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Brave New World: the Emerging Balance, Pluralities, & Non-zero Sums

While international affairs are full of sudden crisis even they emerge from clear trends and always based on deeper structural characteristics. Like understanding how the great currents of the ocean move around the world and inter-act with the global environment grasping the future must be, and can be, based on understanding the structure, trends and dynamics of the world socionomic system. Which is under-going a radical shift in response to pressures that have accumulated over the last three decades and will take another three to work out; and which will be subject to enormous soci-demographic, ecological and economic strains in that period. To survive and prosper the global system requires an evolved institutional framework, which necessarily rests on the support of force but also requires a balance of smart-power instruments, and appropriate participation and contribution relative to benefits by each major stakeholder. But that evolution holds out the promise of the greatest increase in human welfare and well-being in human history if we keep the wheels on the wagon. The central debate will be between foreign and economic policies of mercantilism, "beggar-thy-neighbor" which views the world as a zero-sum gain where your losses are my gains. Or a world of free exchange, cooperation and collaboration which is decidedly non-zero sum where statesmen, not politicians, realize that the pie of world wealth can be grown enormously even if they end up with a smaller share. In all of this the US will remain the indispensable nation thru at least the rest of this century because of it's geography, resources, human capital and resilient institutions. Indispensable doesn't mean dominance though, it means major stakeholder, direction-setter and major player. We have to be prepared to see other powers take their rightful places at the table based on their interests. In both cases though the future is dependent on whether our collective leadership understands that those interests include the stability, peace, progress and prosperity of the system as a whole. As late as post-WW2 European nations were still pursuing traditional maneuvers of the old school which threatened to collapse Europe into chaos and were saved by the intervention of the US thru the Marshall Plan. The US acted partly out of altruism with many domestic political challenges and barriers and partly out of deep-seated self-interest. Now our bright new future can result from the balanced pursuit of balanced strategic self-interest by the emerging and existing stakeholders. Such a future will require major domestic shifts as well by all parties as well as the emergence of a new pluralistic world order. Those are the lessons we draw in this, the last in a series of posts, on the state of the world. Call it the "New Realism" or the pragmatics of knowledgeable self-interest and check out Leslie Gelb's CSpan interview to get a flavor.

Re-thinking US Policy, Power and Instruments

There are a lot of mis-conceptions running around about the relative position of the US in the current and future world from social to political to economic to military. By way of disabusing some of those, it not all - which we've been addressing piecemeal in the previous posts on this subject, we borrow from StrategyPage.com to show the relative position of the USN vs the rest of the world's naval powers. A similar graphic on world military power in toto is here. As the Somali pirates just learned the USN has a long-arm. In fact the world's sea lanes are more under the control of the USN than ever the Mare Nostrum was of the Roman Navy in it's heyday. But in both cases the result was and is safety, security and predictability for world trade...with all the resulting benefits for everybody. Those relative positions are not just unlikely but nearly impossible to change in five decades...and as long as the US continues to act as the guarantor of the trade lanes no one has the incentive, let alone the resources. Navies are beyond expensive but they can make for a peaceful world. But the nature and structure of all instruments of national power, hard and soft, will need to be adapted, radically, to this new world. In in less than a 100 days the new Administration has put down more markers in the right directions than at any time in the last 30, perhaps 60+, years ! Presuming balanced good judgment manages to triumph over partisan self-interest here's our summary of the state of things:

  1. We're ten years into a multi-decade adjustment and adaptation process that represents a historical re-balancing (more akin to the world of 1300 or 1800 than anything seen in a long-time).
  2. Historic because the dynamic, thrusting and resilient institutions of a pluralistic and aggressive Western Europe created a set of societies that were competitive, aggressive and innovative. In the last 2-3 decades the rest of the world has begun adopting and adapting those to it's own circumstances
  3. This adaptation will go on for next 30 with timetable driven by population growth and it's already locked in leveling off combined with numbers of resource barriers (water, air, oil, etc.).
  4. THE key is a new world system architecture that adapts the existing one - the best in history but aging - to new major players and new challenges.
  5. Early signs are somewhat encouraging: Davos09 + stakeholder responsibility by China, India, et.al. Russia not a major player over this horizon because of institutional failures, demographics and likely implosion. Europe will remain a player but needs to get it's act together while Latin America and Africa are beginning the transitions.
  6. Critical factor is resilience of domestic institutions in each major stakeholder which are badly strained by current crisis and were in many cases reaching thresholds of disruption in any case; as a trigger for change this crisis may in fact be all to the good before the "REAL" problems hit !
  7. US has best combination of geo-political position, innate resources and capabilities (pop, ed., size, resource base) and adaptive and inclusive institutions that are pro-growth.
  8. Bottomline therefore is stability and evolution of domestic institutions in world's players, particular the major potential stakeholders
  9. ...which therefore becomes a vital national interest of the US
  10. ...and makes it a vital interest that the US continue to support the evolution of a new world institutional framework while continuing to play a role in the development of each country, region and geography as constructively as we can manage.

