Normative Narratives

Tag Archives: Economic


by 1 Comment

The Democratic Costs of a “Grexit”

To Grexit, or not to Grexit?

Greece’s negotiations with its creditors have not gone smoothly.  The Greek government treated an interim deal reached in February as a starting point for negotiations, while it’s creditors considered it more of an non-negotiable outline of a deal. The result has been two sides talking past each other; the longer this situation persists, the more likely a “Grexit”–Greece leaving the Eurozone and / or EU–becomes.

There is a ton of middle ground for the two sides–both want Greece to return to growth and full employment. The Greek government also wants a safety-net for people negatively affected by labor market and other structural reforms; pushing already impoverished people further into poverty is not only morally reprehensible, it is bad economics.

To prevent this result, Greece has passed an “anti-poverty law” to protect its most vulnerable citizens. The problem is financing this program; the Greek government needs room to implement needed structural reforms without further destabilizing Greek society.

In addition to staving off a humanitarian crisis, Greece also needs a long-term growth strategy beyond structural reforms. There are few options for the Greek government:

1) It can completely comply with creditor demands.

2) It can continue to push its lenders for more fiscal space (smaller primary surplus and / or promises of greater EU level aid / debt relief).

Or,

3) It can default on its debts and exit the Eurozone.

The first option is a non-starter, as the Greek government feels current demands would exacerbate social and economic hardship in Greece.

The second option would allow Greece to leverage more public money for safety net programs, educational and workforce training programs, and public private partnerships. This would allow Greece to avoiding default while mapping out a plan to boost economic growth.

The last option would be painful in the short-run as Greece would get battered by financial markets and possibly have to deal with currency instability as it reintroduced the drachma(?), but it would open policy space and make Greece much more competitive in terms of cost of doing business. A Grexit could also lead to a domino effect–if other ailing E.U. countries see a post-E.U. Greece succeeding, it would bolster anti-E.U. parties within these countries.

It is obvious that the second choice is in everyone’s best interests. Unfortunately, that is no guarantee this route will be taken:

Herman van Rompuy [former head of the European Council of EU leaders] told a Brussels conference that if Greece were to leave the euro zone, that would also have geopolitical repercussions in the current standoff with Russiaover Ukraine, emboldening Moscow to see Europe as weak.

Van Rompuy urged all sides to consider the political and geopolitical implications of such a step and not just the economic and financial arguments.

“I hope we will never have to answer the Grexit question,” he added

Greece staying in the E.U. is important for both sides of the negotiation. There are enough crises in the world without manufacturing one in Greece. It is exactly times like these when budgetary restrictions should be relaxed in the name of pragmatic, longer-term priorities. But so far Greece and it’s lenders have been unable to map out a solution that worksall parties involved, and so the current impasse and possibility of an “accidental Grexit” persists.

Greece did submit a new proposal to it’s creditors yesterday, and it was apparently strong enough that it got an unofficial endorsement from French Prime Minister Francois Hollande. This could be meaningful development, as heads of major European states have to this point been reluctant to acknowledge Greek concessions. It is a step towards the “political dialogue” Tsipras has been pleading for (framing the debate less in adversarial terms between debtor and creditor, and more as a mutual compromise between equal partners working towards a common goal).

—

“Democracy in Recession”

If Greece were to leave the EU, (aside from the economic impact) there would be significant geopolitical repercussions, including a Greek pivot towards Russia. The Greek government has already signaled it disagrees with EU sanctions on Russia. More recently, it was reported that Putin and Tsipras “did not discuss financial aid” on the sidelines of the St. Peteresburg International Economic Forum. Generally speaking, whenever someone has to defend that something “wasn’t discussed”, it means it either was discussed or very likely will be in the future.

This is not to say that Greece would stop being functioning as a democracy if it leaves the EU. In fact, it is a strong belief in democratic ideals that underpin the current standoff between Greece and it’s creditors. But a fracturing of the EU would certainly be a blow to the ideals the EU stands for–peace and prosperity through a cooperative, democratic international system. Specifically, if Greece signed a natural gas pipeline deal with Russia, it would undermine the current sanctions regime against Russia.

Even more alarmingly, Greece’s problems are emblematic of a greater inward shift by major democratic powers:

A recent NATO Poll found that “At least half of Germans, French and Italians say their country should not use military force to defend a NATO ally if attacked by Russia,” the Pew Research Center said it found in its survey, which is based on interviews in 10 nations.

In the United States, the study notes, support for NATO remains fairly strong. Americans and Canadians, it says, were the only nationalities surveyed in which more than half of those polled believed that their country should take military action if Russia attacked a NATO ally.

