chez Nadezhda

Great minds and all that

nadezhda — Sun, 21 Sep 2008 13:21:08 -0400

Well after spending hours noodling outloud on why I object to the Treasury bailout proposal, Paul Krugman asks the same questions I asked and comes up with the same conclusions, but short and sweet:

What is this bailout supposed to do? [ed. That's the $700 billion question.] Will it actually serve the purpose? [ed. Not bloody likely!] What should we be doing instead? [ed. A real RTC-like effort.]

What's the heart of the problem? The pricing scenario (my Scenario 2) we must assume if the plan is to have any impact at all.

So where in this process does the Temporary Asset Relief Plan offer any, well, relief? The answer is that it possibly offers some respite in stage 4: the Treasury steps in to buy assets that the financial system is trying to sell, thereby hopefully mitigating the downward spiral of asset prices. But the more I think about this, the more skeptical I get about the extent to which it’s a solution. Problems: (a) Although the problem starts with mortgage-backed securities, the range of assets whose prices are being driven down by deleveraging is much broader than MBS. So this only cuts off, at most, part of the vicious circle. (b) Anyway, the vicious circle aspect is only part of the larger problem, and arguably not the most important part. Even without panic asset selling, the financial system would be seriously undercapitalized, causing a credit crunch — and this plan does nothing to address that. Or I should say, the plan does nothing to address the lack of capital unless the Treasury overpays for assets. And if that’s the real plan, Congress has every right to balk.

As they say, read the whole, short thing.
UPDATE: Fester has a good roundup of sensible objections in "talking points" format at Newhoggers.

This Turkey Won't Fly

nadezhda — Sun, 21 Sep 2008 13:03:40 -0400

The $700 billion Treasury proposal is a non-starter on a host of grounds. I'll leave it to others to spell out the awesome dreadfulness -- politically and even constitutionally -- of giving a lame-duck Bush Administration such a gargatuan blank-check. The proposal also flunks on basic "fairness" principles -- McCain's sketchy notion of a Mortgage and Investment Trust, though inadequate, would be preferable in that it at least places some cost to participation (warrants) on participating institutions.

On purely mechanical grounds, others can better explain why the notion that Treasury will be able to use market mechanisms (e.g. reverse auctions) to price the junk transparently is laughable, given the extremely heterogenous nature of the instruments they'll be buying. Again, as a mechanical matter, I'm less concerned about objections that Treasury would hire outside firms to dispose of the assets that are purchased -- the use of Asset Management Companies to handle the cleanup of busted banking systems is a familiar solution in financial crises. The objection to AMCs isn't their structure but that they don't move us any further in promoting workouts of mortgages so that the downward spiral in asset values can be ended.

But rather than objecting on political or technical grounds, I want to focus on what I see as the fundamental problem with the proposal. We don't know what this proposal is trying to accomplish. And under almost any scenario, it is highly unlikely to work. If this proposal had been made by an Asian government during the financial crisis of 1998, it would have been hooted down by international financial experts, led by the US Treasury, as wishful thinking and crony-protection on a gigantic scale.

This proposal isn't simply a matter of removing some toxic sludge that's gumming up otherwise healthy financial plumbing. As a two-year roll-over facility of $700 billion, it's a much bigger deal than the government getting new authority to provide liquidity to the system. With hundreds of billions involved, it's more than simply being authorized to take risky assets of uncertain value in return for providing liquidity to otherwise healthy financial institutions (FIs) who don't have access to the interbank markets due to the uncertainty that has frozen the global markets.

In very simple terms, there are two alternative possible objectives to this gargantuan proposal, but we haven't been told which one is the real purpose.

Treasury intends to pay a low price for toxic waste to desperate financial institutions (FIs), get the junk off the FIs' books, and allow the "system" to recognize the losses but stop further bleeding (any futher bleeding will take place in Treasury's hands at taxpayer expense), so the affected FIs can take further steps to delever their balance sheets and recapitalize.

Treasury intends to pay a high price for toxic waste, which will serve to effectively recapitalize FIs who are allowed to sell their junk to the government.

Scenario 1. If the government's purpose is to pay a low price merely to "stop the bleeding," there are two challenges. First, since FIs will not be eager to book losses that will leave their balance sheets exposed, only those FIs who find themselves in extremis are likely to take advantage of the facility. Second, stopping the bleeding is only the intial step. If an FI's core businesses is solid after the junk is removed, they'll still be left with repairing their balance sheets. They'll have to deleverage (selling off assets and engaging in less, not more, new lending) and recapitalize (finding new equity or highly subordinated debt from private investors). Most will be looking for a buyer. And if a buyer can't be found, it's liquidation time, most likely in the hands of a government agency like the FDIC. So a "low price" scenario will necessitate further government action, both to complete the clean-up process and to counter the credit crunch that will accompany deleveraging by surviving FIs. if Treasury is trying to smooth things over until the private sector or the FDIC or a future RTC can recapitalize/liquidate these firms, why not just do it straight away in a clean (and probably cheaper to the taxpayer in the long-run) fashion by setting up an RTC now.

Scenario 2. If the government's purpose is backdoor recapitalization, we have a different set of problems. This would be a pure bail-out, with no apparent cost to the participating FIs. The core dilemma, then, is how to allocate this taxpayer largess. Toxic waste is littered across the entire global financial system, not simply in US-based banks and investment banks but in foreign FIs (which are inextricably linked with American FIs -- a major reason why both Fannie/Freddie and AIG had to be taken over) and in non-banking institutions, from hedge funds to pension, insurance and mutual funds.

Objections to preferential deals will rise not only from those footing the bill -- US taxpayers -- but from other holders of US MBS, especially competing FIs. Treasury could allocate the goodies on the basis of need -- giving preference to FIs who needed recapitalization -- but that would reward the managers and shareholders who are most responsible for the current state of affairs. If I'm Citibank or BofA (or Deutschebank) and have managed to survive this long, how enthusiastic am I going to be if WaMu gets a bunch of junk taken off its hands at a price that allows it to stay in business? The "healthy" FIs benefit only to the extent that the system avoids a catastrophic meltdown or they escape rising liabilities or declining assets as parties to toxic Credit Default Swaps. These aren't minor benefits, but when the time comes for FIs to queue for freebies, how likely will it be that the healthier FIs won't scream bloody murder if they're forced to go to the back of the queue? Or as an individual investor, why should WaMu get a good deal on the junk it holds, when my own investment-grade bond fund, where I have my retirement funds, gets no benefit? (As an early indicator that eligibility for the toxic waste buy-up program may be highly prized, Calculated Risk notes that the Treasury Fact Sheet implies that foreign institutions may be eligible if they have substantial US operations. Not only fair but, since the crisis is truly global, probably necessary if the program is to have a chance at working.)

The only scenario that makes any sense is a highly unlikely "Goldilocks" scenario -- Treasury is able to set a price that's just right. This is the condition that Williem Buiter at the FT says is critical.

Prices should be higher than what the banks that own these assets now can obtain in the market, but as far below their fundamental value as is consistent with the survival of these banks. This is both to protect the tax payer and to create the right incentives for future risk taking by the banks. Punitive pricing is therefore essential. If the banks and their shareholders don’t complain loudly about expropriation through under-pricing, then prices are too high.

Buiter thinks a reverse auction would be able to find this just mean -- I and many others have my doubts given the characteristics of the instruments to be auctioned. But accepting for the sake of argument that a market mechanism could be devised to auction the toxic waste, it's a futher heroic assumtion that it will set a Goldilocks price. The prospects of the auction must hurt a little so sound FIs won't be encouraged to participate (they'd rather take the risk of further declines in asset values). But it can't hurt a lot, so wobbly FIs will be eager to participate. With a "Goldilocks price," only the toxic waste that's gumming up the system is removed. Under this unlikely scenario, once the dust settles and the "true" condition of everybody's balance sheets is clear, counterparties can once again deal with each other with confidence, and the regulators can determine which FIs are still in trouble and force their sale or shut them down.

Even under the Goldilocks scenario, the financial system would remain in a precarious state. That's because the proposal doesn't deal with the underlying deterioration in asset values -- the mortgage crisis itself -- nor does it address the ever-increasing liabilities (bond insurance, Credit Default Swaps) that are linked, directly or indirectly, to declining asset values and eroding FI balance sheets. Because it doesn't take a sufficiently systemic approach -- the erosion of asset values and the disruption to the credit markets -- it also isn't set up to deal with contagion into other classes of financial assets such as asset-backed commercial paper (credit card receivables, etc). So even the best case Goldilocks scenario doesn't address the ongoing credit crunch because it doesn't recapitalize the financial system, it only keeps it from collapsing.

The Treasury proposal is a gigantic exercise in temporizing. It's still treating the problem as a liquidity crisis, and as Dean Baker points out, Paulson's track record at temporizing hasn't been stellar -- he's consistently underestimated the scope and intensity of the crisis at each stage. And fundamentally, the proposal doesn't address the heart of the problem -- the continuing downward spiral in the value of US mortgage assets and the permanent damage that has been wrought on global financial institutions.

For $700 billion we should make headway on the core problems. It's evident that we can't rely on voluntary participation by mortgage holders in cleaning up the housing market mess, but the experience of the FDIC with IndyMac suggests that progress can be made when "voluntarism" is removed. Any workable proposal must, at its heart, provide a system that will force underwater mortgages into workouts where feasible rather than continue to flood local housing markets with vacant foreclosures. "Equilibrium" in the housing markets can be found at several levels -- we shouldn't have to wait until we have a total bloodbath in housing to begin gaining traction at a bottom of the mortgage market. Addressing the housing crisis isn't a "Christmas tree" add-on as a sop to Democratic politicians. It should be a core part of any proposal.

Any proposal should also openly undertake the process of recapitalizing or liquidating dodgy FIs at a cost to the managers and shareholders of those FIs. Backdoor recapitalization via generous prices for toxic waste isn't going to solve the crisis of confidence. First, it's non-transparent. It would reward the worst offenders. It would also privilege some FIs over others on arbitrary (regulatory discretion) grounds or by applying eligibility rules that leave out important classes of affected FIs. When combined with other recent regulatory forebearance (e.g. allowing the recognition of "goodwill", exemptions to net capital requirements that have permitted excessive leverage), non-transparent recapitalization will leave much of the financial system fragile and susceptible to further unpleasant surprises.