 Re-balancing the World: Zheng He's Treasure Fleets

Between 1405 and 1433 the Ming Emperor Yongle (a reign name) sponsored a series of seven huge exploratory and political voyages by the eunuch and fleet admiral Zheng He with fleets of hundreds of ships and thousands of men. While the exact dimensions of the major Treasure Ships are in some debate there's no question that the West didn't build their like until the late 19thC. This wasn't all a matter of a show of face - these voyages not only over-awed the local potentates with the power and capabilities of China but created secure and stable trade lanes that saw a huge upsurge in trade and prosperity in the Indian Ocean and China Sea. A soft infrastructure that the later Europeans (primarily the Portuguese and then the Dutch) inherited and exploited. The European "Age of Discovery" was in fact heavily dependent on the Chinese fleet's history. Semi-fortunately the eunuch's clique lost power and influence at court while the traditional Mandarinate was restored and re-emphasized more internal concerns. Given the major projects from re-building Peking/Beijing to expeditions into nomad lands to restoring the Great Wall and the Great Canal they may in fact have made rational decisions about resource allocation trade-offs; after all nobody mounts five Apollo Programs at the same time ! When Columbus went to the New World his flagship could have been a tender for one of the Treasure Ships; no wonder the locals were impressed. Those ships were the end state of almost 400 years of Chinese development in marine engineering and naval operations that really got started under the Song. (When China Ruled the Seas: The Treasure Fleet of the Dragon Throne, 1405-1433 by Louise Levathes ) China, India and the rest have acquired or are acquiring the knowledge and skills they need to return to positions of prominence. Now we'll see if they're up to it.

R X P X H X C X I = Power: Exchange and Welfare

When tiny little Holland held off the world's mightiest empire in the 16th and 17thC for 80 years it did so because of it's institutional advantages, manufacturing and trade. Power is NOT simply counting heads or rocks though Population and Resources are critical elements. Equally important are Human Capital (the education and attitudes of that population), financial resources (which in turn are created by Capital markets) and Institutions. The difference between the decline of Spain and France and the rise of Holland and England lay, ultimately, the differences between their institutions. One was centralized, rigid and subject to political gamesmanship while the other was open-ended, competitive and pluralistic while providing secure foundations of the rule of law, security of property, non-arbitrary justice and some (relatively speaking) opportunity for any person to better themselves. [For a graphic comparing the modern powers of Europe] When you enlist the interests of the populace in getting ahead AND they understand and believe that the State is the best guarantor of those opportunities you have cracked the code for sustainable progress. That progress depends on and is driven by the gains from free exchange, in the proper institutional framework. [Structure and Change in Economic History by Douglass C. North, The Rise of the Western World: A New Economic History]

Consider two villages who grow corn (C) using Hoes (H). Their total output is limited by land, water and heads. But supposed one village is closer to the river with rich lands while the other is closer to the mountains with ready access to the flint for Hoe heads and wood for handles. BOTH can raise their individual outputs by focusing on what they do best. Seem fanciful and simplistic ? Well consider why Chicago specialized in meat-packing and grain trading while NYC focused on trade and finance and LA on making movies and planes. Each could have done each but they were all better off collectively and individually by letting the other do what they were best at. Nor does it stop there - supposed the Mountain Village finds a source of clay for Pottery (P) which allows corn to be stored better and more water to be carried for growing it. Re-investing some of the surplus in new capabilities means that innovation grows both economies yet again. And it doesn't end there - we face another cusp point in the world situation where protectionism reduces the benefits for all, where we keep trading but have limited innovation or where we really hit the jackpot and not only grow the world's economies thru open-exchange but increase the rate of growth thru innovation. To do that of course means investing in Education, Healthcare, new technologies (Green anyone) to adapt our Human Capital to the challenges. The shape of the world to come is being defined around us as we sit here and it can go many different directions.

Rising to the Challenges

So far it appears to be moving in the right ones. Now it's up to us to keep it so.

This post is the capstone of our survey of the state-of-the-world and the fourth major one we've done. Those prior posts are listed in the readings sections along with selections on the radical changes back to realistic pragmatism by the US, representative cases (Mexico & Drugs, the Pakitani near-death implosion, & African futures) along with some readings on the challenges to the world system. The various titles along are revealing IOHO but if you check back for compare and constrast we've moved from a world of challenges and no response to one of bigger challenges and greater responses. Actually that's encouraging in our book, even if we wished the motivation had been cheaper !

The Emerging US Foreign Policy Grand Strategy

Let him who desires peace prepare for war

Flavius Renatus The third contains a series of military maxims, which were (rightly enough, considering the similarity in the military conditions of the two ages) the foundation of military learning for every European commander from William the Silent to Frederick the Great.

US National Security Policy Videos

A conversation with Adm. Mike Mullen, JCS Chairman (an hour-long interview which covers US National Security strategy and doctrine in general, focuses on Pakistan and Afghanistan in particular, touches on other topics, e.g. Mexico and outlines the key commitments to integrated national power that balances hard and soft-components. If you want to understand where the US is going with regard to the rest of the world here it is in a nutshell)

President Obama Dedicates Lincoln Hall at NDU (this is a short 20 min. but it lays out the core of the evolving US strategic doctrine, which is in turn the Gates Doctrine. As important as the substance is the w arm reception and relationship with the military that is shown here. This is NOT the disdain given to Clinton nor the distrust the Bush ended up with).

