I'm feeling curiously optimistic this morning which has me thinking it may be time for a CAT scan.
But I can actually see a way that things don't turn out so bad for the world.
First, to deal with the wolf closest to the sled, the Europeans will have to get their act in order. While they have thus far resisted this tooth and nail, I've heard some modestly encouraging rumblings from folks in the center of the negotiations. I want to point out the people with whom I have been speaking are not terribly optimistic themselves. But they have offered a few crumbs of optimism for those of us who starved for it to scarf up.
First, in the words of one participant, European leaders have begun to work themselves through "the stages of grief associated with the crisis. First, even just a few weeks ago, they were purely in denial. Then, they entered a phase of denial in which it was clear they didn't even believe their own denials. Finally, last week we entered what might be called the ‘silly ideas' phase. And I am hopeful that means now we can get down to serious ideas."
What kind of ideas? Coming up with a program that takes a big chunk, perhaps $250 billion, of ESFS money and uses it as "equity" in funding a "firewall" that might then include a trillion or so capital available to the ECB in the event a big economy -- Italy or Spain -- stumbles. The plan would also need other elements such as Europe dealing with the structural issues associated with achieving something like monetary union and a recognition that no firewall can protect against all threats, especially those that could be associated with a fixation on austerity. Governments in Europe need to focus on getting growth restarted in places like Spain or Italy or bigger problems are inevitable. A final element of an effective plan would then include a significant recapitalization of the IMF which currently is not funded properly to deal with the new forms of risk and contagion which confront global markets.
At some point, banks will need to pay for the insurance policies they are expecting their governments to provide for them and whether that is done by a Tobin tax or some levy on non-deposit liabilities, grappling with that issue will be key to winning political support for further government involvement. And while countries and the IMF are at it, they ought to start to tally what sovereign exposures are to those "implied liabilities", their unwritten but real "obligation" to bail out the too big to fail institutions that are the nuclear charges set at the fault lines of the global economy.
That might in turn trigger a recognition that we will not be well and truly out of the woods of this crisis until we demand more transparency from these banks in terms of their liabilities (including counter-party risks in all manner of derivative transactions), regulations that enforce responsible provisions for dealing with those risks, and perhaps even globally agreed upon limits on the size and activities of such institutions.
But one step at a time. While the insiders with whom I spoke were only cautiously optimistic that progress might be made on putting together an interim solution-firewall for Europe -- or to be more accurate, while they did not outright dismiss the possibility -- they did emphasize that there was a long way to go, the Germans and the French were not playing nicely with each other, and there were deep cultural barriers to even having an intellectually honest conversation among the players about what ails them.
Still, since the focus is optimism, another encouraging sign were the glowing reports I have been hearing of the work that both new IMF Managing Director Christine Lagarde and U.S. Treasury Secretary Tim Geithner having been doing trying to hammer some sense into Europe's fiscal policy pygmies. No, not pygmies ... lemmings. Well, blundering action-phobic bureaucrats. (The problem, according to a friend, is "lots of leaders, not enough leadership.") By one account, about a third of the progress made during the last few weeks is due to circumstance, the growing direness of the situation, and the rest is due to the compelling arguments and forceful interventions of Lagarde and Geithner.
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The world is ending! We're back! The end is nigh! Hallelujah, we're saved! Pawlenty! Bachman! Perry! Oh my God, maybe the end really is nigh! No, Ryan Mallett and Tim Tebow looked good and the heat wave in DC has broken, maybe a better autumn is ahead.
Suffice it to say, it's been a rough week. And amid the wreckage and rivers of bile, adrenaline, and tears that have flowed this week, a few stories have slipped through the cracks, a few perfectly bloggable topics have gone uncommented upon. And it's Friday and we can't let the week go by without offering a few quick takes on at least four of those bits and pieces:
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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Here at Les Recontres Economiques d'Aix-en-Provence we are ostensibly discussing "The States of the World" but in reality the buzz around the event is about the global economic ugly pageant. Although much of the conversation among delegates --whether at the venerable conference sites like the law school of the Universite Paul Cezanne or the local outpost of Sciences Po -- focuses on the harrowing state of the Eurozone, one can regularly hear concern expressed for the other contestants in the current perverse competition among the world's economies.
To understand the competition, you just have to understand the old joke about the group of friends whose picnic is disturbed by a hungry grizzly bear. As the friends bolt from their campsite, one stops to put on his sneakers. The others ask what he is doing, worried that he will never be able to outrun the bear if he stops. The one in the sneakers observes as he starts sprinting away, "I don't have to outrun the bear, I just have to outrun the rest of you."
So it is now with the global economic ugly pageant. While most of the major economies of the world are spluttering and the possibility of an unprecedented geoeconomic disaster remains palpably real, what money there is does have to go somewhere. That place is likely to be the least ugly of the world's economies. In other words, absent a true safe haven, capital will seek the safest haven of those available. It's one reason the dollar has done fairly well recently, for example. While the U.S. government seems to do everything in its power to screw things up economically, investors buy dollars because the managers of the world's other big currencies, the Europeans and the Japanese, are screwing things up worse.
The question now is will our "luck" remain the same going forward? How will the world's economies fare in the next round of this contest? Here's the current betting line based on my scientific eavesdropping on conversations here in Provence, appropriate discounting for self-interest and biases of the speakers and my own reading of the tea leaves that get floated as economic news in the world's newspapers. (Note: I am focusing only on national and regional economies here. Suffice it to say that almost certainly the big losers of the coming months -- whether policymakers accidentally blow up the world economy or they dodge disaster through a judicious combination of austerity and stimulus -- will be the poor. They have no voices advocating for them (as do, for example, the makers of private jets currently lobbying to keep the corporate tax breaks their purchasers receive under present U.S. law). Austerity programs will squeeze them further. Disaster will crush them. And almost certainly the biggest winners will be big corporations and the super-rich who will venue-shop and use their access to cash to buy up devalued assets including fire-sales among privatizing formerly state-owned bric a brac like roads, ports, powerplants and water rights.)
While NATO bickers over strategy in Libya, BRIC leaders have gathered in Sanya, China, to demonstrate the growing strength of an alternative grouping that has among its principle selling points the fact that it is neither Western nor U.S.-dominated. To compare the world's most potent and enduring military alliance with a loose affiliation of emerging powers that are divided by perhaps more issues than unite them is clearly comparing apples and lychee nuts or guarana seeds, but the juxtaposition of the two events does offer yet another whiff of how the institutions and ideas of the 20th century are giving way to those of the 21st.
In Libya, the potent alliance that "won" the Cold War is coming apart at the seams fighting over strategy, tactics, and objectives in an optional, low-grade intervention in a largely irrelevant country. The U.S. secretary of state is forced to make public pleas for the bumptious commanders of the coalition to get their acts together, while on the ground the weakened forces of the isolated Muammar al-Qaddafi seem to be holding the megapower onslaught at bay. It is too poignant a reminder that intangibles like knowing what you're fighting for and political will are as important to any battle as the hardware being brought to bear by each side on the other.
In Sanya, Brazil, Russia, India, and the hosts welcomed South Africa into their little club, and if they achieved little else they underscored that they are taking coordination among their countries very seriously and seeking to deepen their ties. However, they did go further and offered a broad agenda including more hints that they will push for alternatives to the dollar-dominated global monetary system that we currently have.
Of course, the BRICs summit resonates with the Libya follies because the original four BRICs voted as a bloc to abstain during the Security Council vote on the imposition of the no-fly zone in Libya and within days of its initiation were publicly speaking out against it. That they were joined in the vote by Europe's most powerful country, Germany, also sent a message that the opposition to the initiative was meaningful and suggested that future votes in international institutions might see the BRICs (or the BRICS … if the final "S" is for South Africa) emerge at the core of a potent new alternative coalition to the traditional Western or developed powers.
