, joke about his quirks and collection of VHS tapes. I can't help doing so sometimes. But we ought to stop suggesting he is irrational or unpredictable. What he is doing, it's completely in character, following a clear pattern and may very well ... and yet again ... pay off, precisely as he intended it to.
After a brief stop at an Asia-Pacific Economic Cooperation summit that will almost certainly be the anticlimax of a 10-day swing through Asia, President Barack Obama will briefly return to Washington to pick up a new change of socks before heading off to Europe. From unsatisfying discussions about the world economy he will move on to unsatisfying discussions about Afghanistan. From difficulties with the new powers of Asia he will move on to difficulties with the old powers of Europe. And through all this he must be thinking, "The heck with the birthers debating where I was born -- if this keeps up, I have to wonder, where am I going to live once I leave this job?"
Admittedly, many of the challenges he faces are not of his own making. He did not send the world economy into a tailspin, gut the U.S. manufacturing sector, recalibrate global labor markets, or introduce the first U.S. troops into Afghanistan. And on this trip to Asia and next week's to Europe he has taken many substantial steps to address these problems and to restore the United States' international footing. From a successful mission to India, the innovative and smart (if largely symbolic) move to endorse India for a permanent seat on the United Nations Security Council, a sensitively handled journey to an Indonesia where he spent time as a boy, and an effort to embrace the new world economic order by continuing to support the empowerment of the G-20, many of his efforts deserve praise.
Having said that, as is often the case with this administration, Obama giveth and Obama taketh away.
The frustrations and missteps of this trip, especially those encountered in Seoul, could have been easily avoided. First, the United States could be somewhat less disingenuous about our economic policies. I am a supporter and admirer of Treasury Secretary Tim Geithner in most things, but his line that "We will never seek to weaken our currency as a tool to gain competitive advantage or grow the economy…" has to go down as the howler of the month, and may qualify for howler of the year honors next month. In the wake of QE2 and longer-term easing, money-pumping policies -- which are clearly designed to offset what are seen as unfair Chinese currency practices -- the United States is guilty of promoting precisely the race to the bottom that earned such broad condemnation from Europeans, Asians, and other emerging powers in Seoul.
The failure of the Korea-U.S. Free Trade Agreement talks is also due to American misplays. Long ago in this space I warned about the mistake of giving too much authority to the office of Senator Max Baucus (D-Mont.) in appointing senior officials at the office of the U.S. Trade Representative. This week, Baucus' influence apparently triggered the breakdown of the Seoul talks. Sources suggest that the Montana senator pushed for greater beef market access beyond what the Koreans had repeatedly said were their limits. The result: A deal the president promised would be done this week floundered -- and its prospects do not look good.
Should the White House, then, have been as surprised and disgruntled as it was this morning by the two column New York Times lead headline "Obama's Economic View Rejected on the World Stage"? Heck no. Them's the facts. What's more, like the election results, perhaps it was a message the team needed to see written out in bold dark type.
Obama embarked on this trip with a message from the American people: They were frustrated with the state of the U.S. economy, and something had to change in the way Washington was dealing with it. As it happens, that is the same message he got from the G-20 leaders in Seoul. While he was away there were two events that may present him with an opportunity to gain ground with both of his stakeholder constituencies, the voters who elected him and the creditors to whom the United States owes so much money. One was that by some sort of alchemy (which is to say the ability of Democrats to do basic arithmetic), the administration realized they would have to accept a deal to extend all the Bush tax cuts, probably for a couple of years. They leaked their inclination in this regard without clearly confirming it. The second was the leaking of the co-chairman's bullet-point summary of the Deficit Commission report. Whatever the problems with their recommendations, they represent the first recent, high-level effort to deal seriously with this problem on both the revenue and the cost side of the ledger.
My sense is that there is a potentially transformational deal here for the president: Agree to an extension of the Bush tax cuts for two years, if Congress agrees to an up or down vote on the National Commission on Fiscal Responsibility and Reform report -- provided it receives support from at least 14 members of the deficit commission. Link dealing with the poor economy to a commitment to getting our house in order -- as our creditors, allies, and most sensible citizens and neighbors are pleading with us to do. (If it is not "fast track" for the deficit report, perhaps it could be a commitment to linking a deficit reduction plan to the first budget of the new congress.)
The president has three big game changers that could restore his standing at home or abroad. One is a spontaneous recovery of the U.S. economy. Another is catching Osama bin Laden. Neither of these is likely, nor are they things that he has much control over. The last would be establishing himself as a president with the courage to manage us through first a market crisis and then a deficit crisis, who could do so in the face of criticism from both parties and who could engineer support from both parties. It is not that much more likely than the first two "brass ring" events, but it is the one outcome over which he has the most potential control.
