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anonymous

United Kingdom Moves Away from the European Project - 0 views

  • Cameron has pledged to hold a referendum after 2015 on the United Kingdom's role in Europe. He has also said he would reclaim powers London surrendered to the European Union. While they no doubt reflect similar anxieties across the Continent, such statements are anathema to the European project, and by making them, Cameron could be setting a precedent that could further undermine the European Union.
  • According to various opinion polls, roughly 8-14 percent of the country supports the United Kingdom Independence Party, even though it received only 3.1 percent of the popular vote in the 2010 elections. These levels of support make the party a serious contender with the Liberal Democrats as the United Kingdom's third-largest party (after the Labour Party and the Conservative Party). Some polls show that the United Kingdom Independence Party already is the third-most popular party, while others suggest it has poached members from the Conservative Party, a worrying trend ahead of elections for the European Parliament in 2014 and general elections in 2015.
  • Despite his criticisms of the bloc, Cameron has said he does not want to leave the European Union outright; rather, he wants to repatriate from Brussels as many powers as possible.
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  • London also believes that the United Kingdom has surrendered too much of its national sovereignty to supranational EU institutions.
  • Yet the United Kingdom is a strong defender of the single market. Roughly half of its exports end up in the European Union, and half of its imports come from the European Union.
  • Some critics suggest that the United Kingdom could leave the European Union but remain a part of the European Economic Area, the trade agreement that includes non-EU members, such as Iceland and Norway. However, the country would still be required to make financial contributions to continental Europe and adapt its legal order to EU standards, but it would not have a vote in EU decisions. According to Cameron, the United Kingdom must be part of the common market and have a say in policymaking.
  • The issue points to the United Kingdom's grand strategy. Despite an alliance with the United States, the United Kingdom is essentially a European power, and it cannot afford to be excluded from Continental affairs.
  • However, this is the first time that London has openly demanded the return to a previous stage in the process of European integration. At no other time has a country tried to dissociate itself from the bloc in this way. The decision not only challenges the Franco-German view of the European Union but also makes a compromise extremely difficult and risky between France and Germany and the United Kingdom.
  • Cameron's rhetoric suggests that he is positioning the United Kingdom to be the leader of a counternarrative that opposes Germany's view of the crisis.
  • In recent years, the country's veto power in the European Union has been reduced substantially. With each reform of the European treaties, unanimous decisions were replaced by the use of qualified majority
  • London could try to become the leader of the non-eurozone countries, but these countries often have competing agendas, as evidenced by recent negotiations over the EU budget. In those negotiations, the United Kingdom was pushing for a smaller EU budget to ease its financial burden, but countries like Poland and Romania were interested in maintaining high agricultural subsidies and strong development aid.
  • The dilemma is best understood in the context of the United Kingdom's grand strategy. Unnecessary political isolation on the Continent is a real threat to London. The more the European Union focuses on the eurozone, the less influence the United Kingdom has on continental Europe
  • As long as London is the main military ally and a major economic partner of the world's only superpower, continental Europe cannot afford to ignore the United Kingdom.
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    "British Prime Minister David Cameron will deliver a speech in London on Jan. 23, during which he will discuss the future of the United Kingdom's relationship with the European Union. Excerpts leaked to the media suggest that harsh EU criticism will figure prominently in the speech, a suggestion in keeping with Cameron's recent statements about the bloc. But more important, the excerpts signal an unprecedented policy departure: renegotiating the United Kingdom's role in the European Union. London has negotiated exemptions from some EU policies in the past, even gaining some concessions from Brussels in the process; this time, it is trying to become less integrated with the bloc altogether."
anonymous

Britain's Strategy - 1 views

  • Britain's rise to its once-extraordinary power represented an unintended gift from Napoleon. It had global ambitions before the Napoleonic Wars, but its defeat in North America and competition with other European navies meant Britain was by no means assured pre-eminence.
  • The defeat of the French fleet at Trafalgar and the ultimate French defeat at Waterloo then eliminated France as a significant naval challenger to Britain for several generations.
    • Erik Hanson
       
      (Sorry I'm late) To be fair, most of the "French" ships were Spanish.
  • Not only was Britain the dominant political and military power, it also was emerging as the leader in the Industrial Revolution then occurring in Europe.
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  • Napoleon's devastation of continental Europe, the collapse of French power and the underdevelopment of the United States gave Britain an advantage and an opportunity. 
  • Britain also benefitted from the Napoleonic Wars' having crippled most European powers. Britain was not under military pressure for most of the century, and was not forced into a singularly exploitative relationship with its empire to support its wars. It thus avoided Hitler's trap.
  • This began to change in the late 19th century with two major shifts.
  • The first was German unification in 1871
  • The second challenge came from the United States, which also was industrializing at a dramatic pace -- a process ironically underwritten by investors from Britain seeking higher returns than they could get at home.
  • The German challenge culminated in World War I, a catastrophe for Britain and for the rest of Europe. Apart from decimating a generation of men, the cost of the war undermined Britain's economic base, subtly shifting London's relationship with its empire. Moreover, British power no longer seemed inevitable
  • World War II, the second round of the German war, broke Britain's power.
  • Britain lost the war not to Germany but to the United States. It might have been a benign defeat in the sense that the United States, pursuing its own interests, saved Britain from being forced into an accommodation with Germany. Nevertheless, the balance of power between the United States and Britain completely shifted during the war. Britain emerged from the war vastly weaker economically and militarily than the United States. Though it retained its empire, its ability to hold it depended on the United States. Britain no longer could hold it unilaterally. 
    • Erik Hanson
       
      I think many would argue that Britain didn't retain its empire, but lost large parts of it, even if it clung to a few key colonies for a while longer.
  • British strategy at the end of the war was to remain aligned with the United States and try to find a foundation for the United States to underwrite the retention of the empire. But the United States had no interest in this. It saw its primary strategic interest as blocking the Soviet Union in what became known as the Cold War.
  • The U.S. political intervention against the British, French and Israeli attack on Egypt in 1956, which was designed to maintain British control of the Suez Canal, marked the empire's breaking point. Thereafter, the British retreated strategically and psychologically from the empire.
  • the British aligned themselves with the U.S.-dominated alliance system and the postwar financial arrangements lumped together under the Bretton Woods system.
  • The British, however, added a dimension to this. Unable to match the United States militarily, they outstripped other American allies both in the quantity of their military resources and in their willingness to use them at the behest of the Americans.
  • Britain could not be America's equal. However, it could in effect be America's lieutenant, wielding a military force that outstripped in number -- and technical sophistication -- the forces deployed by other European countries.
  • The goal was to accept a subordinate position without being simply another U.S. ally.
  • The United States was not motivated to go along merely out of sentiment based on shared history, although that played a part. Rather, like all great powers, the United States wanted to engage in coalition warfare and near warfare along with burden sharing.
  • A good example -- though not a very important one -- was London's ability to recruit U.S. support in Britain's war against Argentina in the Falkland Islands, also known as the Malvinas. The United States had no interests at stake, but given that Britain did have an interest, the U.S. default setting was to support the British. 
  • There were two dangers for the British in this relationship.
  • The first was the cost of maintaining the force relative to the benefits.
  • The second was the danger of being drawn so deeply into the U.S. orbit that Britain would lose its own freedom of action, effectively becoming, as some warned, the 51st state.
  • Britain has developed a strategy of being enmeshed in Europe without France's enthusiasm, at the same time positioning itself as the single most important ally of the only global power. There are costs on both sides of this, but Britain has been able to retain its options while limiting its dependency on either side.
  • While the United States remains Britain's largest customer for exports if Europe is viewed as individual countries, Europe as a whole is a bigger customer.
  • Britain has positioned itself superbly for a strategy of waiting, watching and retaining options regardless of what happens. If the European Union fails and the European nation-states re-emerge as primary institutions, Britain will be in a position to exploit the fragmentation of Europe to its own economic and political advantage and have the United States available to support its strategy.
  • If the United States stumbles and Europe emerges more prominent, Britain can modulate its relationship with Europe at will and serve as the Europeans' interface with a weakened United States. If both Europe and the United States weaken, Britain is in a position to chart whatever independent course it must.
  • Whatever the British thought of Iraq, a strategy of remaining the most reliable ally of the United States dictated participation.
  • The British strategy represents a classic case of a nation accepting reversal, retaining autonomy, and accommodating itself to its environment while manipulating it. All the while Britain waits, holding its options open, waiting to see how the game plays out and positioning itself to take maximum advantage of its shifts in the environment.
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    Britain controlled about one-fourth of the Earth's land surface and one-fifth of the world's population in 1939. Fifty years later, its holdings outside the British Isles had become trivial, and it even faced an insurgency in Northern Ireland. Britain spent the intervening years developing strategies to cope with what poet Rudyard Kipling called its "recessional," or the transient nature of Britain's imperial power. It has spent the last 20 years defining its place not in the world in general but between continental Europe and the United States in particular.
anonymous

