Archive for October, 2011

The Political Pendulum

After the 2008 election Democrats were on a high.    President Barack Obama had been elected as the first black President, the Democrats controlled both the Senate and the House, and demographics seemed to indicate that if anything, their future  was brighter than ever.   President Bush left office as one of the least popular Presidents in history, being blamed for a dubious war in Iraq and an economic crisis that hurled the US into recession.

Yet the pendulum swung.   The depth and severity of the recession proved greater than the Obama White House had anticipated, and with the Democrats in control of government they were blamed for anything that went wrong.   After health care reform was pushed through just barely, yielding a compromise that angered conservatives and many liberals alike, President Obama found the honey moon over.   The tea party movement achieved amazing success at shaping the political discourse, and a new narrative took hold.

This narrative said that President Obama’s policies were hindering the recovery, that the stimulus was a waste of money and a failure, and that the raw politicking of the health care deal showed the shady side of Democratic politics.    Republicans said the real solution to the problems the country faces is smaller government and fiscal conservatism.   The hope and change promised by the Democrats was just more tax and spend — more government programs.

In 2010 the GOP achieved dramatic success, something unexpected after two election cycles dominated by the Democrats.   Without the drag of the Iraq war and with President Obama “owning” the economy (even though neither he nor Bush ever could control it) the public swung right.   Some of it was fear that change was going too fast; others thought the Democrats simply moved farther and faster than the public wanted.  President Obama’s approval ratings dropped down below 50%.

Yet even as the Republicans start to lick their chops over electoral prospects in 2012, the pendulum may be swinging again.   The President’s approval ratings are still bad, but they are picking up slightly.   Don’t forget, President Clinton had 40% approval in early 1995, and Reagan dropped to 38% for awhile in 1983.   President Obama is now at about 43%.

The mood seems to be changing.  E J Dionne notes this “narrative change,” citing Paul Ryan’s somewhat bitter speech to the Heritage Foundation as evidence that Republicans recognize that the argument is slipping away from them.   Occupy Wall Street has shown itself more popular and resilient than anyone expected, and the efforts to paint them as a bunch of spoiled hippies and malcontents has failed.     President Obama’s “new populism” is hitting a chord.   Americans don’t want massive redistribution and high taxes, but the idea that the system is unbalanced in favor of the wealthy is gaining traction.

Moreover, the Republican party doesn’t seem to have a clear leader, and their primaries have been dominated by sometimes extreme rhetoric that scares independents.   Herman Cain wants an abortion ban with no exceptions, not even for rape and incest.   That kind of talk scares people.   Michelle Bachmann’s call to bring taxes back to the level they were under Ronald Reagan is illustrative.    Taxes were much higher under Reagan than they are now; as she had to retreat from that statement it reinforced the idea that Reagan would be far too liberal for today’s GOP.    The narrative of an extremist Republican party is building.   Rick Perry’s assault on social security addsto that as the GOP Presidential field tries to capture the tea party electorate that vote in early primaries.

Mitt Romney should be a strong candidate.  He is clearly a moderate who shouldn’t scare anyone, but his Mormonism and moderation might actually decrease conservative enthusiasm in 2012.   He’s benefited from the turmoil in the GOP field, but the Republican party has lost control of the conversation.   Instead of Reaganesque optimism the tune from the right is increasingly antagonistic.

Meanwhile, Democrats in the House start whispering that there are a lot of vulnerable Republicans, especially first termers, who are having trouble raising money and whose ideological voting records don’t play well at home.    All Democrats expect gains in 2012; the idea of winning back the House is not as far fetched as it used to be.

Right now the conventional wisdom remains that President Obama is, if not the underdog, in a difficult position heading into the re-election fight.   But at this point in 2009, when Obama was still above 50% in approval, few people realized that the pendulum had already started a decisive swing away from the Democrats and towards the Republicans.

It’s still too early to know for sure if the pendulum is swinging back in the Democrat’s direction.   Obama is getting kudos for success in Libya, he announced the end of the Iraq war, and there may be an end in Afghanistan sooner than people expect.   The economic news has become slightly more optimistic.    Occupy Wall Street has stolen the attention that the tea party used to enjoy and has spread across the country, gaining a lot of support from Iraq veterans.    In states like Ohio, Wisconsin and even here in Maine conservative causes have led to dissatisfaction — ballot initiatives in both Ohio and Maine might be very telling about the way the mood is changing (Ohio’s involves public labor unions, Maine’s is an effort to undo Republican legislation removing same day voting registration).

It feels like the pendulum has switched directions.   It feels like 2012 could be for the Democrats what 2010 was for the Republicans.   It feels like Obama may join Presidents Clinton and Reagan in the catagory of having their political obituaries written too soon.   Time will tell — there is still a lot that could go right or wrong for both parties.     The good news about the political pendulum is that if you’re on the losing side of an election, it won’t be that way forever.   The bad news is that if you’re on the winning side the same applies.