Secretary of Defense Robert Gates on the 2008 National Defense Strategy Secretary of Defense Robert Gates speaks to students at the National Defense University, as part of the university’s Distinguished Lecture Program. During his remarks, Sec. Gates discusses the 2008 National Defense Strategy. This is the more detailed foundations of the Strategy that underpins Mullen’s and Obama’s remarks.

A Bushian Foreign Policy President Obama's foreign policy team has been working hard to present its policies to the world as constituting a radical break from the Bush years. In the broadest sense, this has been absurdly easy: Obama had the world at hello. When it comes to actual policies, however, selling the pretense of radical change has required some sleight of hand -- and a helpful press corps. Thus the New York Times reports a dramatic "shift" in China policy to "rigorous and persistent engagement," as if the previous two administrations had been doing something else for the past decade and a half. Another Times headline trumpeted a new "softer tone on North Korea," based on Secretary of State Hillary Clinton's suggestion that the United States would have a "great openness to working with" Pyongyang -- as soon as it agrees to "verifiable and complete dismantling and denuclearization." Startling. So, too, the administration's insistence on linking proposed missile defense installations in Europe to the "threat" posed by Iran, or its offer to negotiate Russia's acquiescence to this plan and even to share missile defense technology. All this is widely celebrated as new. But Defense Secretary Robert Gates began these negotiations with Moscow more than a year ago. On Iran, the emphasis on carrots, in the form of a global political and economic embrace if Tehran stops pursuing nuclear weapons, and sticks, in the form of international sanctions and isolation if it doesn't, is not exactly novel. Add to this the administration's justifiable hesitancy, campaign rhetoric notwithstanding, to jump into direct, high-level negotiations but to focus instead on mid-level contacts or multilateral meetings on other subjects such as Afghanistan and Iraq, and it's no surprise if Iranian officials wonder what's the big deal. This is all to the good. So far, President Obama has made generally sound decisions on Afghanistan, Iraq, missile defense and Iran. Along with the language of unclenched fists and reset buttons, the basic goals and premises of U.S. policy have not shifted. If the world views this as a revolution, so much the better. Whatever works.

The Return of Statecraft  Vast multinational conferences, like the G20 summit in London, are useful mainly for the "bilaterals"—the one-on-one side-room conversations—and, in these forums, President Barack Obama is living up to high expectations. Which is to say, the United States seems to be returning to diplomatic basics—a development that in the wake of the last eight years is practically revolutionary. Take Obama's meeting on April 1 with Russian President Dmitry Medvedev, which produced an unusually substantive 19-paragraph joint statement laying out a broad but specific agenda—all stemming from a cleareyed, even somewhat steely grasp of what international relations are all about. "What I believe we began today," Obama said at a joint press conference afterward, "is a very constructive dialogue that will allow us to work on issues of mutual interest." The italics are mine, but a "senior administration official" also drew attention to the phrase in a background press briefing and contrasted the approach with George W. Bush's first meeting with a Russian president, after which he proclaimed that he'd looked into Vladimir Putin's eyes and seen his soul. The Medvedev meeting, then, marked the occasion when Obama officially pushed that "reset button." The move was recognized as such by Russian Foreign Minister Sergei Lavrov, who noted a "new atmosphere of trust," stemming not just from personal camaraderie—which, he said, creates only "the illusion of good relations"—but from recognition of "mutual interests" and a "readiness to listen to each other." Lavrov added, "We missed this much in the past years."

Gates readies big cuts in weapons As the Bush administration was drawing to a close, Robert M. Gates, whose two years as defense secretary had been devoted to wars in Iraq and Afghanistan, felt compelled to warn his successor of a crisis closer to home. The United States "cannot expect to eliminate national security risks through higher defense budgets, to do everything and buy everything," Gates said. The next defense secretary, he warned, would have to eliminate some costly hardware and invest in new tools for fighting insurgents. What Gates didn't know was that he would be that successor. Now, as the only Bush Cabinet member to remain under President Obama, Gates is preparing the most far-reaching changes in the Pentagon's weapons portfolio since the end of the Cold War, according to aides. Two defense officials who were not authorized to speak publicly said Gates will announce up to a half-dozen major weapons cancellations later this month. Candidates include a new Navy destroyer, the Air Force's F-22 fighter jet, and Army ground-combat vehicles, the offi cials said. More cuts are planned for later this year after a review that could lead to reductions in programs such as aircraft carriers and nuclear arms, the officials said. As a former CIA director with strong Republican credentials, Gates is prepared to use his credibility to help Obama overcome the expected outcry from conservatives. And after a lifetime in the national security arena, working in eight administrations, the 65-year-old Gates is also ready to counter the defense companies and throngs of retired generals and other lobbyists who are gearing up to protect their pet projects. One aide who has traveled with Gates more than a dozen times said the secretary "is particularly keen and aware of the urgent operational needs on the ground." That likely means greater investments in intelligence-gathering systems such as pilotless drone aircraft, special-operations forces and equipment, and advanced cultural training for military personnel, aides said. Girding for a showdown with Congress, Gates took the unusual step of making the Joint Chiefs of Staff and other participants in budget deliberations sign nondisclosure agreements to prevent leaks. But already lawmakers and defense contractors are preparing to fight back. Lockheed, maker of the F-22 jet, recently launched an ad campaign to protect its fighter. Northrop Grumman, which could face cutbacks to its ship-building programs, has hired consultants to write op-eds. Unions are raising alarms about job losses. Even his closest friends acknowledge Gates is in the bureacratic fight of his life.