We need a FDIC/RTC-type hybrid now that would temporarily take over problem FIs, engage in triage, supervise the purchase or recapitalization of those that can survive, and liquidate the others in an orderly fashion.

The proposal should also outline a plan for bringing the Credit Default Swap market under control and for establishing a regulated market in credit derivatives going forward.

If that costs $700 billion -- or even eventually carries a higher price tag -- so be it. But at least we would know where we were trying to get to and how we intend to get there. Which we certainly can't say about Treasury's proposal.

But whatever we decide to spend our $700 billion on, it's important to recognize that we have choices. The real economy may not yet have taken a giant hit from our financial sector difficulties, but it's just a matter of time. We're not going to avoid a significant recession, but attention to the real economy should help us avoid a depression. While addressing the current financial crisis, we need to take real sector effects into account in any program going forward. Here are some thoughts on what our choices might be from Steve Randy Waldman at Interfluidity:

I think we'll only get one shot to set things right by throwing a ton of money at the problem, so we'd better think carefully before we throw it at symptoms rather than causes. Trying to figure this out in a week before Congress goes off to reelect itself strikes me as ambitious. Broadly, my view is that if we are going to legislate, Congress should empower regulators to declare systemically important firms insolvent, write off existing common and preferred, fire incumbent management and unilaterally convert debt to equity as far up the capital structure as they need to go until the firms are unambiguously well-capitalized, with little or no public money involved. Going forward, investors should understand that firms that are too big to fail are too big to be debt-financed, and government enforcement of debt claims against such firms will be limited. If economies of scale are real, equityholders should be glad to reap them. Otherwise markets function better anyway when populated by small actors who compete rather than by behemoths who dominate. The government should not subsidize the many negative externalities of scale. Members of the Pigou Club might suggest that bigness should be taxed and diversity subsidized.

As far as the money is concerned, throw it at infrastructure. Increase worker bargaining power by offering Federally funded retraining sabbaticals for any worker over thirty who decides they want to retool. I'd rather see a new WPA than a new RTC. If it is true that during a debt deflation, the government can spend freely without fear of inflation, let's spend in a way that balances the economy, not in a manner that tries to ratify the imbalances that brought us here in the first place.

There's no such thing as a choice-free bailout. The government's largesse will go to some and not to others, and we have to decide. Don't believe self-styled technocrats who claim that science or the market tells them who deserves the tax- (or inflation-) payers' dollar. In a bail-out, there are winners and losers, and we get to pick. I think we should focus on a simple goal: Restructuring the economy so that the vast majority of Americans can afford a middle-class lifestyle with very little leverage on household or government balance sheets. That may be a radical suggestion in 2008, but our grandparents would have considered it only common sense.

Recommended reading:

Doublas Emendorf, Brookings: Concerns About the Treasury Rescue Plan -- good technical analysis; includes pros/cons of optional approach of Treasury buying equity in troubled firms

Paul Krugman: Doubts about the rescue
No Deal
Authorization for use of financial force

Henry Blodgett, ClusterStock: The critical question about Paulson's rescue plan

Naked Capitalism: Why you should hate the Treasury bailout proposal

Calculated Risk: Some thoughts on the bailout

Interfluidity: Truth and Reconciliation -- on why transparency in pricing and participation is essential to a bailout proposal

David Merkel: Oppose the Treasury's Bailout Plan -- and bring back a true RTC

Robert Reich: The Coming Bailout of All Bailouts Bill -- A Better Alternative

Mary Kane, The Washington Independent: AIG raises bar for action on mortgages: Activists push for mortgage crisis intervention

One picture says it all

nadezhda — Fri, 08 Aug 2008 13:25:32 -0400

If Obama wins, the Republicans in Congress will suddenly discover the "fiscal rectitude" religion, and along with the Blue Dogs, will try to water down or defeat every Obama economic policy initiative. We've seen this game before -- Dems have to be the adults, tale the punch bowl away, and clean up Rep messes.

Steve Greenberg, via Crooks and Liars.

Obama's exercise in rhetoric

nadezhda — Thu, 24 Jul 2008 18:35:33 -0400

Not substantively important, since Obama said nothing surprising in Berlin, but I enjoy well-constructed speeches, so here are a few things I noticed.

In the run-up to Obama's Berlin speech, much has been made of the obvious echos of JFK and Reagan. As the speech is picked over (now and for years to come), all sorts of allusions will be identified, starting with the obvious "walls that cannot stand": "These now are the walls we must tear down."

There are also the familiar little Lincoln motifs -- used less for content than because they are so evocative to our ear, a bit like the King James version for earlier centuries: "now the world will watch and remember what we do here," "form a more perfect union."

What I find continually interesting in Obama's speeches, however, are not just the individual quotations or flourishes, but the way he uses references or allusions to other famous and familiar speeches to structure his own in unexpected ways. His national security speech of July 15 used George Marshall's Harvard speech, but not as a cliched call for another Marshall Plan. Rather, he invoked Marshall as an example of someone who responded with imagination and judgment to a world that presented an entirely new set of challenges -- that changing our "mentality" about our role in the world is as important as any specific policy or Marshall Plan.

Today, a central "structuring" reference comes at the end of Obama's speech. It's not from a speech by an American in Berlin but is equally relevant for the Berlin location because it was from FDR's Four Freedoms speech, delivered in January 1941 when Nazi Germany was FDR's primary concern.

Here's FDR's State of the Union in January 1941:

In the future days, which we seek to make secure, we look forward to a world founded upon four essential human freedoms.

The first is freedom of speech and expression--everywhere in the world.

The second is freedom of every person to worship God in his own way--everywhere in the world.

The third is freedom from want--which, translated into universal terms, means economic understandings which will secure to every nation a healthy peacetime life for its inhabitants-everywhere in the world.

The fourth is freedom from fear--which, translated into world terms, means a world-wide reduction of armaments to such a point and in such a thorough fashion that no nation will be in a position to commit an act of physical aggression against any neighbor--anywhere in the world.

Obama uses the Four Freedoms to wind up his remarks, presenting them as the ideals that both form the basis of American identity and that are shared with the world -- and via his own father, how he personally came to be both a proud American and, echoing JFK's inaugural,* a "fellow citizen of the world." This links back directly to how he identified himself when he began the speech:

I come to Berlin as so many of my countrymen have come before. Tonight, I speak to you not as a candidate for President, but as a citizen – a proud citizen of the United States, and a fellow citizen of the world.

.
And then the Four Freedoms and how they connect to both his personal identity and that of his audience:

>What has always united us – what has always driven our people; what drew my father to America’s shores – is a set of ideals that speak to aspirations shared by all people: that we can live free from fear and free from want; that we can speak our minds and assemble with whomever we choose and worship as we please.

He then segues to reinvoke Berlin's history, which he had earlier described extensively. The Berlin reference hooks the end of his speech back to his introduction of himself to the audience via an echo of JFK's "Ich bin ein Berliner". When Obama says at the outset he is "a fellow citizen of the world", he shows us by the end of the speech that it is the same claim of citizenship that JFK made.

Rather than repeat explicitly JFK's self-identification as a Berliner, Obama gets to the same place at the end of his speech by connecting the Four Freedoms with the world's response to the Berlin airlift:

It is because of these aspirations that all free people – everywhere – became citizens of Berlin.

So the rhetorical connections are:

Obama via his father: and JFK Four Freedoms = proud citizen of US + fellow citizen of the world and

Obama via JFK and Cold War generations:Four Freedoms and Berlin airlift = citizen of Berlin

The final formula, linking the opening and concluding paragraphs, is: FDR's Four Freedoms (American ideals and universal aspirations) plus shared historical experience (JFK and Cold War generations in Berlin) plus a partnership for the future (Obama and audience in US and Europe.

Here are the final paragraphs of Obama's speech.

But I also know how much I love America. I know that for more than two centuries, we have strived – at great cost and great sacrifice – to form a more perfect union; to seek, with other nations, a more hopeful world. Our allegiance has never been to any particular tribe or kingdom – indeed, every language is spoken in our country; every culture has left its imprint on ours; every point of view is expressed in our public squares. What has always united us – what has always driven our people; what drew my father to America’s shores – is a set of ideals that speak to aspirations shared by all people: that we can live free from fear and free from want; that we can speak our minds and assemble with whomever we choose and worship as we please.

These are the aspirations that joined the fates of all nations in this city. These aspirations are bigger than anything that drives us apart. It is because of these aspirations that the airlift began. It is because of these aspirations that all free people – everywhere – became citizens of Berlin. It is in pursuit of these aspirations that a new generation – our generation – must make our mark on the world.

People of Berlin – and people of the world – the scale of our challenge is great. The road ahead will be long. But I come before you to say that we are heirs to a struggle for freedom. We are a people of improbable hope. With an eye toward the future, with resolve in our hearts, let us remember this history, and answer our destiny, and remake the world once again.

* Given all today's right-wing ruckus over "fellow citizen of the world", here's the quote from JFK's inaugural address:

And so, my fellow Americans: ask not what your country can do for you—ask what you can do for your country.

My fellow citizens of the world: ask not what America will do for you, but what together we can do for the freedom of man.

Obama Grand Tour and McCain Circus Roundup

nadezhda — Mon, 21 Jul 2008 21:59:22 -0400

I don't know what has been more fun to follow over the past few days -- the McCain campaign's scramble to play catch-up with Maliki's suppport of an Obama-esque timetable, or the US media starting to go all-meta on their own coverage of the Obama trip. There are too many gems for a single QOTD, so here are a few highlights.

The first stage of "We're f**ked" is Denial

Even though McCain was given an extra 24-hour news cycle -- the delay in coverage by the NYT and WaPo was, as Steve Benen remarked, journalistic malpractice -- he and his campaign are running around like ham-handed headless chickens. They seem to be stuck in the Denial Stage even though the evidence was clear from the outset that Maliki was serious.

The focus in the media and in the McCain campaign's (various) responses has been on whether Maliki really gave a quasi-endorsement of Obama's "sixteen months" -- the whole walkback nonsense. However, the interview has been on Spiegel's site since Saturday, and in the interview Maliki expresses several times the need for an end-date, the sooner the "more realistic". There could have been no confusion on McCain's staff about the overall thrust of Maliki's position if they read the interview. The "mistranslation" excuse was transparently feeble from the outset.

