Corruption

"Wait a minute..."

Those were allegedly the final words of Pope Alexander VI back in August of 1503. I was thinking of fat, old, syphilitic, corrupt, murdering, adulterous Alexander just this morning. This particular Pope, known before his papacy as Rodrigo Borgia, who had so many mistresses he makes modern America's politicians and talk show hosts look chaste by comparison, is also distinguished by the fact that he was the father of, among many others, Cesare and the notorious Lucrezia Borgia. (To give you a taste for the man, upon becoming Pope he annulled his daughter's previous marriage so he could marry her off in a lavish Vatican ceremony to a relative of one of the cardinals who supported his papacy even as rumors circled of her incestuous relationship with one of her brothers. And the Heene family thought they had what it takes to make a good reality show...)

I thought of old Rodrigo as I flipped through a pile of clippings that I had set aside during the past couple of days. I started collecting the stories last week. The first were clippings about the record round of financial community bonuses in the U.S. and in the U.K. Then, as all this was happening, was Goldman Sachs' CEO Lloyd Blankfein's FT op-ed calling for financial reform. As I mentioned before I found the juxtaposition uncomfortably calculated.

A couple days later, there was the story announcing that former Goldman Sachs' VP Adam Storch was being named Chief Operating Officer of the "new and improved" SEC enforcement division. I have no doubt that Mr. Storch is an excellent fellow and a perfect choice ... other than the fact that he worked at Goldman. Does anyone think about the optics of these things? Or more than the optics, do they ever consider just how genuinely inappropriate such a hiring might be?

Of course, that's a rhetorical question. Some people do think about it. Just not people doing the hiring in the administration. Hence the articles in my pile of clips about the big bonuses that senior advisors to Tim Geithner got from big Wall Street houses prior to signing up to help devise the plans to "fix" Wall Street. I know some of these guys very well, consider them friends, consider them eminently qualified to be doing their jobs ... and yet, something gnaws at me about all this, an insensitivity on the part of the people who were putting together the administration team about what was really at stake in the financial crisis. It seems they felt the issue was more fixing the immediate problem than it was fixing the enduring problems in a system that once again has Wall Street executives lighting cigars with hundred dollar bills while unemployment hits record levels (see Mort Zuckerman's strong piece on this in today's FT) and home foreclosure are forcing former homeowners to live on the streets as never before. In any event it seems like they were really stopping to ask whether something big had changed ... or needed to.

Paul Krugman gets it, has all along and has written about it again in today's Times. Frank Rich, in yesterday's Times wrote a column capturing some of the anger that people feel about the power of Goldman and the other big banks and the utter unwillingness of Washington to do anything other than offer the occasional talk show tsk-tsk in response to the current return to profligacy (or the return of big lenders like Citi and Bank of America to losses after a momentary, bailout induced spate of profits). 

Meanwhile, John Harwood in the Times writes about Larry Summers' wise silence on sensitive economic questions while failing to go further and ask why it was that this week's tsk-tsking assignments went to Rahm Emanuel, David Axelrod, and Valerie Jarrett -- successors in function to the troika that once ran Ronald Reagan's White House (James Baker, Michael Deaver and Ed Meese). On the one hand the question is interesting because it leads one to other questions, like why the folks from the president's morning economic briefing who are being most prominently rolled out are not actually the ones who are the economic professionals? Could it be that the administration political brain trust feels the economic team has lost too much credibility by their minimalist, go-slow approach to reform? I think that would be a miscalculation because the future effectiveness of Geithner and Summers will depend on their being seen as the architects of substantially (and accelerating) reforms.

(Of course another question raised by the appearance of the Big Three on the Sunday shows is whether or not the administration really is being some so Office-of-the-President centric that it is all head and no arms and legs, kind of like one of those big-brained creatures from outer space or our future that we were led to believe would evolve from societies that didn't require physical exercise. The critique, provided to me this weekend by a prominent diplomat who has lived in Washington a long time, is that the administration has no trouble coming up with ideas or giving speeches but it has yet to put an effective implementation apparatus in place. It is kind of the Marvin the Martian model of governance.)