INTELLIGENCE: Spies From The Heartland Carry The Weight The CIA has found that it has a lot of potential recruits across American, especially away from the northeast and the west coast urban areas. That was discovered after September 11, 2001, as the CIA has undertook a massive recruiting program (of analysts and field operators), and the introduced lots of new technology (especially for the analysts) and techniques. All this was largely the result of the CIA being put into a sort of semi-hibernation in the late 1970s. This was an aftereffect of the Church Committee, an investigative operation sponsored by Congress, that sought to reform, and punish, the CIA. But after September 11, 2001, the CIA was tossed a huge pile of money and told to staff up and get going and save us all from the Islamic terrorists. The Church Committee restrictions were largely, if not completely, discarded. Recruiting efforts were greatly expanded, and since September 11, 2001, several hundred thousand applications were received. The agency has had a hard time keeping up with that. This created some interesting personnel problems, especially in the operations division (the people who go to foreign countries and, well, sometimes do James Bond stuff.) There were few people left in the agency that remembered how to do field ops the old school way. By late 2001, many of recently retired field ops guys were being lured back to active duty. You now had a situation where the field ops population is like a cross between a college fraternity and retirement community. There are few people in the middle, age and experience wise. It was almost as bad in the analysis division (where the data is studied and reports prepared.) The area of the CIA that has flourished in the last three decades has been the geek side of things. These folks were always flush, thanks to a Congress that felt safer with spy satellites, than with spies on the ground. But those days were over. But now Congress is resuming the cycle all over again. The CIA is being investigated for doing what was desperately demanded of it after September 11, 2001. Proposed new restrictions would outlaw things like the use of contractors for interrogations (even if there were no other source of manpower to do the job in time), the use of "vigorous interrogation", the detention of foreigners without giving them access to the U.S. criminal justice system, and many more items that most CIA officials know, from their own experience, will only get Americans killed. They know that because they paid attention to what the Church Committee restrictions did to degrade U.S. intelligence gathering capabilities. Thus the thousands of new people hired into the CIA since September 11, 2001, will be, for the foreseeable future, the only ones with practical experience in effective espionage. Congress wants new hires to stay away from anything that is unpleasant or potentially embarrassing.

Cases and Situations

Drugs, Guns and a Reality Check It's an indictment of our fact-averse political culture that a statement of the blindingly obvious could sound so revolutionary. "Our insatiable demand for illegal drugs fuels the drug trade," Secretary of State Hillary Clinton told reporters on her plane Wednesday as she flew to Mexico for an official visit. "Our inability to prevent weapons from being illegally smuggled across the border . . . causes the deaths of police, of soldiers and civilians." Amazingly, U.S. officials have avoided facing these facts for decades. This is not just an intellectual blind spot but a moral failure, one that has had horrific consequences for Mexico, Colombia, Peru, Bolivia and other Latin American and Caribbean nations. Clinton deserves high praise for acknowledging that the United States bears "shared responsibility" for the drug-fueled violence sweeping Mexico, which has claimed more than 7,000 lives since the beginning of 2008. But that means we will also share responsibility for the next 7,000 killings as well. Our long-running "war on drugs," focusing on the supply side of the equation, has been an utter disaster. Domestically, we've locked up hundreds of thousands of street-level dealers, some of whom genuinely deserve to be in prison and some of whom don't. It made no difference. According to a 2007 University of Michigan study, 84 percent of high school seniors nationwide said they could obtain marijuana "fairly easily" or "very easily." The figure for amphetamines was 50 percent; for cocaine, 47 percent; for heroin, 30 percent. At the same time, we've persisted in a Sisyphean attempt to cut off the drug supply at or near the source.

