Normative Narratives


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The Greek Bailout Deal Is A Failure of Leadership in Both Greece and Germany

Kick-The-Can2

The terms of the 3rd bailout deal between Greece and its creditors brought a lot of issues to the forefront.

Silly me for thinking negotiations had to with economics–modernizing the Greek economy by enacting needed structural reforms, while providing the Greek government with the fiscal space needed to promote growth and address it’s pressing humanitarian crisis (which said structural reforms would only exacerbate in the short run). Instead, the defining elements of the deal were related to personality and politics.

The Germans were mad at the Greeks, so much so that German finance minister Wolfgang Schäuble said perhaps Greece might be better off leaving the Euro–this short-sighted self interest is not suitable behavior for Europe’s de facto leader. Tsipras’s government, for it’s part, apparently did not have a backup plan in case it’s creditors failed to offer a reasonable deal. I know Syriza is new to politics, but you don’t have to be a master negotiator to know that going into negotiations without a backup plan is a flawed strategy.

I was a fan of Tsipras’s government because of the interim agreement it secured in February–the potential for trading structural reforms for fiscal space. But since that point it terribly misplayed its hand. It went into negotiations without a backup plan. It held a referendum at least a month too late–the overwhelming “no” vote would have been a strong bargaining chip had Greece been able to take it back to the negotiating table while still covered under the terms of its prior bailout.

But once those terms expired, and Greek banks closed, the only choices for Greece were Grexit or capitulation. Since there was no plan in place for a Grexit, Greece ended up with the terrible deal it got. That deal–as it currently stands–fails in all regards: financial sustainability, growth prospects, and short term humanitarian concerns.

Not Financially Viable:

The International Monetary Fund threatened to withdraw support for Greece’s bailout on Tuesday unless European leaders agree to substantial debt relief, an immediate challenge to the region’s plan to rescue the country.

A new rescue program for Greece “would have to meet our criteria,” a senior I.M.F. official told reporters on Tuesday, speaking on the condition of anonymity. “One of those criteria is debt sustainability.”

The I.M.F. is now firmly siding with Greece on the issue. In a reportreleased publicly on Tuesday, the fund proposed that creditors let Athens write off part of its huge eurozone debt or at least make no payments for 30 years.

The I.M.F. said in its report that a write-down could be avoided, but only if creditors extended the schedule for Greece to repay its debt. The only other alternative to a haircut would be for the eurozone countries to give Greece the money it needs to repay them.

“The choice between the various options is for Greece and its European partners to decide,” the I.M.F. report said.

Greece would need to spend a sum equal to more than 15 percent of G.D.P. annually to pay interest and principal on its debt, according to the latest I.M.F. report.

Does Not Fulfill Greek’s Human Rights:

The implementation of new austerity measures in Greece amid the country’s deteriorating economic crisis must not come at a cost to human rights, a United Nations expert warned today as he urged international institutions and the Greek Government to make “fully informed decisions” before adopting additional reforms.

“I am seriously concerned about voices saying that Greece is in a humanitarian crisis with shortages in medicines and food,” Juan Pablo Bohoslavsky, the UN Independent Expert on foreign debt and human rights, stressed in a press statement today. “Priority should be to ensure that everybody in Greece has access to core minimum levels of economic, social and cultural rights, including the right to health care, food and social security.”

“A debt service burden that may be sustainable from a narrow financial perspective may not be viable at all if one considers the comprehensive concept of sustainable development, which includes the protection of the environment, human rights and social development,” he added.

And of course, as the IMF report highlights, the deal is not even “sustainable from a narrow financial perspective”.

Kicking the Can or Letting Heads Cool?

If Greece’s creditors, led by Germany, ultimately want to see Greece stay in the Eurozone (for the long run), a friendlier deal is needed. If a “Grexit”, with its short term pain but long term possibilities to return Greece to economic health, is indeed in Greece’s best option given what it’s creditors are willing to offer, why not take that tough medicine and let the healing start? The current deal represents the worst of both worlds–economic pain now and a likely Grexit in the future.

The one positive of this deal is that it did buy time, which should not be undervalued as “Grexit” would be permanent and have terrible geopolitical consequences. But  without stimulus (there are talks of a 35 billion euro stimulus fund by 2020 if reforms are fully implemented, but this may be too little too late) and debt restructuring (which cannot be ruled out, but also cannot be counted on), the deal is little more than kicking the can down the road–all while the Greek people continue to suffer.

Greece’s creditors cannot keep dangling future carrots while imposing fiscal restraints which hurt Greece’s already beleaguered citizenry in the here and now. Aid must be synced with structural reforms, or else the Greeks will see their situation go from terrible to worse and reject the terms of this 3rd bailout. 

Doing the same thing and expecting different results is the definition of insanity. Greece has tried to implement reforms in order to unlock future aid before, and we see where that got it--a severely contracted economy, depression level unemployment rates, and costly political instability. 