That particular aside aside, the pile of clippings grew this morning with the Wall Street Journal noting in its particularly "fair and balanced" way that the criticism of Wall Street from Emanuel and Axelrod was more tempered than in the recent past, suggesting that at least as far as the newspaper of record of the financial community was concerned, the White House wasn't too het up about all these fat pay checks. Apparently swine flu worries us but an epidemic of swinishness does not. At least the Journal seems to hope so.

And so, reflecting on all these clips, I started thinking to myself, is it capitalism? Could Michael Moore be right? (That seems so unlikely...) It's troubling to me, a dyed-in-the-wool practicing capitalist. And I'll have to admit I am still a long way from coming to a good answer about just how we have gone wrong and what needs to be done to fix a system that is producing greater inequality than ever and that is so apparently corrupt that even those from whom you expect big reform have either been co-opted or, alternatively, are simply reluctant to toss these particular money changers out of our particular temple (the small "d" democratic one). 

But my first instincts are what brought me back to good old Pope Rodrigo the Base and Repulsive. Because it strikes me that the issue isn't capitalism per se. Because 21st Century Wall Street is to capitalism as Pope Alexander VI was to the teachings of Jesus Christ. There was a connection but it was remote and observed more in the breach than in the honoring of the essentially good underlying ideas.

And that's where I take some comfort. It's not that we need a new economic ideology. We're just in dire need of a Reformation. (Although I for one could do without some of the wars, inquisitions, and public executions of the last one.)

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While we here at FP don't recommend eating disorders as an effective weight control technique, sometimes it's hard to pass up the canapés at those fancy Washington parties -- like GQ's "50 Most Powerful People in DC" cocktail blast at 701 last night. 

Of course, GQ's party had its own built-in trigger of the gag reflex for most Washingtonians: their names weren't on the list. (I talked with one of GQ's writers as she was working on the list, a conversation I enjoyed right up until the moment it was clear they didn't think I was list-worthy. As for the final product's, um, curiosities see FP's earlier take. But, Leon Panetta ahead of Hillary Clinton? Tom Donilon on the list, but his boss Jim Jones off it? Various worthy but random journalists and bloggers and not Tom Friedman or David Sanger? The Sidwell admissions director ahead of the GDS admissions director? Insiders know the truth ... even as they all hungrily pour over the list looking for their own names and those of their allies, enemies and worst of all, their friends.)

But when a glossy, man-perfume scented equivalent of a long hairy finger down your throat isn't readily available, then knowledgeable Washingtonians know there is always another place they can turn, the Capital's naturally produced form of Serum of Ipecac. Just follow the news until you develop the acute reaction to hypocrisy that is certain to launch away your own indiscretions in one or two turbulent but satisfying moments.

For example, here's a recipe for Capitulimia drawn from just what's going on around town today:

Take just one dose of insurance companies trying to suggest in print and broadcast advertisements that after years of making indefensible profits from literally killing people and destroying families with their policies (the one's they didn't actually deny to those who needed them), it is they who are actually looking out for the interests of Americans in need of health care.

Add one 30 second American Petroleum Institute commercial in which they actually argue that the pending climate bill might hurt consumers by producing more highly priced gasoline? After their record? While they should actually all be hovering in their basements waiting for the class action suit from the planet for selling a product they have known for years was destroying it?

Then sit down and take a listen to say, Rush Limbaugh complaining the media is making spurious, emotional, and uninformed attacks against him ... and that "the media" has too much power. The media? Who is he? Where does his power and obscene wealth come from? Appearances to the contrary, he is not a manatee sunning on a rock. 