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Economy Turning Around?

The stock market broke 12,000 for the first time in a long time on news that Europe had reached a deal on the Greek debt crisis, the US economy grew by 2.5% last quarter, and first time unemployment claims fell slightly.  It’s possible the economy may be turning around and we’ll avoid the dreaded “double dip” recession.

If true, this is the best news President Obama could receive.  If next year there is a palpable sense that things have turned around, Obama’s chances of re-election grow considerably.     Still, The recession currently is in its fourth year.   Yes, there has been growth so it’s not technically a recession, but in terms of high unemployment and a tough economy things have been in the dumps since 2007, even before the September 2008 crisis.

President Bush and Obama get little credit for how they mitigated the worst of the crisis.   President Bush’s “bailout” of Wall Street was necessary in order to prevent a further credit squeeze, perhaps pushing us into the Great Depression.   The banks also paid it back, meaning it turned out to be “cost free.”   President Obama’s stimulus package also turned around the bleeding of jobs and prevented states from becoming insolvent in 2009.   Since we never experienced the reality that would have happened without the stimulus it’s easy to dismiss it since it didn’t “fix” the economy and make everything better.   But in 2009 nothing was going to do that.

There is a good chance this spurt of growth will cause economic tailwinds to push the economy forward in 2012.   But while this may save the President’s job, it doesn’t mean the economy is “returning to normal” or that the problems are solved.  It does suggest that we may be able to handle the crisis without total collapse.

Here’s the deal.    Global debt is still way to high, and that’s going to hinder economic growth.   Moreover, states like the US have been consuming more than we’ve been producing, thinking this is OK because we lured in outside investment (the capital account surplus balanced our current account deficit).

At a national level, the US needs to expand its productive capacity and reduce consumption to the point that it more or less balances production.    The trade deficit needs to drop, either through currency devaluation (inflation) or less consumption.   At a global level the issue gets murkier.   Total debt (public and private — one can’t blame governments alone for this) is over 300% of GDP for the industrialized West.   High debt levels have funded a sustained period of living beyond our means.

The good news is that the year to year deficits (how much we’re living beyond our means) have not been dramatically high.   But if you earn $50,000 a year and spend $52,000 a year, in 20 years your debt is probably near $30,000 (thanks to interest).   Small deficits repeated yields high debt, both for governments and for the private sector.   Because yearly deficits were relatively small, and the economy seemed to be growing thanks to the bubbles, people had the illusion that growth would solve the debt problem.   In the US a brief surplus in the federal budget at end of the 90s made it seem like a solution was easy.   The high federal budget deficits in the last decade got rationalized by the aftermath of 9-11.

The brief budget surpluses were thanks to the bubble economy, and did not extend to the private sector — private debt kept growing, in part because no one identified it as a problem.   High debt and cheap credit created this crisis.   It’s different than the classic Great Depression crisis of over production.   Yes, easy credit was a factor there (margin calls, etc.), but the level of pervasive debt was nowhere near what it is now.   That makes this crisis unique and difficult to solve with traditional means.

Obviously it’s important to de-leverage — to pay down debt.   That’s been happening, especially in the private sector.   Governments have not paid down a lot of debt yet, in part because of macroeconomic pressure to stimulate recession weary economies.

Another lesson is the need to reform and re-regulate the financial sector.   The bubble and the extent of the collapse in 2008 was completely avoidable.   If over the counter derivatives had been subject to regulations of reporting and transparency, the big financial institutions could have never packaged dubious mortgages into bonds that confused ratings agencies stamped “triple A”.     That in and of itself would have done a lot to prevent the crisis since it was demand for mortgages to be packaged as bonds that created the intense increase in real estate prices.

Beyond that, incentives matter.   In the past lenders had incentive to be careful about who they lent money to.   If someone can’t pay their mortgage the bank stood to lose a chunk of money.   But when the demand for mortgages was high and brokers did not bear any of the risk, then there was an incentive to just provide the mortgage no matter what — even if it meant lying and arranging absurd loans to people who had no means to pay it back.    That also was engineered by the big banks, who then did all they could to try to decrease their risk (thereby creating systemic risk).

So three things need to be done:  pay back debt (de-leveraging), increase production, and create a functioning regulatory regime for the financial sector to prevent future credit orgies.      Increasing productive capacity usually involves investment, which works against paying back debt.    However, at a global level if the economies of export led growth countries like China start switching towards more internal consumption and less reliance on trade (something the recession is forcing them to do — bankruptcies are growing in China), then rebalancing is possible.   Things won’t be as cheap in the US so consumption will decline, but domestic production will grow, as will jobs.

Regulating Wall Street is a tougher nut to crack, thanks to the intense lobbying power of the big financial institutions.   Public pressure like “Occupy Wall Street” helps, and President Obama’s new found populism could give him support to push effective reform in a second term.    One can understand his coziness with Wall Street in the depths of a recession — you don’t want to scare the big economic actors.   But if the economy starts growing so too does the governments independence from big money.