This is not the time for more business as usual; this is the time for bold action and trust between Greece and it’s creditors. Unfortunately nothing about the past few months of negotiations suggest this is outcome will be realized.

 

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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.


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Conflict Watch: The End of Team America World Police (Part 7)

Obama’s Strategic Plan For National Security:

The latest installment of my ongoing series “The End of Team America, World Police” focuses on President Obama’s second and final National Security Strategy (full document can be found here):

“The question is never whether America should lead, but how we should lead,” Mr. Obama writes in an introduction to the document, a report that seems to mix legacy with strategy. In taking on terrorists, he argues that the United States should avoid the deployment of large ground forces like those sent more than a decade ago to Iraq and Afghanistan. In spreading democratic values, he says, America should fight corruption and reach out to young people.

“On all these fronts, America leads from a position of strength,” he writes. “But this does not mean we can or should attempt to dictate the trajectory of all unfolding events around the world. As powerful as we are and will remain, our resources and influence are not infinite. And in a complex world, many of the security problems we face do not lend themselves to quick and easy fixes.”

“There is this line of criticism that we are not leading, and it makes no sense,” said Benjamin J. Rhodes, a deputy national security adviser. “Who built the effort against ISIL? Who organized the sanctions on Russia? Who put together the international approach on Ebola?”

The strategy lists eight top strategic risks to the United States, starting with a catastrophic attack at home but including threats like climate change, disruptions in the energy market and significant problems caused by weak or failing states.

Regardless of your opinion on how effectively the Obama administration has handled foreign affairs, it is hard to argue the United States is not leading from the front on major global issues. Yet it is important that our future leaders recognize, as President Obama has, the limits of both our government’s resources and our ability to sustain democratic revolutions through unilateral military intervention.

In a highly interconnected world, confronting global problems is in America’s economic and security interests (not to mention ethical considerations). This does not mean, however, that we should rush headlong into battle without carefully considering the probability of success and costs of alternative courses of action. There are other tools in America’s foreign policy toolkit–the other components of the D.I.M.E (diplomatic, intelligence, military, economic) framework–which should be considered before sending our military (and particularly ground troops) to war.

Military interventions are never quick, easy, or cheap. Even when successful, they leave a power void that must be carefully managed, lest that void be filled by ineffective leaders or extremist groups (or, as is often the case, both). When mismanaged, even the most well intended interventions can be counter-productive, fueling anti-Western propaganda and empowering the very ideologies we seek to destroy.

American tax dollars are a precious resource. Every dollar we spend abroad is a dollar we cannot use for nation building at home. The American government is solely responsible for managing America’s domestic affairs, but we have many allies who share the same ideologies and interests as us (and who should therefore more proportionately shoulder the cost of defending them).

A NATO By Any Other Name…:

NATO was established in recognition that global security was part of the “global commons” (and remains even more-so today). This brings us to recent comments on NATO’s future by outgoing Secretary of Defense Chuck Hagel:

Hagel, making his final appearance at NATO as U.S. defense chief, said the alliance faced several challenges, including violent extremism on its southern rim, Russian aggression in Ukraine and training security forces in Afghanistan.

“I am very concerned by the suggestion that this alliance can choose to focus on only one of these areas as our top priority,” Hagel told a news conference. “And I worry about the potential for division between our northern and southern allies.”

“The alliance’s ability to meet all these challenges at once, to the east, to the south and out-of-area, is NATO’s charge for the future,” Hagel said.

“This is a time for unity, shared purpose and wise, long-term investments across the spectrum of military capability,” he added. “We must address all the challenges to this alliance, all together and all at once.”

Often times, one can speak most candidly when their tenure at a position is coming to an end. Those who oppose the ideals of NATO will not coordinate their attacks one at a time. In fact, knowledge that NATO resources are strained (due to say, simultaneous humanitarian crises, a wear weary American public, or underinvestment in the global security commons by the rest of the international community) is only likely to embolden our enemies. While NATO needs to be able to effectively counter more than one major threat at a time, this does not mean the American army alone needs that capacity.

As the world becomes “smaller”, the exclusively Northern Atlantic nature of NATO should be reconsidered. Two major democracies–India and Japan–are not members of NATO, limiting the groups ability to fulfill its goals. Furthermore, having regional actors involved in security operations helps builds legitimacy, underscoring the strategic importance of greater Indian and Japanese involvement.

President’s Obama and Modi recently met and discussed, among other things, defense cooperation. India must become a major partner in promoting peace and democracy in the Middle-East (particularly in coordinating the fights against the Afghan and Pakistani Taliban) even as it itself modernizes.

More Turkey Please:

An Op-Ed published in the NYT today by two Arab professors teaching at American Universities was very supportive of Turkey’s level of involvement in the Middle East:

There have been sharp disagreements over the 2013 coup in Egypt, the Israeli-Palestinian conflict and the need for intervention in Syria. Turkey’s critics have called into question its reliability as a NATO ally, including in the fight against the radical Wahhabi group known as the Islamic State.