If that hasn't done it, listen to one-time supporters of the havoc wreaked by the Great Decider's impulsive and catastrophic policies in Iraq or his ineffective blundering in Afghanistan as they criticize President Obama for actually taking some time to work out a sensible adjustment to tackling the mind-boggling challenges posed in the AfPak region ... challenges that were altered by the recent elections embarrassment in Afghanistan.

Or listen to Republican legislators responsible for the biggest deficits in American history and the collapse of the American economy, attack President Obama for doing what had to be done to clean up their mess.

Not there yet, go to Amazon.com and pre-order not only the Sarah Palin book but the upcoming books from President Bush, Vice President Cheney, Don Rumsfeld, Hank Paulson, and Karl Rove. Then think about the millions that will be generated by these books. (In New York State, I seem to recall once upon a time in the days of "The Son of Sam" they passed a law blocking criminals from writing books allowing them to profit from retelling the tales of their wrong-doing. These aren't criminals, of course ... well, not all of them ... but what are we to make of millionaires who gutted the American economy making millions from telling us all how they did it?)

Still on the verge of relief but not quite cleansed? Well, pick up a paper and read about the fact that roughly $140 billion in compensation will be paid out on Wall Street this year, a record beating out the last peak year of 2007. (And while you're at it, flip back to the FT from a day or two ago and read Goldman CEO Lloyd Blankfein's call for more industry reform and ask yourself: was placing this oped at the time the bonuses were going to be announced just a little cynical? Do they really think we're going to fall for that kind of grade-school spinning -- even if he did make a number of good points.)

There, that ought to do it. Feeling better now? Lighter on your feet? Angry but empty? No need to thank me. Just another public service from your virtual friends here on the Internet who will always do what we can to ensure our Washington readers are ready for another day of making the rounds from the Four Seasons to the Palm to the usual receptions sponsored by the likes of the American Foot Odor Institute and the National Alliance for Getting Children to Make Their Beds. And for the rest of you outside the beltway, with America's health care system unlikely to be high functioning any time soon, it's probably a good idea to drop a few pounds and get into better shape. 

And here's our hint for turning what could be an eating disorder into a sustainable diet: just keep watching those headlines -- they're the world's most effective non-addictive appetite suppressant. If you follow Washington without losing your appetite, you're not paying attention.

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Foreign policy is a fast-paced business. Despite the fact that at least someone in the Obama Administration is actually celebrating the art of indecision, you can save the world with snap judgments if you know what you're doing.  I know what I'm doing. 

To demonstrate I will now solve some of the biggest foreign policy problems confronting some of the world's most important newsmakers in a matter of just a few seconds each. (I will also solve a few lower-grade domestic problems as well.) If you are an important figure on the international stage, just look for your name below. Next to it will be the advice you need in a couple of quick sentences. If you are not a world leader but know one, please feel free to forward this to them.

To Chaudhry Nisar Ali Khan of the Pakistani Muslim League: If you don't like the provisions of the U.S. aid package, keep it to yourself. Your complaints are precisely how we know the deal has been constructed properly. (Hint: Turn back the Americans who are offering aid and you'll end up with those who want to make all future deliveries by drone.)

To President Barack Obama: If you think that George's war (that'd be Iraq) is likely to look better than yours (Afghanistan) in five years -- and that'd be my bet right now -- then you really do need to listen to the people calling for a change in strategy.

To Manuel Zelaya: Fair or not, your five minutes are just about up...unless you choose to start dating Kate Gosselin. (And if that is Plan B, I have to say, I'd stay locked in the basement of the Brazilian Embassy, too.)

To Kim Jong-Il: You tell Wen Jiabao you want one-on-one talks with the United States to establish peaceful ties as a prelude to returning to the nuclear arms negotiating table? No problem. Two steps: First, ask for them. Second, realize Michael Jackson wrote "The Man(iac) in the Mirror" for you. As in the "how many shrinks does it take to change a lightbulb?" joke, the punchline is that it's you who've really got to want to change.