For all McCain's vaunted international experience, this episode is displaying him as someone who isn't what we might call "agile" at handling an unexpected international curveball. Joe Klein hit exactly what I've been thinking:

I suppose that McCain's stubborn brittleness on this subject isn't news. But his inability to respond to a major change in policy from our Iraqi allies -- the announcement that they can take it from here -- certainly is newsworthy. There are three possibilities:

McCain doesn't believe the Iraqis can take it from here. (In the most benign reading, he may see this new position as mere domestic political posturing on Maliki's part, which is no doubt part of the truth.)

McCain doesn't want the Iraqis to take it from here. He still wants long-term, 100 year, military bases.

McCain doesn't move very quickly to adapt to changing facts on the ground. None of them speak very well of the guy. [emph. added]

I think it's "all of the above" -- but especially the last factor. McCain is so wedded to a particular view of the Iraq War, the GWOT, and the US role in the Middle East, that he can't adapt. If he had had a more realistic understanding of the situation, Maliki's remarks wouldn't have -- or more accurately, shouldn't have -- come as such a bombshell.

The second stage of "We're f**ked" is Anger

Some of McCain's supporters are ahead of their candidate and acknowledging that Maliki appears to mean what he says. But that's not to suggest they're to the Acceptance stage yet. They're getting mad that "our guy" isn't following the script. Rob Farley's been tracking the emergence of the Anger crowd at the Corner.

At 11:38 AM EDT, Rob remarked (echoing a constant refrain of our own Eric Martin):

The conservative media and Right Blogistan have been undertaken to steadfastly ignore any hint that Prime Minister Maliki might and his political allies might have connections with Iran, preferring instead to assert that Iran influences events in Iraq through Sadrist militia and Sunni tribes (!). Given Maliki's statements on withdrawal, I wonder this: How long it will take for an anti-Maliki trope to develop on the American right that concentrates on his Iranian connections?

Ask and ye shall receive! Less than two hours later, Rob noted:

Andrew McCarthy answers my question:
As I've mentioned before, Maliki, of the Shiite Dawa Party which opposed the 2003 U.S. invasion of Iraq in the first place, has long-standing ties to Iran and Syria -- and has expressed support for Hezbollah. The only thing that surprises me about this story is that anyone is surprised.
McCarthy also chides Maliki for being insufficiently grateful for the awesomeness of the Surge. Look for more of this as Maliki fails to walk back his statements...

But as Daniel Larison points out, maybe John McCain is simply too confused to be angry.

McCarthy is entirely right in what he says here, but that raises a couple questions. First, there is the obvious question of why the U.S. is attempting to pursue a strategy premised on limiting Iranian influence in Iraq and the region while actively backing a government that has no intention of limiting Iranian influence in Iraq and very clearly is led by a sectarian party.

[snip]

Even more than creating a political problem for McCain back home, Maliki’s recent statements have revealed both the untenability of a continued U.S. presence in Iraq and the complete incoherence of U.S. strategy in that country.

Serious ouch! And then John Derbyshire added his two cents. Again from Rob:

Shorter Derb:
All of your country are belong to us now.

Verbatim Derb:

We should tell Maliki, loudly and in public, that he owes his job to us, and that further prosecution of our military operations in his country will be conducted with regard only to U.S. interests, as determined in consensus by our established domestic political processes. And if he doesn't like that, he can go to hell.

God, I am so glad that this incident has caused the right to discard its phony interest in democracy promotion...

To be fair to Derb, he's always been a "To Hell With Them" Hawk, so his sentiments should come as no surprise. As he remarked today: "This absurd and insane desire to be loved and admired by foreigners will be the death of this republic." Derb doesn't have to do Denial -- he starts (and finishes) with Anger.

Those "Listening to Commanders on the Ground" C-i-C Credentials

If there was one piece of Conventional Wisdom we've heard for the last week about Obama's Grand Tour it was that the trip was risky but necessary. Obama had to show voters he would be "acceptable" as Commander-in-Chief. Obviously, he wouldn't be better at foreign relations than the tough, seasoned veteran, John McCain, but Obama had to somehow find his way across the "acceptability barrier."

So here's the Photo of the Day (photo released by US Army via Mark Halperin).

As Michael Crowley notes: "Hmmm, Petraeus doesn't look like he's been telling Obama he's a defeatmonger. "

Worse yet for McCain image-wise are these photos paired together by Ben Smith of Politico: "It's not really close," says Ben. Heh, indeed!

And what would be a Circus without Coverage of the Coverage of the Coverage...

Jesse Taylor is back!

Despite the fact that his foreign policy vision has been largely validated in the past week - McCain caught up to Obama on Afghanistan and the aforementioned endorsement by Maliki - the main discussion today and over the past few days has been whether or not the press is covering Obama’s trip too much and whether or not the coverage of them talking about the coverage results in too much (and too favorable) coverage for Obama. It’s a tesseract of inanity - a new fourth dimension of coverage about the coverage of the coverage will soon emerge, with Jessica Yellin invited on to discuss how she talked about her in-depth discussion of the impact of Obama’s trip on the race...without ever mentioning what Obama did, how he did it or who he did it with.

Call it the Fafblogging of the media: CNN is the whole world’s only source for CNN! [emph added]

Now if we only still had Billmon!

Biden has Obama's Afghan back = update - and the Pentagon too

nadezhda — Thu, 17 Jul 2008 13:21:23 -0400

This item from Mark Murray at MSNBC's First Read is worth copying in full:

Remember that letter that South Carolina Sen. Jim DeMint (R) sent to Obama -- over the fact that the Foreign Relations subcommittee that Obama chairs hasn't held a hearing on the issue of Afghanistan?

Well, Foreign Relations Committee chairman Joe Biden -- a possible Obama veep pick -- responds to DeMint with his own letter. "As you are aware, under my chairmanship the Foreign Relations Committee has addressed most Afghanistan issues at the full committee level. I believe that this is the best way of ensuring the most comprehensive examination of the complex issues involved, and of ensuring the highest-level Administration participation," he writes.

"On the particular issue of NATO’s mission in Afghanistan, we have held three full committee hearings in the last 22 months... At all three of these hearings, we were fortunate enough to have the expert testimony ... of former NATO commander and Supreme Allied Commander-Europe, Gen. James R. Jones (USMC, ret.). At my request, Sen. Obama chaired the confirmation hearing for our next ambassador to NATO, which he focused on NATO’s mission in Afghanistan."

Biden concludes, "Sen. Obama has displayed great leadership on this issue: he called nearly a year ago for the deployment of at least two additional combat brigades to Afghanistan -- it has since become the accepted position of a wide range of U.S. military officials, including the Chairman of the Joint Chiefs of Staff. I look forward to working closely with him, and with you, on any future Afghanistan hearings that might be held in our committee."

UPDATE: And the Pentagon seems to have Obama's back as well. From the AP.

Pentagon leaders on Wednesday signaled a surge in U.S. forces in Afghanistan "sooner rather than later," a shift that could send some units there within weeks, as officials prepare to cut troop levels in Iraq.

Senior military officials are looking across the services to identify smaller units and other equipment that could be sent to Afghanistan, according to a defense official.

Although there are no brigade-sized units that can be deployed quickly into Afghanistan, military leaders believe they can find a number of smaller units such as aviation, engineering and surveillance troops that can be moved more swiftly, said the official, who requested anonymity because the discussions are private.

The moves are expected to happen within weeks rather than months, the official said.

The decisions are being made against the backdrop of shifting priorities for the U.S. military, and were discussed during a meeting Wednesday of the Joint Chiefs of Staff.

Military leaders are weighing requests from commanders in Afghanistan for more troops, aircraft and other assistance. And they are trying to determine the right balance between the needs of the force in Iraq, versus troops in Afghanistan who are facing a Taliban resurgence.

To date, the fight in Afghanistan has taken a back seat to Iraq, which has been the strategic priority. While Iraq will remains the top goal, it now appears the military believes there should be a more urgent emphasis on Afghanistan than there has been.

Cross-posted at American Footprints

Bush's Pakistan-Afghanistan-Iran "legacy" - updated

nadezhda — Thu, 17 Jul 2008 13:08:28 -0400

To follow up on Armchair General's post on Burns' announced participation in talks with the Iranians and Haggai's comment that this may be following the North Korea multilateral pattern.

One further thought on the mini-"opening" to Iran, especially if the Guardian is right that State is going to get its way finally and be allowed by the White House to open a US interests section in Teheran.

I think the White House has finally become seriously spooked about Pakistan. When Benazir was assassinated, they lost Plan A and there never was a Plan B. They've been treading water while watching things go from bad to worse in both Pakistan's domestic political chaos and in the border areas with Afghanistan. The US doesn't have more troops to put in, and even if there were a few more brigades available, everybody (except Mr "I authored the Surge(TM)" McCain) seems to realize that the military isn't going to solve this problem, it's only a finger in the dike.

Whoever is the new President come January, US-Pakistan policies are going to have to be reworked entirely. The Biden-Lugar economic aid package, which Obama is sponsoring, is just the first step.

But one factor surely is common to any options for dealing with Af-Pak -- keep western Pakistan stable. Which means having cooperative, if not cordial, relations with the Iranians re Afghanistan has become more than just desirable -- it's an absolute imperative.

Bill Varner at Bloomberg reports today on this topic, although it's framed as the sorts of trouble Iran could cause if it were attacked. However, Varner's observations are equally relevant to the options the US faces in adjusting its approach to the Afghanistan-Pakistan gordian knot.

Khalizad is making noises about the potential mischief Iran could make, and US Ambassador William Wood is claiming that Iran is helping arm the Taliban, under the "fingers in every pot" theory of influence. The Iranians themselves are miffed that the US didn't build on their initial cooperation when the US first invaded Afghanistan, so they're not rushing to help the US counter the Taliban. One assumes, however, that the Iranians aren't eager for western Afghanistan to become a Sunni fundamentalist hotbed. So the US objective should be to persuade the Iranians to shift back to their more cooperative mode on the Taliban.

While the world focuses on tensions between Afghanistan and Pakistan 800 miles to the east, U.S. officials keep watch on Iran's expanding presence in Herat and the surrounding province of 2 million people. The region might play a major role if conflict erupts over Iran's nuclear program.