Pakistan Dodges A Bullet A month ago, Pakistan came close to a political breakdown that could have triggered a military coup. How that crisis developed -- and how it was ultimately defused -- illuminates the larger story of a country whose frontier region President Obama recently described as "the most dangerous place in the world." A detailed account of the March political confrontation emerged last week during a visit to Islamabad by Ambassador Richard Holbrooke and Adm. Mike Mullen. As described by U.S. and Pakistani officials, it's a story of political brinkmanship and, ultimately, of a settlement brokered by the Obama administration. At stake was the survival of Pakistani democracy. Allies of President Asif Ali Zardari attempted to cripple his political rival, former prime minister Nawaz Sharif. The opposition leader took to the streets in response, joining a "long march" to Islamabad to demand the reinstatement of Pakistan's deposed chief justice, Iftikhar Chaudhry. The march threatened a violent street battle that could have forced Gen. Ashfaq Kiyani, the army chief of staff, to intervene. The confrontation demonstrated the fragility of Pakistani politics. But it also showed that after some initial mistakes, the three key players -- Zardari, Sharif and Kiyani -- were able to defuse the crisis. The lesson for nervous Pakistan-watchers is that however enfeebled the country's elite may be, it isn't suicidal. Pressure for compromise came from Clinton and Holbrooke, in phone calls to Zardari and Sharif. According to Pakistani sources, the American officials signaled to Sharif that they wouldn't object to his becoming president or prime minister some day. Another key intermediary was David Miliband, the British foreign secretary, who urged dialogue with Sharif. Last week's visit by Holbrooke and Mullen reinforced the deal. They saw the key players and came away hoping that the three could form a united front against the Taliban insurgency in the western frontier areas, rather than continuing their political squabbling. Husain Haqqani, Pakistan's ambassador to Washington, praised Holbrooke's diplomacy. "He brings hope that complex problems will be resolved." On the political scorecard, Zardari came out a loser and Sharif and Gillani as winners. But the decisive actor was Kiyani, who managed to defuse the crisis without bringing the army into the streets.

Africa: Open for Business Africa is becoming a business destination. In 2006, according to the Organization for Economic Cooperation and Development, foreign investment in Africa reached $48 billion, overtaking foreign aid for the first time. That gap has only widened, reflecting a quadrupling of foreign investment since 2000. As the senior adviser in Africa for the International Monetary Fund (IMF), David Nellor, noted in a report last September, sub-Saharan Africa today resembles Asia in the 1980s. "The private sector is the key driver," wrote Nellor, "and financial markets are opening up." War is down. Democracy is up. Inflation and interest rates are in single digits. Terms of trade have improved. Crucially, said Nellor, "growth is taking off." The IMF puts Africa's average annual growth for 2004 to '08 at more than 6% — better than any developed economy — and predicts the continent will buck the global recessionary trend to grow nearly 3.3% this year. Yes, Africa is still a continent of commodities — with its forests, oil fields and mines — and demand for commodities has plummeted. Yes, Africa still has its Darfurs, Somalias, Congos and Zimbabwes. But commodity prices are higher than they were in the 1990s. Most Africans are not middle class, but most also no longer live in extreme poverty. The World Bank says the percentage of Africans living on $1.25 a day or less dropped from 59% to 51% from 1996 to 2005 and has decreased further since. Perhaps the most compelling evidence that Africa is now a business destination is China's new love for it. While the old superpowers still agonize over Africa's poverty, the new one is captivated by its riches. Trade between Africa and China has grown an average of 30% in the past decade, topping $106 billion last year. Chinese engineers are at work across the continent, mining copper in Zambia and cobalt in the Democratic Republic of Congo and tapping oil in Angola. Nor is this merely exploitative. China bought its access by agreeing to create a new infrastructure for Africa, building roads, railways, hospitals and schools across the continent. The current crisis is not expected to affect China's march in Africa: on the contrary, with the West's plans in Africa on hold at best, Beijing views it as an opportunity to extend China's lead.

Zero- vs None-Zero Sum: Challenges for the World

America's Way on Trial The Ugly American is no longer an uncaring bureaucrat or soldier posted to Southeast Asia, but a greedy financier on Wall Street selling unsecured securities to gullible foreigners and Americans alike. The G-20 gathering is the first important international test of Obama's considerable leadership and communication skills. He will need all those talents to prevent the summit from becoming a mock trial of America's recent alleged financial crimes and selfishness, and of "Anglo-American capitalism" itself. It is important to understand the case for the prosecution, even -- perhaps especially -- for those who do not accept it. Americans are much less sensitive than are foreigners to the preeminent role of the dollar in global power politics as well as commerce. As Charles de Gaulle argued in the 1960s (to the outrage of Lyndon Johnson), the original Bretton Woods system enabled Washington to ignore the international monetary discipline it enforced on the currencies of others. The United States could finance budget deficits at home -- and its wars abroad -- on the backs of foreign nations. The French have never abandoned that analysis, even if it waxed and waned as global fortunes shifted. President Nicolas Sarkozy renewed that approach last year by calling for greater international supervision of financial markets and the global exchange-rate system. This month, the European Union endorsed the Sarkozy line by agreeing to emphasize regulation at the summit -- even though Obama wanted the G-20 to focus on new stimulus spending by others to match the United States and Britain. The two camps have in fact patched together an agreement for the summit to highlight the need for more stimulus by some and more financial regulation by all, French Prime Minister François Fillon indicated during a visit to Washington's Carnegie Endowment last week. But the "global New Deal" compromise will actually rise or fall on details still to be settled. The United States is fine with more national regulation -- see the latest Wall Street oversight plan offered by the administration's Inspector Gadget, Treasury Secretary Tim Geithner. But Washington balks at surrendering real power over its economic life to international bodies it does not control. So do other nations. France and Britain talk eloquently about the need to make the IMF and other international financial bodies more democratic. Yet they don't offer to give up their vetoes in the U.N. Security Council to jump-start global institutional reform. Russia champions self-determination until it comes to countries that do not submit to the Kremlin's plans for a Euro-Asian pipeline and energy monopoly. Egypt, Libya and other Arab chauvinist regimes mouth off about double standards and then flock to praise and protect Omar Hassan al-Bashir, Sudan's president and indicted war criminal, and cover his back in Darfur. The G-20 leaders must avoid turning the London summit into a high-level hunt for scapegoats. This crisis is a collective failure of the world's established and rising powers. The United States should acknowledge any responsibility that its excesses and its beloved greenback bear for this mess. But other nations that demand new power must also show they are ready to exercise it responsibly before a meaningful reform of international institutions can begin.