To Jon Corzine: You don't get re-elected governor of New Jersey by attacking fat people. I have a two word clue for you on this front: Tony Soprano.

To Silvio Berlusconi:  Are you the one that's tanned now or is that just a red face? The ruling by the Italian Supreme Court stripping you of immunity from prosecution just because you are Prime Minister certainly seems likely to put a hitch in your mambo Italiano. With three trials going on that involve you or your holdings, you might want to start planning your post government career. (I know your wife has some interesting ideas for what to do with you ... or parts of you.)

To Donald Tusk: As Poland's Prime Minister dealing with a corruption scandal, you have learned some important truths: gambling always produces losers (in your case, the three ministers who have been forced out of your government for corruption) and you can't beat the house (even if you try by suggesting you'll fire the anti-corruption official who blew the whistle on your cabinet) ... especially if the house is run by the two who stole that stole the moon and you don't fit in with their plans. 

To Robert Mugabe: You say you want better ties with the U.S.? Well, you're going to need a long rope... Kim Jong-Il has a better shot at restored relations with the United States ... by a lot. Frankly, so does Mahmoud Ahmadinejad. Frankly, so too does Rufus T. Firefly. Dictator, purge thyself.

To David Letterman: Ok, so far there's no rumors of foreign affairs in this story. But my advice to you is: continue doing just what you're doing. The openness is working...on the ratings...and on what's left of your image.  Silvio, you randy slimebag you, pay attention. Old men apparently can screw around with younger women if they are charmingly self-deprecating about it, not political leaders and not you. 

To Mazen Abdul Jawad:  You may have been condemned to 1,000 lashes in Saudi Arabia for discussing your (kinda gross) sex life on a tv talk show.   Here in America (see above), the same thing would actually get you your own talk show.  Time to consider relocating...almost anyplace else.  And speaking of Saudi outrages...

To Mohammed S. Al Sabban: If, as head of the Saudi delegation to the global climate talks, you are actually as reported going around saying if measures are taken to reduce world dependency on oil that the planet should offer aid to Saudi Arabia ... then get used to the idea that you are going to replace the woman who buried her husband in a rented suit as the living embodiment of laughable chutzpah.

To David Axelrod: Stay out of camera shot in photos about major foreign policy decisions. You're the president's right hand guy. He needs you: You have the "mind-meld" thing going, offer invaluable advice and by all reports are actually a good guy. Which is why what neither the president nor you need are the uncharitable whispers that you are out-Roving Rove in terms of day-to-day influence over administration operations. (Oh and to Karl Rove, re: your WSJ article that the GOP is winning the health care debate: There's a reason you guys are out. Wrong again. See the CBO report. The Obama-Baucus bill is getting closer and closer to being a done deal.)

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I am beginning to think that John Edwards, South Carolina Governor Mark Sanford, Octomom, and Jon Gosselin have joined together to form their own public relations firm ... and that their first client is the Vatican. I have come to this conclusion because it is impossible for me to imagine any other group of people giving the Holy See the kind of P.R. advice they seem to be getting.

The evidence came in yesterday's extraordinary statement from the Vatican "defending" themselves against attacks that they have not done enough to combat sexual abuse by priests. Rather than contritely focusing on all they have done to address this cancer on their credibility, they offered a response that will be studied in schools for years to come, whether in classes seeking to offer a lesson in how not to handle a crisis or in those offering an advanced degree in miscalculated chutzpah.

Following a meeting with the U.N. Human Rights Council meant to address concerns that the Church was failing to respond appropriately to a long history of members of the clergy abusing their flocks, Archbishop Silvano Tomasi read a statement that was undoubtedly considered by some spin doctor-equivalent somewhere to advance their case but which actually probably amounted to more convincing proof that the Vatican doesn't get it on this issue than anything discussed behind closed doors with the United Nations.