So far my worst fears about this recession/depression have not been realized.   It’s not been the quick recession many predicted back in 2008.   It’s not just another business cycle recession.   There still is a long way to go.   But perhaps we’re turning a corner and it’s possible to see a way out of this that avoids catastrophe, even if there will be no return to the heady consumerism of 2006.    And just maybe we’re relearning the importance of virtue — focusing on the importance of work, family and values rather than material consumption.

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On a Roller Coaster

Blaise Pascal, 1623-1662

In our honors course we discussed a few intriguing minds over the last week.   Baruch (Benedict) Spinoza and Blaise Pascal were to of the most fascinating, each dealing with the power of the unleashing of human reason in the 1600s alongside the loss of authority of the Roman Catholic Church.

Baruch "Benedict" Spinoza, 1632-1677

Spinoza (1632-77) was a determinist and philosophical monist, who died when he was only 45.   Pascal (1623 – 1662)  was a fideist and Jansenist who gave up his amazing scientific career at a young age to devout himself to religion.  He died when he was only 39.   They both lost their mothers when they were young, both lived in ill health, both were on the margins of their religion (Spinoza rejected by the Jewish community while Pascal’s Jansenism was ultimately branded heretical by the Pope).

Though each were responding to the Meditations of Rene Descartes, they went in different directions.   Spinoza maintained a strong rationalism, even while rejecting Descartes dualism of mind and spirit.  Pascal was the ultimate skeptic, noting that even contradiction did not prove something untrue (nor did lack of contradiction indicate truth).

Pascal without a doubt had the more impressive intellect.   His early scientific discoveries are amazing.   He is said to have invented the first computer, pioneered work in probability (he lived in a community where gambling was very popular), and once when we had an energy audit at our house the auditor measured air pressure in “Pascals” — a remnant from his early work on barometrics.  There is even a computer language named in his honor.

Ultimately he sacrificed his scientific career to use his intellect to use reason to destroy reason.   He was one of the first who understood that reason itself cannot be a path to truth and that ultimately it could undercut any argument.   He seemed to sense that Christianity’s embrace of reason might come to haunt it later.    He took Descartes skepticism but, while Descartes escaped it through his “first principle” (cogito ergo sum – I think therefore I am), Pascal was unconvinced.   Overwhelmed by the absurdity of life, the superstition and pettiness of human nature, he decided that the only way to truth was through the heart.

Consider his rejection of the principle of contradiction.   That seems straight forward, if two things are in contradiction one of the two cannot be true.  I cannot be both human and not-human.  But Pascal’s skepticism extended to even the observations and logic that allows such linguistic constructions to be built.   You can never know through reason, reason devours itself.   But, he argued, through God’s grace you can know in your heart God’s love, and that will give one the perspective and understanding to live in an absurd world.   The heart has reasons that reason cannot understand.  Fideism was faith, and faith alone, with a commitment to an Augustinian notion of grace.

Spinoza, on the other hand, rejected the notion that there was anything different about mind/spirit and body, and saw reality as being all the same stuff, positing a deterministic world decades before Newton’s physics provided the clockwork universe (though keeping with Descartes’ view on universal laws.)    Perhaps an atheist or maybe a pantheist, Spinoza saw of all reality reflecting God’s will unfolding by necessity in a path already perfect and predetermined.   Free will is an illusion; reality is.

Good and evil become relative for Spinoza, something is only good or bad relative to your experience of it; as part of the whole neither good nor evil exist, all is perfection.   Humans can drive themselves crazy worrying about what will happen next, what their life has in store, or fretting over some mistake or threat.   But all of that is pointless, nothing can be changed.   Perhaps the only thing one can do is train oneself not to be shaken or disquieted by how reality is unfolding; one must just accept it with the knowledge that it is as it must be.

It strikes me that the two very different philosophies have one thing in common: they want to make the ride of life more bearable.   For each, life is like a roller coaster.   For Spinoza it’s a ride that you cannot alter.  After you’re strapped in and the roller coaster starts going up the first hill, there is no way you can change your experience.   Every curve, dip and loop is pre-determined, you cannot stand, move or do anything until the ride stops.   What you can do is enjoy the ride, scream, be scared, hate the ride, be mad, or whatever — all that you control is how you respond.   For Spinoza life is like that, to experience life to the fullest one must accept it is as it must be.

Pascal sees the absurdity of human existence in the tumultuous 1600s, as well as the roller coaster ride of reason.   Reason can prove anything, given the right assumption and definition.   Yet it can destroy any proposition, no truth claim can be made in the abstract through reason; all empirical claims can be questioned.   Skepticism may annoy philosophers, but it’s powerful, especially if one extends it to being skeptical of even skepticism itself!