This is further evidence of a worrying global trend, what Thomas Friedman calls “Democracy in recession”:

“…perhaps the most worrisome dimension of the democratic recession has been the decline of democratic efficacy, energy, and self-confidence” in America and the West at large. After years of hyperpolarization, deadlock and corruption through campaign financing, the world’s leading democracy is increasingly dysfunctional, with government shutdowns and the inability to pass something as basic as a budget. “The world takes note of all this,” says Diamond. “Authoritarian state media gleefully publicize these travails of American democracy in order to discredit democracy in general and immunize authoritarian rule against U.S. pressure.”

Diamond urges democrats not to lose faith. Democracy, as Churchill noted, is still the worst form of government — except for all the others. And it still fires the imagination of people like no other system. But that will only stay true if the big democracies maintain a model worth following. I wish that were not so much in question today.

Look, I get it. The world is still emerging from a generational economic crisis. Democracies are first and foremost accountable to their electorates, and in the face of short-term problems it is difficult to sell the importance of dealing with seemingly longer-term issues. But this is what we should demand of our political leaders–the ability to meet peoples short term needs while simultaneously laying the groundwork for long-term peace and prosperity.

—

The Democratization Process

Modernization theory and recent history support the idea that sustained democratic movements must result from organic desire by local factions. When these natural movements towards democratic governance emerge, they must be nurtured.

Democratic movements are always opposed by those who stand to lose power should they succeed. If the primary champions of democracy (the U.S. and the E.U.) seem increasingly unwilling to provide the resources needed to defend those who share our values, democratic movements are less likely to take shape against adversaries that tend to have economic and military advantages.

Autocratic rulers have always used propoganda and media control to make democracy look less appealing. This job becomes easier when traditional democratic stalwarts appear unable to govern effectively at home, and unwilling to defend their ideals abroad.

Advertisement


by 2 Comments

Conflict Watch: The End of Team America World Police Pt. 6; Towards A Global D.I.M.E. Framework

“Now, ultimately, global leadership requires us to see the world as it is, with all its danger and uncertainty. We have to be prepared for the worst, prepared for every contingency, but American leadership also requires us to see the world as it should be — a place where the aspirations of individual human beings really matters, where hopes and not just fears govern; where the truths written into our founding documents can steer the currents of history in the direction of justice. And we cannot do that without you.” –Barack Obama, 2014 West Point Commencement Speech

Yesterday, President Obama delivered the commencement speech at West Pt. (full text). The President took the opportunity to lay out his vision for American foreign policy, hitting on many points discussed here at NN:

1) The Human Rights Roots of Terrorism and Conflict: Most conflicts are, at their root, related to human rights violations (Protracted Social Conflicts) . Over time, if unsupported, legitimate grievances can be overridden by opportunistic forces hoping to advance very different agendas. President Obama correctly hit on the important roles sustainable human development and democratic empowerment play in preventing future conflicts and creating new markets for shared prosperity. By recognizing the importance of human rights concerns in security matters, we can work towards preventing future conflicts.

2) The Cost of Traditional Warefare: The War on Terror has resulted in nearly 7,000 U.S. combat deaths, 50,000 wounded military personnel (not to mention hundreds of thousands of Veterans suffering with psychological ailments such as PTSD), and $8 trillion in spending and interest payments. Given these costs, its is imperative that unilateral military action be reserved as a last resort to direct threats to America’s National security.

3) A Global D.I.M.E. Foreign Policy Framework: Military intervention is only one of the tools available to influence international affairs, as part of a broader “D.I.M.E” (Diplomatic, Intelligence, Military, Economic) framework. The situation in Ukraine highlights how a strong network of institutions can use these tools to counter military threats: Because of American leadership, the world immediately condemned Russian actions. Europe and the G-7 joined with us to impose sanctions. NATO reinforced our commitment to Eastern European allies. The IMF is helping to stabilize Ukraine’s economy. OSCE monitors brought the eyes of the world to unstable parts of Ukraine. This mobilization of world opinion and institutions served as a counterweight to Russian propaganda, Russian troops on the border, and armed militias.

4) Strengthening Multilateral Security Forces: Some threats require a military response–America cannot continue to shoulder such a disproportionate share of global security costs. I regularly echo the call for our NATO partners to more equitably share the costs of global security.