But much of this concern is misguided. The ongoing crises in the Middle East have only underscored Turkey’s pivotal geostrategic position: It’s no surprise that Pope Francis, President Vladimir V. Putin of Russia and Prime Minister David Cameron of Britain have visited Ankara in the past few months. And Turkey’s detractors, partly because they do not understand the sources of its new assertiveness, fail to see that its transformation actually serves America’s long-term interests.

The United States has long allowed client states like Saudi Arabia, the United Arab Emirates and Israel to pursue shortsighted goals in the Middle East. This has only brought despotism and strife. Washington’s failure to fully support the democratic government of Mohamed Morsi and his Muslim Brotherhood in Egypt contributed to its collapse, and so to the instability and violence that have occurred there since. And it was President Obama’s cynical abandonment of the Syrian opposition during the first two years of the uprising against Mr. Assad that set the stage for the advent of the Islamic State.

To avoid any more such calamities, policy makers in Washington, and other Western capitals, should abandon their counterproductive approach: They should embrace Turkey’s growing, and positive, engagement in the Middle East.

I could not agree more.

But I do not think America’s leaders are opposed to Turkey asserting itself in the Middle-East. Indeed, as a primarily Muslim democracy and NATO member, it must play a large role in Obama’s plan of relying more heavily on regional partners in curtailing Islamic extremism.

I agree the Obama administration was wrong on Syria and Egypt, I am on the record saying as much. But in this case, two wrongs don’t make a right. Turkey cannot afford to play the moral high ground on these issues while the dogs of war bark at it’s door-step. Furthermore, Erdogan’s delayed and half-hearted support of the Kurdish peshmerga reeks of political calculus, not someone who considers ISIS a serious threat to regional stability.

So I am not exactly sure what these professors are talking about–they appear to be building a straw-man just to knock him down. I think it is pretty clear the Obama administration wants more Turkish involvement, including ground forces, in the fights against Assad and ISIS, not less.

Japan and Germany (Finally) Begin to Shed Their Post-WWII Identities:

Updating a previous blog about Japan and Germany shedding their post-WWII pacifist identities, Prime Minister Shinzo Abe is pushing Japan to change it’s pacifist Constitution:

Prime Minister Shinzo Abe has said that he wants to start the process of revising Japan’s Constitution as early as next year, a senior lawmaker in his party said Thursday, giving the clearest indication yet that the Japanese leader will seek to change a document that has undergirded the country’s postwar pacifism.

Mr. Abe told Hajime Funada, the leader of a group of Liberal Democratic Party lawmakers, on Wednesday that the best time to begin the difficult political task of amending the Constitution would be after elections for the upper house of Parliament, scheduled for the summer of 2016…

The Constitution, which also prohibits Japan from possessing the means of war, was written by American occupiers after World War II to prevent the defeated nation from ever again engaging in militarist expansion. The document proved so popular among Japan’s war-weary people that it has never been amended.

But Mr. Abe has seized on the murders of the Japanese hostages to make some of his strongest appeals yet for unshackling the nation’s military. Saying Japan was unable to save the hostages, he has called for easing restrictions on its purely defensive armed forces to allow them to conduct rescue missions, evacuations and other overseas operations to protect Japanese nationals.

The hostages, Kenji Goto, a journalist, and Haruna Yukawa, an adventurer, were beheaded a week apart by the Islamic State, a militant group in Syria and Iraq that had demanded a $200 million ransom for their release. The murders outraged and sickened Japan, which had seen itself as largely immune to the sort of violence faced by the United States and other nations that have been involved militarily in the Middle East. Since 1945, Japan has adhered to a peaceful brand of diplomacy that has seen it become a major donor of economic and humanitarian aid to the Middle East and elsewhere.

It remains unclear whether the shock of the killings will swing the Japanese public in favor of Mr. Abe’s harder line. Since the murders, opposition politicians have stepped up attacks on the prime minister, accusing him of provoking the Islamic State by allying Japan more closely with the United States-led efforts to destroy the militant group. Just days before the ransom demand appeared, Mr. Abe pledged $200 million in nonmilitary aid to countries in the region confronting the Islamic State.

However, on Thursday, the lower house of Parliament unanimously adopted a resolution condemning the killings and calling for increased coordination with the global community to combat terrorism.

Germany to Play a More Active Role in Global Security?:

Germany must ramp up defense spending starting in 2016 to ensure its military is able to take on a bigger role in crisis zones, according to two top lawmakers in Chancellor Angela Merkel’s coalition.

Germany spends about 1.3 percent of gross domestic product on the military, short of the 2 percent level pledged informally by North Atlantic Treaty Organization allies.

Merkel’s spokesman has said no additional funding will come in the short term as the government struggles to hold on to its target of balancing the budget next year and with 2015 spending already largely negotiated.

Germany must engage in international missions “earlier, more decisively and more substantially,” Gauck told the Munich Security Conference on Jan. 31.