Should Iran's nuclear ambitions spark hostilities, it would use its sway in western Afghanistan as a ``bargaining chip,'' said Afghan-born Zalmay Khalilzad, the U.S. ambassador to the United Nations and former envoy to Kabul. If attacked, Iran ``could make life difficult for us'' in Afghanistan, he said in an interview.

Iran has ``intelligence operatives everywhere, military commanders who work for them'' in the region who could be deployed to stir up trouble, including riots, said Barnett Rubin, an Afghanistan specialist at New York University's Center on International Cooperation.

For now, Tehran's investment of $500 million in the region has helped the U.S. by minimizing the influence of the Taliban extremists who once ruled the country and the sort of violence they have inflicted on southern and eastern Afghanistan. Iran paved half of Herat's streets and 40 miles of highway leading north, built schools and health clinics and partnered with Afghan companies in an industrial park.

``It's not just investments, but also trade,'' said Ali Shah Ahmedi, the 43-year-old manager of Herat's Tejarat Hotel. ``I have Iranian businessmen staying here all the time, coming to buy or sell goods'' such as packaged foods and motorcycles.

Sana, 42, holds forth from his office in the Herat Trade Center, a modern nine-story building of gleaming blue glass that helped inspire residents' nickname for their city: ``the Dubai of Afghanistan.'' A hotel, law offices and a finance company that supports farmers are connected by an Afghanistan rarity: an elevator.

Traffic lights in Herat work, in contrast to the capital, Kabul, so vehicles flow smoothly around the Blue Mosque, an 800- year-old, blue-tiled landmark. Herat is cleaner than Kabul, with more trees and parks, and less dangerous, with fewer visible police and troops.

Ties between Iran and Herat run deep. The city was the capital of 15th-century Persia, and Iran held Herat until midway through the 19th century. Heratis, mostly Sunni Muslims, today speak a dialect closer to the Farsi spoken in Tehran than the Dari used in Kabul.

Predominantly Shiite Iran opposed the Sunni Taliban -- who refused to educate girls when they ran Afghanistan, among other strictures -- as extreme.

After the Taliban were toppled for harboring the terrorists behind the Sept. 11, 2001, attacks, Tehran's government helped the U.S. and the UN begin the political transition that led to Hamid Karzai's election as president.

Iran's leaders feel that contribution wasn't properly acknowledged, said Manouchehr Mottaki, its foreign minister. The slight explains their refusal to help fight the Taliban's current insurgency, he said.

``We limit our cooperation with Afghanistan to helping reconstruct the country,'' Mottaki told reporters at the UN on July 2.

William Wood, the U.S. Ambassador to Afghanistan, said Iran now helps arm the Taliban. Tehran's policy is to ``make everyone a loser'' in Afghanistan, he said in a Kabul interview.

Karzai is ``walking a very fine line'' and doesn't accuse Iran of actively supporting the insurgents, said Humayun Hamidzada, the president's chief spokesman.

``President Karzai believes Iran has a positive role to play in Afghanistan,'' Hamidzada said last week in Kabul. ``We are working with the U.S. and Iran, and don't want to become the battleground for their conflict.''

Iran's presence in Afghanistan will be an issue for the next U.S. president.[No kidding!!!]

I would be astonished if the Bush Administration were able to make significant headway with the Iranians on Afghanistan, even though it's clearly in both nations' interest to cooperate. The calendar is increasingly becoming a tyrant for the Bush Admin. There are too many interrelated regional issues within which the nuclear matters (and Iran's long-term security interests) will have to be addressed, and too few months until the height of the election campaign. It's too hard to break the Iranian relations into discrete pieces -- nuclear, Iraq, Afghanistan, Lebanon, etc. -- because they're so intertwined. So there's really no way to avoid linkage.

The Bush Administration would also have to go a long way to convince the Iranians they should deal with Bush now rather than wait for the new US President. And whoever the elected President is, he's going to want to have his own say in any overall deal with the Iranians.

However, W seems to be heavily invested in "legacy" planning. I expect he'd like to be able to claim credit for having "laid the foundations" for future progress on these issues to mitigate the blame for leaving an unholy mess behind in Af-Pak. Hence his stated intention, as Haggai noted, that "he expected his remaining months in office to 'leave behind a multilateral framework' for dealing with Iran."

It will be interesting to see how far Bush's commitment to his own "legacy" leaves McCain dangling in the wind on the campaign trail.

UPDATED: Another sign that the White House is increasingly spooked by Afghanistan-Pakistan is this AP interview yesterday with an unidentified "defense official." It suggests the intensity of the scramble underway to meet the needs for additional forces in Afghanistan, which Sec Gates and Adm Mullen have been discussing with the press:

Senior military officials are looking across the services to identify smaller units and other equipment that could be sent to Afghanistan, according to a defense official.

Although there are no brigade-sized units that can be deployed quickly into Afghanistan, military leaders believe they can find a number of smaller units such as aviation, engineering and surveillance troops that can be moved more swiftly, said the official, who requested anonymity because the discussions are private.

The moves are expected to happen within weeks rather than months, the official said.

The decisions are being made against the backdrop of shifting priorities for the U.S. military, and were discussed during a meeting Wednesday of the Joint Chiefs of Staff.

No wonder McCain suddenly announced the need for one of his Surges(TM) for Afghanistan on Tuesday.

Cross-posted at American Footprints.

Then WTF is a "bail-out"?

nadezhda — Wed, 16 Jul 2008 15:00:27 -0400

At his press conference yesterday, President Bush assured his listeners that he won't do financial sector bail-outs.

President Bush also wanted fast action on his latest proposal to rescue Fannie Mae and Freddie Mac in Congress. He strongly endorsed Treasury Secretary Henry Paulson's plan but asserted definitively that the two companies would continue to be held by private investors. Bush also rejected the notion that the government would bail out any private enterprise.

But, but... government support for Fannie Mae and Freddie Mac that doesn't wash out current equity holders is... ummm, how shall we say this... exactly what a "bail-out" is. If we provide financing to keep Fannie and Freddie up and running but leave the equity holders in place, when their shares are underwater, we are bailing them out!

The best summary I've seen of the Fannie/Freddie situaton -- history and current problems -- is by Tanta at Calculated Risk. As they say, read the whole thing. Looking at the core function of the GSEs (government sponsored enterprises) -- which is to provide liquidity to the mortgage origination markets -- she explains:

They have always been about recycling lending capital and taking long-term fixed interest rate risk off depository (and eventually non-depository) lenders much more than about merely absorbing credit risk. This goes against the grain of much current media over-simplification of "securitization" of mortgage loans that sees laying off credit risk as the main or even the only point of selling loans. The GSEs do take on the credit guarantee obligation of the securities they issue, but nobody sells loans to the GSEs just to offload credit risk--in fact, more than a few lenders work hard to negotiate contracts with the GSEs that leave quite a substantial part of the credit risk with the original lender: recourse agreements, indemnifications, servicing options that put a lot of the cost of default on the seller/servicer, not the GSE. They have historically done this because the credit risk of GSE-eligible loans has always been modest, but the benefits of getting 30-year fixed interest rate loans off your balance sheet has been substantial.

For decades, I have believed that Fannie and Freddie either should not have been privatized or should have been more strictly reined in. They serve, and must continue to serve, a critical function for US (and gobal) debt markets. But they're not ordinary financial institutions. They are public utilities which shouldn't be managed, as private financial institutions are, primarily for the benefit of the holders of their capital base (as currently structured, common and preferred shareholders) and their management.

The backing of the Federal government is the sine qua non of these institutions' existence and successful functioning. Without that implicit guarantee, they would never have fulfilled their public roles -- providing reliable liquidity to the mortgage markets in good times and bad, and setting widely-adopted standards for loan origination and servicing, which made the development of a healthy mortgage-backed securities market possible in the first place.

In recent years, managers and shareholders of the GSEs grew sloppy and forgetful about the real nature of these institutions. They forgot the instiutions were public utilities and that they had a duty to protect the implicit guarantee which made their business possible. Instead, they adopted the same expectations as typical corporate management and equity holders, with a focus on growth, retaining market share in a rapidly growing and increasingly risky market, and pumping up earnings, in order to justify huge executive compensation packages and higher share prices. They also had a lousy corporate governance structure, about which critics on both left and right have complained for years.

When housing market innovations started leaving them behind, instead of sticking to their knitting, they went running to Capitol Hill, where they enjoy enormous power on both sides of the aisle. They were allowed to stray into parts of the housing bubble where they didn't belong while simultaneously ignoring and taking advantage of the implicit government guarantee. Their behavior helped to magnify the overall size of the housing bubble and delay its bursting. (See Tanta for a nice summary of recent history.)

Today, the leverage ratio of Fannie's equity to on- and off-balance-sheet liabilities is, depending on which measure one uses, between 68:1 and 128:1. By comparison, leverage for a healthy private financial institution is likely to be in the range of 10:1 to 20:1, depending on what lines of business it is in. The implications of that excessive leverage are spelled out in a restructuring plan proposed by hedge fund manager William Ackman of Pershing Square Capital Management. (See attached pdf, which is an excellent view of the situation, regardless of what you think of Ackman's proposed solution). As Christine Richard of Bloomberg explains:

Ackman, 42, has his own plan that would see Fannie Mae raise about $86 billion in capital by giving investors in $750 billion of senior unsecured notes 90 cents on the dollar in debt of a new company, with the balance in equity. Investors in Fannie Mae's $11 billion of junior debt would get warrants, while common and preferred shareholders would get nothing, according to Ackman.

``We've not yet heard Secretary Paulson's plan but it would be a grave error for the government to invest in the equity of Fannie Mae and Freddie Mac as they are currently capitalized,'' Ackman, who oversees $6 billion at Pershing Square Capital Management in New York, said in a telephone interview.

[snip]

``The good news is that Fannie Mae has all the capital that it needs,'' Ackman said. ``It just has the capital in the wrong form with too much debt and not enough equity.''

Ackman also suggested the government put in place a stand-by purchase commitment for the new common stock for three years. The government is unlikely to be asked to buy any shares as there would be market demand for equity in the better-capitalized companies, Ackman said.