Another important multilateral security force are United Nations Peacekeepers. As certain countries (mainly the U.S.) work to reduce military expenditure, it is important to ensure U.N. Peacekeeping operations–which benefit from the technical knowledge and legitimacy of the U.N.–remain adequately funded to respond to conflicts around the world. UN Peacekeeping has 16 active missions, yet currently accounts for only 0.5% of global military expenditure; the global community must dedicate more resources to this increasingly important security force.

5) Capacity Building in [Potential] Conflict Regions: In response to the high cost of American “boots on the ground”, and in an effort to promote security partnerships globally, the U.S. military has renewed its focus on training local forces to deal with threats. Training local forces is cheaper, keeps American lives out of harms way, and avoids the anti-American sentiment often associated with direct intervention. Furthermore, local forces naturally have a better understanding of both their enemy and the terrain.

That is not to say training local forces always goes smoothly, there are often complications related to local allegiances and ancillary resources. However, this is all the more reason to have American’s involved in training local units. Many of the qualitative concerns regarding trust can only be addressed through prolonged relationship building. Training and oversight, alongside their primary function of developing more effective security forces, also provide an opportunity to establish these necessary relationships.

Furthermore, building local capacity goes beyond establishing military relationships. In order for the international community to successfully support human rights / democratic movements, we must establish reliable relationships across a range of actors. Leaving only a strong military, without supporting the institutions which champion human rights, is not likely to lead to sustainable democracy.

—

There will always be the need for both “soft” and “hard” power in international affairs–every type of response has its strengths and weaknesses, its costs and benefits. It is important to remember that “hard power” does not necessarily require unilateral military action. By more equally distributing the costs associated with global security, and building the capacity of trustworthy local partners in conflict regions, hard power can be utilized in a more sustainable and preventative fashion.

Since hard and soft power are complimentary, making these global security reforms is an essential component of the emerging global D.I.M.E. framework. Furthermore, to the extent that security is a necessary precondition for sustainable human development, the global D.I.M.E framework is an indispensable component of the broader global partnership for development.


by 1 Comment

Economic Outlook: Why Economics Failed (EU Edition)

Special thanks to Dr. Darryl McLeod for the graph!

The Importance of A Strong EU:

In 2012, The European Union won the Nobel Peace Prize, a symbolic award mean to show appreciation for the global importance of a unified European in the midst of the continents  most serious economic downturn since WWII:

The European Union‘s three presidents have collected the Nobel peace prize in Oslo in recognition of six decades of work promoting “peace and reconciliation, democracy and human rights”.

David Cameron was one of six EU leaders who decided not to attend. But his deputy, Nick Clegg, was there to represent the UK at the Nobel Institute.

Attendees heard the Nobel committee president, Thorbjoern Jagland, praise the EU’s role in transforming a European “continent of war” into a “continent of peace”.

“That should not be taken for granted – we have to struggle for it every day,” he said.

European commission president, José Manuel Barroso, said: “This is an award for the European project – for the people and the institutions – that day after day, for the last 60 years, have built a new Europe. “We will honour this prize and we will preserve what has been achieved. It is in the common interest of our citizens. And it will allow Europe to contribute in shaping that ‘better organised world’ in line with the values of freedom, democracy, human rights and rule of law that we cherish and believe in.

Indeed, I have advocated for a stronger role for Europe in ensuring global security, promoting democracy, human rights and rule of law throughout my “End of Team America World Police” series. Europe has to play a greater role in security both for budgetary and practicality reasons; it is much closer to Africa and the Middle East, the U.S. public is war weary, and we cannot have groups such as Boko Haram, ISIS (Islamic State of Iraq and Syria), and the Yemen-based Al Qaeda in the Arabian Peninsula thinking they can act with impunity (or join forces).

The EU is currently holding parliamentary elections, and anti-EU parties expect to gain seats:

These far-right and far-left groups will not win anything approaching enough seats to take control. But they could get around a quarter of them, amplifying their voice in debate and giving them more opportunities to slow down measures that the Brussels bureaucracy and international economists say could help save Europe from a Japan-style “lost decade” of anemic growth and policy stasis.

These include initiatives to bind the 18 countries that use euro currency closer together and open up Europe’s markets to greater competition, including from the United States.

Set up in the 1950s as a common assembly to introduce an element of democracy into the nascent European project, the parliament became directly elected in 1979 as part of push to narrow the chasm between Europeans and the arcane work of integrating their economies that few ordinary people cared about and even fewer could understand.

This anti-EU sentiment, while expected during times of economic downturn, is actually counter-effective. The issue holding back the EU recovery is insufficient integration; and this is not news. Since well before the existence of the Euro, economists have known that while some factors favored the chances of Eurozone success (such as geographic proximity and high level of trade, what is sometimes known as the gravity theory of international trade), others factors raised red flags (lack of fiscal integration, cultural and language differences which hold back the flow of residents from high unemployment to low unemployment areas).