So absurd, humans using this tool “reason” to try to figure life out, yearning for the “right answer,” or a “first principle” upon which to build some edifice of knowledge.   Doomed to fail or be locked in delusion, the absurdity of the whole effort overwhelms Pascal who decided that faith alone is the key.   God’s grace saves us from this trap, the heart can understand clearly what the head cannot comprehend.   Faith provides meaning where reason is helpless.

It’s easy to dismiss these brilliant thinkers now.   Quantum mechanics throws Spinoza’s determinism for a loop (though it creates a capacity for free will to exist within Spinoza’s framework — we may be playing out one path in a pre-determined set of possible paths).    Pascal’s faith in God can be seen as seeking emotional solace.   Moreover Pascal’s famous wager (a metaphor used because of all the gamblers of his era) is thrown a curve by the existence of many potential Gods to believe in.

Yet the roller coaster ride is still here.   Pascal criticized the way people lived through distractions, afraid of asking the question “who am I” and “why am I here.”   He certainly would recognize the same tendency in our modern hectic consumer society where distraction is a way of life.    Looking beyond the distractions and asking those questions leads many to the same kind of solution Pascal embraced: faith.   It may not always be Christian faith, but its a belief in the heart that life matters.

It’s a shame that we so rarely take the time to think about our intellectual history and how philosophers and thinkers handled the changes that have been sweeping western civilization for a millennium, and which now confront other cultures and peoples.  Understanding Pascal and Spinoza — and others — gives us insight on core dilemmas we still face, and how people worked through them in the past.  It won’t answer the timeless questions, but will help us get insight into various ways the nature of our world can be understood.  It is enriching and enlightening.

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No Need to Fear Islam

When I was in 7th grade I remember hearing about Islam for the first time, at least in an educational setting.   Our teacher, Mrs. Gors, asked us what religion was closest to Christianity.   Most people thought it was Judaism.  She said that she thought it was Islam, and she explained the basics of the Islamic faith.   I don’t remember much else, only that I was intrigued by the fact there were other religions that were well developed and had a considerable following.   Perhaps it sticks in my memory because that opened my mind to the fact that perhaps I was Christian simply by dint of geography.

Of course the rise of Islamic extremism with the Iranian revolution caused the faith’s reputation in the West to take a hit, but not a fatal one.   After all, there are Christian extremists as well.   During the 90s brutality against Bosnian Muslims and later Albanian Muslims in Kosovo painted the picture of Muslims as victims, minorities in a culture that was defined by brutal nationalism.

Then came 9-11.   Suddenly a man with an extreme, radical and bizarre interpretation of Islam launched an attack on the US.    19 of us followers managed to shock and anger (and awe) the country with the use of box cutters, hijacked planes and spectacular destruction.   For Americans the Taliban and al qaeda became the face if Islam.   Instead of being a great and popular faith spread over North Africa and down into Asia, it was seen by many as dangerous and scary.

Muhammad went from a prophet that people didn’t know much about to a demonized caricature, the most extreme forms of Islam became posited as the norm; the Koran was misinterpreted and taken out of context to make it seem like Muslims were commanded to kill all others.  Out of fear and ignorance people constructed an “other” that was irrational, unreasonable, unwilling to change, and therefore an enemy that had to be defeated.

Islam is a great world religion that is not going to go away, and trying to repress Muslim political expression is not only futile, but likely to create more harm than good.  The Ottoman Empire’s repression of peoples’ political voice and embrace of a very conservative form of Islam set up current difficulties.   Those problems are real but can be overcome.   The region has to start progressing, which means bringing all voices, including those of fundamentalists and extremists, into the mix.   There is no other way.

The US can facilitate this with a clear message:  We will not get involved in your internal affairs, we will assist you when our mutual interests make that possible, and we will respect our cultural differences.  All we ask in return is not to be seen as or treated as enemies.   For almost all Muslims that would be welcomed and start a path to a good relationship.

If not for the Israeli-Palestinian issue, that would be enough.    There can never be true normalcy in the region as long as the Arabs (and to a lesser extent non-Arab Muslims) see Palestinians being humiliated and denied basic rights in the occupied territories.    That doesn’t mean Israel is completely to blame, they’re in a tough spot with Hamas and Hezbollah kindling trouble: who can blame them for being hesitant?  But there is hope.

The Arabs blew the first opportunity in 1948 when they could have had a state containing far more territory than what they now could possibly dream of when they rejected the UNSCOP plan (Israel accepted it and declared statehood on its basis).   After losing the first Arab-Israeli war in 1948 the Arabs could have accepted their defeat.   They would have kept East Jerusalem and been able to construct a Palestinian state with no issues of Israeli territory.   Not wanting to compromise kept them from results that now would be seen as major Israeli concessions.