No Givens as Obama Takes World Stage After 69 days in which international issues have taken a back seat to attempts to rescue the economy at home, President Obama takes the world stage this week as a wildly popular figure among the people of Europe, but one who faces a difficult task in selling his plans to the continent's leaders. The president plans to push for a new approach to the war in Afghanistan, aggressive action to stop the proliferation of weapons and a more united European effort to combat the global recession. But if the U.S. president thought his popularity would cause foreign governments to fall quickly into line behind a new American leadership, experts warn, he could be in for a rude awakening. The German government has resisted calls to deploy more combat troops to Afghanistan. Russia is pushing back against a NATO missile defense system in Poland. And the Czech prime minister last week described the U.S. plans for global economic recovery as the "road to hell."  On Saturday, the White House made clear that it is not trying to dictate spending in European capitals to revive the economy, after facing strong resistance from France, Germany and other nations. "The notion that Europe is going to rally around this administration is being exploded," said Nile Gardiner, director of the Margaret Thatcher Center for Freedom at the Heritage Foundation. Gardiner predicted "a rapturous welcome" for Obama from the European public but said that "when it gets down to the discussions . . . there are going to be very tense discussions."

Anglo-American Capitalism on Trial Sitting in a gilded upper room at 10 Downing Street last week listening to Prime Minister Gordon Brown outline his ambitions for reforming the world economy had something of an out-of-this-world feeling. With Mr. Brown seated beneath a 16th-century oil painting of Queen Elizabeth I, it was tempting to imagine for a moment that Britain was again rising grandly to the challenges of the age, in the way of Good Queen Bess. The occasion was a briefing for reporters on the Group of 20 summit meeting to be held Thursday at a conference center in the London docklands, close to the historic City of London, Britain’s financial hub. Mr. Brown was intense, and prolific with facts. He was also visibly exhausted, hours before leaving on a five-day, 20,000-mile trip to Europe, the United States and Latin America before the conference. The event for which he was preparing is as weighty as any London has hosted in decades. It will be attended by President Obama and the leaders of 21 other nations, including Europe’s wealthiest countries and Russia, China, and India. Organizers say that those attending generate 80 percent of the world’s wealth, making the gathering a potential powerhouse for global reform. The meeting is too short — a single day — to make more than a start on fixing the weaknesses in the international financial system that contributed to the current crisis. But it will help determine the extent to which the economic model shaped largely by Britain and America after World War II — call it Anglo-American capitalism — survives as the touchstone for economic growth worldwide. Now, the conviction that the system must be rebuilt to curb future excesses forms a starting point for the reforms that will come under discussion in London. Like Mr. Brown’s, President Obama’s message to his own compatriots has focused on ways of revitalizing the system, often to the exasperation of those among their supporters who would favor more radical measures. Even as both men have embarked on enormous increases in public-sector spending, they have maintained that solutions to the crisis lie in reawakening the markets and recapitalizing the banks, rather than having the government take them over, and in placing financial institutions under closer supervision rather than tearing at the system’s foundations. And both, when they respond to public anger at the private sector, have seemed more geared to managing that anger than stoking it. Now, a wave of voices around the world would like a new Big Bang to sweep away the Bretton Woods template and the era of Anglo-American dominance it ushered in. Prime Minister Vladimir Putin of Russia has suggested as much, to nobody’s great surprise, and even France’s otherwise pro-American president, Nicolas Sarkozy, has said the “Anglo-Saxon” presumption of dominance should be abandoned. Against this background, what the British and American leaders will be attempting at the G-20 conference, along with their partners from around the world, will be to begin building a new global financial system that curbs the rampant and often conscienceless free-marketeering of the past 20 years with a new sense of accountability and restraint, but without extinguishing the spirit of enterprise that arrived in America with the Pilgrims who landed at Plymouth Rock. It is a task some have likened to rebuilding an aircraft in midflight, and on its success may depend the future well-being of much of the world’s population of 6.5 billion, not to mention the fragile political prospects of Mr. Brown.