The U.S. is an optimal currency union; everyone speaks English, and can move about the country fairly easily. Furthermore, we have the worlds largest Federal Government and most powerful National Bank anchoring the economy. As bad as the Great Recession was in America, it was irrefutably worse in Europe (and not because of their generous social welfare systems, because of the lack of fiscal integration).

And now the anti-EU sentiments are hunkering down for the zombie apocalypse, instead of fostering the closer bonds (both fiscal and cultural) needed to return the EU to a position of global leadership and prosperity. A strong unified Europe is important both for the European Economy and global security and development, hopefully whoever wins seats in the EU Parliamentary Election understands this.

—

Why Economics Failed:

This anti-intellectual refute of economic theory reminds me of a recent Paul Krugman Op-Ed, “Why Economics Failed”:

On Wednesday, I wrapped up the class I’ve been teaching all semester: “The Great Recession: Causes and Consequences.” (Slides for the lectures are available via my blog.) And while teaching the course was fun, I found myself turning at the end to an agonizing question: Why, at the moment it was most needed and could have done the most good, did economics fail?

I don’t mean that economics was useless to policy makers. On the contrary, the discipline has had a lot to offer. While it’s true that few economists saw the crisis coming — mainly, I’d argue, because few realized how fragile our deregulated financial system had become, and how vulnerable debt-burdened families were to a plunge in housing prices — the clean little secret of recent years is that, since the fall of Lehman Brothers, basic textbook macroeconomics has performed very well.

But policy makers and politicians have ignored both the textbooks and the lessons of history. And the result has been a vast economic and human catastrophe, with trillions of dollars of productive potential squandered and millions of families placed in dire straits for no good reason.

Essentially, economics didn’t fail, policy-makers failed ECON 101. Any economist worth a damn understands that economics is always “context-sensitive”. Appropriate economic policies are different during “good times” and economic downturns; economic policy should be “counter-cyclical”, saving up during good times to pay for essential safety net and stimulus programs out of a surplus in bad times. Instead we had the Bush Administration give tax breaks during good times, part of a much larger misguided concept of “starve-the-beast” economic policy.

Of course one could argue most policymakers are aware of the economics and just beholden to vested interests, in which case I would say your probably right more often than not.

And amazingly, across the pond. a parallel dismissal of textbook economics is also playing out in Europe. Instead of pursuing closer fiscal and cultural integration, the EU seem to be drifting apart.

—

Economics: Art or Science?

I have always believed that Economics is more “art” than “science”, particularly when it comes to responding to crises. In such instances, policy responses have to be made before robust economic analyses can be conducted; policy makers have to rely on intuition and historic lessons, alongside economic theory and context.

But it is not scientific deficit which has led economics to “fail” in recent history. From dogmatic misinterpretation of Adam Smiths “Invisible Hand” (only in the presence of proper safeguards and regulations), to the inflationary / rising borrowing cost effects of fiscal expansion (not in a liquidity trap), to the benefits of currency unions (but only under certain conditions, as explained above), it has been an inability / unwillingness by “conservative” factions on both sides of the Atlantic to grasp the conditions in which certain economic theories operate. As an economist, the solutions to the short-term problems facing advanced economies are frustratingly obvious.

Sometimes I think the only solution is teach everyone economics and political science once in middle school and again in high school. In a functioning democracy people set the agenda, does it not make sense invest in an informed (and therefore more engaged) citizenry?

—

America the Anecdotal:

America has indeed become the anecdotal nation. We do not have to be, it is a collective conscious choice we have made (or a series of choices we choose not to make). It seems Europe has become anecdotal as well.

Maybe it is part of a concerted effort by fast food chains and entertainment conglomerates to brainwash…No–we cannot blame conspiracies. Sure, vested interests will do all they can to maintain power imbalances, but is this really an excuse, or have the people who live in the world’s most modernized, democratic societies just become lazy and complacent?

I leave my readers with a quote from Matt Taibbi’s best seller “Griftopia”, “America is no longer a country that cares about experts. In fact, it hates experts. If you can’t fit a story into the culture-war storyline in ten seconds or less, it dies. (2 Taibbi references in blogs this week; you go Matt!)”

It takes a bit more civic responsibility to build egalitarian, progressive societies; I for one think it’s worth the effort.    


by 1 Comment

Transparency Report: TEOTAWP, Cyber-Terrorism, Civil Liberties and Invasion of Privacy

For clarity sake, TEOTAWP stands for The End of Team America World Police, a recurring theme here at NN.