Although much has been made of the declining quality of the GSEs' portfolio, Ackman's plan shows how the structure of their balance sheets is at the heart of their current difficulties. Even if they hadn't wandered into high risk business, given how highly leveraged they are, Fannie and Freddie would today be nearing the point where the government guarantee would be called into play simply because the drop in housing prices nationally has been so large. The rule of thumb for Fannie's plain vanilla mortgage financing is a minimum 80% Loan to Value (LTV) ratio. That means, in some regions of the country, a large number of mortgages will now exceed the current value of the underlying real estate even if they continue to be performing. That's not the "fault" of the GSEs and doesn't suggest they should stop doing business -- as the housing sector continues to collapse, they are needed now more than ever. Being able to ride through periods of large drops in underlying asset values and growth in non-performing assets is one of the reasons why we have the GSEs in the first place.

In effect, the GSEs are designed to be "bailed out" by the government when market conditions demand. When the government steps in, the GSEs require restructuring and new capital, with existing equity being heavily diluted if not wiped out. That didn't really matter when the government owned the institutions. But when they were privatized and the equity in the GSEs was sold to private investors, the share price should have reflected the risk of dilution if the goverment's implicit guarantee was called. Yet that wasn't the case -- the GSEs behaved, and the market priced their shares, as if there was no risk that the guarantee would be necessary even though their balance sheets were built on the basis of the implicit guarantee. The recent plunge in their share prices is simply the market finally pricing the GSE equity to reflect the central fact that defines their business.

As many have observed today, yesterday's prohibition by the SEC against naked short positions in the shares of the GSEs is either simply political theatre or a case of the panics. (See e.g., Dean Baker, Dealbreaker, Felix Salmon). There are other ways than naked shorts for investors to bet, so the objective of the move is unclear. In any event, even if it Cox's game slows the price decline, it isn't going to make those shares worth any more than they already are, which fundamentally is zero.

The only thing which allows the shares to retain any market value is the political optics against "nationalization" of the GSEs. Together with President Bush's comment, the SEC's concern with the declining market price of GSE shares suggests that, although Treasury Sec Paulson hasn't described the conditions under which the government would provide an equity injection, nonetheless a figleaf of private equity will have some sort of role.

By trying to discourage a fall in share price, the government seems to be encouraging investors to believe in fairy tales -- that a restructuring may not be necessary or that current equity holders may not get washed away entirely in the restructuring-to-come. But if leverage ratios are to be brought down to somewhere closer to earth, new private equity won't come in without the existing equity being washed out. If existing equity holders retain a place in a new capital structure, it will be only because, in effect, the government has provided equity financing at rates far below what the private sector would demand.

Contra President Bush, there's going to be a bail-out. The only questions are how and how much. Retaining a role for private investors in the GSEs as Bush and Cox appear to suggest -- without restructuring the roles of the GSEs and their balance sheets -- is the very essence of the worst kind of government bail-out. Privatize the profits and socialize the costs.

Cross-posted at American Fooprints.

Blogging making reporters more relevant

nadezhda — Sun, 18 Jun 2006 09:07:54 -0400

While I'm on the topic of how online content can engage and enrich a journalist's traditional product, the Online Journalism Review at the Annenberg Center has a terrific interview with a Tacoma, Washington sports reporter who covers the Seattle Seahawks. Some highlights of the Q&A with Mike Sando:

OJR: Do you modify your voice when writing for the blog? And if so, how hard is it for a newspaper reporter to adapt to blogging?

Sando: . . . [T]he first thing reporters need to do is lighten up and realize that the blog is not the newspaper. If a columnist somewhere makes an off-the-wall proposal that has people talking, or if you want to throw out some analysis on the topic of the day, the blog is the place to do it. In that sense I have definitely modified my voice for the blog. That was a little tough to do initially, but after running the blog for a while, I'm figuring out what works and where I want to go with things. I used the word "analysis" and not "opinion" because it's important for me to remain true to my identity as a journalist (that probably sounds higher-minded that I'd prefer, but hopefully the point holds up). [note: washingtonpost.com should probably stress the "analysis" category rather than stick the "opinion" label on their non-traditional-reporting online product, such as Dan Froomkin's daily White House review. It would help them avoid the Froomkin Froofraw (Joel Achenbach's term) they got into with the left blogosphere over Deborah Howell's swipe at Froomkin's "liberal" quasi-blog -- that supposedly needed to be distinguished from the paper's political news coverage, even though their reporters often provide "analysis" stories, and required a "conservative" countervoice. Followed by the infamously aborted experiment with a red-meat conservative blogger, Ben Domenech.]

OJR: What reporting and information do you put in the blog that you can't or won't put in your newspaper stories?

Sando: Here's a recent example: The Flint, Mich., paper published a story about former Seahawks receiver Daryl Turner, who enjoyed some productive years in the 1980s before disappearing in a haze of drugs and alcohol. It wasn't something we needed to chase for the paper, but I turned it into a quick blog item. There are numerous other examples. The blog allows more room to discuss (and sometimes debunk) rumors, too.

OJR: Is there a difference in the feedback that you get for what you do on the blog versus what you do for the paper?

Sando: I get way more feedback about the blog. In years past, I might answer 15 emails asking the same thing. Now I address the matter once on the blog and that's it; my time spent answering emails has almost disappeared. Along the same lines, having your own blog is sort of like hosting a radio show. It's more about the host, whereas people don't pay much attention to non-columnist bylines in the paper. For years I have written 350-500 stories per year for the paper, only to have people recognize me as the guy who spends 30 minutes a week during the NFL season as a guest on a sports-radio show. It's not that the radio station had more listeners than we had readers; rather, it's that the listeners were listing to me, whereas the newspaper readers were merely reading my stories. This is an important distinction. Blogs make reporters more relevant as individuals. This would seem to be good for reporters, long term.

OJR: What is the editing process for your blog, if any?

Sando: I post directly to the Internet. A blog with filters is not much of a blog, in my view. Immediacy is very important. The News Tribune trusts my ethics and my judgment. The paper also realizes, shrewdly, that online standards differ from print standards. This doesn't mean that anything goes in a blog. Basic journalism values still apply and management has a responsibility to enforce them wherever its name appears. It's just that reporters have more freedom on a blog.

OJR: What do you see as the potential risks for a newspaper reporting in blogging? What have you done to try to overcome them?

Sando: I think a blog will expose a poor reporter more quickly, while allowing a good reporter to flourish more demonstrably. Also, the comments section of a blog will test a reporter's restraint. I've spent a fair amount of time maintaining the comments section by discouraging crassness, hot-temperedness and overall idiocy.

Ignatius and Zakaria - new WaPo joint venture

nadezhda — Fri, 16 Jun 2006 18:35:47 -0400

For some time now, I've been a fan of the way the Washington Post's online presence has been evolving. Last September, when the New York Times introduced TimesSelect and moved various features, including its columnists, behind the paywall, it was clear that the two companies were pursuing very different business models. And I speculated that those divergent business models were likely to produce very different models of a "news organization."

The Washington Post Company and washingtonpost.com are continually engaged in product innovation -- using technology to redefine "news" as dynamic, conversational, contextual content which is networked with related content across the internet (especially the blogosphere, but also including their other properties, Slate and Newsweek), and linked with their other media properties -- now including their new radio station. By contrast, the NYTimes is focusing on production/distribution innovation of their existing product -- using technology to improve the timeliness, relevance to the customer, and revenues from their traditional product, tweaked for online capabilities such as video. As I explained in September:

The overall impression from [washingtonpost.com's] changes is that content is growing more dynamic -- no longer simply the electronic publication of a series of static stories, or photos or graphics. Each Post page becomes the center of, or portal to, a constantly changing network of relevant linky goodness.

The changes are also increasingly reflected in the approach reporters are taking to their respective "beats." Certainly, the "stories for publication" remain fixed by the size, form and flow that are dictated by the conventions of newsprint distribution. In that domain, the Post competes with other news outlets in its attempts to tell news stories better and, in its particular government-related specialties, with greater coverage. But the news stories are being enriched with complementary content by those same reporters, who are bringing more than simply extra information.
[...]
If the printed news story is history's first draft, a permanent record however partial of "what happened," the new types of complementary content implicitly acknowledge the limits of that permanent printed record. The stories are shown to have added layers. The complementary content also celebrates the fact that the stories are constantly evolving -- evolving not simply in the sense that tomorrow's events will overtake today's or that we will have more information about those events in the future, but that their context and meaning are always in the process of morphing as they become part of broader conversations.

Washingtonpost.com has now introduced another example of precisely the sort of product innovation I described, called PostGlobal. It's potentially very good news for those of us who focus on US foreign relations.

David Ignatius (WashPost) and Fareed Zakaria (Newsweek and his TV show, Foreign Exchange) will host roundtables on various timely issues. The responses will come from their stable of about thirty editors and journalists from around the world, their "PostGlobalBloggers." Readers have a thread for their own comments. And Ignatius and Zakaria will provide some sidebar notes and roundups in their "Editor's Inbox" blog. Here's how the site describes what they're trying to do:

PostGlobal is an experiment in global, collaborative journalism, a running discussion of important issues among dozens of the world's best-known editors and writers. It aims to create a truly global dialogue, drawing on independent journalists in the countries where news is happening -- from China to Iran, from South Africa to Saudi Arabia, from Mexico to India.

At least twice a week, we'll post a question then solicit responses from members of our diverse network of experts, whose combined views, we believe, will reflect what the world thinks about important issues more quickly and completely than would those of any single commentator. We will also post comments on the question from readers around the world, highlighting the most interesting.

As news breaks, PostGlobal will ask leading journalists to offer quick insights in our "Editor's Inbox" area. Look here for assessments of the latest stories and for links to useful resources for making sense of what's happening. We're also talking with potential partners about additional features that will allow PostGlobal to pull together and analyze information from around the world.

The first question, posted on Wednesday, was "If Iran becomes the dominant regional power in the Middle East, the region will be safer and more stable. True or false?" The True/False framing isn't all that interesting -- not surprisingly, it produced more "false" than "true" responses from the journalists. Far more interesting were the varied perspectives about the dynamics of the Middle East from journalists from around the world -- including Japan, India, Mexico. They had distinctive views on the prospects for Iran becoming "the dominant regional power," and just what that might mean. Good exercise in revisiting unstated assumptions that underpin a lot of what passes for debate in the US.