• They argued that "available research" showed that only 1.5 to 5 percent of the clergy engaged in child sex abuse. Which is to say that they seemed to think that possibly having one out of every 20 priests taking advantage of the children in their parishes was not really such a big number. After all, it's only 6,000 to 20,000 priests worldwide.

• Tomasi then went on to quote statistics suggesting that in the U.S. protestant churches actually had a much worse child sex abuse problem and that sexual abuse was also common in Jewish communities. "They're doing it too," was never a very good defense when I was in elementary school and in this case, it seems a particularly ill-considered line of argument. Compounding the mistake, he also argued that family members, neighbors and babysitters were far more likely to molest children than priests. While all this may be true, it does not exactly sound like they were focused on accepting responsibility for actions within their own organization. Not being a Catholic, I'm not sure of the procedures, but I'm pretty sure that the proper drill at confession is "forgive me Father for I have sinned" and not "well, yes, Father I may have sinned, but I wasn't the only one."

• As reported in the Guardian, the statement then took what was probably its most bizarre turn:

The statement said that rather than paedophilia, it would "be more correct" to speak of ephebophilia, a homosexual attraction to adolescent males.

Of all priests involved in the abuses, 80 to 90% belong to this sexual orientation minority which is sexually engaged with adolescent boys between the ages of 11 and 17."

Aha. Well, I don't know about you, but now I feel much better about things. Most of the 6,000-20,000 priests who are abusing children at a rate somewhat lower than that of other religious groups are doing it with somewhat older kids. That puts things in a whole different light! I'm sure the whole ephebophilia defense will have altar boy enrollments skyrocketing in no time at all.

Perhaps not surprisingly, the Vatican's response neither satisfied the man accusing it of covering up sex abuse within the Church nor did it sit very well with representatives of other religions. Keith Porteous Wood, of the NGO that charged the Catholic Church with violating several provisions of the Convention on the Rights of the Child, said not enough had been done by the Church to address its internal problems or to open its records to permit civil prosecution of wrong-doers.

Protestant and Jewish representatives were quick to respond condemning the Church's attempt to spread around the blame and defending their own approaches to the problem.

Had these other religious groups asked my advice, I might have told them to simply remain silent and let the Archbishop Tomasi have the limelight and the microphone all to himself. It is hard to imagine what the Church could possibly do to look worse than it already did in the face of a global scandal that has cost it $2 billion in settlements in the United States alone. Hard to imagine ... and yet somehow, that's precisely what it did. 

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World Bank President Bob Zoellick has done an important service with remarks he delivered Monday in which he said, "The United States would be mistaken to take for granted the dollar's place as the world's predominant reserve currency. Looking forward, there will increasingly be other options." In fact, the only issue I take with his statement, delivered at the Johns Hopkins School of Advanced International Studies, is that it does not go far enough.

It has thus far been easy for most Americans to shrug off discussions of coming competition for the dollar as a reserve currency. First, of course, most Americans aren't even aware that the discussion is taking place and of those that are aware, most haven't the slightest clue how the international monetary system works -- which at least gives them something in common with most members of Congress and central bankers everywhere. (Zoellick is rightly pretty tough on the central banking community in his remarks, as well.)

Also, when Europeans or Russians starting talking about needing another currency so there is an alternative to the greenback, Americans tend to shrug it off as dollar-envy. It was not, of course, so easy to dismiss such suggestions when it came from the Chinese given their role as our principal creditor and the fact that they had more reserves than any other country in the history of mankind. But we put our hands over our ears and made "la, la" noises to drown out the discussion anyway.

Thus, whenever the issue arose, as it did again in discussions last week at the G-20 meeting, it has not had much resonance even among most members of the policy community in Washington. Many view the dollar as an immutable, unchanging fixture of the financial world ... even though recent experience has demonstrated that other than greed, there are few immutable, unchanging features of the financial world. This made it easy for the U.S. Treasury to simply mouth reassurances -- as Tim Geithner did last week -- that the dollar should remain the reserve currency without getting much questioning here at home. 