Israelis, Saudis and the Iranian Agreement - 0 views

  • The mere fact that the U.S. secretary of state would meet openly with the Iranian foreign minister would have been difficult to imagine a few months ago, and unthinkable at the beginning of the Islamic republic. 
  • The U.S. goal is to eliminate Iran's nuclear weapons before they are built, without the United States having to take military action to eliminate them.
  • The Iranians' primary goal is regime preservation.
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  • Western sanctions have dramatically increased the economic pressure on Iran and have affected a wide swath of the Iranian public.
  • The election of President Hassan Rouhani to replace Mahmoud Ahmadinejad after the latter's two terms was a sign of unhappiness.
  • The logic here suggests a process leading to the elimination of all sanctions in exchange for the supervision of Iran's nuclear activities to prevent it from developing a weapon. Unless this is an Iranian trick to somehow buy time to complete a weapon and test it, I would think that the deal could be done in six months.
  • An Iranian ploy to create cover for building a weapon would also demand a reliable missile and a launch pad invisible to surveillance satellites and the CIA, National Security Agency, Mossad, MI6 and other intelligence agencies. The Iranians would likely fail at this, triggering airstrikes however risky they might be and putting Iran back where it started economically. While this is a possibility, the scenario is not likely when analyzed closely.
  • There is a bit of irony in Israel and Saudi Arabia being allied on this issue, but only on the surface. Both have been intense enemies of Iran, and close allies of the United States; each sees this act as a betrayal of its relationship with Washington.
  • In a way, this marks a deeper shift in relations with Saudi Arabia than with Israel.
  • It was a massive producer of oil. It was also the protector of Mecca and Medina, two Muslim holy cities, giving the Saudis an added influence in the Islamic world on top of their extraordinary wealth. 
  • It was in British and American interests to protect Saudi Arabia from its enemies, most of which were part of the Muslim world.
  • Absent the United States in the Persian Gulf, Iran would have been the most powerful regional military power.
  • The problem from the Saudi point of view is that while there was a wide ideological gulf between the United States and Iran, there was little in the way of substantial issues separating Washington from Tehran.
  • The United States did not want Iran to develop nuclear weapons. The Iranians didn't want the United States hindering Iran's economic development. The fact was that getting a nuclear weapon was not a fundamental Iranian interest, and crippling Iran's economy was not a fundamental interest to the United States absent an Iranian nuclear program.
  • The Iranians want investment in their oil sector and other parts of their economy. American oil companies would love to invest in Iran, as would other U.S. businesses.
  • There are other significant political issues that can't be publicly addressed. The United States wants Iran to temper its support for Hezbollah's militancy, and guarantee it will not support terrorism. The Iranians want guarantees that Iraq will not develop an anti-Iranian government, and that the United States will work to prevent this.
  • From the Saudi point of view, Iranian demands regarding Iraq will be of greatest concern.
  • From the Israeli point of view, there are two threats from Iran. One is the nuclear program.
  • The other is Iranian support not only for Hezbollah but also for Hamas and other groups in the region.
  • But in the end, this is not the problem that the Saudis and Israelis have. Their problem is that both depend on the United States for their national security. Neither country can permanently exist in a region filled with dangers without the United States as a guarantor.
  • Israel needs access to American military equipment that it can't build itself, like fighter aircraft. Saudi Arabia needs to have American troops available as the ultimate guarantor of their security, as they were in 1990.
  • What frightens them the most about this agreement is that fact. If the foundation of their national security is the American commitment to them, then the inability to influence Washington is a threat to their national security.
  • The fact is that neither the Saudis nor the Israelis have a potential patron other than the United States.
  • The United States is not abandoning either Israel or Saudi Arabia. A regional policy based solely on the Iranians would be irrational. What the United States wants to do is retain its relationship with Israel and Saudi Arabia, but on modified terms.
  • The modification is that U.S. support will come in the context of a balance of power, particularly between Iran and Saudi Arabia. While the United States is prepared to support the Saudis in that context, it will not simply support them absolutely.
  • The Saudis and Israelis will have to live with things that they have not had to live with before -- namely, an American concern for a reasonably strong and stable Iran regardless of its ideology.
  • The American strategy is built on experience in Iraq and Afghanistan. Washington has learned that it has interests in the region, but that the direct use of American force cannot achieve those goals, partly because imposing solutions takes more force than the United States has and partly because the more force it uses, the more resistance it generates. Therefore, the United States needs a means of minimizing its interests, and pursuing those it has without direct force.
  • Saudi Arabia is not abandoned, but nor is it the sole interest of the United States.
  • In the same sense, the United States is committed to the survival of Israel.
  • If Iranian nuclear weapons are prevented, the United States has fulfilled that commitment, since there are no current threats that could conceivably threaten Israeli survival. Israel's other interests, such as building settlements in the West Bank, do not require American support.
  • With this opening to Iran, the United States will no longer be bound by its Israeli and Saudi relationships. They will not be abandoned, but the United States has broader interests than those relationships, and at the same time few interests that rise to the level of prompting it to directly involve U.S. troops.
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    "A deal between Iran and the P-5+1 (the five permanent members of the U.N. Security Council plus Germany) was reached Saturday night. The Iranians agreed to certain limitations on their nuclear program while the P-5+1 agreed to remove certain economic sanctions. The next negotiation, scheduled for six months from now depending on both sides' adherence to the current agreement, will seek a more permanent resolution. The key players in this were the United States and Iran. "
anonymous

Coming to Terms With the American Empire | Stratfor - 1 views

  •  
    ""Empire" is a dirty word. Considering the behavior of many empires, that is not unreasonable. But empire is also simply a description of a condition, many times unplanned and rarely intended. It is a condition that arises from a massive imbalance of power. Indeed, the empires created on purpose, such as Napoleonic France and Nazi Germany, have rarely lasted. Most empires do not plan to become one. They become one and then realize what they are. Sometimes they do not realize what they are for a long time, and that failure to see reality can have massive consequences."
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    We are always the underdogs and greatest.
anonymous

"Were You Born on the Wrong Continent?": America's misguided culture of overwork - 0 views

  • even before the recession, American workers were already clocking in the most hours in the West. Compared to our German cousins across the pond, we work 1,804 hours versus their 1,436 hours – the equivalent of nine extra 40-hour workweeks per year. The Protestant work ethic may have begun in Germany, but it has since evolved to become the American way of life.
  • Aren’t we at least more productive by virtue of the amount of time we’re putting in? No. Look at their productivity rates. They’re like ours.
  • How did Germany become such a great place to work in the first place? The Allies did it. This whole European model came, to some extent, from the New Deal. Our real history and tradition is what we created in Europe.
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  • Despite the numbers, social democracy really does work and delivers the goods and it’s the only model that an advanced country can do to be competitive in this world.
  • You know, it’s 50,000 dollars for tuition at NYU and it’s zero at Humboldt University in Berlin. So NYU adds catastrophic amounts of GDP per capita and Humboldt adds nothing.
  • So much of the American economy is based on GDP that comes from waste, environmental pillage, urban sprawl, bad planning, people going farther and farther with no land use planning whatsoever and leading more miserable lives
  •  
    "Germany's workers have higher productivity, shorter hours and greater quality of life. How did we get it so wrong?" By Alex Jung at Salon.com on August 25, 2010.
anonymous

Geithner's Speech on the Global Economy | STRATFOR - 0 views

  • three points where the United States sees dangers to the global system.
  • The first is maintaining growth.
  • Next, Geithner pointed to differences in exchange rate systems.
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  • Third, Geithner spoke about the reformation of the global financial architecture and evoked the framework agreement signed at the September 2009 G-20 summit.
  • The problem for China is that while Germany and Japan are U.S. allies, firmly lashed to the American-dominated international system, and have already been forced to change in response to American demands — such as the 1985 Plaza Accord in which Washington forced them to adopt market-oriented exchange rate policies — China is not.
  • If the United States is serious about enforcing such a policy, it will require changes to the next three biggest economies — China, Japan and Germany — as well as to those who have grown accustomed to the status quo, that is, in some way, almost everyone else in the world.
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    "U.S. Treasury Secretary Timothy Geithner spoke at the Brookings Institution on Oct. 6 and outlined Washington's economic and financial goals for a series of major upcoming international meetings. He called for G-20 countries to continue working together on global economic and financial challenges, and presented three points where the United States sees dangers to the global system. " At Stratfor on October 7, 2010.
anonymous

The Real New Deal - 0 views

  • Money, an item not necessarily intrinsically desirable or usable but serving as a stand-in for the complex wants and valuations of untold individuals, is an unnatural idea that required centuries to take hold.
  • Endism, especially when attached to the sort of nouns we were once prone to capitalize, can become a bad habit when used as anything more than a literary device to call attention to events worthy of it. The Great Depression was certainly worthy of its capital letters; even if nothing exactly ended, plenty changed. But what? And with what, if any relevance for present circumstances?
    • anonymous
       
      Hat Tip to Robin Hanson at Overcoming Bias for pointing me toward this article. http://www.overcomingbias.com/2010/03/great-depression.html
    • anonymous
       
      And this 'endism' is quite present in the current anger over health-care reform. It's not merely a loss, it is elevated to historical travesty.
  • Whether we realize it or not, we are still reacting to those portrayals more than we are to the actions themselves. What really changed was the way the world’s elite thought of themselves and their institutions.
    • anonymous
       
      This falls under the category of "lies we tell ourselves." Of course, less cynically, we can call it the standard act of national mythmaking. It's akin to the fact that humans remember what they *need* to remember, not what was.
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  • In crude political form, this Whiggish inclination toward progress was encapsulated in the functionalist view retailed by Norman Angell around the turn of the last century, which held that countries that traded with each other would develop economic self-interests too intertwined to justify war.
    • anonymous
       