News Analysis - Hints of Obama’s Strategy in a Telling 8 Days ... In eight days in Europe, President Obama has started down the road to remaking the global financial system, reinvigorating the NATO commitment to Afghanistan and Pakistan, rewriting nuclear policy, and repairing relations with the Muslim world. So, 77 days into his presidency, is there an emerging Obama grand strategy? Not yet, but that may have been the point. Pragmatic, conciliatory, legalistic and incremental, he pushed what might be called, with a notable exception or two, an anti-Bush doctrine. There was no talk of pre-emption, or of the American mission to eradicate tyranny. From the Thames to the Bosporus, and at several landmarks in between, Mr. Obama barely mentioned his predecessor. But he emphasized one of their main differences: that the United States planned not only to give greater authority to international institutions that President George W. Bush often shunned, but also to embrace the creation of some new ones. Not surprisingly, these were the applause lines of his journey across the Continent. When he described his strategy for grappling with nuclear disarmament and countering proliferation, where some of the biggest shifts since the cold war’s end appeared to be under way, Mr. Obama emphasized that treaties and legal norms could help accomplish what sanctions and military pressure had failed to achieve. In doing so, he veered toward a pre-Sept. 11 world order. “This trip was more about reattaching all the cars on the train and convincing the other leaders that we’re no longer headed for derailment,” one of Mr. Obama’s senior advisers said in London. But of course, his pragmatic tone was born of necessity: unable to persuade important allies to follow his lead on economic stimulus or Afghanistan, he decided to settle for relationship building over immediate results. Looking for a grand strategy, a coordinated plan to use American power for broad goals in the world, is always risky.

Democracy in difficult places IN THE poor world, elections often seem to be accompanied by violence, civil war or worse. Over the past two years, in Africa alone, Nigeria, Zimbabwe and Kenya have all experienced widespread unrest during and immediately after general elections. These ballots not only precipitated killing and maiming; the violence also seemed to discredit democracy itself. It allowed critics, such as China, to lecture the West on the inherent divisiveness of democracy; best not to bother, is the verdict from the East. And if your family has been incinerated in a church in Kenya in a bout of ethnic cleansing triggered by an election, who is to say that the Chinese are so wrong? That is an uncomfortable question for Americans and Europeans. So Paul Collier’s new book on democracy and conflict in poor countries is timely. Most important, he shows unambiguously what observers of elections in poor countries have long suspected: that on their own, unless they are held in the context of a functioning democracy, elections can retard rather than advance a country’s progress. “If democracy means little more than elections, it is damaging to the reform process,” he writes. Nigeria is a case in point. Its immense oil wealth, which should be used to help the country develop, makes politicians particularly anxious to hold onto office. They employ ever fouler means to do so, and elections thus become little more than organised gangsterism. The violent methods the politicians use become the modus operandi of their period in office, and the whole political system is corrupted. Mr Collier observes that elections begin to pay dividends to society only when they occur in a system of checks and balances, with a functioning rule of law: “As with elections and reform, democracy is a force for good as long as it is more than a façade.” That thought alone should make all Western donors and United Nations officials pause long and hard before doling out more millions of dollars to support so-called democratic elections in Congo, Nigeria or, maybe this year, Sudan. Mr Collier also analyses the other factors that militate against the successful functioning of democracy and which cause violence in poor countries. Ethnic identity is one; the presence of a large pool of underemployed, testosterone-charged youths is another. Economic development is “a key remedy to violence”, he argues; you may not be able to take the testosterone out of young thugs, but creating jobs gives them something to do other than take up machetes. Rapid development, his research shows, is probably the most important determinant for maintaining peace. Aid alone does not achieve this; encouraging a flourishing private sector does.

Financial Fate, in Each Country’s Hands HERE’S a scary thought in the midst of the financial crisis. Although there was a time when Argentina and the United States were serious economic rivals, that changed with the Great Depression. America recovered and became the world’s richest nation. Argentina ended up a mess. How did such a reversal of fortune happen? In “False Economy: A Surprising Economic History of the World” (Riverhead, 321 pages), Alan Beattie writes that the answer had a lot to do with the two nations’ radically different responses to the panic that followed the stock market crash of 1929. The United States swiftly enacted the New Deal of Franklin D. Roosevelt. Argentina ended up electing Juan Domingo Perón, who tried to seal off Argentina from the rest of the world economically. Over the years, the country would endure huge deficits, runaway inflation and a host of other maladies that contributed to economic collapse. To this day Argentina has not recovered. Mr. Beattie, world trade editor at The Financial Times, provocatively suggests that it could have been the other way around.  What if wealthy Americans had blocked the New Deal? What if the country had fallen under the sway of demagogues like Father Charles Coughlin, the radio show host who admired Hitler and Mussolini? What if we had never removed the trade barriers we erected to shelter our industries from the world economy? We might have ended up like Argentina, too. In short, Mr. Beattie writes, countries choose their own economic destinies. That is worth considering as we try to extricate ourselves from the wreckage of the subprime mortgage debacle. “We created this mess and we can get ourselves out of it,” the author says. “To do so involves confronting a false economy of thought — namely that our economic future is predestined and we are helplessly borne along by huge, uncontrollable, impersonal forces.”  “False Economy” isn’t really a history book; instead, each chapter is an attempt by the author to debunk what he considers to be “fatalistic myths” about the economies of different counties and societies.  He devotes a chapter titled “Religion: Why Don’t Islamic Countries Get Rich?” to skewering some people’s post-9/11 view that Islam is the reason that so many Arab countries have high rates of unemployment. If that were true, Mr. Beattie argues, why is a Muslim country like Malaysia outperforming the Christian Philippines and the largely Buddhist Thailand? Good question. In another chapter, “Natural Resources: Why Are Oil and Diamonds More Trouble Than They Are Worth?,” Mr. Beattie challenges the notion that countries with large deposits of these items beneath their soil are doomed to poverty. “The corrupting power of mineral wealth has been shown graphically in movies like ‘Blood Diamond,’ set in the civil war that raged in Sierra Leone in the 1990s and turned it into one of the most deprived nations on earth,” he writes. “When the Saddam Hussein regime fell in Baghdad, one of the first lines of public questioning was how the newly liberated Iraq could avoid the mismanagement of its oil that had characterized so many other Middle Eastern counties.”