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There are revolutions and there are revolutions. Those sweeping across the Arab world hold out the possibility of breakthroughs that may improve the lives of millions and remake the geopolitics of the region. But there are other revolutions more difficult to capture on camera but far more sweeping in their implications, revolutions that can change the lives of billions and remake the geopolitics and the very economic and technological fiber of the planet.
We know the familiar signs of revolutions in the Middle East. Crowds assembled in public squares. Banners. Nervous governments sending out troops or shuffling cabinets. But the signs of these other revolutions are subtler, harder to spot.
Take for example a story carried by the BBC yesterday that will not earn its own logo and theme music from TV news producers, but which has profound implications whether measured in terms of the changes it portends or the number of lives it may potentially impact.
In that story, it is reported that China is on a course to pass the United States by one important measure to become the world's leader in scientific research within two years. It cites a study by the Royal Society, Britain's national science academy, that analyzes publication trends in scientific literature.
Citing the shifts in the world's scientific output as "dramatic", the Royal Society's report observes, "The scientific league tables are not just about prestige -- they are a barometer of a country's ability to compete on the world stage."
The report reveals that whereas in 1996, the U.S. produced approximately 290,000 scientific papers and China produced just over 25,000, by 2008, the United States had crept forward to just over 316,000 whereas China had increased to about 184,000. While estimates as to the speed China is catching up vary, the report concludes that a simple straight-line projection would put the Chinese ahead of the United States ... and every other country in the world ... in output by 2013.
How did China do it? Simple: They made it a priority. They increased research and development spending 20 percent a year or more every year since 1999 and now invest over $100 billion annually on scientific innovation. It is estimated that five years ago, the Chinese were already producing over 1.5 million new science and engineering graduates a year.
This data resonates on many levels. It suggests a profound shift in the world's intellectual balance of power. This shift is one that is historically linked to the economic vitality and consequent political and military clout of the countries that lead. It suggests a much better future for the people of the world's most populous country and knock-on benefits for their neighbors and trading partners. It suggests a relative decline in influence for the U.S. And, for the people of the Arab world, currently struggling with their own revolutions, it suggests the only true path to real reform, opportunity and empowerment.
It is an axiom of history that the silent revolutions -- like those that periodically come in science and technology -- are far more important than the noisier, bloodier and more publicized political kinds. That's why these subtle indicators of their progress can be even more momentous than the round-the-clock coverage of upheaval that seems to be dominating our attentions at the moment.
It is a certainty that the future of the world be far more greatly influenced by what is happening in a Chinese laboratory than what is happening in the Arab street.
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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Recently, there have been perturbations in the wonkosphere. While the trembles are so slight that they wouldn't show up on the Richter Scale of a real human being, they have generated blog headlines and conversations at conferences full of people with advanced degrees and too much time on their hands. The stir has been caused by the assertion that we now live in something that big idea branding experts are trying to characterize as a "G-Zero" world.
In the words of one of the term's proponents, Ian Bremmer, the term refers to the assertion that we now live in a world in which "no country or bloc of countries has the political and economic leverage to drive an international agenda." Bremmer, and another supporter of the idea, NYU's Nouriel Roubini, have been explaining the notion and have done so compellingly enough that after it came up at this year's World Economic Forum gabfest in the Swiss Alps, the New York Times called it the event's "buzziest buzzword."
Buzz words are important in the wonkosphere because people are very busy going from conference to conference, periodically stopping to Tweet about who they bumped into and how they influenced them, and they have very little time to really think about anything. So if you can take an idea, reduce it to a couple of key, easily digestible, tasty ingredients, and wrap into a piece of shiny gold foil you have ... a Reese's Pieces Mini. Well, actually, you have something just like it, but not quite as tasty; you have a candidate for buzz-term of the moment.
Sometimes, it must be said, that even the fizziest of the buzziest actually contain a core idea of real value. Take a stroll down foreign policy nerd memory lane and savor past hits like "illiberal democracy" or "the world is flat" or "clash of civilizations" or "the end of history." Agree with the core notion of the idea or not (the delicious peanut butter center), you have to admit these ideas performed a useful purpose, captured a zeitgeist, and got the conversation going. Some, like "the end of history," were both widely misunderstood and, when understood correctly, wrong. But it was a compelling idea thoughtfully arrived at.
This G-Zero thing, not so much. The idea, of course, plays on all the discussion that has swirled around recent international summits as the attendance lists changed and the labels were altered accordingly. We went from the G-8 to the G-20 and then, keen observers, eager to build their own bit of buzz in the pundit-hive, pondered whether we weren't really seeing a case of a G-18 wrapped around a G-2 (the United States and China.) The Chinese didn't much like this and wished pundits would leave their g-darned labels off of them.
Bremmer and Roubini and company make the case that the United States and the Europeans and the Japanese are too deeply under economic water, and the emerging powers like China and India are too busy developing all the time for anybody to be able to step up and drive the international agenda. And while I know and like Ian and think both he and Roubini are smart guys, this is as an idea that looks like what it is: not much built around a big zero.
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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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Given the events of the past week, it seems appropriate to devote some time to assessing the China-U.S. summit this week. It would be fascinating to explore why it turned out that in the end, the story was not so much how President Obama did, but rather was how President Hu did and how in noticeable strides he has helped elevate China's international game during his tenure in office. This recent meeting was in some respect the culmination of that fitful but striking process.
But it has been a long week. And if one focuses on the serious too long one misses the important … or, more to the point, the unintentionally hilarious. For example, it might not seem even remotely amusing that the U.S. federal government late this week rounded up 127 suspected mobsters. After all, it suggested that the mafia had not in fact gone the way of the Great Auk (extinct since 1844) -- an event which dates either to effective use of RICO statutes by prosecutors beginning in the early 1980s or to the June 10, 2007, airing of the last episode of The Sopranos.
That last episode was so bad, that ending was so ill-conceived and self-indulgent, that it had the effect of completing The Sopranos' ultimate mission in its last years, which was to make mob life seem so petty and boring that we lost interest. But now here comes this week's roundup, and suddenly the life is back. All you had to do was read through the list of names of the guys that got rounded up: Joseph "Jojo" Corozzo, Anthony "Big Tony" Moscatiello, Richard "Nerves" Fusco, Luigi "Baby Shanks" Manochchio, "Vinny Carwash," "Tony Bagels," "Johnny Pizza," "Lumpy," "The Bull," and "Meatball."
Maybe there is a lesson in this. Maybe if we want to recapture America's interest (and the world's) in foreign policy, maybe all it will take is coming up with colorful nicknames for world leaders. Nicknames that, like those of leading mobsters, tell you all you need to know in a word or two and would make any dull story on policy machinations that much more lively.
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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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Scrooge. The Grinch. Critics calling out the cinematic deficiencies of "Love Actually." Christmas humbuggery is a cliché.
I however, am a New Year's curmudgeon. The holiday is a fraud celebrated by idiots. Our arbitrary slicing of time into comprehension-sized chunks and then celebrating the false distinctions between December 31 and the first of January is a big honking nonsense.
The fact that this ersatz holiday then motivates people to put on silly hats and drink to excess to celebrate the non-event event compounds the ridiculousness of it all and makes it dangerous to leave the safety of your couch. The only thing that adds any gravity to the activity at all is America's tradition of spending part of the evening watching Dick Clark slowly losing body functions on live national television. (I sympathize with the man and admire his courage. But he seems to be crowning a lifetime of cashing in on his bad taste with an ultimate grotesqueness: a multi-year, hard-to-watch reality show about his own demise.)
That said, you don't have to be a drunken lunatic who spends 10 hours trapped in the freezing cold in Times Square waiting for Snooki to be dropped in a glass hamster ball to add to the absurdity of this annual ritual about nothing. No, even very serious types like commentators and still grave but less credible types like bloggers regularly mark the holiday in ways that make them bigger laughingstocks than the insurance salesmen with lampshades on their heads who made the holiday famous: They make predictions.