The readers' comments were also interesting and, as Ignatius noted in his roundup post today, "in many cases adding a dimension you would not find sitting around a discussion table in Washington." Readers who don't parrot the conventional wisdom of Washington foreign policy elites -- who woulda thunk?

As a further example of the potential for enriching content and conversation, Ignatius' first "editor's inbox" post broadened the discussion by asking "what would Kissinger do"? -- and linked to two documents detailing Henry Kissinger's secret diplomacy with China, which have just been released by The National Security Archive. A lovely reminder of just what a piece of work was Henry the K. And just how far the Bush Admin has moved away from anything resembling strategic thinking and effective diplomacy, even after its supposed return under Rice.

Today's question is: "Should the U.S. and other countries send representatives to the G-8 counter-summit?" (being held by some Russian "liberal dissidents" such as Gary Kasparov at the same time as the G-8 summit in St Petersburg in July). Wonder of wonders, Masha Lipman actually provides a thoughtful response with considerable context for understanding the issue. Wish she'd bring the same nuance to the stuff she produces for Fred Hiatt and the WashPost op-ed pages! That suggests that this more conversational format -- with Ignatius and Zakaria as sponsors -- may actually be as liberating for the opinion-peddlars as for readers and commenters.

One of the reasons why the Post's "global view" experiment may work is that, rare for American pundits, Ignatius and Zakaria both can put themselves in the shoes of non-Americans when looking at US policy and actions. Admittedly, neither has positioned himself as a contrarian, but rather as a mainstream observer whose insights don't fit neatly within the conventional wisdom. I fault both of them for timidity -- for sometimes not extending the logic of their observations to more forcefully challenge US policy. But it's refreshing that they aren't simply a part of the echo chamber on either side of the US political debates. And here's hoping that the voices they assemble will expand the views available to those debates.

So back to the difference in business models between the WashPost and the NYTimes, and what that may mean for redefining the relation between traditional print and online media. Here's my speculation from nine months ago.

I expect the difference in the two approaches will in the long run have an impact on the content of the two newspapers and ultimately their philosophy of what it means to be a news organization. The NYT proposes to continue to "deliver" its "product." The Post, by contrast, is becoming a portal to a dynamic network of content, only a portion of which is home-grown. But by placing its own content at the heart of the portal and letting its home-grown content interact both with other Post-produced content and with content produced by others, the Post is pursuing a far different model than a classic portal, which aggregates content produced by others. In the process of distributing that home-grown content via the portal, the Post's own way of producing content, and the content itself, will continually be changed or enriched by the interaction with other content and content producers. Maybe, if Eric Nelson is right, the process may even produce added insight from Post reporters on their blogs, or from the commenters or trackbackers or Technorati-linkers, even if they're not named Friedman, Dowd, Brooks, Tierney, Kristoff or Krugman.

Very, very different bets. The NYT's business model is easier to discern than the Post Company's business model -- which clearly incorporates not just the Post but its other media properties. But then again, the NYT's model is easier to understand because it's basically defensive -- do better, whether in terms of quality vis a vis competitors, advertising revenues or satisfying their existing customer base, with their current newspaper business. The Post is, bit by bit, devising a new type of multi-media news business.

The new Ignatius/Zakaria joint venture appears to fit squarely within that prediction. I wish it great success!

P.S. -- While we're on the topic of media, the Huffington Post (NOT my favorite site) has a new section/portal that's devoted to the media, Eat the Press. It's an aggregator, blog and linkroll that's a bit of cross in style/content between Romenesko, Media Matters, CJR Daily, Jeff Jarvis and the Guardian's media section. If you like tracking the nexus of media as a business, politics, and tech, it looks promising.

[cross-posted at american footprints]

Reasserting US Hegemony: Russian rollback, Chinese containment and Iranian regime change

nadezhda — Mon, 08 May 2006 03:09:07 -0400

Introduction

On the surface, the US has been saying it wants Russia's cooperation on Iran's nuclear program in the Security Council this week. So praktike wonders what to make of the timing of Cheney's anti-Russia speech in Lithuania, in which he accused the Russia government of using oil and natural gas as "tools for intimidation and blackmail," "unfairly and improperly restrict[ing] the rights of her people," and taking "actions that undermine the territorial integrity of a neighbor, or interfere with democratic movements."

After that bit of raw chutzpah, Cheney proceeded, in the words of the NYT, to wade into the energy battles in Kazakhstan while embracing Nazerbayev with smiling praise for Kazakhstan's "political development." Cheney finished his tour in Dubrovnik with the endorsement of NATO membership for an unlikely trio of candidates, Croatia, Albania and Macedonia.

Altogether, the trip was a tour de force -- a nicely judged combination of high-minded Cold War-style ideological conflict with cynical Great Game competition, carefully tailored at each stop to play to the specific anti-Russian (and pro-US) interests of key local players.

Strategic linkages

I don't think there can be any question that the Bush Admin has been making a number of anti-Russian moves in recent weeks and that Cheney's trip was deliberately designed to be provocative. It appears to me that the Russophobe hardliners within the Bush Admin, led by Cheney, have won the internal debates about how to deal with Russia leading up to next month's G-8 summit in St Petersburg.

As important, I also think the provocations directed toward Russia are part of a parallel program to delegitimize the UN process for dealing with Iran, where the US is transparently engaged in faux diplomacy.

In my view, recent moves by the Bush Admin are comprehensible only when they are seen as linked -- part of a broader "forward-leaning" effort to aggressively reassert US hegemony. My fear is that the tactics the US is using in playing the "diplomatic route" re Iran may not only be extremely dangerous as a way of dealing with Iran itself. Those tactics are likely to have far broader and more profound long-term effects on the structure of the international system.

Where are US foreign policy elites?

Why so little reaction to the Bush Admin's tougher line on Russia by American foreign policy elites ("realists" and "liberal internationalists") who aren't the natural allies ("neocons" and "national greatness" conservatives) of the Bush Admin? Perhaps it's because most foreign policy elites tend to be experts in one area or another with limited overlap -- e.g. nuclear proliferation, Middle East, former Soviet Union, China, Latin America, defense, etc. Or perhaps it's because they've lost the old Cold War habits of seeing linkages across diplomatic and security issues and across regions.

I also think, in part, it's because almost all "schools" of American foreign policy share unquestioningly the assumption that being the sole superpower is in the natural order of things. American hegemony is, at least in principle, assumed to be necessary and/or benign, and its maintenance and assertion is a good thing. What the various schools quarrel about is how best to maintain and assert American power (soft and hard) and "leadership." When liberal internationalists like John Ikenberry and Anne Marie Slaughter question whether maintenance of a unipolar system is actually in American interests, note how gingerly they approach the issue in order to avoid being treated as anti-American heretics.

"Realists" and "liberal internationalists" may tut at Cheney's confrontational style, and some may question his blatant hypocrisy on the subject of democracy. But I'm rarely seeing any challenge to the basic narrative that Russia deserves a smack-down from the US. First, it's become conventional wisdom (albeit of the ahistorical variety) that Russia is rolling back democracy and increasingly flirting with dictatorship at home [ed. - without really explaining why, it seems to be assumed that Putin's "soft authoritarianism" at home should automatically have a negative impact on US-Russia relations on everything from terrorism to trade]. Second, there's a general feeling that Russia has been getting a bit uppity abroad [ed. - Russia is seen as somehow "meddling" where it doesn't belong, even where some American elites actually agree more with Russia's position than that of the Bush Admin -- e.g. issues such as Iran or the Palestinians]

So maybe it's not surprising that it takes a rabid anti-imperialist who doesn't belong to any of the mainstream foreign policy schools, Justin Raimondo, to produce the first article I've read that condemns Cheney's anti-Russia attacks as something more than just undiplomatic and hypocritical. Even Raimondo, however, doesn't fully link Cheney's moves with the diplomatic games vis a vis Iran.

A five-pronged strategic offensive?

To see how recent Bush Admin policy moves are part of a broader strategy of reasserting hegemony, I find especially helpful the following observation by DrLeoStrauss (Stop the Spirit of Zossen).

The U.S. is currently conducting five separate strategic grand offensives:
(a) the roll back of the old Soviet imperial periphery across Eastern Europe, down through the Russian 'Near Abroad' of Ukraine and Georgia and Central Asia;

(b) the on again off again stuttering efforts to isolate China as the new 'Peer Competitor' across both the Asian Pacific rim and also in Central Asia [ed. - and in recent months, competition in Africa has been added to the list];

(c) conduct an international war on 'terrorism' (such as it is);

(d) lead new international cooperation regarding nuclear and WMD proliferation [ed. - "lead" is a charitably neutral way of describing the Bush Admin goals of (i) leaving to the US the determination of which countries are worthy of obtaining nuclear technology and weapons and (ii) ensuring that no unfriendly state can achieve deterrence against the US use of force]; and
(e) bootstrap the Middle East into modernity through unilateral American force of arms.
(Sprinkle 'democracy' on all of the above).

What's remarkable is that Iran intersects with all five "grand strategic offensives" plus "democracy." That helps explain how and why the Bush Admin has turned the nuclear dispute with Iran into a "crisis" (with considerable help from the Iranians themselves, of course). The Iranian situation offers the Bush Admin an opportunity to make "progress" on a number of its strategic offensives simultaneously -- not just with Iran or with the nuclear proliferation regime but with China and Russia as well.

The UN process is set up for "failure" in the sense that the Bush Admin is not going to obtain the sort of robust steps against Iran that it has sought. Either the Security Council negotiations will produce some sort of deadlock over the statement or, as Bolton has suggested this weekend, the US intends to proceed without Chinese and Russian support. Either outcome would give the US the excuse to ignore the Security Council going forward -- Rice has already been claiming that the Security Council would suffer a fatal "loss of credibility" if it fails to take action on Iran. Next stop, as again Rice has already suggested, is "coalitions of the wiling."

The Bush Admin will likely pin the blame for failure on the "ineffectiveness" of the UN (and international institutions), in general, and on China and Russia, in particular. We should expect the bill of particulars against China and Russia to be three-fold:

they are authoritarian regimes that cozy up to tyrants for their own narrow economic and geopolitical purposes
they threaten global energy security (in their roles as major consumer and major producer, respectively), and
they are potential threats to their neighbors.