      This strikes me as something generally true, but not necessarily a truism. Libertarians will often postulate the "trade kills war" argument, without appreciating that it's not an iron-clad law or even - necessarily - the most likely outcome. It strikes me as more a naive, though admirable, conceit of what they *wish* as opposed to what IS.
  • If markets had come to play a more prominent part in the industrial West, it was not because markets had just been invented. It was because social and political systems had evolved in which powerful elites were willing to tolerate institutions that diffused economic power and weakened the state at the expense of private enterprise. This was the core meaning of liberalism in its original formulation.
  • The Crash of 1929, the subsequent economic slump and, particularly, the duration of the Depression took most contemporaries completely by surprise. Indeed, the uniquely severe catastrophe of the 1930s is so unusual that modern analysts should be cautious in drawing lessons from it.
    • anonymous
       
      One way in which we fundamentally misunderstand a time period is in projecting our current political definitions on a period in gross violation of the political norms of the time.
  • Conventional wisdom tends to treat President Hoover as a clueless advocate of laissez faire who refused to stimulate the economy in the dramatic downturn. Franklin Roosevelt, on the other hand, was the heroic leader who both saved the day and transformed the American economy through his promotion of the New Deal. Conventional wisdom is still very much with us.
  • Hoover did not advocate “do-nothing” policies.
  • Roosevelt’s interventions were neither as thorough nor as systematically revolutionary as they have often been portrayed.
  • Above all, FDR’s worst policies were animated by a desire to repress business, by distrust of competition and a general disdain for the market. Those were, of course, precisely the qualities that made his policies extremely popular. FDR’s economic policies scored mixed successes at best, but his political strategy succeeded by any measure long before U.S. entry into World War II, and subsequent generations have not ceased to conflate the former with the latter.
  • So thoroughly has the West taken for granted the triumph of the more abstract liberal nation-state that its denizens must remind themselves how fragile its origins were and how little emotional loyalty it has commanded.
  • Even in America, where visceral support for individualism and self-reliance remains strong, this has always been so. In good times, economic systems are supported by inertia and utilitarian compromise that appeal to the broad center. In hard times abstract convictions tend to melt away. The American preference for the free market is neither as common nor as “American” as many suppose.
    • anonymous
       
      But our identities are inventions and are mostly divorced from a close reading of history. As America nears a genuine crisis point, the current phenomenon of the "Tea Party" is going to be less relevant. It will eventually become "quaint" and irrelevant. At least, that is my hope (and current Generational prediction).
  • Seen as a reversion to older habits, the odd mix of regulation, make-work, intervention, protectionism, nationalism and (as in Germany and elsewhere) anti-Semitism that characterized the Western policy response to the Depression suddenly seems less like an incoherent flaying in all directions and more like elements of a uniform retrenchment in social relations.
    • anonymous
       
      Which is why the narratives don't stick on a closer read.
  • It seems odd that humans in their day-to-day interactions think of buying or selling as the most natural of activities, recreating markets unprompted in the most dismal of circumstances. Yet there is something about the ideology of a market system, or of any generally decentralized order, that seems inconceivable to most people.
  • Economists have a hard time dealing with nationalism.
    • anonymous
       
      Again: Nationalism - in its current form - is a modern social invention.
  • A severe economic crisis implicates the entire system of political economy, regardless of how narrow the source of that crisis may be. Thus those with long-simmering fears and resentments—as well as those with more venal or ideological motives—see crisis as an opportunity to strike out at the system.
  • Anti-market movements, whether pushed by Populists or Progressives in the United States or the various forms of socialism in Europe, took for granted that vigorous political action was the only way to impose order and bring social harmony to an unfettered market economy. But the specific remedies and the zeal with which reformers sought to repudiate the past belie ideological origins more than technocratic ones.
  • He had mastered the politics of trust.
  • Roosevelt deserves credit for largely resisting these ideological enthusiasms. On balance, he dealt with the crisis pragmatically and forthrightly.
  • If FDR had left out the high-flying rhetoric and only pursued an attenuated New Deal—namely the financial policies that economists now agree truly helped us out of the Depression—would he be as celebrated a figure as he is today? Not likely.
  • The end of World War II furnishes still more evidence that political images leave a wider trace in historical memory than actual policies.
  • Thanks to Truman we were once again moving in the direction of a competitive, open-access market economy. Had there been a lingering recession and a continuation of older, harmful regulations into the 1946–48 period, Truman, not his predecessor, would have been blamed. Yet Truman’s stellar reputation today owes nothing to his economic achievements, which most of those who today praise his foreign policy acumen know nothing about.
    • anonymous
       
      I'll raise my hand on this one. Even with my better-than-nothing knowledge of US history, I knew nothing about this.
    • anonymous
       
      They weren't in the stories I learned about.
  • In any event, we would do well to bear in mind how important, yet also how unnatural, the modern system of impersonal finance and trade really is. If we would preserve that system as a basis for our prosperity, we must recognize that many of the regulatory solutions we apply to our current crisis may themselves induce responses that can generate new crises. History suggests, too, that fears of the market and the political pressures it generates will wax and wane as crises deepen or ease. Patience and prudence are, therefore, the best watchwords for government amid the many trials and errors we will surely endure in the months, and perhaps years, ahead.
  • Indeed, many of his interventions—for example, his attempts to balance the budget by raising taxes in 1932, and strengthening support for the gold standard—worsened the economy for reasons orthodox theory would have predicted. On the other hand, Hoover initiated the Reconstruction Finance Corporation to support failed banks, to fund public works, subsidize state relief and otherwise engage in policies that presaged the widely praised interventions of the Roosevelt era.
  • Economic historians stress that it was in the realm of monetary and not fiscal policy that FDR had the most success.
    • anonymous
       
      I can't even tell you the difference between those two things. I would venture to guess that a *lot* of people with strong convictions about government intrusion can't either.
  • What is one to make of the widespread popularity of protectionism and high tariffs throughout the Western world? Nationalist policies of every stripe, whether in the form of cartelization of industry in the United States or of more widespread regulation and control in Europe, especially in Germany, were not natural accompaniments to any neutral, technocratic view of recovery.
  • large-scale systems based on anonymous exchange were a recent phenomenon.
    • anonymous
       
      We have a stubborn inability to understand that businesses are technologies like anything else we create. A chief conceit of neocons is the idea that our current economic system is somehow closer to a blank slate than those with more government power. Since it is our corporate system that is the "newish" thing, it puts supporters on the right in the uncomfortable position of being Progressives of at least one stripe.
  • The current Chair of the Council of Economic Advisors, Christina Romer, wrote in her widely cited article, “What Ended the Great Depression?” (1992), that “unusual fiscal policy contributed almost nothing to the recovery from the Great Depression.” The consensus view is that FDR’s policy success was the abandonment of the gold standard in 1933.
  • Harry Truman left office in 1953 a very unpopular man. Almost no one at the time gave him credit for overseeing a period of rapid recovery that was much broader and more impressive than anything that happened under Roosevelt’s tenure—and this at a time when most economists predicted a deep postwar recession.
anonymous

Germany as Eurozone Leader - 0 views

  • And that project will have to deal with a number of other geopolitical trends unraveling around it. These trends include the Russian resurgence in Central and Eastern Europe, NATO’s increasing tensions, the United States’ eventual move to counter Russia’s resurgence, Central European security fears of a resurgent Russia, a French realization that Paris is no longer equal to Berlin, and Europe’s underlying demographic and debt problems.
  • Germany now senses the opportunity to reform the eurozone so that similar crises do not happen again.
  •  
    May 14, 2010
anonymous