Invariably the predictions do not come true. There is a charming irony in this: celebrating a non-event through the ritual listing of other soon-to-be non-events. (The New York Times has even run an entertaining discussion forum this week on why we seem to need predictions and how hard they are to make.) It is all a cousin to our penchant for marking the "new" year with resolutions to distinguish the year from that which came before it -- and which are all soon forgotten in ways that should remind us of the falseness of such distinctions.
But while I may condemn the holiday -- which is why on New Year's Eve I will sit here in Paris in our rented digs in the Sixth Arrondissement listening to the nearby revelry on the Boulevard Montparnasse and the Boulevard Raspail while quietly sipping Diet Coke and irritating my very patient wife just as I do each and every other night -- I am not so egotistical as to think my protests can undo the culturally embedded traditions of the season. I also don't think I can ignore the requests of the editors at FP any longer. So I too will now offer some New Year's predictions.
However, in an effort to avoid the kind of pitfalls of which I am critical, I will skip right over the dubious maybes of most pundits and cut right to what you want to know the most: I will list only those things that are absolutely certain to happen in 2011.
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It is conventional wisdom that U.S. elections seldom turn on foreign-policy issues. Armies travel on their stomachs and so do American voters. It's all about the pocketbook. But every so often the pocketbook has a foreign-policy component, which is the case this year -- and it has led to a rather extraordinary shift.
This is the first election in U.S. history in which the most important foreign-policy issue is China. It won't be the last.
Two years ago we had one of those rare elections in which foreign policy mattered. But back then, even in the midst of an historic economic crisis, the foreign-policy focus was on the Iraq War, which served as a referendum on the Bush administration's handling of the war on terror. In 2004 and 2006, the war on terror was the dominant foreign-policy issue. In 2000 foreign policy was not central, but to the extent it played a role, it was it was all about the vision for U.S. leadership in the post-Cold War era. The 1996 vote had a similar theme, plus some focus on the ongoing small wars, notably the upsets in the former Yugoslavia. The 1992 election was influenced by the end of the Cold War and the first Gulf War. During the Reagan Era Cold War issues drove the agenda. Jimmy Carter was bounced from office largely due to his impotence in the face of the Iranian hostage crisis. Prior to that Vietnam and the Cold War were central from 1964-1972.
But during this election cycle the subject of the United States' two wars hardly came up. It is in fact, a tribute to the Obama administration's handling of those wars that, despite their potential to create the formation of political fault lines, they have not. On the contrary, they are one of the few areas in which there is a seeming confluence of views between the parties.
But if you look at campaign ads and listen to campaign rhetoric, China repeatedly arose. China was cited as our top economic rival and as an unfair competitor because of its currency policy, its potential to overtake the U.S. as a global economic leader, and especially its impact on U.S. workers. The giant sucking sound is coming from across the Pacific these days. But unlike that sound in the days of wacky Ross Perot, this time the giant sucking sound is accompanied by the ominous rumblings of a rising superpower -- that many politicians running this year had no problem framing as the United States' natural enemy in the 21st Century.
Much of it was demagoguery. But there was no other foreign policy issue that competed with it for prominence … with the exception of immigration in the border states; a coincidence that reflects a broader theme of turning inward, protectionism and isolationism that threatens to alter the fundamental nature of U.S. international engagement in the long run.
Call it what you will, but this election won't be the last in which China plays such a central role. This administration is also the first, as has been noted here in the past, for which the relationship with China was paramount among all those the United States has worldwide. It was also the first during which China played a central role in an issue outside its region -- as in the case of its important role in the Iranian nuclear issue. It was also the first during which Chinese views began to play a central role driving important international discussions -- from climate, to currency, to coordinating the global economic recovery.
It looks like President Obama's first major visitor of the new year will be Chinese President Hu Jintao. That is no coincidence either.
There are big shifts afoot this election day. And despite what you may read in tomorrow's papers, they have precious little to do with how many House seats the Republicans pick up in these midterm elections.
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It is heartwarming to see Bill Gates and Warren Buffett have achieved some success this week with the visit of their traveling philanthropy road show to China. A number of rich Chinese have apparently promised "very generous gifts" to the Gates-Buffett initiative to get billionaires from around the world to give at least half their wealth to philanthropic causes. It has been estimated that the effort by America's two richest men could net up to $150 billion for good causes from the commitments they already have.
It is impossible to fault such efforts at voluntary redistribution of wealth from the infinitesimal few who have the most to the many who have so little. After all philanthropy comes from roots meaning the love of man or mankind and certainly we never can have enough of that in a world in which such sentiments are as spottily distributed and scarce as great personal fortunes.
Still, for all the momentum behind the Gates-Buffet-Clinton Global Initiative modern philanthropy trend, it is important we realize the short-comings of such efforts. Leaving decisions about how assets are distributed to address global problems to the rich is as unjust as letting them have a disproportionate voice in politics or setting any other priorities for the bulk of society. They answer to no one and come with their own biases and knowledge gaps no matter how well intentioned they are. Further, while philanthropy is a useful adjunct to public sector efforts to address social needs it can sometimes serve as a screen or preemptive argument suggesting that either government programs can be cut back on the one hand or that we needn't tax the rich or question the gross inequities in our economic system by which they have benefitted.
No, while we applaud the donor billionaires we should also continue question how we can fix a system that has allowed the creation of something over a thousand billionaires among six billion people, a cadre that has a net worth equal to something like the poorest 2.5 billion of their fellow humans. And we might even encourage even the most generous of these billionaires to go further and campaign as actively for programs that give all the people more say in where the riches produced by society go ... programs like income taxes.
In fact, that would be the most moving and groundbreaking initiative this election season ... a movement among the rich to embrace an adjustment of the tax code to enable us to stop borrowing from our children to finance a system that enriches so few. That would be real philanthropy ... rich Americans arguing for dropping the Bush tax cuts to ensure future generations had a fair shot at a decent life rather toiling to pay for the excesses of their parents and grandparents.
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Once again, America's political pundits got it wrong in their analysis of this week's primary elections in the U.S. They immediately sounded the alarums regarding the big Tea Party wins, focusing on two of the most bizarre and extreme candidates to recently win victories -- Delaware's anti-masturbation advocate Christine O'Donnell and New York's porn-loving gubernatorial cartoon Carl Paladino. In so doing, they missed a far greater threat to the U.S. that was imbedded in the election results -- the success of the teachers' unions in defeating Washington, D.C.'s reformist mayor Adrian Fenty.
The unions didn't like his tough schools Chancellor Michelle Rhee and her policies holding teachers accountable for their students' performance. So they poured money into the campaign of Fenty's opponent, D.C. City Council Chairman Vincent Gray. The spin on the election was that Fenty lost touch with the city's black voters, but behind the scenes it was another victory for special interests that care more about their job security than they do about America's economic future. The side that seems dedicated to ensuring that the U.S. continues to fall behind other countries in academic performance -- and thus in terms of competitiveness, growth and by extension, national security, scored a big victory … if anything so cynical and counter-productive could actually be called a victory. Sadly, within hours of this setback for education reform in the nation's capital, it became clear that another courageous reformer -- with Rhee, one of the two or three most notable in the country --, New York City's Department of Education Chancellor Joel Klein, was also under growing pressure to suspend some of his trail-blazing accountability practices. The argument the critics made was that some New York City students were underperforming on one measure of English and Math proficiency, even while they conveniently overlooked a wide variety of national and state-level achievement gains made under Klein's stewardship. They also ignored the fact that the areas in which the setbacks occurred were ones in which standards were only this past summer revised upward (as Klein himself had urged for a long time).
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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.")
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The Washington Post, like many Beltway watchers, took President Obama's statement that White House Chief of Staff Rahm Emanuel would make a "great mayor of Chicago" as an acknowledgement that Emanuel is as good as gone from his administration -- and that the typical midterm game of musical chairs that enlivens the West Wing has begun.