But Bob Zoellick is not a whacky, Gitane-smoking, eurocommunist with an anti-American agenda.    

He is a Republican, a Bush appointee, one of only a couple of dozen senior current or former U.S. government officials who can say they worked at Goldman Sachs, the true power center of international finance. So when he says don't take the dollar's place for granted, perhaps others in Washington will listen and start to focus more on the increasing likelihood that the growing chorus of those seeking change may well gain traction and as may the alternative currencies themselves -- be they Special Drawing Rights, the simulated money produced by the IMF for use with its members, or Chinese yuan.

Of course, Zoellick, whose remarks (which I read in "prepared for delivery" form) are typically thoughtful and also address the importance of the ascension of the G-20 and how this newly central group should take into consideration the broader rise of emerging economies, stops short of actually joining those calling for an alternative currency. It's easy to understand why, given his position.

But since none of the rest of us are president of the World Bank, we should not feel so constrained. There are plenty of good reasons why there should be one or more better alternatives to the dollar as a reserve currency than currently exist. Further, by not taking the discussion seriously we are less likely to play an effective role in the discussion about the future architecture of the system, consigning ourselves to a more reactive, sideline role.

First, there is no reason why one country should be given the responsibility or the right to play such a central role in determining international economic policies and outcomes. This is unlikely to be very persuasive here at home where most Americans first reaction is going to be, "Why the heck not? If not us, who? Don't we deserve it as the world's number one economy?" 

Given that the call for equity is not likely to be persuasive, what about basic American values like our belief in the benefits of competition. Look what has happened during this era in which we have not believed there was a real alternative to the dollar: We have behaved extraordinarily recklessly, piling on debt and practically taunting the world to find other options. It is clear, we don't have the discipline to manage the dollar properly as it is. We need the competition as much as anyone else.

Would a rapid selloff of dollars be potentially disastrous for America?  Absolutely. But, we are deluding ourselves if we don't think such alternatives already exist. Why is gold at such absurd heights and going higher? Further, there is plenty of evidence to suggest that oil and other commodities are regularly used as alternatives to currencies in what amount to forex trading strategies. In other words, markets demand such alternatives already. And any movement toward acceptance of new alternatives is likely to take a long time as investors cautiously adjust. So, we have to ask ourselves is the greater downside in embracing change or in clinging to a viewpoint that is both out of touch with emerging realities and promoting bad behaviors on our own part?

The international economic system will evolve with our cooperation or without it. Currently the biggest threat to the dollar is not those who seek alternatives but the U.S. policies that are pushing them in that direction.   It's time we engaged in this debate in a serious way, and Zoellick's remarks are a very constructive first step in that direction.

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This week is a three ring circus for the international community. The U.N. The G20. The Clinton Global Initiative ... and a host of other side shows for good measure. But with most of the activities featuring little more than the foreign policy equivalent of jazz hands ... eye-catching moves amounting to much ado about nothing ... it may ultimately be remembered for a reason no one saw coming. Because I think it is pretty likely that in the future we will look at this week as the beginning of the end of America's presence in Afghanistan and by extension, George W. Bush's 8-year involvement in the Middle East.

It will take some time to wind things down. I also think history may come up with some better name to describe the Bush war in the context of related wars that took place before it, during his father's time in office, and will almost certainly take place after it. Perhaps it will be seen as the Second Gulf War in a series of several. Perhaps it will be seen as the Second Oil War. But we can leave the lasting labels to historians.

The reality is that the reaction to the leak of the McChrystal Report is indicative that there are really only two options in Afghanistan open to the administration. One is that they do not provide McChrystal with the additional resources he requests and they further narrow his mission as a justification for their decision and we begin an inevitable process of winding down. The second is that Obama does grant McChrystal's request but due to the growing doubts about the entire endeavor that the leak of the report has both revealed and exacerbated, that he sets much more specific goals and timelines that in turn pre-sage an ultimate winding down.