Marketing the program

This three-pronged attack draws on several different policy rationales or motives, each with a different way of defining "threats" to American interests:

Cold War-style: ideologically-defined enemies, based on the "nature of the regime";
Great Game-style: challenges to US influence/control of global energy;
US "global leadership"-style: threats to US predominance in any region.

As DrLeoStrauss suggests, even if the Bush Admin's strategic goals were commendable (which I dispute), the simultaneous pursuit of such an ambitious collection of strategic objectives is likely to produce considerable incoherence in execution. Furthermore, as Cheney's trip illustrated, that incoherence will be compounded by relying on such a mix of "styles." It's difficult to reconcile the Cold War-style (e.g. Cheney's ideological assault on Putin's supposed lack of democracy) with the Great Game-style (e.g. fishing for gas deals with Nazerbayev while praising his fifteen-year contribution to Kazakhstan's "political development").

The advantage of this mixed bag of rationales, however, is the same the Bush Admin enjoyed in assembling support for the Iraq war: a bit of something for everyone -- liberal hawks, ideological warriors, "national greatness" conservatives, and old-fashioned military hawks. The fact that no one can explain the "real reason" the US went to war in Iraq isn't a bug, it's a feature.

Of course, such an ambitious program can't be left entirely to the Bush Admin. They need help from pundits and politicians to frame, legitimize and sell the program. Not surprisingly, we've already begun to hear from the usual suspects. A mere four days before Cheney's appearance in Lithuania, Robert Kagan warned in the op-ed pages of the WashPost of a global threat to liberalism potentially greater than Al Qaeda: a "League of Dictators" (read China and Russia) that will use their positions at the UN to undermine the promise of a new international order. Although Kagan's essay is primarily an example of the Cold War-style, he deftly weaves in the "energy security" card by showing how China's ideological and strategic interests (i.e., access to energy) are likely to coincide in places like Africa or Venezuela.

Max Boot has similarly been busy on the op-ed pages. The day before Cheney began his trip in Vilnius, Boot was lamenting the "dictatorship dividend" -- the windfall from rising oil prices enjoyed by "noxious dictators" like Putin and Chavez. Boot hit the trifecta -- the challenge to global "energy security," an ideological conflict, and the threat of "regional contagion."

Vladimir Putin and Hugo Chavez can buy off their publics with generous subsidies and ignore Western pressure while sabotaging democratic developments from Central America to Central Asia.

Since in this article Boot is concerned with nefarious energy suppliers, his list of villains doesn't include China, with which he is willing for the US to make common cause, at least as fellow energy consumers. In a longer piece, I'm confident he'd be able to find a way to lodge China in the enemy camp a la Kagan. As Matt Yglesias notes, Francis Fukuyama reminds us that the PNAC folks always need an enemy, and China was their pre-9/11 favorite. So they may just be reverting to form.

If John McCain's speech at the Brussels Forum on transatlantic relations a week ago is any indication, the "national greatness" conservatives are on the same page as the neocons and, according to Dan Drezner, the "muscular liberals" in the person of Richard Holbrooke are in full agreement with McCain. And of course the human rights folks and democracy true believers have long had China in their sights and are delighted to hear Cheney take on the Russians.

Reporting on his attendance at the Brussels Forum, Drezner notes:

The general tenor of the conference so far has been to focus less on transatlantic frictions and more on the geopolitical and geoeconomic difficulties that Russia and China are posing to the West as a whole. More later, but a question to readers -- will the realpolitik of a rising China and a renegade Russia... be the ultimate driver for a closer transatlantic partnership? And should that be the main driver?

Snark aside, Kagan and Boot give us a taste of the sort of arguments, from the same unholy alliance that brought us Iraq, that I expect to hear against Russia and China as the Bush Admin seeks to reassert American hegemony.

This post certainly requires quite a bit more fleshing out, so let's call it an "Intro." As and if I develop some of these thoughts further, I'll update with links to future posts.

cross-posted at American Footprints

What's up

nadezhda — Sat, 22 Apr 2006 10:57:41 -0400

praktike has now moved to Cairo to study Arabic, and I can report first hand that Cairo seems to agree with him. He's looking decidedly content and healthy. He's now blogging primarily at American Footprints, where I can also be found with a number of other bloggers.

Note: We've finally, after much grousing and snark from the multitudes, changed the name to American Footprints from "Liberals Against Terrorism." The old address will still work, but the new one is http://americanfootprints.com

A "paddling" of lame ducks?

nadezhda — Sat, 22 Apr 2006 10:50:10 -0400

Between the continued tanking of President Bush in the polls and this week's White House shakeup-that-is-no-shakeup, the question is no longer whether Bush is the lamest of ducks. It's how Bush, the US and the rest of the world are going to navigate the next almost-three years of historic levels of lameness.

But Bush isn't alone -- he's one of a growing "paddling of ducks" (a la an exhaltation of larks) in Western-style democracies. Simon Serfaty of the CSIS observes that European elections are producing governing coalitions with little authority or lattitude to govern.

There could not have been any worse possible outcome to last week’s election in Italy than the political tie that leaves Romano Prodi with a plausible claim of victory, but a clear inability to govern. Such conditions had already been seen in Germany last September. They may well be seen next in France next spring — and in Spain the year after that. Everywhere, weak governments are getting weaker, making out their passivity to be a virtue and their flexibility to be a strength.

Serfaty sees this trend as troublesome for transatlantic relations, as America's approach to Europe has been shifting away from the first Bush Administration's prediliction for divide-and-conquer, with its ad hoc coalitions of the willing, and towards renewing partnerships with Euro-wide institutions.

[F]or the past 15 months, Bush has cultivated Europe not one state at a time, but all of them together in the context of the European Union to which the U.S. president has reasserted his country’s commitment. As a result, the central significance of bilateral relations — and, in this context, the personal dimensions of these relations — has been eroded. The issue is no longer what Italy — or Britain or Poland—can do for the U.S., but what the U.S. can do with Europe in the context of the two sets of organizations, N.A.T.O. and the E.U., that define the trans-Atlantic partnership.

There, in the E.U., the switch from one man, Berlusconi, to another, Prodi, might make a difference, not because Prodi proved to be an effective president for the European Commission, but because Berlusconi proved to be such a disliked head of government for Italy. In other words, Italy will regain an influence within the E.U. that had faded over the past few years. The problem, however, is that the more the E.U. becomes populated by weak members — not just à l’italienne but also à la française or German-like and more — the less likely it is to emerge out of the deep institutional crisis into which it has fallen of late.

I note Serfaty's comment not as further evidence for profound Europessimism, which I don't particularly embrace. Rather, it's a warning that we may be headed for a "crisis of governance" period -- akin to the moody decade of widely shared malaise, in the 1970s and early 80s, when politicians, pundits and political scientists fretted about the "ungovernability" of democracies and the collapse of the welfare state. The Thatcher/Reagan neo-liberal response seems to have run out of energy -- at least in its political incarnation in parties on the Right -- and the Clinton/Blair Third Way, though retaining some centrist abstract appeal, is certainly suffering from the disappearance or weakening of its prime proponents on the world stage. A growing sense of anxiety coupled with desire for change -- rather than the embrace of an alternative governing philosophy -- may be the common thread in election results across Europe (Eastern and Western) and even Latin America.

A compelling and coherent new vision from either Right or Left has yet to emerge. Instead, we have a hodge-podge of competing prescriptions for anxiety-reduction, which vary country-by-country according to which bundle of anxieties (economic, cultural, security) afflicts a given politician's electoral base. There's a growing sense that, whether in riot-riven France or in the US with its cratering approvals for Congress and the President, political elites are out of touch or, worse yet, irrelevant. If global macroeconomic trends lead to a new round of stagflation* -- especially if accompanied by the tensions produced by recycling petrodollars and a politically destabilizing slow-down of China's economic growth -- the recipe will be complete for another decade of gloomy pondering of the future for liberal democracy and the international system.

It is this prospect of a globally-shared sense of impotence in the face of a world seriously off-track that I find more worrisome than the oft-repeated warning that Americans will become "isolationists" in a fit of pique that the Iraq war is a disaster. Certainly, an America that withdraws from the world as it is consumed internally with bouts of xenophobia and culture wars would be a threat to both the US and the rest of the world. But like most analyses by Americans of the international system, it's too US-centric. It assumes that the rest of the world isn't susceptible to similar pressures and anxieties and that the management of the global system will be principally a matter of US choices.

We would be entering choppy waters if we were merely facing the prospect of a global hegemon having to come to terms with the limited utility of aggressively applying its power to pursue narrowly defined interests. Although "isolationism" might be one response, Jacksonian pugnaciousness might also produce a further outburst of "forward-leaning" aggressiveness. To navigate away from either extreme, it would be difficult but sufficient to execute the sort of unilateral shift in US grand strategy and national "personality" being advocated by John Ikenberry -- a rediscovery of the virtues of self-restraint and rule-set compliance and the importance of reassurance to other members of a unipolar international system.

My fear, however, is that the international system is going to present far more challenging conditions for the US and other Western-style democracies to navigate if they are also suffering from a "crisis of governance" period in domestic politics. As Serfaty concludes with regard to Western Europe:

Which gets us back to the disturbing tendency to go into democratic overtime as each election ends with an unwanted tie. That makes it difficult for each new or fading government to make the decisions needed to assuage its respective constituencies, for the E.U. to make the decisions needed to satisfy its members, and for the U.S. to be confident in its allies’ ability to not only be willing, but also capable and relevant.

The same can be said for European lack of confidence in the US -- certainly during Bush's forthcoming years of lameduckness -- but potentially longer if we're looking at a governance crisis that is not unique to this President and is shared among Western-style democracies.

------------
* Stagflation is one of several plausible scenarios for the long-predicted and oft-postponed but inevitable adjustment of global economic imbalances. The Cunning Realist has been warning of the risks of hyperinflation as we approach the day of reckoning for US fiscal and monetary policies. Though I view creeping stagflation, in the absence of a hard landing, as a more likely scenario if inflation rears its ugly head again, TCR's regular analyses of inflationary pressures and financial market dynamics are well worth a read. Certainly, the extreme narrowing of spreads and the ongoing search for yield regardless of risk are symptoms of a coming bout of creative destruction in the financial markets.

Just as the cover of Business Week has become a leading indicator of a company or sector about to reach its market highs, I expect that when we start hearing about the IMF no longer being needed to deal with the international exchange regime or global financial crises, we're about to painfully rediscover the relevance of the IMF as part of a reformed international financial architecture. The world will need a better response from the lameduck presidency than a cosmetic replacement for John Snow.