I take the statement as something different. I take it as a personal request from the President to me to let him know what changes he needs to make after the November elections.
So, let's begin with replacing Rahm. Rumor has it that Emanuel himself has been mentioning Valerie Jarrett, among the president's closest confidantes, for the job. While being as simpatico with the president as Jarrett clearly is would be a big plus, the chief of staff job has a massively tough management component to it that would undercut Jarrett's ability to remain the vital sounding board for the President she has become. Better suited to the job would be two of the other names mentioned: Ron Klain, the vice president's chief of staff, and Tom Donilon, the deputy national security advisor. Both are excellent, smart and proven administrative masters. Tom Daschle, former Democratic majority leader in the Senate, has also been mentioned. He played a vital role in the president's campaign and would add an important capacity for Hill outreach to the mix.
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Think tanks being what they are -- large meat lockers in which future government bureaucrats are stored until needed -- the reports they produce tend to be little more than exercises in reputation management. They state the obvious, then slather it in a bland, nutrient-free sauce of quasi-academic qualifications that seek to explain why they are really not saying anything new or practical. The best of them offer course corrections that are minuscule at best, and new ideas are as hard to find as honest politicians in the Karzai administration.
Which brings us to the latest such report to be issued, one that proves to be the exception to the rule. That report is "A New Way Forward: Rethinking U.S. Strategy in Afghanistan" from the New America Foundation. It is one of the very few such documents that I have recently read and found myself nodding at almost every turn of the page. It is so good that it almost restores my youthful belief in the potential benefits of putting smart people around a table and letting them cogitate and argue and bullshit and grapple with tough problems. Produced by a glittering group of wonks, it contains real thoughtful insights into America's situation in Afghanistan and comes to sound, generally implementable conclusions about what the United States should do to avoid making a very bad situation even worse.
The report is well summarized in an article by Steve Clemons, one of its architects, that appears in Politico. In short, it makes the case that spending $100 billion a year to fight a war we can't win in Afghanistan is just one of several reasons that America's policies are misguided and demand immediate correction. He writes, "Though Obama is more likeable, and often more inspiring, than the fictional captain in the Melville novel, Afghanistan has now become the Moby Dick to Obama's Ahab."
The report begins by revisiting the forgotten territory of America's initial reasons to be involved in the region in the first place. It correctly notes there are only two: preventing Afghanistan from being a staging ground for further terrorist attacks against the United States, and doing what we can to reduce the threat that Pakistani weapons of mass destruction might fall into the wrong hands. It argues correctly that if we focus on these two goals, then our mission, military and diplomatic presence in the region would and should look very different.
It makes five key recommendations. The first is promoting power sharing and political inclusion in a more decentralized Afghanistan: In other words, trying to work with rather than against the historical and cultural tides in the country. Second is downsizing and ending military operations in southern Afghanistan and reducing the military presence there. Third is focusing the military's attention on Al Qaeda, which is no longer really present in Afghanistan but remains an issue in Pakistan. (Notably, the New America group suggests using the cost-savings the drawdown would produce to bolster U.S. domestic security and contain the spread of weapons of mass destruction worldwide.) Fourth is encouraging the promotion of economic development, while emphasizing that this should be an internationally rather than U.S. led effort. (Hallelujah to that.) Finally, it recommends collaborating with influential states in the region to ensure Afghanistan is not dominated by "any single power or being permanently a failed state that exports instability." The report notes that those states -- Pakistan, India, China, Iran and Saudi Arabia -- aren't the best of pals, but suggests correctly that there are ways to work with each or even small clusters of them to promote these outcomes that are, for the most part, in their interests.
Point five is a bit of a stretch. Point four is more or less boilerplate, though worthy of emphasizing. The reality is that Afghanistan will become a strongman dominated quasi-failed state, but that as long as our core goals in the region -- the two mentioned above -- are met, then we should be less concerned with whatever structure produces an outcome supportive of them.
Personally, I think the international community needs to be involved actively in ensuring that whatever successor state emerges, the rights of all Afghans -- and notably women and tribal minorities -- are respected and protected. It is also true that Pakistan is the real problem and appropriate subject of U.S. attention in this region, and that this requires forthrightly addressing what diplomatic and force structure is required to promote stability and contain threats within that country.
But this report is clear-eyed, direct, well-argued and in its tone even more than its substance sends a message that the only door we should head for in that country is the one with the exit sign over it. In Clemons article he notes that the United States spends seven times Afghanistan's own GDP on our involvement there -- an amount equal to the cost of the recent U.S. health care legislation, and one that if saved could pay down the U.S. deficit in 14 years. The recklessness and irresponsibility of such a costly involvement, given America's other urgent priorities and the true nature of the threats within Afghanistan, makes the blood boil.
It does no dishonor to our military to wish their lives and services were available for other missions. Reports like this raise the hope that opinion is shifting in ways that may lead us to just such a desirable outcome.
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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.
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Maybe the answer is staring us in the face.
China seems to "get it" on climate change and embracing a new energy paradigm. We don't. Why do they have a sense of urgency while we dither? What useful lesson can we learn from the fact that as America fumbled the ball on energy and climate legislation, China announced its plans to begin carbon trading?
Is it because the Chinese love the environment more than we do? Has "Green China" supplanted "Red China?"
No, they are spending hundreds of billions more and working hard to advance everything from new technologies to the establishing of a national carbon trading mechanism not because of some national sense of charity or planetary good will. They are doing it because it makes economic sense. They are as hard-nosed and unsentimental as any people on the planet -- especially the bureaucrats atop the Chinese government. And the only reason they would invest in green energy technologies is because they think that ultimately it will make their country more secure and prosperous.
They believe efficiency is worth the investment because it will make energy cheaper. They will invest in solar and wind because they have solar and wind resources. They will invest in electric cars because they mean importing less oil, spending less hard currency... and spending less on pollution related health care costs.
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In yesterday's post, I noted some of the most relevant developments in the political world that've occurred recently. But we're hardly out of the neck of the woods. The summer of 2010 promises to be an ... interesting time.
As promised, here's an idea of the potential Black Swans to come:
1. Wars of Summer, Part I: The Koreas
As we've seen just in the past couple of days, "engagement" doesn't seem to be doing the trick with North Korea. When you have two countries that have been pointing guns at each other for half a century and one of them is run by the kind of guy who makes Mahmoud Ahmadinejad look like Albert Schweitzer trouble is always just a Dear Leader moodswing away. When one of those countries starts firing torpedoes at the other, that raises the temperature a bit ... and when that same country has a diplomatic tantrum because its neighbor actually doesn't like having its ships sunk, you get a sense of how off-balance and dangerous the whole thing is. (You also get dictionary editors everywhere rushing to insert North Korea's reaction into the official definition of chutzpah right where "burying your husband in a rented suit" used to be.) While most people assume this is just one of those periodic Korean peninsula hiccups, you never know.
2. Wars of Summer, Part II: Somalia, Yemen, etc.
These places are just two examples of plenty where conditions are chronically horrible and getting worse. If you're going to worry about the Koreas where the stakes are high and both sides would pay an unimaginable price for a conflict, don't rule out conflicts in places where everyone has a gun and life is cheap.
3. Wars of Summer, Part III: Israel, Syria, Lebanon
Speaking of places not to rule out, over the years few places have proven themselves more reliable breeding grounds for warfare than the borders of the state of Israel. And tensions are rising along the most northern of these as we speak. The Israelis are worried about growing stockpiles of missiles being deployed in Lebanon, new missile capabilities in Syria and Iranian mischief in both places. Of all the possibilities for tensions turning to a shooting war this summer, this one may top the list. And, what a great distraction it would make from Iran's nuclear issues (or what great cover for an Israeli strike against the Iranians who are paying for the missiles and underwriting Hezbollah trouble-makers in Lebanon and elsewhere).