'Power Rules' The author wishes to reclaim the middle ground in the debates over American foreign policy between the two parties, toward both of which he feels “a bit surly.” At the start of his extended analysis of world power, he complains that “the core meaning of power has been lost, or even worse, hijacked by various liberals and conservatives,” who “repeatedly corner our leaders into making commitments they cannot fulfill,” as well as groups like “America’s premature grave diggers” and “the world-is-flat globalization crowd,” presumably led by Gelb’s successor on the Times Op-Ed page, Thomas L. Friedman. Gelb insists that power “is what it always was — essentially the capacity to get people to do what they don’t want to do, by pressure and coercion, using one’s resources and position. . . . The world is not flat. . . . The shape of global power is decidedly pyramidal — with the United States alone at the top, a second tier of major countries (China, Japan, India, Russia, the United Kingdom, France, Germany and Brazil), and several tiers descending below. . . . Among all nations, only the United States is a true global power with global reach.” None of this detracts from the general importance of Gelb’s book. His plea for greater strategic thinking is absolutely right and necessary. The campaign of 2008 was but the latest instance of a presidential contest (like 1952 and 1964, to name only two) when the debate over foreign affairs was underdeveloped and the election mandate for the new president in foreign policy was strong but underdefined. That campaign and the months that followed have demonstrated that Barack Obama’s inclination is to approach problems with a calm and steady concentration on long-term strategy. Thus, as he copes with domestic and world problems whose magnitude and range exceed those facing most American commanders in chief, he would no doubt benefit if someone should slip “Power Rules” into his evening reading. President Obama won’t, by any means, concur with all of Gelb’s meditations or policy recommendations, but he will surely agree that — especially in world affairs and especially at this moment — a president or secretary of state should consider strategy to be anything but baloney.

Previous Posts

 

Previous Posts: Series 3

Current Series

Black Swans & Unintended Consequences: the Food Crisis

WRFest 20Apr08(World Politics): More "Black Swans", UiC, and Self-Inflicted Wounds

Knowing China (Readings): Issues, Trends, Futures, Culture

Brave New World: Non-Flatness, History and Challenges

SoW I (the Good): Britain, Brazil, Mexico and India

SoW II(the Maybe So): Africa and Asia (China, Burma)

SoW III (the Bad): Challenged Russia...another Potemkin Village

The Iran Dilemma: They Like Us, Not; We Like Them, Not...usw.

 

Oil and Other System Shocks: Beyond Iraq & Georgia

Foreign Policy for a Dangerous Old World: Adoption, Adaptation & Resilience

3of4 BRICs: Governance, Stability & Outlook in China, Russia and India

The Next Decade's Crisis: ME, Bubbling Cauldrons & Fracture Lines

Witches Brew Recipes: ME Details (Iraq to Iran) {Updates}

From Complacent Stablities to Disruptive Challenges: Europe, Latin America, Africa

Sounds of Angry Men, Whimpering Politicians & the Global Crisis

G-20 Persepctives: How Well Do Bears Dance ? (Updated)

ME Update: Exemplar, Laboratory and Conundrums (Updates)

 


Previous Posts: Series 1

Previous Posts: Series 2

WRFest 15Feb08(Nat'l Security):

WRFest 23Feb08(Int'l Affairs): What Makes for Progress

WRFest 1Mar08(World Affairs): Seismic Changes a'Comin

WRFest 2Mar08(Europe): the Failure of Reform and Adaptation

WRFest 9Mar08(China/India): the Rise of the Dragon and Elephant

WRFest 9Mar08(Int'l): Russia, Iran, Iraq and the New Caudillos

 WRFest 16Mar08(Int'l I): Japan, India, China

WRFest 16Mar08(ROW): Latin Beat to Flamenco to Nigerian drums

WRFest 30Mar08(Europe): France and Russia - What's that Tune ?

WRFest 30Mar08(Asia): Trouble in Big China

WRFest 13Apr08(China): More Troubles in Big China

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