—

Two weeks ago, President Obama addressed the nation to signal a shift away from President Bush’s “War on Terror” towards more sustainable foreign policy.

Yesterday, information was leaked about the U.S. government using “dragnet” tactics to access American’s personal telephone and internet information. There has understandably been outrage about this apparent infringement on civil rights / liberties. The purpose of this blog post is not to address this legitimate concern, but rather to explain why data-mining is perfectly consistent (and arguably a logical conclusion) of the Obama administrations stance on national security.

A recap of what Obama said, through the NN lens, can be read here:

“‘Our systematic effort to dismantle terrorist organizations must continue,’ Mr. Obama said. ‘But this war, like all wars, must end. That’s what history advises. That’s what our democracy demands.’

Mr. Obama rejected the notion of an expansive war on terrorism and instead articulated a narrower understanding of the mission for the United States. ‘Beyond Afghanistan, we must define our effort not as a boundless ‘global war on terror’ but rather as a series of persistent, targeted efforts to dismantle specific networks of violent extremists that threaten America,’ he said.

‘Neither I, nor any president, can promise the total defeat of terror,’ Mr. Obama added. ‘We will never erase the evil that lies in the hearts of some human beings, nor stamp out every danger to our open society. But what we can do — what we must do — is dismantle networks that pose a direct danger to us, and make it less likely for new groups to gain a foothold, all the while maintaining the freedoms and ideals that we defend.’”

“As our fight enters a new phase, America’s legitimate claim of self-defense cannot be the end of the discussion,” Mr. Obama said. “To say a military tactic is legal, or even effective, is not to say it is wise or moral in every instance. For the same human progress that gives us the technology to strike half a world away also demands the discipline to constrain that power — or risk abusing it.”

“The changes reflect a conclusion by the White House that the core of Al Qaeda has been decimated by years of strikes and the raid that killed Osama bin Laden. But in the speech, the president said that the threat had evolved in a complicated mosaic of dangers from affiliated groups and homegrown terrorists, like the bombers who attacked the Boston Marathon.”

“Speaker John A. Boehner, Republican of Ohio, issued 10 questions to the president in reaction to previews of his speech. “Is it still your administration’s goal to disrupt, dismantle, and defeat Al Qaeda?” he asked. “If you are scaling back the use of unmanned drones, which actions will you be taking as a substitute to ensure Al Qaeda’s defeat? Is it your view that if the U.S. is less aggressive in eliminating terrorists abroad, the threat of terrorist attacks will diminish on its own?”

I, like President Obama, addressed the issue from a theoretical/normative perspective; over the medium to long run more cooperation and building stronger, more resilient geopolitical relationships will allow the U.S. to divert some resources from the DoD to the DoS, an element of “D.I.M.E” diplomacy.

Secretary of Defense Chuck Hagel expanded on Obama’s vision recently, in a more practical short-term way:

“Over all, he said, the United States will keep its “decisive military edge,” an oblique but distinct reference to American military superiority. China has announced an 11.2 percent increase in military spending this year, part of its rapid military modernization.

He stressed that new technologies would entail spending fewer resources in a smarter way…”

As Senator Boehner’s questions highlight, simply ignoring terrorism and the growing threat of cyber-terrorism will not make these issues go away. They demand a response that is more sustainable financially and more stomach-able morally. Obama did not say he would stop drone strikes, but that he would make the process more transparent. He did not say he would stop fighting terrorism, but that the way that terrorism is going to be fought is changing.

Instead of sending our young men and women to remote locations to fight unsustainable wars which tarnish America’s image and fuel anti-American sentiments, the Administration will use a fraction of those resources to protect homeland security. Obama’s statement that the “threat had evolved in a complicated mosaic of dangers from affiliated groups and homegrown terrorists, like the bombers who attacked the Boston Marathon.”, alludes to a more covert approach in combating terrorism and protecting America’s national security interests.

We must realize that everyday there are people who try to hurt Americans–Jihad does not take a vacation. The fact that the Boston Marathon attack was the first major act of terrorism on American soil since 9/11 is not a result of a diminished threat, but rather highlights the efficacy of American intelligence efforts.

To the extent that the Obama administration is embracing a a shift to D.I.M.E. (diplomatic, intelligence, military, economic) foreign policy, winding down traditional military programs requires putting more resources in diplomacy, economic aid, and intelligence gathering. As I said, far from being hypocritical, the Obama administration is being consistent; when the ultimate goal is security for American’s (and the world), putting people directly in the line of fire is counter-productive unless it is truly a last-case scenario.  