Yet Israel has also proven unwilling to entertain ideas that could finalize Palestinian borders.  My own view is that Arafat should have taken Ehud Barak’s 1999 proposals, but Israel could show some leeway on East Jerusalem and Palestinian borders.  If they had done that in 1999 then Hamas might not have become a factor, Hezbollah would be easier to counter, and a main irritant in Mideast relations could have been avoided.   Both sides are to blame, and neither side can “win” — the Arabs won’t push the Jews into the sea, the Jews won’t push the Arabs into the desert.

Though the positions there have intensified in the last decade, ultimately the two peoples’ destinies are linked.  They’ll fight or they’ll make peace, but neither will make the other go away.   One cannot be pro-Israel without being pro-Palestinian, or pro-Palestinian without being pro-Israel.   That irony is the biggest obstacle to piece, neither side wants to truly accept their shared destiny.

Still, after a decade of pessimism there may be cause for optimism.   As the Arab world changes, so to will change come in thoughts about Israel.   One reason the issue has remained so hot is that it was useful for the dictators to have something to unite their people around.   Now as Arab peoples slowly start moving into modernism and away from the old repressive regimes, they’ll need to rethink what is best for them and their respective states.

Islam is not anti-Jewish; the Koran commands respect for the other religions of Abraham, Judaism and Christianity.   Muhammad had many Jewish friends and allies.     Political Islam could actually hasten acceptance of a settlement in Israel by shifting the tone.    After all, religion only entered the conflict late, before 1973 it was about European colonizers taking Arab land, not Jews taking Muslim land.

First and foremost is to make sure that the West does not fear political Islam in the Mideast, or treat it as an enemy, thereby setting up a self-fulfilling prophecy.   Second, treating political Islam without fear does not mean ignoring our values.   A Taliban like state will have to be opposed.    If new leaders start acting like the old ones in denying people a voice, our support should be lukewarm.   We shouldn’t fear them, but shouldn’t treat them different from other third world states where we reward democracy (or at least moves towards more openness) and refrain from supporting authoritarians (especially now that the Cold War is over).   Finally, we need patience.   Modernism came to Europe from 1300 to 1900, and during that time there were wars, plagues, holocausts, ideological extremism, slavery and sexism.  Even in the last Century we had 11 killed by Nazis under Hitler, 20 million by Communists under Stalin.

Their transition need not be so messy, we’ve shown one possible path to modernism.  The Arab world and other Muslim states will choose their own path, not exactly like ours, but we can help avoid the extremes.   But we shouldn’t expect it to be smooth, nor should we give up on them because they don’t quickly leap into modernity.   We’re entering a new era, full of danger and promise.

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Occupy Wall Street and Globalization

Global protests show OWS to be more than a national event

There is immense confusion over the “Occupy Wall Street” movement.   The left embraces it, though they’re not sure where it came from or what it means.   The right ridicules it, though efforts to say it’s a bunch of “lazy losers” who “envy the rich” are laughable.  Those involved don’t make things easier because they tell multiple stories, ranging from professional anti-globalization demonstrators along for the ride and Ron Paul supporting libertarians who want to break the big money big government nexus.

37% have positive reactions to the movement in the US, only 18% actually oppose them.   People are frustrated and the taste of corporate bailouts and shady financial instruments leaves Wall Street one of the least popular set of institutions in the US.    The fragility of the global financial system which over leveraged itself and seemed oblivious to the danger it was creating for the entire system has shocked people from Frankfurt to Beijing.   There is a sense that something has gone wrong and leaders are clueless on how to respond.

Given the surprising rise of this movement and its capacity for quick expansion, I believe that we are not seeing a moment of rage that will pass when the weather gets cold in winter, but the start of a global movement to critique the power of big money and the lack of voice so many people have in an era of globalization.   It will not be a movement of socialism, but of democracy.   It will not have a clear ideological focus but an evolving agenda.  It will persist even after Zuccotti park empties and Manhattan returns to normal.

Globalization is the name that was given to “complex interdepedence” in the late eighties as it became clear that the growing links between economies noted by scholars of international relations in the seventies (most notably Keohane and Nye in their 1976 work Power and Interdependence) were expanding beyond what anyone had anticipated.    The two most important aspects of this was: a) the technology/information revolution; and b) the internationalization of capital.

Up until the 80s most investors were national.   To invest outside ones’ own borders was risky and difficult, and often faced legal obstacles at home.   Between 1980 and 1990 that changed completely.   In 1980 foreign direct investment in the developed world totaled $390 billion, while $302 billion went to the third world.  By 2008 developed world FDI was over $10 trillion, while in the developing world it topped $4 trillion.  Portfolio investment also grew rapidly.

Investors no longer had any reason to be loyal to their home state, corporations expanded to use whatever advantage they could to minimize cost and maximize profit.    In many ways these are good developments, naturally reflecting the way in which the instantaneous exchange of information can allow greater flexibility.   Toyotas now can be made in the US rather than having to be shipped from Japan, consumers can enjoy the fruits of inexpensive goods from countries with low labor costs, and with linkages between states growing, the chance for major war declines.