The Turkish Role in Negotiations with Iran - 0 views

  • The Iranians have achieved a similar position. By far the weakest of the negotiators, they have created a dynamic whereby they are not only sitting across the table from the six most powerful countries in the world but are also, like the North Koreans, frequently being coaxed there.
  • If the United States withdraws from the region, Iran becomes the most powerful conventional power in the Persian Gulf, regardless of whether it has nuclear weapons.
  • Given that the United States is officially bound to leave Iraq by the end of this year, Iran is becoming substantially more powerful.
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  • The drawdown of American forces in Iraq is the first step. As U.S. power declines in Iraq, Iranian power increases.
  • If it continues its withdrawal of forces from Iraq, Iraq will be on its way to becoming an Iranian satellite.
  • If Iraq becomes an Iranian ally or satellite, the Iraqi-Saudi and Iraqi-Kuwaiti frontier becomes, effectively, the frontier with Iran.
  • with the most strategically located country in the Middle East — Iraq — Iran now has the ability to become the dominant power in the Middle East and simultaneously reshape the politics of the Arabian Peninsula.
  • Assuming that the United States is not prepared to increase forces in Iraq dramatically, the Iranians now face a historic opportunity.
  • As STRATFOR has said and WikiLeaks has confirmed, it is the Saudis who are currently pressing the United States to do something about Iran, not because of nuclear weapons but because of the conventional shift in the balance of power.
  • The destruction of Iranian naval power is critical, since Iran’s most powerful countermove in a war would be to block the Strait of Hormuz with mines, anti-ship missiles and swarming suicide craft, cutting off the substantial flow of oil that comes out of the strait. Such a cutoff would shatter the global economic recovery. This is Iran’s true “nuclear” option.
  • Iran comes to the table with two goals
  • The first is to retain the powerful negotiating hand it has by playing the nuclear card. The second is to avoid an air campaign by the United States against Iran’s conventional capabilities.
  • The Iranians would not have to invade militarily to be able to reshape the region. It would be sufficient for there to be the potential for Iran to invade. It would shift the regime survival question away from Iran to Saudi Arabia.
  • the choices appear to be
  • accepting the shift in the regional balance in favor of Iran, reversing the withdrawal of U.S. forces from Iraq or attempting to destroy Iran’s conventional forces while preventing the disruption of oil from the Persian Gulf.
  • There is, of course, the option of maintaining or intensifying sanctions.
  • The Europeans are hardly of one mind on any subject save one: They do not want to see a disruption of oil from the Persian Gulf.
  • Therefore, at the table next week will be the Americans, painfully aware that its campaigns look promising at the beginning but frequently fail; the Europeans and Chinese, wanting a low-risk solution to a long-term problem; and the Russians, wanting to appear helpful while hoping the United States steps in it again and ready to live with soaring energy prices. And there are the Iranians, wanting to avoid a conventional war but not wanting to forego the opportunity that it has looked for since before the Islamic Republic — domination of the Persian Gulf.
  • The Turks opposed the U.S. invasion of Iraq because they expected it to fail to establish a viable government in Baghdad and thereby to destroy the balance of power between Iraq and Iran.
  • the United States was unprepared for the unilateral role Turkey and Brazil played at the time they played it.
  • It is all very good to want to negotiate as a neutral party, but the most important party isn’t at the table: Saudi Arabia. Turkey wants to play a dominant role in the Muslim world without risking too much in terms of military force. The problem for Turkey, therefore, is not so much bringing the United States and Iran closer but bringing the Saudis and Iranians closer, and that is a tremendous challenge not only because of religious issues but also because Iran wants to be what Saudi Arabia opposes most: the dominant power in the region.
  • The nuclear issue is easy simply because it is not time-sensitive right now. The future of Iraq is time-sensitive and uncertain.
  • If Turkey wants to play a constructive role, it must find a formula that satisfies three needs.
  • The first is to facilitate the American withdrawal
  • The second is to limit the degree of control Iran has in Iraq
  • The third is to persuade Saudi Arabia that the degree of control ceded to Iranians will not threaten Saudi interests
  • Having regional power is not a concept. It is a complex and unpleasant process of balancing contradictory interests in order to prevent greater threats to a country’s interests emerging in the long run.
  • As the Americans have learned, no one will thank them for it, and no one will think better of them for doing it. The only reason for a deeper involvement as mediator in the P-5+1 talks is that stabilizing the region and maintaining the Persian-Arab balance of power is in Turkey’s national interest. But it will be a wrenching shift to Turkey’s internal political culture. It is also an inevitable shift. If not now, then later.
  •  
    "The P-5+1 talks with Iran will resume Jan. 21-22. For those not tuned into the obscure jargon of the diplomatic world, these are the talks between the five permanent members of the U.N. Security Council (the United States, Britain, France, China and Russia), plus Germany - hence, P-5+1. These six countries will be negotiating with one country, Iran. The meetings will take place in Istanbul under the aegis of yet another country, Turkey. Turkey has said it would only host this meeting, not mediate it. It will be difficult for Turkey to stay in this role."
anonymous

Never Fight a Land War in Asia - 0 views

  • First, why is fighting a land war in Asia a bad idea? Second, why does the United States seem compelled to fight these wars? And third, what is the alternative that protects U.S. interests in Asia without large-scale military land wars?
  • Let’s begin with the first question, the answer to which is rooted in demographics and space. The population of Iraq is currently about 32 million. Afghanistan has a population of less than 30 million. The U.S. military, all told, consists of about 1.5 million active-duty personnel (plus 980,000 in the reserves), of whom more than 550,000 belong to the Army and about 200,000 are part of the Marine Corps. Given this, it is important to note that the United States strains to deploy about 200,000 troops at any one time in Iraq and Afghanistan, and that many of these troops are in support rather than combat roles. The same was true in Vietnam, where the United States was challenged to field a maximum of about 550,000 troops (in a country much more populous than Iraq or Afghanistan) despite conscription and a larger standing army. Indeed, the same problem existed in World War II.
  • When the United States fights in the Eastern Hemisphere, it fights at great distances, and the greater the distance, the greater the logistical cost. More ships are needed to deliver the same amount of materiel, for example. That absorbs many troops. The logistical cost of fighting at a distance is that it diverts numbers of troops (or requires numbers of civilian personnel) disproportionate to the size of the combat force.
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  • Regardless of the number of troops deployed, the U.S. military is always vastly outnumbered by the populations of the countries to which it is deployed. If parts of these populations resist as light-infantry guerrilla forces or employ terrorist tactics, the enemy rapidly swells to a size that can outnumber U.S. forces, as in Vietnam and Korea. At the same time, the enemy adopts strategies to take advantage of the core weakness of the United States — tactical intelligence. The resistance is fighting at home. It understands the terrain and the culture. The United States is fighting in an alien environment. It is constantly at an intelligence disadvantage. That means that the effectiveness of the native forces is multiplied by excellent intelligence, while the effectiveness of U.S. forces is divided by lack of intelligence.
  • The United States compensates with technology,
  • from space-based reconnaissance and air power to counter-battery systems and advanced communications. This can make up the deficit but only by massive diversions of manpower from ground-combat operations. Maintaining a helicopter requires dozens of ground-crew personnel. Where the enemy operates with minimal technology multiplied by intelligence, the United States compensates for lack of intelligence with massive technology that further reduces available combat personnel. Between logistics and technological force multipliers, the U.S. “point of the spear” shrinks. If you add the need to train, relieve, rest and recuperate the ground-combat forces, you are left with a small percentage available to fight.
  • The paradox of this is that American forces will win the engagements but may still lose the war.
  • the United States is well-suited for the initial phases of combat, when the task is to defeat a conventional force. But after the conventional force has been defeated, the resistance can switch to methods difficult for American intelligence to deal with.
  • The example of the capitulation of Germany and Japan in World War II is frequently cited
  • The back of the Wehrmacht was broken by the Soviets on their own soil with the logistical advantages of short supply lines.
  • The Germans had no appetite for continuing a resistance against the Russians and saw surrendering to the Americans and British as sanctuary from the Russians.
  • As for Japan, it was not ground forces but air power, submarine warfare and atomic bombs that finished them — and the emperor’s willingness to order a surrender.
  • Had the Japanese emperor been removed, I suspect that the occupation of Japan would have been much more costly.
  • Neither Germany nor Japan are examples in which U.S. land forces compelled capitulation and suppressed resistance.
  • The problem the United States has in the Eastern Hemisphere is that the size of the force needed to occupy a country initially is much smaller than the force needed to pacify the country.
  • Some people argue that the United States is insufficiently ruthless in prosecuting war, as if it would be more successful without political restraints at home.
  • The guerrilla has built-in advantages in warfare for which brutality cannot compensate.
  • Given all this, the question is why the United States has gotten involved in wars in Eurasia four times since World War II.
  • In each case it is obvious: for political reasons.
  • In each case, the military was given an ambiguous mission. This was because a clear outcome — defeating the enemy — was unattainable.
  • There are two problems with American strategy.
  • The first is using the appropriate force for the political mission.
  • Moreover, it requires an offensive mission. Defensive missions (such as Vietnam and Korea) by definition have no terminal point or any criteria for victory.
  • Having destroyed the conventional forces of Iraq, the United States was unprepared for the Iraqi response, which was guerrilla resistance on a wide scale.
  • The purpose of a military is to defeat enemy conventional forces. As an army of occupation against a hostile population, military forces are relatively weak.
  • By having an unclear mission, you have an uncertain terminal point. When does it end?
  • Donald Rumsfeld once said, “You go to war with the Army you have. They’re not the Army you might want or wish to have at a later time.” I think that is a fundamental misunderstanding of war. You do not engage in war if the army you have is insufficient.
  • Diplomacy can find the common ground between nations. It can also be used to identify the hostility of nations and use that hostility to insulate the United States by diverting the attention of other nations from challenging the United States.
  • Diplomacy for the United States is about maintaining the balance of power and using and diverting conflict to manage the international system. Force is the last resort, and when it is used, it must be devastating.
  • The argument I have made, and which I think Gates is asserting, is that at a distance, the United States cannot be devastating in wars dependent on land power. That is the weakest aspect of American international power and the one the United States has resorted to all too often since World War II, with unacceptable results.
  • An elective war in which the criteria for success are unclear and for which the amount of land force is insufficient must be avoided. That is Gates’ message
  • As with the Monroe Doctrine, it should be elevated to a principle of U.S. foreign policy, not because it is a moral principle but because it is a very practical one.
  •  
    "U.S. Secretary of Defense Robert Gates, speaking at West Point, said last week that "Any future defense secretary who advises the president to again send a big American land army into Asia or into the Middle East or Africa should have his head examined.""
anonymous