4. The Other "Big Spill"
While Washington works itself up into a lather over the spill in the Gulf, it effectively ignores a much bigger catastrophe. A recent NPR report indicated that the amount of man made pollutants that have flowed into the Gulf during the current crisis flow into the air every 2 minutes or so. That's 30 crises like this an hour. 360 a day. Over 1,000 a month. That means this summer there will be 3000 crises like this offshore drilling calamity ... and throughout this period the likelihood that the U.S. government or the world move any closer to addressing this much larger, much less photogenic disaster is pretty close to zero.
5. The Financial Crisis They Call "The Big One"
Remember the financial crisis that took down Bear Sterns? Now we look at that as only prelude. Remember the one that took down Lehman, Merrill and AIG? Perhaps we'll look at that as just the appetizer. Because with the world economy now trembling at the thought of further deterioration in the Eurozone, it wouldn't take much to send us into territory that was unimaginable even two years ago. Likely? No. But possible? Well, let's see, Japan has a debt to GDP ratio that is worse than most of Europe's. What if the markets sour on lending them any more money? What if that takes down some of their banks and they start calling in IOUs and cut lending in places like China? Tim Geithner said this week that overall China's economy is not a bubble. Maybe so. But that doesn't mean it doesn't have some pretty big bubbles in it (see: real estate).
6. The Dem Rebound
The big political story in the United States is supposed to be the losses Dems will suffer in mid-term elections in November. Big time members of the punditocracy are calling for a big swing to the right, a likely Republican take-over in the House and even the possibility of one in the Senate. But by the end of the summer, once campaigns have started in earnest, the loony, fringy, dysfunctionality of the "just say no" party will be revealed and the big surprise U.S. political story of the year will start to take shape. The Dems may have modest losses in November, but it won't be anything like the washout the chattering classes expect.
7. Argentina's Surprise Victory
Despite Lionel Messi's dominance on the soccer field, Argentina won't win the World Cup this year. That'll be Spain. But maybe as the summer ticks on a few more people will start to realize that having done everything wrong and utterly alienated the financial system by telling the big banks to take a hike a few years ago, Argentina is actually having something like a recovery worthy of a tango. Oh, all is not rosy to be sure, but take a look at its per capita GDP in purchasing power parity terms. It just passed Chile to be number one in Latin America (according to Latin Business Chronicle). Between this and the U.S. dollar strengthening despite the fact that the U.S. has also done practically everything wrong (and China's flourishing for years despite its penchant for, how shall we put it, well, communism) who knows... this could be the summer that moral hazard makes its long awaited big comeback.
8. Someone Writes the Truth About Financial Reform
This is the least likely black swan on this list. But it is possible that once financial reform passes later this summer and is signed into law that someone will note that "the most sweeping financial reforms since the Great Depression" actually don't amount to much when it comes to fixing the problems we face. Mortgage defaults, unregulated global derivatives markets, unintended consequences of interconnectivity of markets, lack of global regulatory mechanisms, failure to address the trading culture's perversion of finance, etc... this is like the health care bill and Beatlemania: not the real thing, just an incredible simulation.
9. The White House Gets Humble
Ok, maybe I'm wrong. Maybe this is the most improbable of the Black Swans. But the folks in the White House are good people at heart and smart ones. Sooner or later they will realize that their mixed, incomplete record in office trumps the historic nature of their victory and that a little humility is in order ... if not because they feel that way then because by alienating even their most enthusiastic supporters they are doing themselves great political damage. As for the American people, they would do better with more realistic expectations. We all want Washington, Lincoln or Roosevelt whenever we elect a president. But the vast majority of the time we get Chester A. Arthur. Bush was Chester A. Arthur. Clinton was Chester A. Arthur. And in all likelihood Obama will end up being Chester A. Arthur.
10. Iran Cooperates
Ok, never mind. This one is most likely. But the dangerous twist here is that cooperation from Iran is actually just them buying time to move toward their goal of possessing nuclear weapons technology. The only thing that will stop them from such a stalling course is if they are much further ahead of schedule than we think and that the big black swan of this summer will be the announcement that the world's largest state sponsor of terror will actually have gone nuclear.
ATTA KENARE/AFP/Getty Images
Is It Too Early to Call the Karzai Visit a Failure?
No. Especially after it was upstaged by General McChrystal's televised declaration that we're getting nowhere in Afghanistan. But the fact that the media has reacted to the whole carefully orchestrated exercise as though it were either a) a charade (see Maureen Dowd yesterday or Helene Cooper's excellent article in today's New York Times) or b) not happening (see the fact that the story didn't even make the front page of Friday's Times) is really a secondary problem for those with the unenviable task of guiding Obama's benighted AfPak policy.
The real measure of success of the effort is going to come in the U.S. Congress when it votes on the supplemental appropriation to support the increasingly unpopular conflict. If they vote the money, then all this lying through the gritted teeth of U.S. and Afghan politicians about how well everything is going and everyone is getting along will have bought some time at least. If they don't vote it, vote less or make the process really painful for the president then not only will all this posturing seem to have been pointless but Obama is going to have to face up to the possibility that not only is the war going to end badly (as almost seems inevitable) it's going to end for the United States a lot sooner than he, Karzai or anyone involved wants it to.
That said, the fact that both U.S. and Afghan officials believe it will take a decade of active U.S. involvement in Afghanistan to prepare for a real security handover á la Iraq suggests just how unlikely a real U.S. success in Afghanistan is. Because if the Congress is choking on the money this year (and Speaker Pelosi has warned more than one visitor to her office that passing the supplemental could be "tougher than health care") imagine how much worse it will get in the run up to 2012. Which in the end means the current visit is actually serving a useful purpose, preparing all involved for the bald-faced dissembling that will be required to put a good face on this mess when we head for the door.
Is the Hot New Trend Divided Government?
With the election of the Doublemint Twins in the U.K. after an election that didn't produce a majority winner, the voters of the countries that were once seen as the world's top powers seem to be sending a message (advertently or otherwise) that at a moment of great crisis, they're perfectly happy letting someone else take the lead -- because in country after country election results or projections seem to be making it tougher for leaders to get anything done.
In Germany, the recent election bodes ill for Angela Merkel's party. Japanese politics are just a hopeless mess. The United States seems to be headed for an election which produces a much more evenly divided Congress. France's president seems to currently have the support of only about a third of the French people. Admittedly, the confusion among voters only mirrors that among the leaders but it doesn't bode well for swift or bold decision-making within the G8 countries ... and may offer an opening to countries, like China, that aren't burdened with the complexities and headaches associated with democracy.
And while we're on the subject of the Brits, all credit to them for being presented with a confounding (if not entirely unexpected) election result and within days not only piecing together an inter-party deal but actually putting together and announcing an entire coalition cabinet. It's one thing they do so well that Americans, accustomed to agonizingly long cabinet nominating and approval processes, watch with envy. At least this one does. And since this one is also a bit of a National Security Council historian, he was pleased to see the Cameron government launch the process to set up an equivalent body in Britain. It's a bit of a trend worldwide recently. The question is could we in the United States be using ours better while others are so inclined to imitate it?
Does the European Economic Crisis Spell Trouble for Alternative Energy Advocates?
It has been a bad year for the European model of coping with the climate crisis. First, in the run up to Copenhagen, we saw the preferred European approach of moving toward a global cap and trade system falter. The Chinese and Indian idea of "target and regulate" (meaning they set their own national targets, don't commit to global hard caps and use regulation and whatever tools they saw fit to achieve those goals) gained traction and as it did, so too did the center of gravity for global leadership on these issues shift to the Pacific from the Atlantic.