Yet there is a clear loser: the state.   States no longer have as much control over their economies, have less capacity to create strong social welfare systems and find it harder to create regulations they believe necessary to protect their publics or the environment.   Whether or not one agrees with those policies, the fact of the matter is the state is not as powerful as it used to be.   And, as political leaders become both dependent on financial and business institutions and vulnerable, they listen very closely to what Wall Street or Frankfurt or Tokyo insiders say.   Whether in the World Trade Organization, IMF or US Congress, the influence of big business and big finance has never been greater.

This also means that democracy is weaker in states with democratic traditions.    Law makers no longer have the power to give people what they want if what they want flies in the face of economic realities of the new globalized political economy.    We can’t save the paper mills in rural Maine if foreign competition leads those investors elsewhere; to try we have to make wages low and avoid even almost all regulations.    That’s economic reality.

Beyond that, if politicians listen more to big money in a world where political campaigns are often just marketing campaigns with slogans and focus group tested themes, elections become almost meaningless.   No matter what the candidate says, once in Washington (or Berlin, Paris, etc.) the candidate is limited to a rather constrained set of options.   Thus emotional rhetoric painting the other side as horrid and ignorant hides the real problem.   There isn’t a lot the politicians can do.

As long as the economy was growing, people didn’t care.   They had jobs and their retirement accounts were healthy. Even those middle class who had to have two incomes rather than one and whose high paying factory job was replaced by low wage work at a call center at least had cheaper than ever goods from Walmart.   As wealth inequity grew rapidly to its peak since the 1800s, the rush of new technology and economic bubbles hid the reality:  both the public and even the politicians were not really in control of where this ride was heading.

Meanwhile the financial sector, over leveraged and under regulated, set up the perfect storm that hit in 2008, turning what should have been a normal recession into near economic collapse and a long term slow down as de-leveraging spread.    This crisis came from the same folk who brought us cheap clothes and global connection – the global financial and business elite.

It’s not that they are bad people.   They are doing what they are supposed to do, trying to maximize profit, innovate, and make money.   It’s just that markets are not magic, and without regulation from the state, insiders are able to rig the game and hide the risks, altering what capitalist theory says markets should do.    Moreover, public values that may be different from raw market outcomes become irrelevant – democracy becomes weak and impotent.

That’s the motivation for OWS.   It’s a public effort to stand up and say there has to be a counter balance to big money and its ability to shape the system.    Except for a few on the fringe it’s not an attempt to demonize or destroy big money; for all the faults of the system, globalization is both a good and an inevitable thing.   Rather, it’s a demand that democracy not be sacrificed, since if it is, the only voice that matters will be those with the resources to shape the market.   And while there are market romantics who believe that somehow markets magically gives us what is best, such faith does not stand up to historical scrutiny.

Don’t expect OWS or the core demand for more transparency and democracy to go away.   Now that we’ve seen the damage big finance can do to the economy and the need for regulation, as well as concern for human rights and a sense of justice, these efforts will persist and grow as part of the global civil society.   They may push governments to reach agreements allowing for more political control, they may create local responses to the standardizing influence of globalization.   We don’t yet know where this will lead, or how the emerging global order will function.   We’re living at the dawn of a new era, and OWS reflects a logical response to the weakening of traditional state-centric democracy.

One can’t understand OWS or the changing global order through the lens of twentieth Century perspectives.

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The Iraq War, RIP

Shock and awe, March 20, 2003

President Obama’s announcement that all US forces would be out of Iraq by the end of the year, thereby ending the longest and one of the most divisive foreign policy actions in US history.

I still remember the spring of 2003.   I was finishing up my book on German foreign policy.   Gerhard Schroeder had won re-election as German Chancellor by actively opposing the US decision to go to war in Iraq.   I was adding the final pieces to my last edit when the war started on March 20 (19th if you count the attempt to take out Saddam the night before), and on April 3rd I finished for good, sending back the last changes.

I know it was April 3, 2003 because as I was making my final edits my wife came to let me know that it was time to go to the hospital.   “Five more minutes,” I said, finishing up.    We left at about 5:00 PM, and at 11:47 PM that same day our first son Ryan was born.   In that sense, I’ve always had a measure of how long the war dragged on by the growth of my son.   He’s now in third grade; the US has been in Iraq his whole life.

I was also teaching American Foreign Policy with a delightfully talkative class which debated and argued with each other in a way that never got mean or nasty.   Lance Harvell, now a GOP representative for my state district and neighbor was there, a non-traditional student who’d been in the military.   There was Sam Marzenell, Joonseob Park, Christine Rice, Sev Slaymaker and others, debating current events as they unfolded.