Fiscal responsibility is usually good, but like anything, overzealous attachment to an ideology can preclude pragmatic policy. Economics is context sensitive, and in the current context, Germany’s dedication to running a balanced budget has left holes in the Eurozone economy and the global security commons.

A large scale increase in German defense spending would bolster global security efforts (particularly in countering Russian aggression in former Soviet Republics), while simultaneously providing a partial answer to Europe’s economic stagnation (by “buying European“).

Please do not confuse my views with war-mongering or advocating for the military-industrial complex, I just recognize that there are bad actors in the world who only understand realpolitik. In order to provide room for the forces of human dignity and freedom to flourish, these bad actors must be marginalized.


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Conflict Watch: 70 Years After “D Day”, Time To Move Foward

World’s top 15 military spenders in 2013

List by the Stockholm International Peace Research Institute (2013)[1]

Rank Country Spending ($ Bn.) % of GDP World share (%)
World total 1747.0 2.4 100
1 United States United States 640.0 3.8 36.6
2 China People’s Republic of China[a] 188.0 2.0 10.8
3 Russia Russia[a] 87.8 4.1 5.0
4 Saudi Arabia Saudi Arabia[b] 67.0 9.3 3.8
5 France France 61.2 2.2 3.5
6 United Kingdom United Kingdom 57.9 2.3 3.3
7 Germany Germany[a] 48.8 1.4 2.8
8 Japan Japan 48.6 1.0 2.8

 

The Top 10 Providers of Assessed Contributions to United Nations Peacekeeping Operations in 2013 [A/67/224/Add.1] PDF Document are:

  1. United States (28.38%)
  2. Japan (10.83%)
  3. France (7.22%)
  4. Germany (7.14%)
  5. United Kingdom (6.68%)
  6. China (6.64%)
  7. Italy (4.45%)
  8. Russian Federation (3.15%)
  9. Canada (2.98%)
  10. Spain (2.97%)

I like to think of myself as a pretty laid back guy. I don’t get worked up when people joke about stereotypes in a non-malicious way, because that’s what stereotypes are–a joke (in that they hold no value). I also believe the ability to laugh about things and engage self-deprecating humor are signs of maturity and progress.

As a Jewish American, there is one thing I cannot tolerate joking about–the Holocaust. There is a saying associated with the Holocaust–“never forget”–to both honor the victims and ensure such evil acts are never repeated. I’m sure other cultural groups have their “red-lines”, and these lines should be respected.

While we must never forget the Holocaust, we must also move on from the legacies of WWII; 70 years is a long time, and the world is a much different place. Germany and Japan no longer represent the “Axis of evil”; both of these countries have proven themselves committed to the institutions and norms that have made the second half of the 20th and 21st centuries the most progressive in the history of mankind.

Both of these countries have also benefited greatly from the global economic system put in place after WWII.  Therefore, we must not only welcome but demand that Germany and Japan play a more active role in fostering the global security which allows this system to function.

Germany:

Anger at Washington mounted Wednesday with the disclosure that American intelligence agents were suspected of having recruited a second spy in Germany, this time linked to its Defense Ministry, prompting even robust allies of the United States to suggest that a fundamental reset was needed in one of the most important of trans-Atlantic partnerships.

“At some point, the ‘no comment’ will not be enough,” Norbert Röttgen, the committee’s head and an influential member of Chancellor Angela Merkel’s center-right Christian Democratic Party, said in a telephone interview from Washington. “The U.S. must understand what psychological damage it is inflicting. I think that will be a difficult process.”

At the same time, Mr. Röttgen cautioned his German colleagues to appreciate that Berlin and Washington had profoundly differing views on the role of an intelligence service and should not let this difference permanently damage otherwise strong ties. Analysts have said that Germans have a far more restrictive view of how intelligence agencies should operate and what a fair target is.

Foreign Minister Frank-Walter Steinmeier, a Social Democrat who after the Sept. 11, 2001, terror attacks led an effort to tighten cooperation with American intelligence, seemed at a loss to understand why the United States would spy on Germany.

“We speak to each other all the time, and nobody makes a secret of their views,” he said in an interview published Wednesday by the newspaper Saarbrücker Zeitung. “The attempt to find out about Germany’s position is not just unseemly, it is unnecessary.”

Despite hurt feelings, “psychological damage”, and a degree of mistrust, US and Germany have vowed to continue cooperating in the name of global security:

The United States and Germany put a brave face on an escalating espionage dispute, stressing on Sunday the importance of their cooperation to solving several global crises but offering little indication they’ve fully mended ties.

After a meeting on the sidelines of nuclear talks in Vienna, German Foreign Minister Frank-Walter Steinmeier and U.S. Secretary of State John Kerry each extolled the value of the two NATO allies’ work together on issues such as Iran and Israeli-Palestinian violence.

“Relations between Germany and the U.S. are necessary and indispensable, and that’s for both of our sides,” Steinmeier told reporters in German. Still, he acknowledged the recent “difficulties” and urged that relations “revive on the basis of trust and mutual respect.”