Now, with Europe's economies battered by the markets and burdened by debt, what will become of the rich incentives that have made the growth of alternative energy in Europe possible? Here's the answer: they're going to have to be cut back over the next several years, particularly in countries like Spain where they are especially expensive and debts are especially high. Further, since the European commitment to combating global warming is not likely to diminish, expect more of focus on regulations, taxes, surcharges and penalties (which actually produce revenues for the government) and less on incentives, grants and other costly goodies. And just as the Europeans get this message, expect a similar one here in the U.S. and in places like Japan. This in turn will leave the Chinese who are sitting on a $2.4 billion piggybank and an equally large reservoir of political will to lead in an ever better position to make the big leap from memories of a red revolution at home to leading a green one worldwide.
Who's in Charge on Climate Legislation?
This week saw the launch of Senators Kerry and Lieberman's long awaited climate legislation. It also saw Senate Majority Leader Harry Reid express his view that such a bill might be difficult to pass this year and that perhaps it would make sense to focus on an "energy only" initiative that might include a Renewable Energy Standard, some offshore provisions and a few other elements more popular with a larger majority of Senate members. His saying this literally hours before the Kerry Lieberman launch suggests a bit of a split at the top of the Democratic congressional leadership on this...the kind of thing that might have been better worked out behind closed doors. Who's in charge here? If the White House is committed to this kind of legislation passing this year -- and it may be much harder to pass after the November elections if the Republicans make big gains -- why aren't they taking the lead on shaping proposals and ensuring that their team on the Hill is unified behind them? Admittedly, this has not been the way things have worked on health care or financial services reform but, perhaps the lessons of those experiences suggest a new approach might be in order.
JIM WATSON/AFP/Getty Images
What would the world do without Mahmoud Ahmadinejad? While it may be pleasing to contemplate, the reality is that Iran's leader has become the one nut job that many of the world's other leaders can't do without.
Consider for a moment the following cases:
While this list goes on, however, there is another dimension to the festering tensions with Iran over its nuclear program that may not, as of yet, be fully understood. This relates specifically to Netanyahu's framing of Iran as an existential threat. It may be just that, but not in the way he was envisioning.
Because over the past several years, growing concerns over Iran and its nuclear program have come to trump most others in the Middle East proper. They have transcended in terms of the security threat involved those associated with either the Israeli-Palestinian issue or those associated, at least for now, with al Qaeda (thanks in part to defeats for al Qaeda like today's killing of its leader in Iraq, and thanks in part to the fact that Iran seems to be, in the words of a former colleague of mine who was a career naval officer and Jack London fan, the wolf closest to the sled). Is a potentially nuclear Iran more dangerous than an unstable Pakistan? Probably not... but that's like saying you have two forms of cancer. You want to treat both, but the one that is most threatening at the moment will dominate your attention.
The Israeli government has played up this threat for completely legitimate and understandable reasons. Getting Iran's nuclear program just a little bit wrong might be minor for the world but a really big deal for Israel. However, having thus framed the issue, the Israelis have to live with the consequences... and the consequences are not what they intended.
Because if, as seems likely, the ultimate result of the Iranian nuclear program is (after "engagement" and sanctions ultimately prove ineffective, as seems likely) that we accept the idea of a nuclear Iran and revert to a strategy of containment, paradoxically Israel may move to be less central to U.S. interests in the region, trumped by the urgent need for a strong alliance with Arab states like Saudi, the UAE, Iraq, etc. designed to contain the new Iranian threat. Further, if we create a "nuclear umbrella" for the region, it is hard to imagine treaty or diplomatic language that did not, of necessity, promise to protect those states from all nuclear threats including those posed by Israel.
We're already seeing signs that the risks of having to live with a nuclear Iran are sufficiently real that relations with anti-Iranian Arab states are becoming more and more central -- and thus are likely to give those states an ever greater voice in the Israeli-Palestinian issue. Hence all the buzz about seeking to set American terms for a peace, gain Arab support and then go to the Israelis and say, here's the deal: You want to contain Iran, you need to give this serious consideration.
Israel felt compelled to sell the Iranian threat. But their pitch really only would work if they persuaded the world to preempt that threat. If Iran got the bomb, then the geopolitics change, U.S. interests align more closely with those of some historic enemies of Israel, and a difficult relationship becomes even more complex. (And it's not so good now. My bet is that if the Palestinians unilaterally declared independence tomorrow there would be two kinds of reaction worldwide: celebration and, perhaps in a few cases, effective silence. Another point the Israelis need to consider: in the 21st Century emerging powers that are less sympathetic to their case are playing an increasingly important role in shaping multilateral outcomes.)
Ahmadinejad may be the region's indispensable lunatic, but if things keep trending in the current direction, he may ultimately be one that the Israelis could well have done without.
BEHROUZ MEHRI/AFP/Getty Images
In the past few days, the Obama team has alienated Republicans by showing them to be the empty poseurs that they are, the EU by deciding not to attend their summit later this year, and the green community by apparently backing away from including cap-and-trade revenues in the upcoming budget and thus sending a message that they're no longer expecting them.
But of all the alienating that has taken place in the past week, the most meaningful has to do with the president's decision to send $6.4 billion in arms to Taiwan and the resulting, inevitable Chinese pique at the U.S. action. According to the foreign ministry, the step "constitutes a gross intervention into China's internal affairs." They're "extremely indignant."
Frankly, following the administration's unsteady performance with China during its first year in office, this willingness to stand up to the Chinese is welcome. On the President's China trip and throughout last year, the Obama team seemed altogether too passive in accepting criticisms from a Chinese government that lives in a Forbidden City full of glass houses. They may be gaining strength but clearly their economic policies are compromised by corruption, a weak banking system, a real estate bubble, and the manipulation of their currency. Their businesses and their people are hampered by their efforts at censorship and their continuing readiness to employ authoritarian tactics. Their foreign policy consists of a willingness to engage when it is in their interest but not to play any kind of real leadership role on global issues where their intervention could be key -- from Iranian nukes to combating climate change.
They are an important partner to the United States on many issues but they are one that is deeply flawed and unsure of themselves. They know they are changing. They know they need to change. But they are unsure how rapidly they can go or in what direction those changes may take them.
China will not be influenced by carrots or kindness alone. Indeed, cozying up to the Chinese leadership will be ineffective with a hard-nosed government motivated by a laser-like focus on national self-interest. For example, they will complain about America's arms sale to Taiwan or our recent criticism of their Internet policies, but they won't let it derail the relationship. Because their growth and national stability depends on us even more than we depend on them for the capital to finance our debt -- although we ought to focus more on the symbiosis that is required by circumstance and less on who has the edge.
All this is to commend the Obama administration for its resolute stance with regard to the Chinese these past few weeks. Having said that, I'm concerned that we are likely to fall victim to several traps.
Beating up on the Chinese is as popular with the Democratic base as beating up on Arabs is to Republicans or beating up on Mexicans is to border-state populists and the thankfully now relatively silent and almost forgotten Lou Dobbs. The problem is, letting the domestic politics of having a whipping boy drive foreign policy is dangerous and on some key issues, like trade, the temptation is likely to be so great that it stands as the single biggest threat to President Obama's surprising State of the Union goal of doubling U.S. exports and strengthening the international trading system. It is a treacherously tempting (and I would say rather likely) first step on a protectionist slippery slope that would make the half pipe at the recently concluded X-Games look slow and shallow.
Another problem is that we need to avoid demagoguing the issue of Taiwan. While many in the U.S. feel that Taiwan, as a democracy, deserves our unquestioning support and that the island nation affords us an "aircraft carrier" just off the Chinese coast, it is not clear to me that this particular issue should be allowed to play as big a role as it has in the past in coloring the U.S.-China relationship.