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The United States seem to be swimming in economic initiatives that are going to go nowhere. But are we really surprised? After all, as in the case of U.S. efforts with regard to Afghanistan, Iraq, Iran, and Israel and the Palestinians, we also seem to be swimming in foreign-policy initiatives that are very unlikely to produce much (positive) change to the status quo.
But seriously, if the United States is going to devote our efforts to empty symbolism and hollow gestures, couldn't we focus on some that were leavened by a little nobility, creativity or boldness? If we are going to float proposals that are doomed to failure or ineffectiveness, couldn't we float better proposals?
Let's take the four big economic initiatives making headlines this week.
The Korea-U.S. Free Trade Agreement
We were greeted this morning with the unsurprising news that the efforts by U.S. Trade Representative Ron Kirk and his Korean counterparts to hammer out a new and improved version of the Korea-U.S. Free Trade deal had foundered on beef and automobile issues. I lead with this news because it is one of those rare proposals that actually have the opportunity to fail twice -- in addition to this week's setback, it could also fail in the negotiating phase. That's not very likely (the White House promises a deal "within weeks"). But even if the deal is reached, the likelihood that a free trade deal is going to make it through the U.S. Congress any time soon seems slim.
conventional wisdom has it that Republicans are warmer to free trade than
Democrats, the reality is that centrists are warmer to trade. The real
opposition lies in the growing right and left wings in each party.
A story in today's New
York Times highlighted a Pew poll that 44 percent of Americans feel free trade deals have
been bad for the country, while only 35 percent feel they have been beneficial.
While some deals are viewed more favorably, others -- like deals with China or
Korea, countries viewed with more unease -- are not. The article also notes
that, "Republicans and Republican-leaning independents who were aligned with
the Tea Party movement had a particularly negative view of the impact of free
trade agreements." In the last election cycle something like 4 out of 10 voters
identified themselves with the Tea Party or Tea Party candidates -- a group
that now has 110 members of Congress.
With the Blue Dogs slaughtered in the last election, the power in Democratic caucus has also shifted solidly to the left; between that fact and the growing importance of unions as 2012 nears, the idea that a trade deal might get approved anytime soon should provoke some skepticism.
South Korean Presidential House via Getty Images
What would you do after a rough few months on campus? Roadtrip!
It works the same way for presidents. Though, instead of making the journey in Flounder's brother's Lincoln this one involves -- according to the same people who estimated 11 million people attended the Glenn Beck rally -- 3,000 people, 34 warships, Air Force One, 13 cargo aircraft, three helicopters, and the private aircraft of a coterie of fat cat hangers-on. And instead of heading to Emily Dickinson College to comfort the grieving roommate of Fawn Liebowitz (by treating her to an evening at a local roadhouse to listen to Otis Day and theKnights) this one includes stops in India, Seoul,Korea for a G20 meeting that will involve more slippery smooth talking than"Otter" Stratton could ever muster, Japan, and Indonesia.The rumor that Obama is visiting Indonesia to consider locating his presidential library there is untrue and was denied by the White House moments after Mitch McConnell started to spread it, thus ending the three hours and twenty-two minutes of civility following Tuesday's elections.
For Obama, the trip is bound to be a relief. In fact, a variety of pundits are peddling the idea that given likely gridlock, congressional investigations, and general acrimony at home, that this trip will mark the beginning of a period during which the president will focus on international issues. As the theory goes, presidents can elevate themselves on the international stage without being dragged down by the Congress. Like many such theories, of course, this is nonsense. Nothing would seal Obama's fate as a one-term president quite as fast as a refocusing away from the domestic economic issues that torment his employers, the U.S. electorate.
Furthermore, given those domestic economic problems and the problems associated with our recent overseas misadventures, the United States is going to be both considerably less forward-leaning overseas, considerably more inward-looking generally and, in all likelihood, despite the "trade" sub-theme of the upcoming trip -- which is really a form of mercantilist chest-thumping -- more protectionist going forward.
SAUL LOEB/AFP/Getty Images
We are not in Kansas anymore. More importantly, Kansas is not even where it once was.
Once upon a time and in the minds of most living Americans, Kansas was more than just a synonym or a metaphor for America's heartland, it was the actual geographic mid-point of the United States. You could debate whether the exact location deserving of this honor was closer to Lebanon or Grenola, but at the end of the day, all would agree that by virtue of the power and position of the United States, somewhere out there in the middle of nowhere was the center of the world.