If gathering personal communications data is what it takes to unlock resources needed for important domestic programs, brings home the troops, while continuing our efforts to undermine anti-American forces at home and abroad, then we must take a practical view of the matter. Particularly in light of the cyber-security threat, monitoring internet actions seems like a logical counterweight.

There is certainly a debate to be had about protecting our civil liberties in modern times, but the “slippery-slope” argument is akin to conspiracy theory. Just because the Federal government has access to personal information does not mean it will be used for nefarious purposes. In fact, its is exactly because it is the U.S. government that we should not have these fears; as cynical as people are about the U.S. government, it is the global model for transparency, accountability, and protection of human rights (including civil rights).

For example, the U.S. government has nuclear weapons in order to maintain peace and stability. North Korea and Iran, on the other hand, are trying to develop nuclear capabilities for destabilizing purposes. That is why North Korean and Iranian nuclear capabilities, while negligible compared to American capabilities, pose a much more direct threat and have drawn a consensus response (global sanctions). If this seems like a double standard, it’s because it is. America, and other nations that have proven they are accountable and responsible, have earned the right to pursue certain questionable actions in the name of the “greater good”. The same claim, by a government that is unaccountable and systematically violates human rights, does not hold the same merit.

Nothing in this world is black-and-white. The economist in me tends to approach complex issues in cost-benefit framework. It seems to me that the benefits of collecting personal information are tangible, while the costs amount to little more than unfounded fear of “big brother”. Conspiracy theories may be a fun distraction on a rainy afternoon for some, but they have little place in practical political and foreign policy debates.

—

The fact that the bipartisan support exists on this issue should tell us something about its importance:

“Congressional leaders from both parties stood by a program that they had effectively sanctioned through the passage of counter-terrorism laws over the years. Senators Dianne Feinstein, Democrat of California, and Saxby Chambliss, Republican of Georgia, the chairwoman and vice chairman of the intelligence committee, released a joint statement defending the surveillance.

“The threat from terrorism remains very real and these lawful intelligence activities must continue, with the careful oversight of the executive, legislative and judicial branches of government,” they wrote.”


by Leave a comment

Transparency Thursday: Making Sanctions “Smarter”

Sanctions are defined as penalties or other means of enforcement used to provide incentives for obedience with the law, or with rules and regulations. In a foreign affairs context, sanctions are generally imposed by a group of countries (the greater the participation the more effective sanctions can be, and in many cases without strategic involvement sanctions can effectively be useless) in order to influence a political/military/economic  outcome abroad. Sanctions allow countries to show their dislike of a particular course of action without infringing on the sovereign rights of states and without military intervention. Sanctions are often used in the face of gross human rights violations. Prominent examples of sanctions in use today are North Korea, Iran, and Syria (covering both the government and the opposition).

Despite the ability to hold powerful interests accountable, sanctions are not a unanimously popular foreign policy instrument.  One reason, as stated before, is that without strategic agreements (neighboring countries, trade partners, ideologically aligned states) sanctions will be ineffective. They can lead to the formation of black markets, giving criminal organizations even more resources for nefarious activities. The main concern regarding sanctions however is in regards to their human rights implications.

Although sanctions are often meant to end human rights violations, their existence can actually exacerbate humanitarian crises, especially in the short run. While each sanction is uniquely tailored to the situation it is trying to influence, the indiscriminate shortages that sanctions generally cause affects everyone in society (and arguably vulnerable / marginalized groups the most). Because of this, the practice of imposing sanctions has evolved towards the imposition of “smart sanctions“. In essence, smart sanctions are more targeted sanctions (think freezing financial assets as opposed to a complete embargo), meant to put pressure on strategic parties while considering and sometimes providing aid to compensate for human rights issues that may arise.

Smart sanctions are the topic of today’s lesson. I am referring specifically to recent changes made in sanctions against Iran and Syria.

—

Iran: A little background, Iran is currently facing sanctions which are attempting to deter Iranian nuclear capacity development, which Iran has insisted is for peaceful purposes (medical), but the Western world has strongly opposed.

Iran is also in presidential campaign season, and preliminary reports do not look good for denuclearization and human rights interests:

“Mr. Jalili, known as Iran’s unyielding nuclear negotiator and a protégé of the supreme leader, Ayatollah Ali Khamenei, is emerging as the presumed front-runner in Iran’s presidential election on June 14, an unsettling prospect for future relations with the West. Mr. Jalili, 47, who many analysts say has long been groomed for a top position in Iran, is by far the most outspoken hard-liner among the eight candidates approved to participate in the election.”