Relations between the U.S. and Germany have never been more important. With the number of humanitarian and security crises rising, and extremist threats posing a challenge to democracy and capitalism abroad, the German-U.S. relationship must be redefined.

The U.S. must focus it’s intelligence efforts on its real enemies, and stop acting like a global hegemon that must know everything about everyone at all times, friend or foe. We must learn to loosen our grip and trust our allies, especially ones as strong and stable as Germany.

Germany, for its part, must contribute a greater share to NATO and UN Peacekeeping operations. Many German’s see their World Cup victory as the beginning of an age of global prominence–I would argue Germany, as the strongest EU economy, has held this distinction for some time. Either way, Germany must assume the responsibilities that come with being a global power.

Japan:

Prime Minister Shinzo Abe has disturbed many in Japan and increased anxiety in Asia by reinterpreting his country’s pacifist postwar Constitution so that the military can play a more assertive role than it has since World War II. While a shift in Japan’s military role was never going to be readily accepted by many, Mr. Abe’s nationalist politics makes this change even harder to swallow in a region that needs to reduce tension.

It is difficult to overstate the significance of what Mr. Abe has done. Since 1947, Japan’s Constitution, written and imposed by the American Army, has permitted the military, known as the Self-Defense Forces, to engage only in self-defense. That meant the large and technologically advanced armed forces was barred from “collective self-defense” — aiding friendly countries under attack — and thus was far more constrained than those of other nations.

With the reinterpretation, Japan’s military would still face restrictions on what it could do, but it would be allowed for the first time, for example, to help defend an American ship under attack, destroy a North Korean missile heading toward the United States or play a larger role in United Nations peacekeeping operations.

As I mentioned before, a large part of honoring those who perished in the Holocaust and WWII is making sure such deplorable acts are never repeated. As the world becomes more interconnected due to technological advances, people become more acutely aware of the gross human rights violations inflicted by terrorist organizations and totalitarian governments with relative impunity on a daily basis. While these acts may occur on a smaller scale than the Holocaust, they are nonetheless deplorable.

Security is a necessary precondition for both human and economic development. As the 3rd and 4th largest economies in the world respectively, Japan and Germany must contribute more than their current 2.8% of global military spending (they do perform better in terms of UN Peacekeeping contributions, but still do not do enough). To fully cast off their WWII legacies, Japan and Germany must take leadership roles alongside the U.S. in ensuring security and human rights are enjoyed by all.

As the U.S. (partially) winds down it’s disproportionate contributions towards global security, the “power void” must be filled by the rest of the international community, led by Germany and Japan. Thankfully, it seems that Germany and Japan are ready to make this transition. It is up to the rest of the international community to not only welcome this shift, but demand that it occurs to a scale that leads to real improvements to the world’s most vulnerable people.

As a Jewish American I will never forget the Holocaust. But I can forgive, so long as Germany and Japan take a more active role in defending innocent people through multilateral security pacts (such as NATO) and UN Peacekeeping operations.


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Conflict Watch: The End Of Team America World Police (Part 5)

Well, after no installments of “The End of Team America” for a few months, I now have back-to-back blogs on the “subject”. I don’t make the news people, I just analyze it! I suppose with the specter of a potential U.S. strike on Syria, unrest in Egypt, and complications with Iran, the timing wasn’t ripe to discuss winding down America’s military involvement around the world. However, this has always been a long term goal of the Obama administration; with Assad’s regime complying with international chemical weapons experts / “Geneva 2” peace talks in the works (I am personally skeptical the Syrian opposition will participate, which would derail these talks), Egyptian unrest seemingly subsiding (or festering under the surface?), and Iran entering the fold of international diplomacy with renewed optimism (but is it just a stalling tactic or a real attempt at change?), it seems that the tune of news outlets has shifted away from imminent U.S. military intervention back towards the long-term goal of winding down America’s role in global security measures. True none of these shifts represent concrete changes in their respective debates, but they do present an opening for a different focus by news outlets, at least for the time-being. 

Original Article:

Germany called for closer military integration between groups of NATO countries on Tuesday as the alliance grappled with how to keep its defenses strong at a time of falling military spending.

Germany’s proposal, discussed by NATO defense ministers at a Brussels meeting, is that big NATO nations act as “framework nations” leading a cluster of smaller NATO allies.

These clusters of countries would jointly provide some military capabilities or develop new ones for the benefit of the whole alliance, with the lead nation coordinating their efforts.

The idea was welcomed by NATO Secretary-General Anders Fogh Rasmussen and by Britain but diplomats said some other countries, including France, had concerns about the proposal, fearing it could undermine countries’ sovereignty and lead to over-specialization.

“Does that lead to a kind of specialization which could be dangerous if some nations specialize only in certain types of mission and disengage from other missions?,” one diplomat said.

Some diplomats also worry that a cluster system could make it more difficult for NATO to use forces on operations because a parliament in one country could effectively veto military action by other nations in the cluster.