I opposed the war, arguing that Iraq’s political culture was not conducive to democracy and rather than be a quick, easy victory enhancing the US role in the region it could turn into a disaster dragging out over years and helping al qaeda recruit.  At least one student from that class who disagreed with me has since contacted me to tell me that they had to admit I was right.    I think most people who study comparative politics were skeptical of the idea of making Iraq into a model democracy, you don’t just remake societies.   This wasn’t like Japan and Germany after WWII, this was a divided pre-modern society with an Ottoman heritage.

Yet what I really remember from that class is how I felt like a good professor in that students were willing and able to debate me using real foreign policy arguments about policy, not fearing that I would somehow punish them for disagreeing (as one told me, some students suspected I gave higher grades to those who disagreed), and making really excellent points.    Why can’t all political disagreements be so heated in substance but friendly in form?    The day Saddam’s government fell I remember coming to class, tired because of our newborn son, and asked by delighted conservatives what I thought now that Iraq fell so quickly.   “Now comes the hard part,” I said, admitting that the war itself had been faster and more effectively than I had expected.

At that point support for the war was high.  It was just two years after 9-11, and Afghanistan was seen as a done war, with troops staying just to help the new government get off and running.   The next year, in 2004 when Dr. Mellisa Clawson from Early Childhood Education and I taught the course “Children and War” for the first time (we’re teaching it again, for the fourth time next semester) many students were nationalistic and reacted negatively sometimes to our clear skepticism about US policy.

In 2005 for me the tone changed after Vice President Cheney’s “last throes” quote describing the Iraqi insurgency on June 20, 2005.    On June 24, 2005 I wrote:

Cheney claimed (still believing his propaganda, perhaps) that the insurgency was in its ‘last throes’ (he defended that by talking about the dictionary meaning of ‘throes’) and — most absurdly — tried to compare this to the Battle of the Bulge and Okinawa.  That is the point where the propaganda becomes so absurd that it really had morphed into comedy.  This is not a battle against another military superpower where there can be a turning point or where they throw all they have at one battle hoping to turn things around.  This is a battle against an insurgency that is building, and which can choose targets, play the time game, and score political victories despite successes in the American/Iraqi military offensives.  If they are comparing this to Germany and Japan, they are grasping at whatever they can to try to convince themselves that things will get better.  They are out of touch with reality. 

By 2006 Iraq slipped into civil war, public opinion shifted against the war, the Democrats took the House, and President Bush’s approval ratings began an inexorable slide to some of the lowest in history.   Yet, in 2007 he made the right call. He dumped the original goal of defeating the insurgency and setting up a pro-American government with whom we would be allies and have permanent bases, and embraced a realist notion of making deals with the insurgents, focusing instead only on al qaeda and trying to create enough stability so we could declare victory and leave.  It was a retreat from the grandiose vision of the neo-cons, but for me it increased my respect for President Bush.  He did something that LBJ couldn’t do in Vietnam:  he changed course.

President Obama has taken that policy to it’s logical conclusion.   By the end of the year the US will be out completely, and efforts to leave Afghanistan are growing as well.    There will be time to reflect on the lessons learned from this war, and how it changed both the US and the Mideast.   The challenge of counter-terrorism remains.   The Arab world is at the start of a long transition which will no doubt have peaks and valleys, Pakistan and Afghanistan still represent uncertainty, but at least we’re not caught in a quagmire.

For now, it’s a time for a sigh of relief that this traumatic and costly conflict is now truly entering its last phase.   President Obama disappointed the anti-war crowd by a cautious winding down of the war rather than a quick exit, but combined with Gaddafi’s death in Libya yesterday, he’s piling up foreign policy success after foreign policy success.   And as bad as the economy is, I’d rather the economy be the main issue on the minds of voters than a foreign war.

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Gaddafi Dead

Libyan dictator Muammar Gaddafi is dead 42 years after he took power.   Having already lost Libya he was holed up in Sirte, his stronghold, fighting to the last minute.    Gaddafi was the Osama Bin Laden of the 1980s for Americans.    He was an organizer of state sponsored terrorism, a supporter of radical anti-American movements around the globe and had ambitions to control all of northern Africa.

The only bad news in this is that he lasted so long.  He was one of the most heinous criminals on the world stage and while there is justifiable celebration over his demise, his brutal criminal regime terrorized the Libyan people for over four decades.     In 1986 the US attempted to kill Gaddafi in bombing raids, seeing him as the most dangerous dictator on the planet.  This was a response to Libyan backed terrorism in Germany in which the LaBelle nightclub in West Berlin was bombed, killing three and injuring 229.   That was a nightclub known to be frequented by US military personnel so the US felt justified in trying to take out Gaddafi.    It failed because he was warned (either by the Italian or Maltese Prime Minister) ahead of time.