Taiwan is small. It offers us very little in the way of true strategic advantages (in the final analysis, it really is China's for the taking ... and it is certainly not worth going to war for regardless of what U.S. rhetoric has been for decades). Further, our policy does not really bear too much scrutiny. Imagine, for a moment, if the Chinese were to make a $6.4 billion arms sale to Cuba as part of a program to provide them with a strategic foothold just off our shores. We've been down that road before. We know how the U.S. would react. While I believe that there is a certain place in foreign policy for a modicum of well-thought-out hypocrisy (a fairly prominent place, usually), we have to realize that this issue is a potential distraction from much bigger questions.
It is one of those issues for the Taiwanese and the Chinese to work out among themselves. Just as are the issues between China and Tibet. Just as are countless other border issues of nothing more than regional significance ... unless we continue to choose, in our desire to aggrandize our role on the planet in Yertle the Turtle fashion to involving all issues we survey. Should we support democracy everywhere? Yes. Are we willing to go to war everywhere to defend it? No. Should we support international efforts to preserve the rights of minorities and small states against bullying neighbors? Yes. Is it up to the U.S. to be the last bulwark of defense for all those states (especially the ones that have movie stars or highly-financed lobbies behind them)? No.
We are entering The Era of Limits for the United States. We can only actively get involved in those few places where our vital strategic interests are involved and where involvement will actually advance those interests. That should mean a spring cleaning of the attic of U.S. foreign policy and an effort to identify vestigial positions we can no longer afford to support. This will mean some wrenching decisions ... and in some cases, it's probably just as well we keep our changed policies to ourselves. But we don't have the balance sheet we once had. Economic trends are not in our favor on that front. And so we have to accept that we simply can't afford to be the country we once were ... or over-reaching will prove to be the ultimate threat to our security.
SAM YEH/AFP/Getty Images
U.S. national security is too important to be left to foreign policy specialists, the media or politicians. These are the clear lessons of the Post-Underpants Bomber Era.
Before Christmas and the disturbing revelations of a man setting his balls on fire on a Northwest Airlines flight from Amsterdam to Detroit (rendering himself only slightly more uncomfortable than those flying economy class), there was at least a feeling that America was regaining her senses following the 8 hysterical years of the so-called War on Terror.
But within hours of the bungled terror attempt, we saw once again America's true vulnerabilities. And while they are linked to intelligence failures, it is not the ones on which the media and the president's political opponents have focused that are most salient.
Obama's reaction to the junkbomber incident was precisely right and just what you want from a leader: Dispassionate, thoughtful, and calculated. He gave his team the time to assess the threat, the breaches and the right next steps to take. At least one person in the United States, Barack Obama, seemed to recognize that the objective of terrorism is to promote terror and sought to defuse that effort by handling the threat with the proportionality and common sense that has long been missing from U.S. counterterrorism strategy.
But almost immediately, the foreign policy establishment -- acting with the acuity and purity of motives of Tila Tequila squeezing a few extra minutes of undeserved fame out of the untimely death of her "fiancé" Casey Johnson -- whipped itself up into a critical lather. Why? Because it was good for America or because it was in their own self-interest?
I'll leave you to work that out on your own, but here are a few clues:
First, we have seen very few such attempted attacks carried to the stage of that of the underpants bomber in the last decade. Second, we have been successful in foiling many such attacks -- successes for which those responsible get little credit. Third, the attempt revealed as much about the genuine and enduring weaknesses of even terrorists affiliated with major league terror operations like al Qaeda as it did about our own counter-terror efforts. Fourth, terrorism by definition is only successful if it produces "terror" -- the kind of hysterical over-reaction we are once again seeing -- yet this fact does not seem to have resulted in very many critics toning down their hysteria or shrillness. (The Republican Party has the collective cool on these matters of Prissy helping to birth Melanie's baby in Gone With the Wind. As for the media, given that the "news" networks probably devoted more live news coverage to the balloon boy hoax than were devoted to say, the invasion of Normandy, you recognize that they are actually in the business of emotional over-reaction. In fact, their constant refrain that every event is an earth-shattering pinnacle of human experience that could well be the biggest thing they have ever seen suggests they have more in common with folks in say, Ashley Dupre's line of work than that of, say, a journalist.)
Most important, however, is that within days of what may go down on record as the world's first and last attempt at plastic explosive-assisted self-circumcision, news stories kept popping up that underscored the fact that the terror attack paled in significance for those concerned with America's future to other concurrent global developments. To begin with, the intelligence failures involved were not even the biggest problem of the week for the intelligence community given the devastating blow to some of our most senior field operatives in Afghanistan.
But the biggest threats to U.S. leadership and security ... to our very ability to protect ourselves at home and abroad ... manifested themselves in other stories that have simply not gotten sufficient attention among the accusations and inflammations of the holiday season terror frenzy. Like unemployment staying at 10 percent. Or, over the weekend, like China passing Germany as the world's largest exporter. Or like the fact that our impending health care bill will still not actually fix the financial threats to our system posed by grotesquely under-funded health care liabilities. Or like the fact that the world is far away from solving the biggest security problems it faces from stabilizing Pakistan to stopping Iran's nuclear program (and thus the WMD proliferation that poses the one great terror threat) to reversing climate change or addressing resource disparities that will trigger many of the wars of the century ahead. (It is worth noting that for America today ... the greatest threats to the nation's future well-being don't involve things that explode ... always the favored topic of foreign policy elites ... but rather things that are imploding ... like our economy, about which most big time foreign policy specialists haven't a clue.)
If one terrorist can in one failed attempt distract America from addressing priorities and will almost certainly lead to further billions and billions being misdirected to the global whackamole game of trying to snuff out the geopolitical pipsqueaks who lead international terror networks it explains more about why terrorists will keep trying than any in-depth analysis of the conditions on the ground in terror-prone regions.
Thus, what this incident really reminds us is, terrorists only have the power we give them. And that the emotional, the shrill, the over-the-top, the self-promoters, the hyper-political, and the other tummlers responsible for the inside-the-beltway mob mentality are as complicit in the spread of terror as those who are too soft on it. If the president's rhetoric was slightly too weak for some tastes, he erred in the direction that also weakens our enemies rather than, as did his most vocal critics, the direction that turns operational failures like the one on Christmas Day into strategic successes for the bad guys.
P.S. I'd like to add that not only is the over-the-top nature of the terrorism debate of late done damage to U.S. interests, the appropriate response is not only not more spending, more programs, more rules ... but that complimenting the moderate response would actually be improvements to our anti-terror efforts all of which would actually be in the direction of narrowing, focusing and spending less. For example, want to improve Intel sharing? Let's start with getting rid of the Directorate of National Intelligence, a legacy of Bush's big government response to 9/11, that amounts to precisely the opposite of what we need: an additional layer of thousands of bureaucrats who actually do not enhance (apparently) our analytical capacity and undoubtedly reduce communications efficiency. The Central Intelligence Agency was created to do all the coordinating the DNI does and easily could do it again if sufficiently empowered? Want another step to improve our intel sharing? How about reducing and eliminating many of the unnecessary levels of information classification that make it impossible for policy makers to actually have access to all the information they need to make decisions? Want another? Heed the advice of former advisor to Dwight Eisenhower General Andrew Goodpaster, who laughed to me during our last intel "crisis" after 9/11 that Eisenhower would have had no patience with it because he knew -- from bitter experience during World War II -- that intelligence can be useful but expectations must be set at the right level. It was always an imperfect tool and one that could not be perfected. Want another? Let's get out of the unwinnable mess in Afghanistan and focus some of those resources on directly targeting terrorists, some on better tools for early warning and the rest on the domestic needs that are actually essential to maintaining long-term U.S. strength. I could go on. But it is clear ... when it comes to responding to terror, the lesson of the past decade is that we need to think a lot harder about proportionality and the unintended consequences of our understandable horror and outrage.
Mark Wilson/Getty Images
So, here we are at last, the big ones, my choices for winners and losers of the decade on the global stage.