The United States has repeatedly voiced alarm about the growing gulf between U.S. military spending and capabilities and those of its European allies.

The German proposal would help share the cost of expensive military systems at a time when many NATO allies are slashing defense spending in response to the economic crisis.

Only four of the 28 NATO members – the United States, Britain, Greece and Estonia – met the alliance’s target of spending 2 percent of their economic output on defense in 2012.

As a block, the EU spends only 1.7% of it’s GDP on military expenditure. The U.S., by contrast, spends 4.7% of it’s GDP on military purposes. This unequal distribution of global security expenditure (39% of global military spending is by the U.S.) has placed an unfair burden on the American tax-payer, even as it has strengthened U.S. influence over global security decisions. The U.S. is expected to foot the bill of many multilateral security operations, which as led to roughly 1/4 of all Federal expenditures to go towards military purposes. This has constrained U.S. fiscal space, draining it’s economy of resources needed to reinvest in it’s future through social programs. The aggregate result has already begun to show in the form of increasing inequality and reduced social mobility.

It is not only in other countries best interest to reclaim some say in security matters, it is also in the U.S. best interest to have such a re-balancing take place. But absent other countries stepping up, the U.S. has no choice but to continue footing the bill, otherwise the “global security commons” would suffer. It appears that Germany now agrees with the U.S. and is taking the initial steps to more evenly distribute the burden of global security.

This plan certainly has snags, which are addressed in the article. Could more “specialized” NATO tie the hands of some of it’s smaller members, requiring an impossible consensus for military action? It is possible, although I would argue that states rarely make security decisions unilaterally (with the exception of the U.S., which would likely still retain it’s ability to act unilaterally in any foreseeable agreement). With each country having to take military intervention back to it’s legislature for a vote, having more votes ultimately complicates military action. I am sure that NATO members, headed by Germany and the U.S., will take necessary steps to streamline a more cooperative process, although admittedly I do not know what these steps would be at this time.

Germany was demilitarized after WWII, that was almost 70 years ago. Germany has, since that time, proven it has the political will, stability, and foresight to be a world power. It is time to allow Germany to become a true world power, by increasing its role in global security debates. I will be sure to keep my readers up to date on any news on this important proposition.


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Conflict Watch: (In Syria) Things Will Get Worse Before They Get Better

Perhaps nowhere does this old saying ring as true as in present day Syria. Two weeks ago I wrote about “The Deteriorating Syrian Civil War and Humanitarian Crisis” and since then things have not gotten any better on the ground. However, it seems that Western powers are finally organizing the support that legitimate factions of the Syrian opposition need to present a real threat to the Assad regime without relying on the help of extremist / terrorist organizations:

“Ministers from 11 countries including the United States, European and regional Sunni Muslim powers, held talks that Washington said should commit participants to direct all aid through the Western-backed Supreme Military Council, which it hopes can offset the growing power of jihadist rebel forces.”

“The meeting in Qatar brings together ministers of countries that support the anti-Assad rebels – France, Germany, Egypt, Italy, Jordan, Qatar, Saudi Arabia, Turkey, United Arab Emirates, Britain and the United States.”

“Qatar’s Prime Minister Sheikh Hamad bin Jassim al-Thani, whose country has been one of the most open backers of the anti-Assad rebels, said that supplying them with weapons was the only way to resolve the conflict.

“Force is necessary to achieve justice. And the provision of weapons is the only way to achieve peace in Syria’s case,” Sheikh Hamad told ministers at the start of the talks.

“We cannot wait due to disagreement among Security Council members over finding a solution to the problem,” he said. He also called on Lebanon’s government to halt intervention by Lebanese factions in the neighboring conflict.”

“‘We won’t get a political solution if Assad and his regime think they can eliminate all legitimate opposition by force, and so we do have to give assistance to that opposition,’ Secretary of State Kerry told reporters before the start of Saturday’s talks.”

“After a series of military offensives by Assad’s troops, including the recapture of a strategic border town two weeks ago, President Barack Obama said the United States would increase military support for the rebels

Two Gulf sources told Reuters on Saturday that Saudi Arabia, which has taken a lead role among Arab opponents of Assad, had also accelerated delivery of advanced weapons to the rebels.

‘In the past week there have been more arrivals of these advanced weapons. They are getting them more frequently,’ one source said, without giving details. Another Gulf source described them as ‘potentially balance-tipping’ supplies.”

One can only hope that this aid is not too little too late, and many questions emerge from the concerted arming of the Supreme Military Council by Western powers: Does the political will exist among the opposition to fill the power vacuum in a sustainable democratic fashion upon Assad’s removal? Would a new governing body protect the rights of minorities, including Alawites, in a post-conflict Syria? What will happen to the extremist factions the opposition once relied on (specifically al-Nursa)? Will these groups attempt to sabotage the Western backed opposition?