No more. America may be the richest and most powerful nation on earth. But the world's economic center of gravity is shifting away from Kansas much more rapidly than anyone had any reason to expect it would even a decade or so ago. (I know this for a fact -- as a senior economic official in the Clinton Administration who helped put together and run the first U.S. inter-agency effort focused on the world's largest emerging markets, I remember how officials would smile patronizingly and roll their eyes, "Yes, China, India, Brazil, yes... important, but not in our lifetimes.")
China Photos/Getty Images
This weekend the Obama Administration will send a team to China headed by the somewhat unlikely duo of Larry Summers, head of the National Economic Council, and Tom Donilon, deputy national security advisor. The purpose is to send a clear message that the U.S. is approaching its relations with China strategically, with a view that integrates the full range of economic and security concerns.
While such trips are old hat for Summers, the journey represents a bit of a change of pace for Donilon, the inside guy who is credited with having done a great job making sure the policy process trains have been running on time within the National Security Council. Some in Washington are buzzing that this is a profile- and skill-raising trip intended to make Donilon a better candidate to replace National Security Advisor James L. Jones should Jones decide to depart, as many expect he will. Others grumble that the trip represents precisely the kind of "operational" role for the NSC and NEC that many cabinet departments have long thought should be out of bounds for White House policy coordinators.
But beyond the Washington gossip the trip has caused, the juxtaposition of economic and security concerns offers an illustration of an often over-looked fact -- the centrality of economic issues to current U.S. national security concerns. In China, the tricky calculus is fostering collaboration on security issues from North Korea to Iran in the face of political pressure back home to press Beijing harder on issues like currency valuation and unfair competitive practices (especially those associated with pressuring foreign firms to transfer proprietary technologies).
The U.S. has never been especially effective at coordinating its multiple interests in China so that pressure in one policy area produces progress in another -- or even simply avoids causing setbacks. So this trip, in concept at least, represents a step in the right direction -- at least if Congress doesn't undercut the administration's efforts by, for example, drafting its own legislation on currency issues.
But China is just one of a host of current hotspots where Summers, Geithner, and the international economic team are playing a central role on national security issues.
For example, in Afghanistan, the story of the week turns on the amazingly brazen behavior of the Karzai gang in trying to pressure the United States into bailing out a clearly corrupt and mismanaged bank in which President Hamid Karzai's brother, Mahmood Karzai, is the third largest shareholder. Mahmood has publicly called for a bailout even though his affiliation with a bank through which U.S. funds flow to Afghan security forces compromises both him and the president. Both remain unabashed, however, behaving like the proverbial kids who murder their parents and seek the mercy of the court on the grounds that they are now orphans. So the United States is in a pickle: Step in and support the Afghan kleptocracy and its culture of corruption or stand on principle (and law), and run the risk that the bank falters. It's not a situation that General David Petraeus can handle, but how the economic team manages it will have direct ramifications for him.
In the same way, some of the most sensitive concerns regarding Pakistan turn on economic policy. Will the Zardari government pump too much cash into the economy to deal with the aftereffects of the devastating flooding, and risk a major inflationary episode? Or will it introduce price controls and a set of micro economic measures that, if mismanaged, could produce social tensions or even rioting? The wrong mix of policies could plunge the already fractured and battered country into political turmoil and perhaps the reintroduction of military rule.
In talks with the Israelis and the Palestinians, many of the core concerns will turn on how to improve the economic conditions for the Palestinian people. If they can get past initial hurdles, they will, of course, ultimately have to move to a state structure that will enable organic economic growth in a Palestinian state, actually fostering job and wealth creation for people who have lived in an economic no man's land for too long.
In North Korea, it is reported that the administration, conducting high level meetings on the subject this week, is seeking to explore "engagement." In the case of the economically isolated and struggling North, that inevitably will mean economic packages in exchange for gradual normalization of relations or reductions of threats. At the same time, this week, the administration widened sanctions intended to force Pyongyang to give up its nuclear weapons.
In Iran, the core initiative at the moment is making targeted economic sanctions work. In Iraq, the issue is fostering economic growth to help "purchase" social stability. The list goes on. It is clear that wherever the stakes are highest for the United States in the world, even as military and diplomatic initiatives garner most of the attention, behind the scenes much of the most critical work is being undertaken by international economic officials.
It is interesting to note in this respect that the responsibility for conceiving and coordinating most of these activities lies in the White House to a much greater degree than it does with military or diplomatic initiatives. The White House team on these issues is excellent. But in the end, these functions are so fundamental that the real leadership capabilities need to be cultivated elsewhere.