The Vietnam analogy is sticking -- the quagmire paradigm -- and no one near the President wants making that mistake again to be his legacy. The fact that Karzai's regime is turning out to be just as corrupt and feckless as our partners in South Vietnam were doesn't help. Further, as we approach the 10 year point at which Russia ended its occupation (which we'll hit in less than two years), comparisons with yet another futile military effort will become too strong for many to bear. Finally, of course, there is the small fact that we're playing whack-a-mole with the insurgents, we can't close the backdoor to Pakistan and if we could, they would go someplace else in the world. In fact, they already are whether to Yemen or Somalia or, apparently, to Colorado.

The seemingly serious threat posed by an Afghan-led terror group associated with al Qaeda that wanted to use explosives to attack U.S. transport hubs underscores two other important points. One is that as we squeeze Afghanistan we may crush some opponents but we do create new ones. Further, it is also clear that we really need to do some new thinking about how one actually does reduce the risk of terror attacks ... and accept that effective homeland security enforcement as apparently has taken place this week, may be the best front line on which we can prosecute this effort.

Meanwhile, of course, in New York and later in Pittsburgh, the headlines that were hoped for from the three-ring circus are unlikely to be materializing ... and the ones that do emerge are likely to be rather disheartening or, at best, underwhelming.

The United States is likely to frustrate the world by providing it with just what it has been asking for. On climate, on the business of the U.N., at the G20 meeting, America will be the key player but it will not dominate or direct or make the tough calls. It will be a better partner than at any time in the recent past. But the result is a three ring circus without a ringmaster. And paradoxically, the United States will be (is being) fiercely criticized for not being strong enough. We can call the world hypocrites all we want but the reality is that everyone wants the same thing: a leader who will take the heat and always lead in the direction they want to go. Any deviation from this ideal will produce howls ... and reading the news this week should produce plenty of corroboration for this observation.

For the Obama administration, the problem is not being an America we can never be.  Every girl sooner or later (it always happens around her 29th birthday if the girl's still single), realize that Prince Charming is a myth and must settle for a real man. But when they do, they then want that man to have some demonstrable qualities and being better than the last jerk you dated only gets you so far. For Obama though, the world is looking for proof that he can actually deliver on one or more of his international priorities: make engagement work with Iran, embrace a new approach to Israel and Palestine that actually produces results, refocus to AfPak and make that work, get our leadership on with regard to climate, be a better neighbor in the hemisphere, jettison tired old artifacts of policies (see: Cuba), help foster real reform and new levels of cooperation and transparency in international markets, and reduce the threat of WMD proliferation.

One by one these issues will play in one or another of the three rings that makes this week's foreign policy circus so compelling. The Obama team is hoping there will be signs of progress ... but that seems unlikely. Taken together, the United States may end up being seen as the absent ringmaster not because we have chosen a different style of leadership but simply because we can't deliver. Sometimes this will be because circumstances truly are beyond our control and America doesn't have the influence or options that others ascribe to us. Sometimes it may be because we ourselves promised more than we could deliver. Obama's credibility is at stake ... and given the way most of the issues listed above are trending, regaining it is going to be a challenge that could take a long, long time to address.

As with Afghanistan, here's the secret: resetting expectations. Identify some goals you can actually achieve. Achieve them. That should have been the approach to domestic policy. Go slower. Build up a head of steam. And it needs to be the approach to international policy. Ringmaster or not, in the three ring circus of international affairs, the last place Obama wants to be is with his predecessor and many of his critics in a clown car full of people the world no longer takes seriously. 

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There was for a long time been a widespread belief that the guys who were cashing in on Wall Street were the best and the brightest. Now, as we mark the anniversary of the collapse of Lehman Brothers we have yet another form of proof it just ain't so. 

But the deus ex machina arrival of new U.S. ambassador to Germany Philip D. Murphy really is in a class by itself -- stupid, thoughtless and arrogant on so many levels it deserves some kind of an award. 