Despite all this uncertainty, one thing is clear; the Assad regime has lost all credibility and cannot remain in power / be allowed to run in future Syrian elections (having Assad involved in future elections would inherently distort the democratic process and risk reigniting the sectarian divide). It has also become clear that Russia will continue to honor its military contracts with Damascus, and that Assad has no problem turning the Syrian Civil War into a regional conflict if it helps his prospects:

“U.S. Secretary of State John Kerry said the meeting of 11 countries in Qatar was a chance to discuss “efforts to increase and coordinate support for the Syrian political and military opposition”. Kerry said Assad had allowed Iranian and Hezbollah fighters “to cross the lines from Lebanon and engage in the fight on the ground”.

“The Assad regime’s response to a legitimate global effort to try to have a peace conference was to in fact militarize the efforts and internationalize (the conflict) and make the region far more dangerous as a consequences,” he said.”

(In the spirit of fairness, the opposition is also guilty of turning the conflict into a regional one by enlisting other countries help–this is a reality of modern warfare especially in Africa and Middle-East where the sectarian / cultural divide–alongside human rights abuses–underpins the majority of conflicts in the region).

“President Michel Suleiman has called on the Lebanese Shi’ite Muslim Hezbollah movement to pull its guerrillas out of Syria, saying any further involvement in its neighbor’s civil war would fuel instability in Lebanon.” While coming from the right place, such a plea will ultimately be in vain–you cannot end a  2+ year old Civil War by shaming the fighters, as both sides believe they are fighting for a just cause.

Can arming the rebels really help lead to a peaceful compromise? Honestly, I do not think so–I think the idea of a peaceful political transition in Syria is a pipe-dream. Even in the face of defeat, I do not believe Assad will step down–I think he will go down with the ship. His family has been in power in Syria for over four decades, Assad knows nothing else and probably believes his power in Syria borders on “divine right“. I believe that Western powers are building up the capacity of the Supreme Military Council to keep Assad’s forces busy, as a covert “Gadaffi-style assassination” is planned. This may be an extreme position to take, but it is the only realistic solution that does not involve more civil war, human suffering and regional instability.

Former U.S. general Wesley Clark is more optimistic that arming the opposition can lead to a political transition:

“Mr. Assad knows that Mr. Obama can be surprisingly resolute, as in his approval of drone strikes and the military operation to kill Osama bin Laden. While the United States begins to supply the rebels, there is a crucial opening for talks. Russia or China could recalculate and help lead Syria to a real peace process, as Viktor S. Chernomyrdin, a former Russian prime minister, did in Kosovo in 1999. Iran could emerge from a truce with Hezbollah’s power in Lebanon (and its strong links to Iran) intact.

The formula for diplomacy is clear: a cease-fire agreement; a United Nations presence; departure of foreign fighters; disarmament of Syrian fighters; international supervision of Syria’s military; a peaceful exit for Mr. Assad, his family and key supporters; a transitional government; and plans for a new Syria.

The conflict, and the diplomacy needed to end it, are likely to play out simultaneously. All parties will be recalculating their options and risks, so any assurance Mr. Obama gives Americans that he will limit our engagement would reduce the chances of success. This is a nerve-racking time, but the consequences of inaction are too high. Working together, America, Russia and China can halt Syria’s agony and the slide toward wider conflict. Mr. Obama’s decision might be the catalyst to get that done.”

I personally do not see Assad as this calculating figure, but time will tell which version of Assad is closer to the truth.

Of course arming the rebels is no slam-dunk. Even if Assad woke up tomorrow and decided he cannot win this war and would leave (which he will not), arming the rebels inevitably creates the risk that one day our own weapons will be used against us, regardless of how thoughtfully weapons are dispersed.

“As the United States and its Western allies move toward providing lethal aid to Syrian rebels, these secretive transfers give insight into an unregistered arms pipeline that is difficult to monitor or control. And while the system appears to succeed in moving arms across multiple borders and to select rebel groups, once inside Syria the flow branches out. Extremist fighters, some of them aligned with Al Qaeda, have the money to buy the newly arrived stock, and many rebels are willing to sell.”

Even if the arms go directly to the Supreme Military Council, there is no telling where they will end up after this conflict is over.

“For Russia — which has steadfastly supplied weapons and diplomatic cover to President Bashar al-Assad of Syria — this black-market flow is a case of bitter blowback. Many of the weapons Moscow proudly sold to Libya beginning in the Soviet era are now being shipped into the hands of rebels seeking to unseat another Kremlin ally.”

The U.S. learned a similar lesson when arms and training given to Al-Qaeda in the 1970s to oppose Soviet interests backfired.

It is impossible to know where the weapons will ultimately end up–underpinning the ongoing debate of arming the Syrian opposition. Think of the Western world’s “best case scenario”–a legitimate Syrian opposition assumes power following Assad’s removal and attempts to setup a democratic Syria. There is no telling how long that democracy will last (often first attempts at democracy fail). These weapons could be stockpiled by a pro-Western power, only to be lost in a future military coup. The existence of these weapons poses the possibility that they will fall into enemy hands at some point in the future–especially as the conflict becomes a memory and international attention focuses elsewhere.