“He has been featured in flattering terms in recent weeks in the semiofficial Fars news agency, which is connected to the Revolutionary Guards, as well as in dozens of Web sites and other news outlets. By contrast, the other candidates now sometimes discover their campaign appearances canceled for unclear reasons and often find themselves under sharp attack in interviews on state TV, while Mr. Jalili gets softball questions.”

“If he gets elected I foresee even more isolation and conflict, as he doesn’t care about foreign relations, the economy or anything,” the analyst said.”

To make matters worse, lack of transparency has marked previous Iranian elections.

“Iran’s presidential elections, lacking independent opinion polls and subject to manipulation, are notoriously unpredictable. In 2005, Mr. Ahmadinejad came out of nowhere to win. In 2009, millions of people took to the streets to protest what they said was widespread fraud in the voting that returned Mr. Ahmadinejad to office over the more popular opposition candidate, Mir Hussein Moussavi.”

In order to prevent against corrupt election practices, and possibly to help organize opposition to Mr. Jalili, the U.S. today announced it will repeal sanctions on mobile devices and  communication software / equipment. 

“The change is intended to help Iranians communicate through social media, text messaging and mobile-phone videos in order to overcome some of the media and communications restrictions imposed by Iranian authorities.

The action “aims to empower the Iranian people as their government intensifies its efforts to stifle their access to information,” according to a Treasury Department statement.”

“Providing the democracy movement in Iran with access to the latest social media organizing tools will strengthen their efforts to bring about positive change to a government that fears information it can’t control,” Democratic Representative Jim Moran of Virginia, who has sought such action, said in an e-mailed statement today.”

“The U.S. has supported attempts to boost democratic movements and stepped up efforts to stop regimes such as those in Iran and Syria from blocking social media through what Obama has called the “malign use of technology.”

In November, the administration imposed sanctions on Iranian officials –including the nation’s communications minister — and government agencies for blocking Internet access, mobile-phone lines and satellite-television channels to stifle free speech.

The Treasury named today additional individuals and entities for “contributing to serious human rights abuses committed by the Iranian regime, including through the use of communications technology to silence and intimidate the Iranian people.” The State Department issued visa restrictions on about 60 Iranian officials linked to human rights abuses.”

This story highlights the importance of media independence and transparency for effective democracy. The use of social media has been instrumental in “The Arab Spring” revolutions, enabling  the dissemination of information, while overcoming collective action problems that tend to allow powerful interests to remain in control to the detriment of society as a whole. Communications technology also has positive uses for healthcare, education, and e-governance. But in this case, it is clear that the U.S. is trying to allow more liberal Iranians to communicate, in hopes of challenging Mr. Jalili’s candidacy. Additionally, mobile devices make it easier to report political rights abuses, such as coercive measures at polls and other means of election-rigging.

At a recent ECOSOC Partnerships forum I was lucky enough to attend in my capacity as a UNDP intern, Mr. Suneet Singh Tuli, CEO of Datawind, called access to affordable mobile internet access a human right–I agreed with him, and it seems the Obama administration is of like mind. These smarter sanctions should help uphold electoral integrity in the upcoming elections, and should help improve the average Iranian’s opinion of America.

—

Syria has now been engaged in a civil war that has lasted over 2 years, claimed over 80,000 lives, and lead to over 1 million refugees and internally displaced people in the Middle-East. The civil war and refugee flows have threatened the already tenuous stability of the region, and a full blow humanitarian crisis has enveloped the entire country of Syria.

Gridlock in the U.N.S.C. has prevented direct international military intervention. Russia and China have repeatedly vetoed international intervention, championing Syria’s national sovereignty despite undeniable human rights violations committed by the Assad regime. As the fighting continues, and Western support has lagged compared to Russian military support of the Assad regime (with no signs of slowing down, as Assad has apparently just received a new shipment of Russian arms), the Syrian opposition has turned towards extremists groups for support, which has further complicated international involvement.

Recent actions show that the EU is reconsidering its position on it’s Syrian arms embargo.

“Divisions among European Union foreign ministers on Monday prevented the renewal of the arms embargo on Syria, raising the possibility of a new flow of weapons to rebels fighting to bring down the government of President Bashar al-Assad.

“While we have no immediate plans to send arms to Syria, it gives us the flexibility to respond in the future if the situation continues to deteriorate and worsen,” William Hague, the British foreign secretary, said after more than 12 hours of stormy talks.”

“The ministers did agree to renew all the economic sanctions already in place against the Syrian government.”