The economic team at the State Department could and should play a greater role in this respect; Undersecretary for Economic Affairs Robert Hormats is a talented and experienced official. As I have written before, State also could and should develop a dramatically enhanced capability when it comes to emergency economic intervention -- pre- or post-crisis. And all the other economic agencies need to be prepared to collaborate on this, not on an ad hoc basis but through a permanent program promoting cross-training and what the military might call inter-operability. Call it an economic rapid response capability -- or call them economic green berets.
We need people we can drop into critical situations and help manage them with an eye to our security and political needs rather than traditional purely economic metrics. That's a critical role for which development officials are ill-suited, and we still don't really have the fully developed institutional structure we need to support it.
Looking at the issues faced by the United States today, while one can't help but admire much of what is being done, the strategic side of the international economic agenda is such that it warrants some real thought about how and with whom we should be meeting such challenges in the future.
Oleg Nikishin/Getty Images
Yesterday at lunch I ran into a very senior official who is deeply involved in the negotiations with Honduras. He said, "It is a very strange situation. Here you have on one side officials from Honduras and on the other side you have the United States, Hillary Clinton, Brazil, Michelle Bachelet, the rest of the world. They seem to be enjoying it ... they have never had so much attention."
And so the government of Honduras learns the first lesson of weak-state diplomacy as taught by the Sun Tzu of diplomatic tantrums, Kim Jong-Il: the more big powers you can irritate, the better off you are. They almost never manage to apply real pressure and more importantly, wherever they go, the cameras go. If North Korea were a poor Stalinist agricultural enclave on the northern bit of the Korean peninsula that didn't have nuclear weapons they would be getting roughly the publicity of...well, Cameroon, which is a near neighbor on the CIA GDP chart. (Some other neighbors on that chart like Cyprus and Yemen have also managed to ratchet up the attention they get by being festering sores on the political map.)
Whatever the case, the diplomat advised the Hondurans not get too used to the limelight, that their 15 minutes were almost up. What's the matter with these guys? A call to Pyongyang or A.Q. Khan and they could become a first tier nuisance to the world and enjoy all the rights and privileges thereto appertaining.
MAYELA LOPEZ/AFP/Getty Images
What a good week for the subcontinent. India's elections are breathtaking in scope and their re-election of the government of Manmohan Singh, one of the world's wisest and most qualified heads of government, is heartening. That he is only the second Indian leader since independence to be re-elected after serving a full term suggests an India that is entering a phase of stable growth that should be appealing to those investing in its future and comforting to those, like the United States, who are increasingly dependent on it as an ally. But the success of this democratic experiment at such scale also sends a powerful message to countries like China who have long argued that such a system cannot work in nations of such scope and complexity.
Also, as to China, the position of U.S. Ambassador to China may be the second most important in the State Department after the Secretary's job. It has taken the Obama administration a long time to make their selection for this vital post. Their choice, Jon Huntsman, is an excellent one. He has almost all the traits needed to be the first envoy to that country since the general acknowledgement that it is our partner in the G2, our first, most important counterpart in the community of nations. He has extensive regional experience (from service as a missionary in Taiwan to that as an Ambassador to Singapore). He has very high-level U.S. and state government experience which not only gives him familiarity with a wide range of issues but also sends a message to the Chinese that only someone of high stature would do for the post. He speaks Chinese. And while some might quibble that he is not particularly close to Clinton and Obama, this is a small issue.
I have met with him a couple of times, once having had the opportunity for a long dinner time conversation with him a number of years ago, and I was struck with his intelligence, accessibility and political gifts. That he is legitimately seen as a potential Republican presidential candidate also will help with the Chinese and sends a message too about Obama's confidence as a chief executive. It also is an interesting parallel with one of Huntsman's past benefactors, George H.W. Bush, whose resume of diverse senior posts and significant international experience as well as a reputation as a sound centrist are being mirrored by this rising star of the Bush's party. Wouldn't it be interesting if the antidote to George W. Bush was a completely different kind of Republican modeled on his father?
Aung San Suu Kyi deserves to be the center of a more concerted, more visible effort led by America and her allies to win freedom for the Burmese dissident. If Burma's neighbors choose to sidestep the issue, the rest of the world has an obligation to step up the heat on what is one of the world's most repulsive regimes.
PRAKASH SINGH/AFP/Getty Images
In March, for the third month in a row, more cars were sold in China than in the United States. Admittedly, there are many more Chinese. But this is a sign of a permanent change in the structure of the global auto industry that even an army of car czars will not be able to reverse. Even if we had car czars that actually knew something about the industry. Even if the American auto industry did not think the height of innovation was the reintroduction of a 1960s muscle car for the Vin Diesel crowd like the new(ish) Camaro. (Although even tuners prefer to nitro boost foreign-made vehicles as well illustrated in this week's gearhead superhit, the subtle and heart-breakingly beautiful, Fast and Furious.)