Still, steps are being taken to ensure the arms are channeled to legitimate branches of the Syrian opposition. If in the future these weapons fall into enemy hands, that will have to be dealt with in the future. Perhaps newer technology, such as GPS or even a remote “kill-switch”, are possible for bigger-ticket items sent to the opposition. If anybody knows anything about how donors keep tabs on military aid be sure to let us know in the comment section.


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Economic Outlook: The United States of Europe?

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The title of this post is a bit of a joke, even in the unlikely scenario that such a federation is established, I’m sure they would make it a point to make a name less similar to that of the USA. What is not a joke is the state of the European economy, whose unemployment rate and output gap makes America seem like the a model of economic efficiency. (It is impossible to find a single EU or Euro Zone output gap figure, but one can safely assume based on unemployment levels that it is significantly large).

French President Francois Hollande made strong, if not novel, points.

“The French proposal, which Hollande said he would submit to his eurozone partners, also calls for much deeper fiscal integration between the eurozone nations, with a common budget and the authority to issue debt. The government would also debate the main political and economic decisions to be taken by member states and launch a battle against tax fraud.”

“He acknowledged he could face resistance from Germany, Europe’s dominant power, which opposes mutualising debt among member states. Berlin is also reluctant to give the euro zone its own secretariat for fear of deepening division in the EU, between the 17 members of the single currency and the 10 others.

Non-euro Britain’s government already faces growing domestic pressure to hold a referendum on leaving the bloc.

Hollande said he wanted Britain to stay in the EU but added: “I can understand that others don’t want to join (the single currency). But they cannot stop the euro zone from advancing.”

Hollande said a future euro zone economic government would debate the main political and economic decisions to be taken by member states, harmonize national fiscal and welfare policies, and launch a battle against tax fraud.

He proposed bringing forward planned EU spending to combat record youth unemployment, pushing for an EU-wide transition to renewable energy sources, and envisaged “a budget capacity that would be granted to the euro zone along with the gradual possibility of raising debt”.

He also called for a 10-year public investment plan in the digital sector, the promised energy transition, public health and in big transport infrastructure projects.”

Indeed, these concepts are not new. There has always been doubt as to whether the Europe had the necessary preconditions for a strong currency union (based on the theory of optimal currency area). There is considerable economic interdependence, but differences in language and culture make labor less mobile (which is why some countries in the EU have unemployment rates above 25%, while others are high but more manageable).

The head of the Economics department at Fordham, Dominick Salvatore, (a man whom I greatly admire) wrote about the issue of having a currency union without fiscal coordination in the early 1990s. He was probably not the only one to identify this obvious flaw. European leaders thought that by creating the EU and Euro zone, that greater coordination would naturally occur, however this has largely not taken place (at least with respect to fiscal coordination).

The E.U. is at a cross-roads (it has been at it for some time). Britain will eventually have a referendum on whether or not to stay in the EU (a few high level officials have recently signaled they would vote to leave). The economic recovery in Europe has been non-existent. If a stronger European economic government make the Euro zone project more sustainable, it would be in the best interest of both the 17 Euro Zone countries and the 10 countries in the E.U. but without the Euro.

I used to be worried about a E.U. breakup, but I do not think such an outcome would be as painful as a Euro zone breakup. The E.U. was recently given the Nobel Prize, a symbolic move emphasizing the importance of the block of countries in promoting democracy and human rights globally. But if the E.U. wished to merely become a FTA or  common market, I do not see any of the countries drastically changing their political ideology. All of these countries still have a shared history in which peace and trade led to mutually beneficial outcomes, while war and isolation led to pain and suffering; allowing countries to leave the E.U. to sustain the Euro Zone would not change this. Indeed, I do not believe there is any foreseeable outcome that could change decades of hard learned lessons .

Economic integration would continue to exist between non Euro Zone and Euro Zone countries. The Euro Zone, with a more unified political and economic voice, would undoubtedly be a more meaningful partner with the U.S. in terms of global governance. The Euro Zone would become more effective in global security measures, with a strong unified military–in this sense having the Euro Zone move forward without all of the E.U. would help achieve many of the original goals of the E.U.

There is no question that a monetary union cannot be sustained without fiscal coordination. President Hollande was dead on when he said “I can understand that others don’t want to join (the single currency). But they cannot stop the euro zone from advancing.” Sometimes you have to cut off the limb to save the patient, and it seems like this might be the case with the Euro Zone. E.U countries not in the Euro Zone could wake-up tomorrow, decide to leave, and as long as economic ties remained very little would change. If the Euro Zone fell apart, there would be unprecedented losses as countries scrambled to put the pieces of their monetary policies back together.

If allowing countries to leave the E.U. is what it takes to make the Euro Zone sustainable, then this option has to be explored. When has forcing someone to stay, when popular consensus is to go, ever led to a sustainable union? If countries want to go, they should be allowed to go, so that those who remain can move forward.

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