What the Fall of the Wall Did Not Change - 0 views

  •  
    "Twenty-five years ago, a crowd filled with an uneasy mixture of joy and rage tore down the Berlin Wall. There was joy for the end of Germany's partition and the end of tyranny. There was rage against generations of fear. One fear was of communist oppression. The other fear was of the threat of a war, which had loomed over Europe and Germany since 1945. One fear was moral and ideological, while the other was prudential and geopolitical. As in all defining political moments, fear and rage, ideology and geopolitics, blended together in an intoxicating mix."
anonymous

Rising Solar Energy Output Drives German & French Power Prices to Record Lows - 0 views

  • Renewable energy critics and opponents continue to zoom in on the intermittent nature of solar and wind energy in their efforts to undermine and derail the transition away from centralized, mass production of energy based on burning fossil fuels.
  • Observed evidence (two examples here and here) indicates that coupled with adequate grid infrastructure and energy policy reform, solar and wind power generation — on and off-grid — can reduce carbon and greenhouse gas emissions and enhance the security and resiliency of power supplies without putting an excessive burden on consumers.
  • No doubt Germany is struggling to overcome obstacles and resistance to Premier Angela Merkel’s plan to eliminate reliance on nuclear power by building out solar and wind power generation capacity as replacements. This shouldn’t come as a surprise to anyone who cares to familiarize themselves with such revolutionary challenges. In fact, they make Germany’s success in this regard all the more remarkable.
  •  
    "Even at this early stage of a much belated evolutionary process, empirical evidence and ongoing technological advances, as well as pro clean energy and sustainable development polices and market developments, highlight the fallacy of their arguments."
anonymous

Elections Plunge Italy into Political Chaos - 0 views

  • While Grillo's party ended up in third place, one in four Italians voted for it, and the party became the most voted-for single party into the Chamber of Deputies (the two mainstream parties, the Democratic Party and the People of Freedom, competed as part of electoral coalitions).
  • Grillo's emergence as the referent of the protest against traditional politicians in Italy is not an entirely new phenomenon. In 1994, former Prime Minister Silvio Berlusconi took advantage of a corruption scandal that prompted the popularity of traditional political parties to plunge. Berlusconi campaigned as an outsider who criticized traditional politicians and their corrupt ways.
  • He combined the tools of mass politics of the mid-20th century with the media tools of the 21st century.
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  • The rise of the Five Star Movement shares similar elements with the electoral growth of the Coalition of the Radical Left, or Syriza, in Greece.
  • Both are anti-system parties that have put the traditional parties against the ropes.
  • Grillo's remarkable performance reflects a growing fatigue among the Italian electorate with the German leadership during the European crisis.
  • When the total number of votes for these three parties are combined, it becomes clear that more than two-thirds of Italians said no to austerity measures. Monti's poor performance in the elections confirms this trend. No matter what happens with Italy's political future, the new Italian government will have this mandate in mind.
  • Italians went to the polls Sunday and Monday hoping that it would be the first step to bringing Italy out of its political and economic stagnation. But they woke up on Tuesday to a country fragmented into three political groups with similar levels of support, where alliances will be extremely difficult to forge.
  •  
    "When Italian comedian Beppe Grillo created his Five Star Movement three-and-a-half years ago, he probably wasn't expecting it to become the voice of a country beset by a deep economic and political crisis. The overwhelming performance of the Five Star Movement in the general elections that were held Sunday and Monday confirmed that the crisis of legitimacy that is threatening the traditional political parties in Europe has finally reached Italy. While Grillo's party ended up in third place, one in four Italians voted for it, and the party became the most voted-for single party into the Chamber of Deputies (the two mainstream parties, the Democratic Party and the People of Freedom, competed as part of electoral coalitions)."
anonymous

Turkey's Geographical Ambition - 0 views

  • Erdogan and Putin are ambitious because they are men who unrepentantly grasp geopolitics.
  • Putin knows that any responsible Russian leader ensures that Russia has buffer zones of some sort in places like Eastern Europe and the Caucasus
  • Erdogan knows that Turkey must become a substantial power in the Near East in order to give him leverage in Europe.
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  • Erdogan's problem is that Turkey's geography between East and West contains as many vulnerabilities as it does benefits. This makes Erdogan at times overreach. But there is a historical and geographical logic to his excesses.
  • The story begins after World War I.
  • Because Ottoman Turkey was on the losing side of that war (along with Wilhelmine Germany and Hapsburg Austria), the victorious allies in the Treaty of Sevres of 1920 carved up Turkey and its environs, giving territory and zones of influence to Greece, Armenia, Italy, Britain and France.
  • Kemalism willingly ceded away the non-Anatolian parts of the Ottoman Empire but compensated by demanding a uniethnic Turkish state within Anatolia itself. Gone were the "Kurds," for example. They would henceforth be known as "Mountain Turks." Gone, in fact, was the entire multicultural edifice of the Ottoman Empire.
  • Kemalism not only rejected minorities, it rejected the Arabic script of the Turkish language. Ataturk risked higher illiteracy rates to give the language a Latin script. He abolished the Muslim religious courts and discouraged women from wearing the veil and men from wearing fezzes.
  • Ataturk further recast Turks as Europeans
  • Kemalism was a call to arms: the martial Turkish reaction to the Treaty of Sevres, to the same degree that Putin's neo-czarism was the authoritarian reaction to Boris Yeltsin's anarchy of 1990s' Russia.
  • The problem was that Ataturk's vision of orienting Turkey so firmly to the West clashed with Turkey's geographic situation, one that straddled both West and East.
  • An adjustment was in order. Turgut Ozal, a religious Turk with Sufi tendencies who was elected prime minister in 1983, provided it.
  • Ozal spoke of a Turkey whose influence stretched from the Aegean to the Great Wall of China. In Ozal's mind, Turkey did not have to choose between East and West. It was geographically enshrined in both and should thus politically embody both worlds.
  • Ozal, two decades before Erdogan, saw Turkey as a champion of moderate Islam throughout the Muslim world, defying Ataturk's warning that such a pan-Islamic policy would sap Turkey's strength and expose the Turks to voracious foreign powers.
  • Ozal died abruptly in 1993, ushering in a desultory decade of Turkish politics marked by increasing corruption and ineffectuality on the part of Turkey's sleepy secular elite. The stage was set for Erdogan's Islamic followers to win an outright parliamentary majority in 2002.
  • one thing stands clear: Both Ozal and Erdogan were like two bookends of the period.
  • Rather than Ataturk's emphasis on the military, Erdogan, like Ozal, has stressed the soft power of cultural and economic connections to recreate in a benign and subtle fashion a version of the Ottoman Empire from North Africa to the Iranian plateau and Central Asia.
  • Remember that in the interpretation of one of the West's greatest scholars of Islam, the late Marshall G. S. Hodgson of the University of Chicago, the Islamic faith was originally a merchants' religion, which united followers from oasis to oasis, allowing for ethical dealing.
  • In Islamic history, authentic religious connections across the Middle East and the Indian Ocean world could -- and did -- lead to wholesome business connections and political patronage. Thus is medievalism altogether relevant to the post-modern world.
  • it is unclear that Turkey even has the political and military capacity to actualize such a vision.
  • Putin's Russia continues to exert significant influence in the Central Asian states and, through its invasion and subsequent political maneuverings in Georgia, has put Azerbaijan in an extremely uncomfortable position.
  • In Mesopotamia, Turkey's influence is simply unequal to that of far more proximate Iran. In Syria, Erdogan and his foreign minister, Ahmet Davutoglu, thought -- incorrectly, it turns out -- that they could effectively mold a moderate Islamist Sunni opposition to replace President Bashar al Assad's Alawite regime.
  • The root of the problem is partly geographic.
  • Turkey constitutes a bastion of mountains and plateau, inhabiting the half-island of the Anatolian land bridge between the Balkans and the Middle East. It is plainly not integral to a place like Iraq, for example, in the way that Iran is; and its Turkic language no longer enjoys the benefit of the Arabic script, which might give it more cultural leverage elsewhere in the Levant. But most important, Turkey is itself bedeviled by its own Kurdish population, complicating its attempts to exert leverage in neighboring Middle Eastern states.
  • Turkey's southeast is demographically dominated by ethnic Kurds
  • The ongoing breakup of Syria potentially liberates Kurds there to join with radical Kurds in Anatolia in order to undermine Turkey.
  • Erdogan knows that he must partially solve the Kurdish problem at home in order to gain further leverage in the region.
  • He has even mentioned aloud the Arabic word, vilayet, associated with the Ottoman Empire. This word denotes a semi-autonomous province -- a concept that might hold the key for an accommodation with local Kurds but could well reignite his own nationalist rivals within Turkey.
  • Thus, his is a big symbolic step that seeks to fundamentally neutralize the very foundation of Kemalism
  • But given how he has already emasculated the Turkish military -- something few thought possible a decade ago -- one should be careful about underestimating Erdogan. His sheer ambition is something to behold. While Western elites ineffectually sneer at Putin, Erdogan enthusiastically takes notes when the two of them meet.
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    "At a time when Europe and other parts of the world are governed by forgettable mediocrities, Recep Tayyip Erdogan, Turkey's prime minister for a decade now, seethes with ambition. Perhaps the only other leader of a major world nation who emanates such a dynamic force field around him is Russia's Vladimir Putin, with whom the West is also supremely uncomfortable."
anonymous