While these selections are slightly less subjective than, say, the Golden Globe nominations (which are, I believe, selected by three drunken expat Latvian critics in a bar in West Hollywood), they do represent just the views of one man. If you agree with those views, please post your congratulations below ... or go ahead and add a few other names. If you disagree, just remember, there will be other lists -- only I decide whether to include you among the global losers of tomorrow (alongside, say, the Tiger Woods of 10 years from now when he is running Tiger's "Just Do It" Mini-Golf Course in Melanoma City, Florida) or the global winners of the future (alongside, say, President Timberlake in 2030 or so).
The People of Iraq: George W. Bush was our Washington loser of the decade, but all he lost was his reputation such as it was. He's still rich and will probably never pay for a round of golf again. But somewhere between 100,000 and 800,000 Iraqis are dead as a consequence of the war, the country is shattered, its government held together with chewing gum and bailing wire and the random killing continues. Oh, and there was absolutely no justification for going in and breaking up the place from the get-go. This isn't a tragedy ... it's a crime, as I suspect international courts will conclude in the years to come.
The People of Afghanistan and Pakistan: These countries are no playgrounds, they are home to plenty of bad actors and, as Barack Obama has demonstrated, no U.S. president, regardless of party, could stay disengaged from the festering political sore on the planet that is AfPak. But while the pursuit of al Qaeda and the Taliban is justified, the wars that continue to percolate here will kill countless thousands, impoverish hundreds of thousands more and at the same time, support for terrorists and other enemies of civilization will grow. That there are no good choices here is a cliché ... that there are going to be no winners is a related tragic reality.
The British Government (Lifetime Achievement Award): Well, let's book at the worst problems the world has faced during the past decade -- Pakistan, Afghanistan, Iraq, Israel-Palestine...what do these diverse countries have in common? They were all cooked up or stirred up by those fertile minds at the British Foreign Office and their colleagues elsewhere up and down Whitehall, either as they were dismantling their empire or fiddling with the region after one war or another. Thanks guys for your creativity...and for the foresight you showed by actually bequeathing your handwork to yet another remnant of your empire as you shuffled off the world stage so you could focus on counterbalancing your past contributions to global culture by producing Simon Cowell and the likes of Susan Boyle.
The U.S. Constitution, the U.S. Dollar, and American Capitalism: It was a tough decade for the pillars of U.S. society. We should have seen it coming when the decade began with the Supreme Court fiddling with an election and when a central theme of the Bush years became undercutting the Constitution. Thanks to the U.S. government's similar callous disregard for the laws of economics and fiscal responsibility the dollar began a downward spiral that many experts see as a semi-permanent feature of our future.
Democracy: Oh, yes, we know that Churchill called it the "worst form of government except for all the others that have been tried"... but as my grandma would have said, "there's democracy and then there's democracy." In other words, some forms of democracy are worse than others, and among those that that have flourished during the past decade are Russia, Venezuela, Iran, Zimbabwe, and, yes folks, Honduras -- where leaders took advantage of the common misperception that voting equals democracy.
ADEK BERRY/AFP/Getty Images)
On the morning of September 11, 2001, the front page of the New York Times contained stories on school dress codes, violence between Israelis and Palestinians, the struggling U.S. economy, stem cells, nuclear smuggling, and morning television.
Which is to say history is what happens when you are looking in the other direction.
That's not to suggest that the lead story in the newspaper is never the most important story of the day. It is however to urge we approach "news" with considerable caution. What seems newsworthy (Woods-Uchitel) is (the Salahis) often (Going Rogue) just a reflection of conventional wisdom about what's important and ignores other minor factors like history or the fact that people tend to want to read about salacious crap or journalists like to write about things that are easy to caricature politically. As with food we tend to be drawn to the fast, easy or tasty without really much consideration of what we really need.
So it is with the Afghanistan story. Now, it's hard to dismiss any presidential decision that will put over 100,000 American troops at risk as being unnewsworthy. But it is undeniable that most of the coverage misses the bigger point: Afghanistan is a costly distraction for the president, the military, and reporters on the lookout for the big stories of our times. It just barely makes the list of our Top 10 Concerns in the Region and would be unlikely to make the list of our Top 20 or 25 National Concerns overall. At least that would certainly be the case had we not made the decision to put so many of our sons and daughters at risk over there.
President Obama's speech seems brilliantly conceived to mesmerize the punditsphere thanks to what will either be seen by supporters as its balance or by its detractors as its compromises. (It's the Certs approach to speech writing: it's both a breath mint and a candy mint -- both an escalation and an exit, an effort to be tough with and to support the Afghan government, to strengthen institutions but not to do "nation building", to make the war about Afghanistan and about Pakistan, to support the military and to support the critics of the war.) But what all that masks is that every minute further the president is focused on Afghanistan and every dollar further we spend there is withdrawn from some other account, some other higher priority.
Let's just take the Middle East to illustrate the point. We begin, of course, with the fact that Afghanistan is not even the biggest challenge we face in AfPak. (That would be Pak, in case you haven't had your coffee yet.)
In fact here's a handy list you can argue about around the water cooler, the biggest challenges America faces in the Middle East in terms of the broader consequences associated with the problem:
And the only reason the decline of the dollar and the fiscal burdens on the U.S. economy that will severely limit our ability to act in the region are not on the list is that they seem very domestic ... but they would rank near the top otherwise. And as I noted before they are linked to the host of other issues domestic and international which actually outrank the Middle East (hard though that may be to believe to all our friends from all those lobbies, think tanks, and government contractors out there.)
This misplaced focus is revealed especially effectively in the regional context thanks to the juxtaposition of the final stages of this "Afghan decision" (and don't delude yourself into believing this is the last such "decision" or that the new policies will go very far toward resolving the core issues associated with stabilizing that country or getting out) with the recent announcement by the Iranians to proceed with plans to build 10 nuclear enrichment facilities. Whether or not they are capable of doing this, by now it should be quite clear that Iran has adopted a stance that virtually every one of America's enemies in the world has adopted during the past year. They have challenged us to demonstrate that we will simply not confront them in any effective way.
Call it Iraq fatigue, blame it on the economic crisis at home, call it a propensity for dithering, call it a learning curve, the primary message the Obama Administration has sent to the world this year is an unintended variation on the one they intended to send: this administration really is different from that of George W. Bush. On international matters, Bush acted without thinking whereas until this week, it seemed, Obama thought without acting. Given the developments of the past few days, it seems the president has now become adept at thinking and then giving the illusion of action while actually compromising many of the benefits of decisiveness away. For example, while committing the troops must be seen as a kind of an action, it is presented as a double negative thanks to the escalation-exit strategy structure. It's what Groucho Marx might have called the "Hello, I must be going" approach.
And the Iran problem illustrates the consequences of focusing elsewhere (although it is just one such example.) Because thanks to Bush's erroneous decision to focus on Iraq and Obama's premature (last Spring) decision to move his chips to Afghanistan -- thanks to their political and economic costs -- the United States has found it ever more difficult to credibly suggest to Iran that there will be any kind of negative consequences to their move toward becoming a nuclear power. And giving the bomb to the world's largest state sponsor of terror is almost certainly a much greater threat than anything we might see in either Afghanistan or Iraq. (Admittedly, Pakistan poses a similar problem ... and for my money, Pakistan and Iran are the places we ought to be focusing the most of our energy and efforts.) In fact, I sometimes wonder who is pulling the strings for the Iranians in the U.S. government because almost every action we have taken in the past decade or so seems to have inadvertently benefitted them or at least made it harder for us to influence them.
In the end, I'm going to cling to optimism and hope that Obama's decision produces the best possible outcome, the one he and his team clearly are hoping for: a few strong blows against al Qaeda and the Taliban, some measurable stabilization and an exit. Because history is happening elsewhere and as long as we are distracted with wars like this, we raise the likelihood that it will be happening to us rather than that we will have a constructive role in shaping it.
SAUL LOEB/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.