Two years later, on December 21, 1988 Gaddafi got his revenge as Libyan agents caused a bomb to go off on Pan Am Flight 103, which went down over Lockerbie, Scotland.    259 passengers and crew members died as well as 11 people on the ground who got hit by falling debris.    Calls for Gaddafi’s ouster intensified, but he hung on.

But his geopolitical ambitions were already on the wane.   Libya had lost a war to Chad in 1987 and within a year of downing Pan Am 103 the Soviet bloc disintegrated.    The world was changing, and Gaddafi’s influence declined.   After having tried to become a nuclear power in order to cement his leadership position in northern Africa, his WMD programs became a drain on the economy and increasingly meaningless.    As his political ambitions waned his family became more liked an organized criminal syndicate running a state. They siphoned wealth from Libya’s oil revenues, controlled economic relations internally, and ruled with an iron fist.

In 1999 they gave up their WMD program as part of a strategy to gain favor with the West.    It was a cynical shifting of position in recognition to the fact that Gaddafi and his family now had more to gain as a friend of the West rather than a foe.  They then settled the Lockerbie bombing case and promising to work with the West against its newest foe, al qaeda.   Unfortunately leaders in Europe and the US were all too willing to “forgive and forget” Gaddafi’s past.  By 2001 he had been weakened but now used better connections with the West to enhance his grip on power and buy support.

Yet he remained what he always had been: a ruthless tyrant.

Then on February 15, 2011 the arrest of human rights activist Fethi Tarbel sparked a riot in Benghazi.   The unthinkable happened – the Libyan people rose up and defied Gaddafi, starting a revolt.   They had early gains; emboldened by events in Tunisia and Egypt they hoped to bring down the repressive regime.   Gaddafi, seeing how Mubarak folded and was humiliated, decided to do everything in his power to defeat the rebellion.   He used ethnic rivalries, his control of resources, and the Libyan military to strike back.   Soon the rebels were losing ground.  Gaddafi, believing that the West would simply stand back, promised “no mercy” as he moved his military in position to crush the rebellion completely.   Most observers were expecting harsh retribution against those who had dared challenge his authority.   Gaddafi’s sons, once seen as reflecting hope that perhaps the next generation would bring more enlightened rule, echoed the threats.

On March 17th after Gaddafi’s forces took back most of Libya and were advancing no Benghazi the UN Security Council ordered a no fly zone over parts of Libya and authorized air strikes against Gaddafi’s forces.  On March 19th those airstrikes began and the government offensive was halted.   Slowly the rebels started to regain ground.    At first there was intense criticism of the UN action, enforced mostly by NATO airstrikes.  President Obama was criticized by some for acting too slow, but by many for doing anything at all.     As the fighting dragged into summer people accused the President of entering a conflict that could not be won.

NATO leaders knew that it was a matter of time.    With NATO air support the rebels would defeat the government, and it would be months rather than years.  They were right.   In August rebel forces entered Tripoli, and with Gaddafi’s death the rebellion is complete.

Gruesome image of Gaddafi after he was killed

Was this a success for President Obama?  Undoubtedly yes.   A dictator just as heinous and brutal as Saddam was overthrown, yet by his own people thanks to assistance from the West.  No American lives were lost, and the cost was far less than the wars in Iraq and Afghanistan.   This proved that the West will not always side with oppressive regimes if their people rise against them, and that the West is powerful enough and patient enough to offer effective assistance to those fighting oppression.   Moreover without western help it was clear that Gaddafi was going to crush the rebels with brutal force.

This also showed that the US was still relevant in the region; many thought that after the Iraq war’s high cost and ambiguous conclusion (still being played out), the US would be sidelined for quite awhile.  No way would the public support another foreign intervention.   Perhaps more important is the message this sends to other dictators.   The times are changing.   Being pro-western in your policy does not buy you a free pass to oppress your people without mercy.

President Obama’s foreign policy is a mix of realism and idealism.   He doesn’t sacrifice democratic principles for raw self interest, but he’s been willing to act even if it goes against international law.    Such “principled realism” has marked American foreign policy at its most effective, and for all Obama’s economic woes at home, his foreign policy has been strong.   Gaddafi and Osama are dead.  Clinton and Karzai are in Afghanistan planning how to end NATO involvement there, while there is serious talk of the US being out of Iraq completely by next year (except for military guards at the US embassy).   US status abroad is much higher than it was in 2008, and relations with important powers such as China and Russia have been smoother than expected.

Recent US allegations of Iranian plots to assassinate the Saudi ambassador have led to Iranian bombast against the US and Saudi Arabia.   But the Iranians know that Obama is not one to be pushed around, and instead of provoking an Iranian challenge to the US, there has been an internal challenge to Iran’s hardline leadership.   It’s not inconceivable that Iran’s hardliners will be pushed aside by a more moderate faction.  The patient but real successes of Obama’s foreign policy have been a relatively untold story thanks to economic woes, but it appears that one area where Obama will not be vulnerable next year is on foreign policy.

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