Perhaps State ought to consider some kinds of guidelines for the fat cats who are being plunked down in important embassies around the world. Like: "Don't be a pig with your money." Or: "Try to remember you represent the United States of America and not the sovereign principality of Goldman Sachs anymore."

But you do have to give the White House credit. Getting someone from Goldman to serve in the government is a real coup. Who thought of that? They also deserve a medal.   

The revelations of out of control behavior among the guards assigned to the U.S. Embassy in Kabul no doubt brought to mind the images of out of control behavior by guards at Abu Ghraib. But there is an important distinction. The guards at Abu Ghraib were U.S. military personnel. The embassy guards were hired guns, part of the outsourcing explosion that is transforming the way the United States conducts its foreign policy.

The embassy guards were not employees of the U.S. government, did not report up a chain of command to senior U.S. military officers who could make career-ending decisions for them, were not subject to the same rules as U.S. military personnel and, perhaps most importantly, blurred important lines about the nature and role of government.

As most people now know, they also allegedly engaged in "lewd and deviant behavior" featuring nudity, drunkenness, hookers, and other behavior more suited for the cast of a Joe Francis video than U.S. embassy security forces, particularly those in a dangerous environment or a country in which strict Islamic values played such a central role. Why it took a report from the Project on Government Oversight to call out these Guards-Gone-Wild and their employers at ArmorGroup, a subsidiary of Miami-based Wackenhut Services, Inc. is a question worth asking.

But the bigger question in the wake of this behavior and other examples of out of control contractors, most notably the cowboys from Blackwater, who allegedly killed as many as 17 Iraqi civilians while providing an escort for State Department personnel in Baghdad's Nissour Square, is about the centrality of outsourcing in the conduct of sensitive U.S. operations worldwide. 

The Congressional Research Service reported that well over half of America's manpower in Afghanistan, for example, is comprised of contractors -- almost 70,000 of them. They cited it as the "highest recorded percentage of DoD contractors in any conflict in the history of the United States." 

How did we get here? Well, some of it was clearly expediency ... beneath which investigation will reveal another level of expediency. The first level is the one cited by government officials hiring the contractors: they provide skill sets needed by the government and the ability to deploy human resources quickly in difficult circumstances. The second level is that by using contractors, the Bush Administration was able to field twice as many people in Afghanistan with half the political exposure. Headlines report troop deployments. They ignore the ArmorGroups and Blackwaters until they screw up, misbehave or start making obscene amounts of money ... all of which are part of the story of the Bush War on Terror.

But at another level, not only do they put America's goals at risk, they also raise important questions about fairly fundamental questions like "who has the right to legitimately use force?" Traditionally that's a prerogative reserved for states, notes Allison Stanger, professor of international politics and economics and director of the Rohatyn Center for International Affairs, and author of  the much anticipated One Nation Under Contract: The Outsourcing of American Power and the Future of Foreign Policy, to be published by Yale University Press next month. But by handing over a license to kill to big American companies, that line is blurred observes Stanger, which plays directly into the hands of America's enemies.

Stanger is not, it should be noted, an adversary of using outsourcing to leverage American government resources. Indeed, her much-needed upcoming book considers how broadly outsourcing has transformed the way government works in a wide range of issues including areas such as development where NGOs and other private sector players add a great deal of value. But she is a sharp critic of what she sees as outsourcing approaches that undercut America's foreign policy interests either by compromising values or raising risks. (See her recent U.S. News column "How the CIA Became Dangerously Dependent on Foreign Contractors" which addresses similar problems associated with the agency's use of contractors in covert programs to hunt down and kill al Qaeda members.)

Her point is simply that while it makes sense to leverage government resources with private sector capabilities in many instances, we need clearer rules and guidelines about how and when to do it. Her book could not be coming at a more auspicious time and one hopes that her work will get a close reading at State, the Pentagon, and from the leaders of the Intelligence Community.

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