Last week, in the lead story in the New York Times, we also saw that China was actually going to have something like twice as many electric cars as the United States in the next couple years and that the country was poised to lead in electric car technology. While we actually could be competitive on the technology front, the problem we have with electric cars runs deeper. American car owners want longer range, faster, more powerful vehicles than the Chinese (and consumers in many other countries). Sure, I'll take your damn green car, we say helpfully, but only if it is the same as the gas-guzzling, road-rocket I'm used to. Oh, and please be sure it has three rows of seats, a beer cooler in the glove compartment and twin flat panel screens so the kiddies don't have to watch the same episode of Sponge Bob Square Pants (because we don't want them fighting over which life lesson they will gather from their favorite gay underwater kitchen implement).
In other words, our consumers don't look like the consumers in the rest of the world. That's been a challenge to American car makers for some time (the appetite of international consumers for smaller cars led to the rise of the Japanese, European, and later Korean auto industries at the expense of American manufacturers). But with the rise of China and India and other emerging car markets and the more willing embrace of greener standards in everything by Europeans, our consumers are sending a market signal to car makers in the United States that is just completely out of whack with much of the rest of the planet.
Some of that is, of course, due to the success car manufacturers, oil companies and others have had in keeping U.S. mileage standards artificially low and in dragging their feet on efficiency. Some of it may be due to the same auto manufacturers' ability to persuade American men that cars are somehow direct extensions of their penises. (Oddly, I don't know that the reputation of French lovers or other Latin lovers has suffered because they drove Renaults or Fiats...even if it should have. In fact, I know for a fact that the very handsome and irresistible editor of Foreign Policy drives a Smart car that looks like a toaster on a roller skate and yet, still the legions of policy groupies gather each day outside the FP headquarters just to catch a glimpse of him.) But part of it is that American consumers are spoiled and have gigantic rear-ends that don't fit in little tiny car seats. The Obama administration can help to change this (the auto innovation and buying habits parts) with new standards and with incentives for car makers and car buyers to invest in more efficient cars going forward. U.S. consumers will also have a role to play in all this too, of course...they will have to respond to the incentives. (As for the rear ends, all of you now: clench...maintain...release...clench...maintain...release.) But the cultural shift we need can't just stop there. For one thing, it might be helpful if U.S. politicians stopped referring to the Big Three as "the U.S. auto industry," since there are hundreds of thousands of Americans employed by great companies that contribute to American growth like Toyota, Honda, Nissan, Hyundai, Mercedes, and BMW. And who knows, if we took that step, we might actually be a step closer to tuning out the idiot-populism currently clouding this issue such as that by people like noted auto industry economist John Rich (of country music's only economically titled duo Big and Rich). Writes Rich in his current hit "Shuttin' Detroit Down"...
Cause in the real world they're shuttin' Detroit down,
While the boss man takes his bonus paid jets on out of town.
DC's bailing out them bankers as the farmers auction ground.
Yeah while they're living up on Wall Street in that New York City town,
Here in the real world they're shuttin' Detroit down."
Admittedly, this is poetry. Neither Shakespeare nor later day innovators like Bukowski never dared
experiment with anything quite so incomprehensibly moving as "DC's bailing out
them bankers as the farmers auction ground." But the song does have so many flaws you couldn't have hid them all
Underwood's gigantic dress at last Sunday's Academy of Country Music
Awards. Not the least of them being that
a.) as noted earlier many of the auto companies in America are neither the "big
three" nor are they doing anywhere as badly as the big three and, oh yes, b.)
D.C. is actually bailing out Detroit, too. (Although it's still a horse race to see which bailout packages are
actually less successful. I'm splitting
my bet. We'll waste more money on Wall
Street but dollar for dollar we'll be less successful in Detroit.)
Because in the end, we also need to recognize, adjust to and respond with creativity and innovation to the fact that there are secular trends afoot that make it increasingly unlikely that so-called American brands will ever dominate worldwide as they once did. Even if we do reduce the size of those ginormous tushies.
JIM WATSON/AFP/Getty Images
David Rothkopf is the CEO and Editor-at-Large of Foreign Policy. His new book, "Power, Inc.: The Epic Rivalry Between Big Business and Government and the Reckoning that Lies Ahead" is due out from Farrar, Straus & Giroux on March 1.