Annual Forecast 2012 - 0 views

  • In this period, the European Union has stopped functioning as it did five years ago and has yet to see its new form defined. China has moved into a difficult social and economic phase, with the global recession severely affecting its export-oriented economy and its products increasingly uncompetitive due to inflation. The U.S. withdrawal from Iraq has created opportunities for an Iranian assertion of power that could change the balance of power in the region. The simultaneous shifts in Europe, China and the Middle East open the door to a new international framework replacing the one created in 1989-1991.
  • Our forecast for 2012 is framed by the idea that we are in the midst of what we might call a generational shift in the way the world works.
  • the driving force behind developments in Europe in 2012 will be political, not economic.
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  • Normally, we would predict failure for such an effort: Sacrificing budgetary authority to an outside power would be the most dramatic sacrifice of state sovereignty yet in the European experiment -- a sacrifice that most European governments would strongly resist. However, the Germans have six key advantages in 2012.
  • First, there are very few scheduled electoral contests, so the general populace of most European states will not be consulted on the exercise.
  • Second, Germany only needs the approval of the 17 eurozone states -- rather than the 27 members of the full European Union -- to forward its plan with credibility.
  • Third, the process of approving a treaty such as this will take significant time, and some aspects of the reform process can be pushed back.
  • Fourth, the Germans are willing to apply significant pressure.
  • Fifth, the Europeans are scared, which makes them willing to do things they would not normally do -- such as implementing austerity and ratifying treaties they dislike.
  • The real political crisis will not come until the sacrifice of sovereignty moves from the realm of theory to application, but that will not occur in 2012.
  • The economic deferment of that pain is the sixth German advantage. Here, the primary player is the ECB. The financial crisis has two aspects: Over-indebted European governments are lurching toward defaults that would collapse the European system, and European banks (the largest purchasers of European government debt) are broadly insolvent -- their collapse would similarly break apart the European system.
  • In 2012, the Kremlin will face numerous challenges: social unrest, restructuring Russia's political makeup (both inside and outside of the Kremlin) and major economic shifts due to the crisis in Europe.
  • Russia will continue building its influence in its former Soviet periphery in 2012, particularly by institutionalizing its relationships with many former Soviet states. Russia will build upon its Customs Union with Belarus and Kazakhstan as it evolves into the Common Economic Space (CES).
  • This larger institution will allow the scope of Russia's influence over Minsk and Astana, as well as new member countries such as Kyrgyzstan and possibly Tajikistan, to expand from the economic sphere into politics and security as Moscow lays the groundwork for the eventual formation of the Eurasian Union, which it is hoping to start around 2015.
  • In the Baltic countries -- which, unlike other former Soviet states, are committed members of NATO and the European Union -- Russia's ultimate goal is to neutralize the countries' pro-Western and anti-Russian policies
  • Russia will continue managing various crises with the West -- mainly the United States and NATO -- while shaping its relationships in Europe.
  • Russia will attempt to push these crises with the United States to the brink without actually rupturing relations -- a difficult balance.
  • Numerous factors will undermine Central Asia's stability in 2012, but they will not lead to a major breaking point in the region this year.
  • Iran's efforts to expand its influence will be the primary issue for the Middle East in 2012.
  • In 2012, Saudi Arabia will lead efforts to shore up and consolidate the defenses of Gulf Cooperation Council members to try to ward off the threat posed by Iran, but such efforts will not be a sufficient replacement for the United States and the role it plays as a security guarantor.
  • Iran's goal is for Syria to maintain a regime -- regardless of who leads it -- that will remain favorable to Iranian interests, but Iran's ability to influence the situation is limited, and finding a replacement to hold the regime together will be difficult.
  • Despite its rhetoric, Turkey will not undertake significant overt military action in Syria unless the United States leads the intervention -- a scenario Stratfor regards as improbable -- though it will continue efforts to mold an opposition in Syria and counterbalance Iranian influence in Iraq.
  • Hamas will take advantage of the slowly growing political clout of Islamists throughout the region in hopes of presenting itself to neighboring Arab governments and the West as a pragmatic and reconcilable political alternative to Fatah.
  • Three things will shape events in East Asia: China's response to the economic crisis and possible social turmoil amid a leadership transition; the European Union's debt crisis and economic slowdown sapping demand for East Asia's exports; and regional interaction with the U.S. re-engagement in the Asia-Pacific region.
  • While Beijing knows that rolling out another massive fiscal stimulus and bank loans as it did in 2008-2009 is unsustainable and would put the economy at risk, it sees few other short-term options and thus will use government-led investment to sustain growth in 2012.
  • As it learned from the Tiananmen Square incident, CPC factional infighting exploited at a sensitive time is a serious risk, and we expect to see measures to ensure ideological and cultural control throughout the Party and down through the rest of society.
  • The United States will continue to consider a political accommodation with the Taliban, but such accommodation is unlikely to be reached this year.
  • The most important development in South Asia is Pakistan's ongoing political evolution.
  • Regardless of any change in party, Mexico's underlying challenges will remain. The country's drug war rages on, with Los Zetas having consolidated control over most of Mexico's eastern coastal transportation corridor and the Sinaloa cartel having done the same in the west.
  • Brazil will spend 2012 focused on mitigating shocks to trade and capital flows from the crisis in Europe. However, with only 10 percent of Brazil's gross domestic product dependent on exports, Brazil is much less vulnerable than many other developing countries.
  •  
    "There are periods when the international system undergoes radical shifts in a short time. The last such period was 1989-1991. During that time, the Soviet empire collapsed. The Japanese economic miracle ended. The Maastricht Treaty creating contemporary Europe was signed. Tiananmen Square defined China as a market economy dominated by an unchallenged Communist Party, and so on. Fundamental components of the international system shifted radically, changing the rules for the next 20 years. We are in a similar cycle, one that began in 2008 and is still playing out."
anonymous

The Futility of European Elections - 0 views

  • The more elections are held, the more the public will force their leaders in various directions. More often than not, this direction will eschew austerity and Germany. Over time this will solidify into a new map. While this has yet to happen, the recent elections at the least are not solving Europe's problem. In fact, they may be further dividing the Continent. And there are many elections to go.
    • anonymous
       
      This all strikes me as more of that 'boring stuff' that we ignore which will probably snowball into a huge role in whatever formal conflict appears in the future.
  •  
    Europe and the financial markets watched intently June 17 as Greece held general elections. German Chancellor Angela Merkel, French President Francois Hollande and Italian Prime Minister Mario Monti all delayed their flights to the June 18 G-20 summit in Mexico to await the results.
anonymous