“There were also fears that Russia, which already sends arms to the Syrian government, would feel freer to send more.”

“The only effect you could have — let’s be realistic about this — is that it will stimulate the Russians to provide even more arms,” he said. “But they’ve been providing so many arms that I’m sure even more will not make much of a difference.”

While nothing will change immediately, it is significant the Europe has left the door open to providing military aid to the Syrian opposition in the future. The fact the Europe is taking the lead on this is encouraging. It also makes much more sense, as Europe is geographically much closer to Syria and it’s main ally Russia. While I am sure any coordinated European effort would have American support, it is nice to have the spotlight off American foreign affairs for a change.

There is also some concern that increased arms flow will undermine proposed peace talks in Geneva, which would include the Assad regime, the Syrian opposition, the U.S. and Russia among other participants. This is also a legitimate claim, although I see this as more of a measure to ensure the peace talks do bear fruit. European leaders are putting pressure on the Assad regime to negotiate a political transition by signaling their willingness to further aid the rebels should the peace talks break down. Syria has been in a hurting stalemate for sometime now, perhaps European powers are giving the Assad regime one more chance at a political transition to end this war before pursuing a military end.

—

These two stories are linked, as Mr. Jalili, a hardliner and supporter of Hezbollah, would likely step up support to the Assad regime if elected as Iranian president. Perhaps the Assad regime is just trying to buy time with “peace talks” until it has a stauncher ally in Iran.

There has also been the issue of whether Iran should be allowed to participate in Syrian peace talks (if you have been paying attention, the usual suspects are backing the sides you would expect them to in this dispute).

Sanctions are getting smarter, as human rights considerations gain more recognition as the cornerstone of the modernization process.  Will these “smart sanctions” help achieve the desired outcome without exacerbating human rights violations? Lets be cautiously optimistic; be sure to check back for regular updates on these evolving and inter-related issues.

Enhanced by Zemanta


by 2 Comments

Q & A Friday: Should Puerto Rico Become the 51st State?

Today’s question comes from Yshak from New Rochelle, NY:

Q: Should Puerto Rico become the 51st state? What are the pros and cons of statehood?

An interesting question Yshak, first some background information. Puerto Rico is currently a territorial commonwealth of the United States. Puerto Rico receives military defense and federal aid from the U.S. government. Puerto Rico does not, however, have an official say in U.S. political matters.

The most popular option for Puerto Rican’s living in the U.S. is to remain a territorial commonwealth (69.4% support this). As one man in San Juan said, “I believe we should stay the way we are. It’s worked for about 50 years already. We get the best of both worlds.” This reminds me of the old saying “if it aint broke, don’t fix it” Puerto Rico currently receives $4,200 per capita in federal expenditure (about 25% of GDP per capita!), while paying only $888 per capita. As a territorial commonwealth, Puerto Rico receives many of the benefits of statehood, without many of the costs (most notably, income tax).

There are still many pros to statehood, both political and economic. Politically, with a population around 4 million people, statehood would grant Puerto Rico 7 house representatives and 2 senators, totaling a very politically relevant 9 Electoral College votes.

Economically, statehood would include Puerto Rico in all U.S. trade agreements (NAFTA for example), which could greatly increase export revenues. Also, with a per capita income of around $16,000, Puerto Rico would immediately become one of the poorest states, meaning even more Federal benefits (with minimal additional costs, as $16,000 is barely above the taxable income threshold once standard deductions are accounted for).

So what are the cons of statehood? Why don’t more people support it? First off, many first generation Puerto Rican-Americans do support statehood (57.4%). The main argument against statehood is that Puerto Rico will lose its unique cultural identity. It is understandable to be concerned, as the U.S. dwarfs P.R. in size, population, and international influence in basically every category. However, this fear is unfounded. The U.S. as a country is one of the strongest proponents of individualism and freedom of speech. There are many distinctly regional identities within the United States, and there is no reason to believe that the Puerto Rican identity would be lost (unless it is abandoned by its people, which it would not be).

Some people want complete independence, after 400+ years of Spanish and then American rule, this is somewhat understandable. However, this is only a small group of people (typically older, liberal Puerto Ricans); these people are not considering the economic realities of independence. From a modernization standpoint, independence makes little sense.

It is also not just up to Puerto Rican’s whether they want to become a state or not. It would also have to draft a state constitution and pass a vote through U.S. congress, which in today’s political reality is far from a sure thing. The G.O.P has apparently decided to become friendlier to “Latino” voters after the 2012 presidential election, so perhaps it would pass a vote, but only time will tell.