The American Public's Indifference to Foreign Affairs - 0 views

  • At different times, lesser events have transfixed Americans. This week, Americans seemed to be indifferent to all of them. This may be part of a cycle that shapes American interest in public affairs.
  • The United States was founded as a place where private affairs were intended to supersede public life.
  • Public service was intended less as a profession than as a burden to be assumed as a matter of duty -- hence the word "service."
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  • In many European countries, the state is at the center of many of the activities that shape private life, but that is less true in the United States.
  • The American public is often most active in public affairs when resisting the state's attempts to increase its presence, as we saw with health care reform. When such matters appear settled, Americans tend to focus their energy on their private lives, pleasures and pains. 
  • Of course, there are times when Americans are aroused not only to public affairs but also to foreign affairs. That is shaped by the degree to which these events are seen as affecting Americans' own lives.
  • There is nothing particularly American in this. People everywhere care more about things that affect them than things that don't.
  • People in European or Middle Eastern countries, where another country is just a two-hour drive away, are going to be more aware of foreign affairs. Still, they will be most concerned about the things that affect them.
  • The United States' geography, obviously, shapes American thinking about the world. The European Peninsula is crowded with peoples and nation-states. In a matter of hours you can find yourself in a country with a different language and religion and a history of recent war with your own. Americans can travel thousands of miles using their own language, experiencing the same culture and rarely a memory of war. Northwestern Europe is packed with countries. The northeastern United States is packed with states.
  • Passing from the Netherlands to Germany is a linguistic, cultural change with historical memories. Traveling from Connecticut to New York is not.
  • American interest is cyclical, heavily influenced by whether they are affected by what goes on. After 9/11, what happened in the Islamic world mattered a great deal. But even then, it went in cycles.
  • It's not that Americans are disinterested in foreign affairs, it's that their interest is finely calibrated. The issues must matter to Americans, so most issues must carry with them a potential threat.
  • The outcome must be uncertain, and the issues must have a sufficient degree of clarity so that they can be understood and dealt with. Americans may turn out to have been wrong about these things in the long run, but at the time, an issue must fit these criteria
  • Context is everything. During times of oil shortage, events in Venezuela might well have interested Americans much more than they did last week. During the Cold War, the left-wing government in Venezuela might have concerned Americans. But advancements in technology have increased oil and natural gas production in the United States. A left-wing government in Venezuela is simply another odd Latin government, and the events of last week are not worth worrying about. The context renders Venezuela a Venezuelan problem.
  • It is not that Americans are disengaged from the world, but rather that the world appears disengaged from them. At the heart of the matter is geography.
  • The American reality is that most important issues, aside from Canada and Mexico, take place across the ocean, and the ocean reasonably is seen as a barrier that renders these events part of a faraway realm.
  • During the Cold War, Americans had a different mindset. They saw themselves in an existential struggle for survival with the communists.
  • One thing that the end of the Cold War and the subsequent 20 years taught the United States was that the world mattered -- a mindset that was as habitual as it was reflective of new realities.
  • Starting in the late 1980s, the United States sent troops to Panama, Somalia, Bosnia, Kosovo and Kuwait. The American public was engaged in all of these for a variety of reasons, some of them good, some bad. Whatever the reasoning, there was a sense of clarity that demanded that something be done.
  • After 9/11, the conviction that something be done turned into an obsession. But over the past 10 years, Americans' sense of clarity has become much more murky, and their appetite for involvement has declined accordingly.
  • More recently, the standards for justifying either type of intervention have become more exacting to policymakers. Syria was not a matter of indifference, but the situation lacked the clarity that justified intervention.
  • The United States seemed poised to intervene and then declined. The American public saw it as avoiding another overseas entanglement with an outcome that could not be shaped by American power.
  • We see the same thing in Ukraine. The United States cannot abide a single power like Russia dominating Eurasia. That would create a power that could challenge the United States. There were times that the Ukrainian crisis would have immediately piqued American interest. While some elements of the U.S. government, particularly in the State Department, did get deeply involved, the American public remained generally indifferent.
  • From a geopolitical point of view, the future of Ukraine as European or Russian helps shape the future of Eurasia. But from the standpoint of the American public, the future is far off and susceptible to interference.
  • (Americans have heard of many things that could have become a major threat -- a few did, most didn't.)
  • This is disconcerting from the standpoint of those who live outside the United States. They experienced the United States through the Cold War, the Clinton years and the post-9/11 era. The United States was deeply involved in everything. The world got used to that.
  • I spoke to a foreign diplomat who insisted the United States was weakening. I tried to explain that it is not weakness that dictates disengagement but indifference. He couldn't accept the idea that the United States has entered a period in which it really doesn't care what happens to his country.
  • The diplomat had lived in a time when everything mattered and all problems required an American position. American indifference is the most startling thing in the world for him.
  • This was the position of American isolationists of the early 20th century.
  • The isolationist period was followed, of course, by the war and the willingness of the United States to "pay any price, bear any burden, meet any hardship, support any friend, oppose any foe, in order to assure the survival and the success of liberty," in the words of John F. Kennedy. Until very recently, that sweeping statement was emblematic of U.S. foreign policy since 1941.
  • The current public indifference to foreign policy reflects that shift. But Washington's emerging foreign policy is not the systematic foreign policy of the pre-World War II period. It is an instrumental position, which can adapt to new circumstances and will likely be changed not over the course of decades but over the course of years or months.
  • The sense that private life matters more than public is intense, and that means that Americans are concerned with things that are deemed frivolous by foreigners, academics and others who make their living in public and foreign policy.
  • They care about some things, but are not prepared to care about all things.
  • Whether this sentiment is good or bad is debatable. To me, it is simply becoming a fact to be borne in mind. I would argue that it is a luxury, albeit a temporary one, conferred on Americans by geography.
  • Americans might not be interested in the world, but the world is interested in Americans. Until this luxury comes to an end, the United States has ample assistant secretaries to give the impression that it cares.
  •  
    "Last week, several events took place that were important to their respective regions and potentially to the world. Russian government officials suggested turning Ukraine into a federation, following weeks of renewed demonstrations in Kiev. The Venezuelan government was confronted with violent and deadly protests. Kazakhstan experienced a financial crisis that could have destabilized the economies of Central Asia. Russia and Egypt inked a significant arms deal. Right-wing groups in Europe continued their political gains. "
anonymous

The PC16: Identifying China's Successors | Stratfor - 0 views

  • China will have to behave differently from the way it does now, and thus other countries are poised to take its place.
  • Since the Industrial Revolution, there have always been countries where comparative advantage in international trade has been rooted in low wages and a large work force. If these countries can capitalize on their advantages, they can transform themselves dramatically. These transformations, in turn, reorganize global power structures.
  • When it is not in the throes of war, trade reshapes the international order. After World War II, Germany and Japan climbed out of their wreckage by using their skilled, low-wage labor to not only rebuild their economy but to become great exporting powers.
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  • It's not just their work; it's their way of life. As workers move to factories, the social fabric is torn apart. But that rending of life opens the door for a mobile workforce able to take advantage of new opportunities. Traditional life disappears; in its place stand the efficiencies of capitalism.
  • As the process matures, low wages rise -- producing simple products for the world market is not as profitable as producing more sophisticated products -- and the rate of growth slows down in favor of more predictable profits from more complex goods and services. All nations undergo this process, and China is no exception. This is always a dangerous time for a country. Japan handled it well. China has more complex challenges.
  • Low-wage countries seize the opportunity and climb upon the escalator of the international system, and with them come the political and business elite and the poor, for whom even the brutality of early industrialism is a relief.
  • In looking at this historically, two markers showed themselves. One is a historical first step: garment and footwear manufacturing, a highly competitive area that demands low wages but provides work opportunities that the population, particularly women, understand in principle. A second marker is mobile phone assembly, which requires a work force that can master relatively simple operations. Price matters greatly in this ruthlessly competitive market.
  • We were not looking for the kind of large-scale movements that would be noticed globally, but the first movements that appear to be successful. Where a handful of companies are successful, others will follow, so long as there is labor, some order and transportation.
  • Some things are not necessary or expected. The rule of law, understood in Anglo-Saxon terms of the written law, isn't there at this stage. Things are managed through custom and relationships with the elite. Partnerships are established. Frequently there is political uncertainty, and violence may have recently occurred. These are places that are at the beginning of their development cycle, and they may not develop successfully. Investors here are risk takers -- otherwise they wouldn't be here.
  • The Cultural Revolution had ended a few years before. It was a national upheaval of violence with few precedents. Mao Zedong died in 1976, and there had been an intense power struggle, with Deng Xiaoping consolidating power in 1977. China was politically unstable, had no clear legal system, sporadic violence and everything else that would make it appear economically hopeless. In fact, Egbert F. Dernberger and David Fasenfest of the University of Michigan wrote a paper for the Joint Economic Committee of Congress titled "China's Post-Mao Economic Future." In this paper, the authors state: "In the next seven years as a whole, the rate of industrial investment and production, more than the total of the last 28 years, imply a level of imports and industrial labor force such that the exports, transportation facilities, social overhead capital, energy and middle-level technical personnel requirements would exceed any realistic assessment of Chinese capabilities."
  • I don't mean to criticize the authors. This was the reasonable, conventional wisdom at the time. It assumed that the creation of infrastructure and a managerial class was the foundation of economic growth. In fact in China, it was the result of economic growth. The same can be said for rule of law, civil society, transparency and the other social infrastructure that emerges out of the social, financial and managerial chaos that a low-wage economy almost always manifests.
  • Low-wage societies develop these characteristics possibly out of the capital formation that low-wage exports generates. The virtues of advanced industrial society and the advantages of pre-industrial society don't coincide.
  • There is no single country that can replace China. Its size is staggering. That means that its successors will not be one country but several countries, most at roughly the same stage of development.
  • The point to emphasize is that identifying the PC16 is not a forecast. It is a list of countries in which we see significant movement of stage industries, particularly garment and footwear manufacturing and mobile phone assembly.
  • we have excluded countries growing because of energy and mineral extraction. These countries follow different paths of development. The PC16 are strictly successors to China as low wage, underdeveloped countries with opportunities to grow their manufacturing sectors dramatically.
  • When you look at map, much of this new activity is focused in the Indian Ocean Basin. The most interesting pattern is in the eastern edge of Sub-Saharan Africa: Tanzania, Kenya, Uganda and Ethiopia. Sri Lanka, Indonesia, Myanmar and Bangladesh are directly on the Indian Ocean.
  • A special word needs to be included on Mexico. The area north of Mexico City and south of the U.S. borderlands has been developing intensely in recent years. We normally would not include Mexico but the area in central-southern Mexico is large, populous and still relatively underdeveloped.
  • It is in this area, which includes the states of Campeche, Veracruz, Chiapas and Yucatan, where we see the type of low-end development that fits our criteria. Mexico's ability to develop its low-wage regions does not face the multitude of challenges China faces in doing the same with its interior.
  • All of this has to be placed in context. This is not the only growth process underway. It is most unlikely that all of these countries will succeed. They are not yet ready, with some exceptions, for advanced financial markets or quantitative modeling. They are entering into a process that has been underway in the world since the late 1700s: globalism and industrialism combined.
  • It can be an agonizing process and many have tried to stop it. They have failed not because of their respective ruling classes, which would have the most to lose. It doesn't take place because of multinational corporations. They come in later. It takes place because of profit-driven jobbers who know how to live with instability and corruption. It also takes place because of potential workers looking to escape their lives for what to them seems like a magnificent opportunity but for us seems unthinkable.
  • The parabola of economic development dictates that what has not yet risen will rise and eventually fall. The process unleashed in the Industrial Revolution does not seem to be stoppable. In our view, this is the next turning of the wheel.
  •  
    "China has become a metaphor. It represents a certain phase of economic development, which is driven by low wages, foreign appetite for investment and a chaotic and disorderly development, magnificent in scale but deeply flawed in many ways. Its magnificence spawned the flaws, and the flaws helped create the magnificence."
anonymous

Geopolitical Journey: The U.S.-European Relationship, Then and Now - 0 views

  • We have spoken of the Russians, but for all the flash in their Syria performance, they are economically and militarily weak -- something they would change if they had the means to do so. It is Europe, taken as a whole, that is the competitor for the United States. Its economy is still slightly larger than the United States', and its military is weak, though unlike Russia this is partly by design.
  • American intervention helped win World War I, and American involvement in Europe during World War II helped ensure an allied victory. The Cold War was a transatlantic enterprise, resulting in the withdrawal of Soviet forces from the European Peninsula.
  • The question now is: What will the relationship be between these two great economic entities, which together account for roughly 50 percent of the world's gross domestic product, in the 21st century? That question towers over all others globally.
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  • The Syrian crisis began not with the United States claiming that action must be taken against al Assad's use of chemical weapons but with calls to arms from the United Kingdom, France and Turkey.
  • The United States was rather reluctant, but ultimately it joined these and several other European countries. Only then did the Europeans' opinions diverge.
  • Most important to note was the division of Europe. Each country crafted its own response -- or lack of response -- to the Syrian crisis. The most interesting position was taken by Germany, which was unwilling to participate and until quite late unwilling to endorse participation.
  • Their differences have not manifested as virulently as they did before 1945, but still, it can no longer be said that their foreign policies are synchronized. In fact, the three major powers on the European Peninsula currently are pursuing very different foreign policies.
  • Nothing has ruptured in Europe, but then Europe as a concept has always been fluid. The European Union is a free trade zone that excludes some European countries. It is a monetary union that excludes some members of the free trade zone. It has a parliament but leaves defense and foreign policy prerogatives to sovereign nation-states. It has not become more organized since 1945; in some fundamental ways, it has become less organized.
  • Where previously there were only geographical divisions, now there are also conceptual divisions.
  • no individual European nation has the ability by itself to conduct an air attack on Syria. As Libya showed, France and Italy could not execute a sustained air campaign. They needed the United States.
  • I am old enough to remember that Europeans have always thought of U.S. presidents as either naive, as they did with Jimmy Carter, or as cowboys, as they did with Lyndon Johnson, and held them in contempt in either case.
  • After some irrational exuberance from the European left, Obama has now been deemed naive, just as George W. Bush was deemed a cowboy.
  • Amid profound differences and distrust, U.S. and Soviet leaders managed to avoid the worst. Given their track record, Europe's leaders might have plunged the world further into disaster.
  • The Europeans think well of the sophistication of their diplomacy. I have never understood why they feel that way.
  • We saw this in Syria.
  • First, Europe was all over the place. Then the coalition that coaxed the Americans in fell apart, leaving the United States virtually alone. When Obama went back to his original position, they decided that he had been outfoxed by the Russians. Had he attacked, he would have been dismissed as another cowboy.
  • Whichever way it had gone, and whatever role Europe played in it, it would have been the Americans that simply didn't understand one thing or another.
  • The American view of Europe is a combination of indifference and bafflement. Europe has not mattered all that much to the United States since the end of the Cold War.
  • all of Europe became Scandinavia. It was quite prosperous, a pleasure to visit, but not the place in which history was being made.
  • When Americans can be bothered to think of Europe, they think of it as a continent with strong opinions of what others should do but with little inclination to do something itself.
  • The American perception of Europe is that it is unhelpful and irritating but ultimately weak and therefore harmless.
  • The Europeans are obsessed with the U.S. president because, fool or cowboy or both, he is extraordinarily powerful. The Americans are indifferent to the Europeans not because they don't have sophisticated leaders but because ultimately their policies matter more to each other than they do to the United States.
  • But the most profound rift between the Americans and Europeans, however, is not perception or attitude. It is the notion of singularity, and many of the strange impressions or profound indifferences between the two stem from this notion.
  • The dialogue between Europe and the United States is a dialogue between a single entity and the tower of Babel.
  • For example, a friend pointed out that he spoke four languages but Americans seem unable to learn one. I pointed out that if he took a weekend trip he would need to speak four languages. Citizens of the United States don't need to learn four languages to drive 3,000 miles.
    • anonymous
       
      This is an absolutely crucial point and another reason why geography is a very powerful - and perplexingly invisible - determiner of action.
  • The United States is a unified country with unified economic, foreign and defense policies. Europe never fully came together; in fact, for the past five years it has been disintegrating.
  • Division, as well as a fascinating pride in that division, is one of Europe's defining characteristics. Unity, as well as fascinating convictions that everything is coming apart, is one of the United States' defining characteristics.
  • Europe's past is magnificent, and its magnificence can be seen on the streets of any European capital. Its past haunts and frightens it. Its future is not defined, but its present is characterized by a denial and a distance from its past. U.S. history is much shallower. Americans build shopping malls on top of hallowed battlefields and tear down buildings after 20 years. The United States is a country of amnesia. It is obsessed with its future, and Europe is paralyzed by its past. 
  • Where once we made wars together, we now take vacations. It is hard to build a Syria policy on that framework, let alone a North Atlantic strategy.
  •  
    "Most discussions I've had in my travels concern U.S. President Barack Obama's failure to move decisively against Syria and how Russian President Vladimir Putin outmatched him. Of course, the Syrian intervention had many aspects, and one of the most important ones, which was not fully examined, was what it told us about the state of U.S.-European relations and of relations among European countries. This is perhaps the most important question on the table."
anonymous

Borderlands: The View Beyond Ukraine - 0 views

  • from Poland to Azerbaijan, I heard two questions: Are the Russians on the move? And what can these countries do to protect themselves?
  • Moscow is anxious too, and some Russians I spoke to expressed this quite openly. From the Russian point of view, the Europeans and Americans did the one thing they knew Moscow could not live with: They installed a pro-Western government in Kiev.
  • A pro-Western government now controls Ukraine, and if that control holds, the Russian Federation is in danger.
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  • When the Russians look at a map, this is what they see: The Baltic states are in NATO and Ukraine has aligned with the West.
  • The anti-Western government in Belarus is at risk, and were Minsk to change its loyalties, Russia's potential enemies will have penetrated almost as deeply toward the Russian core as the Nazis did. This is a comparison I heard Russians make several times.
  • For them, the Great Patriotic War (World War II), which left more than 20 million Soviet dead, is a vivid, living memory, and so is Hitler's treachery. Russians are not a trusting people and have no reason to be. The same is true of the Central Europeans, the Turks and the Caucasians. Nothing in their past permits them the luxury of assuming the best about anyone.
  • In recent weeks, three things have become obvious.
  • The first is that the Russians will not invade Ukraine directly.
  • Equally clear is that no European power can defend the line running from Poland to Romania with the decisive force needed to repel a Russian attack -- or even support these countries against Russian pressure and potential subversion.
  • Berlin does not want another Cold War. Germany depends on Russian energy and ultimately is satisfied with the status quo. The rest of Europe cannot intervene decisively.
  • Finally, this means that any support to Europe's eastern flank must come from the United States.
  • Washington is not ready to outline the nature and extent of its support, and from the American point of view, so long as the Russians are focused on Ukraine, there is still time to do so.
  • The primary concern for the United States would logically be Poland, the most vulnerable country on the North European Plain.
  • we see the United States beginning to adopt a Black Sea strategy centered on Romania.
  • Put simply, a competent rival Black Sea fleet would create problems for Russia, particularly if the Ukrainian regime survives and Crimea is isolated.
  • It is important to note the extensive diplomacy ongoing between the United States and Turkey
  • What we are seeing is regional players toying with new alliance structures. The process is in its infancy, but it is already forcing the Russians to consider their future.
  • An added dimension to this is of course energy. The Russians would appear to have the advantage here: Many of the nations that fear Moscow also depend on it for natural gas.
  • Natural gas is a powerful lever, but it is not particularly profitable.
  • Deployment of military force, while necessary, is therefore not the core element of the developing Western strategy.
  • Rather, the key move is to take steps to flood the world market with oil -- even knowing that implementing this strategy is extremely difficult.
  • It will be years before these and other alternative sources of energy come online -- indeed, some may never be available -- and there are many constraints, especially in the short term.
  • U.S. companies and oil-producing allies who depend on high oil prices would suffer alongside Russia -- an expensive collateral to this policy. But the game here is geopolitical futures.
  • For the United States, the game is not to massively arm Poland, build a Romanian navy or transform the world oil markets. It is simpler than that: Washington wants to show that it is ready to do these things.
  • Such a show of will forces the Russians to recalculate their position
  • The future for Russia becomes the one thing no nation wants: uncertain.
  • Russia now has two choices.
  • The first is to destabilize Ukraine. Success is uncertain, and Moscow cannot predict the U.S. response.
  • The fallback for Russia is to neutralize Ukraine.
  • Russia would leave the current government in place so long as Kiev pledges not to join Western-led multinational structures
  • The Western strategy is to create a credible threat to fundamental Russian interests.
  • From the U.S. point of view, a Western-oriented but neutral Ukraine would create a buffer zone without forcing a confrontation with Russia.
  •  
    "I traveled between Poland and Azerbaijan during a rare period when the forces that shape Europe appear to be in flux, and most of the countries I visited are re-evaluating their positions. The overwhelming sense was anxiety. Observers from countries such as Poland make little effort to hide it. Those from places such as Turkey, which is larger and not directly in the line of fire, look at Ukraine as an undercurrent rather than the dominant theme. But from Poland to Azerbaijan, I heard two questions: Are the Russians on the move? And what can these countries do to protect themselves?"
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