Cross-posted at American Footprints

Voices of the New Arab Public

nadezhda — Sat, 31 Dec 2005 18:58:50 -0500

I was flipping through the newest issue of Foreign Affairs and what should I see but an ad for the hot-off-the-presses book by Mark Lynch, aka Abu Aardvark, on Arab media: Voices of the New Arab Public: Iraq, al-Jazeera and Middle East politics today. Here's the catalog description:

Al-Jazeera and other satellite television stations have transformed Arab politics over the last decade. By shattering state control over information and giving a platform to long-stifled voices, these new Arab media have challenged the status quo by encouraging open debate about Iraq, Palestine, Islamism, Arab identity, and other vital political and social issues. These public arguments have redefined what it means to be Arab and reshaped the realm of political possibility. As Marc Lynch shows, the days of monolithic Arab opinion are over. How Arab governments and the United States engage this newly confident and influential public sphere will profoundly shape the future of the Arab world.

Marc Lynch draws on interviews conducted in the Middle East and analyses of Arab satellite television programs, op-ed pages, and public opinion polls to examine the nature, evolution, and influence of the new Arab public sphere. Lynch, who pays close attention to what is actually being said and talked about in the Arab world, takes the contentious issue of Iraq-which has divided Arabs like no other issue-to show how the media revolutionized the formation and expression of public opinion. He presents detailed discussions of Arab arguments about sanctions and the 2003 British and American invasion and occupation of Iraq. While Arabs strongly disagreed about Saddam's regime, they increasingly saw the effects of sanctions as a potent symbol of the suffering of all Arabs. Anger and despair over these sanctions shaped Arab views of America, their governments, and themselves.

Lynch also suggests how the United States can develop and improve its engagement with the Arab public sphere. He argues that the United States should move beyond treating the Arab public sphere as either an enemy to be defeated or an object to be manipulated via public relations. Instead of wasting vast sums of money on a satellite television station nobody watches, the United States should enter the public sphere as it really exists.

Amen, to that last point in particular. And just maybe the much-hyped and much-criticized new public-diplomat-in-chief, Karen Hughes, has figured that out? One indicator is the decision to pull the plug on the innocuous teen-oriented Arabic lifestyle magazine, Hi. Another potential indicator is the doubling of the number of the State Department's media interviews in Arabic this year, to about 100, as reported by Steve Weisman, in a profile of Hughes in the NYT. Weisman also reports that Arabic satellite television is definitely on Hughes' radar screen.

Ms. Hughes departs from one common policy among top American officials. She appears on Al Jazeera, the popular Arabic satellite television station accused by the Pentagon of cooperating with anti-American extremists. This past week, Ms. Hughes sparred with a Jazeera moderator over Iraq, Israel and democracy in the Middle East. "I came here because I respect Al Jazeera," she said. "You have a large audience, and I wanted to address that audience to communicate with the Arab world."

Afterward, Ms. Hughes said that she had been advised not to appear on the station but that she disagreed.

"We have to be out there," Ms. Hughes said. "We may not like everything they report. They may be putting out misinformation. They may incite violence. But we have to be out there."

Marc Lynch has set up a separate blog for discussions of the book, reviews, and his book-promotion schedule, and you can buy it there through his Amazon links. For a good intro to his views, see this recent article in the Wilson Quarterly, Watching al-Jazeera.

cross-posted at American Footprints

Time for a post-post-9/11 world?

nadezhda — Wed, 21 Dec 2005 06:34:56 -0500

This time David Ignatius nails it, although nothing he "discloses" is news to anyone who is a regular visitor to this site.

Many of the actions taken in the immediate aftermath of 9/11 may have made some sense at the time, but they were not well-thought through as long-term policy shifts. Since 9/11, however, the dominating fear of another attack has kept the White House focused on not losing the next skirmish rather than promoting the nation's long-term interests.

The result of continuing to operate in a state-of-emergency mode, what Jack Balkin calls "governing through terrorism," has been a pattern of policymaking that has often turned out to be short-sighted and self-defeating, whether in the wars we've chosen to wage and how we've waged them, the methods we have used to capture and handle detainees, or the ways we have confused spin and propaganda with public diplomacy. Not surprisingly, as we've been belatedly learning in the press over the past several weeks, the loosening of constraints on domestic intelligence collection has also appeared to produce mission creep by some agencies or parts of the military, unaccountable privacy intrusions, and unwarranted surveillance of political activities.

As we've pointed out frequently on this site, many of the Administration's post-9/11 policies, from the conduct of the Iraq war to the handling of detainees, have increasingly been opposed not only by the Administration's political opponents but by highly-respected professionals in the very departments and agencies devoted to security, intelligence and diplomacy. These "revolts of the professionals," as Ignatius calls them, can't be simply dismissed as classic turf-fighting. Instead, the pros have been trying to push the system back toward a more sensible, balanced and, in the long-run, more sustainable approach to strategy, operations and practices. The recent revolts by a number of Senators and Congressmen who are long known as strong advocates of the military and intelligence communities have been a clear signal that the pros have failed to get their message through to the White House, so they've decided that Congress must at least hear the full story.

In saying that we're moving into a post-post-9/11 world, I'm not suggesting that the risks facing America are necessarily greatly reduced compared to what they were on 9/12/2001. In some respects, threats to American interests abroad are considerably greater. But rather, the US is now in a much better position to evaluate, manage and respond to those risks.

Ignatius doesn't go as far as I would -- I think the proposal earlier this year to switch from the Global War on Terrorism to a Global Struggle Against Violent Extremism, how daffy the acronym, is another long-overdue shift to a post-post-9/11 world. However, he's certainly correct that it's no longer productive for the White House (or the OVP) to continue to insist on every executive prerogative and to dig in their heels on every issue of executive authority. As Ignatius argues, it's past time for the President to start providing leadership so we can start fashioning a workable consensus on how we will operate in a post-post-9/11 world.

Revolt of the Professionals

The national security structure that the Bush administration created after Sept. 11, 2001, began to crumble this month because of a bipartisan revolt on Capitol Hill. Newly emboldened legislators forced the administration to accept new rules for the interrogation of prisoners, delayed renewal of the Patriot Act and demanded an investigation of warrantless wiretapping by the National Security Agency.

President Bush has bristled at these challenges to his authority over what has amounted to an undeclared national state of emergency. But the intelligence professionals who have daily responsibility for waging the war against terrorism don't seem particularly surprised or unhappy to see the emergency structure in trouble.
[...]
I asked [a senior intelligence official] what he thought, watching the emergency structure come down around him. "We all knew it would," he said. The interim structure was inherently unsustainable. But he noted that the very fact that the nation is debating rules for interrogation and surveillance of suspected terrorists demonstrates the success the intelligence agencies have had since Sept. 11 in disrupting attacks.

One little-noted factor in this re-balancing is what I would call "the officers' revolt" -- and by that I mean both military generals in uniform and intelligence officers at the CIA, the NSA and other agencies. There has been growing uneasiness among these national security professionals at some of what they have been asked to do, and at the seeming unconcern among civilian leaders at the Pentagon and the CIA for the consequences of administration decisions.

The quiet revolt of the generals at the Pentagon is a big reason U.S. policy in Iraq has been changing, far more than Bush's stay-the-course speeches might suggest. Defense Secretary Donald Rumsfeld is deeply unpopular with senior military officers. They complain privately about a management style that has stretched the military to the breaking point in Iraq. For months they have been working out details of troop reductions next year in Iraq -- not just because such action will keep the Army and Marine Corps from cracking but because they think a smaller footprint will be more effective in stabilizing the country.

A similar revolt is evident at the CIA. Professional intelligence officers are furious at the politicized leadership brought to the agency by ex-congressman Porter Goss and his retinue of former congressional staffers.
[...]
The CIA, like the military, wants clear and sustainable rules of engagement. Agency employees don't want their careers ruined by future congressional or legal investigations of actions they thought were authorized. Unhappiness within the CIA about fuzzy rules on interrogation, and the risk of getting clobbered after the fact for doing your job, was a secret driver for Sen. John McCain's push for a new law banning cruel interrogation techniques.
[...]
President Bush needs to do what he so often talks about, which is to provide strong leadership. In place of the post-Sept. 11 emergency structure, the country needs clear rules that Congress can debate and finally endorse.

Amen!

cross-posted at American Footprints

"V" is for Victory and "C" is for Caliphate

nadezhda — Tue, 20 Dec 2005 19:07:34 -0500

I couldn't help stealing that great post title from Patricia Kushlis (PHK) of Whirled View. Her starting point is Elisabeth Bumiller's recent White House Letter ($ req'd), which noted that the Bush Administration is now "on message" regarding the existential threat of an AlQaeda-sponsored caliphate.

Needless to say, both the history and geography contained in the warnings from Cheney et al are more than mildly suspect, as PHK illustrates. But the Caliphate is certainly a colorful way to package the President's claims that the West is engaged in another generational struggle of near-apocalyptic proportions akin to the Cold War. Norman Podhoretz and the World War IV advocates must be highly gratified.

"D" is for Dominoes?

Few would argue that the US is not facing a long-term threat of terrorist attacks on US interests at home and abroad. The debate is rather about the appropriate strategy for addressing that threat, which depends in part on how one views the nature and sources of the enemy's strengths and weaknesses, and the best means to reduce its strength and counter its ability to cause lasting damage. And one of the central points of contention in that debate is the place, within the "global struggle against violent extremism" (yes, GSAVE is actually a useful concept despite its origins) of the current fighting with the AlQaeda-linked insurgents in Iraq.

By introducing the caliphate argument, the Administration seems to be shifting away from crude "flypaper" logic, although certainly not abandoning the rhetoric entirely, based on the President's Sunday speech from the Oval Office. The handy feature of the caliphate argument is that it doesn't simply equate Iraq as the "central front in the GWOT" because that's where the terrorists are fighting. Rather, Iraq is proclaimed to be the main line of defense against the encroachment of a geopolitical enemy. We can't leave Iraq because it could be taken over by AlQaeda -- step one in the march to the caliphate. Echoes of dominoes anyone?

Big Media Justin and his Cato colleague, Christopher Preble, have addressed the Administration's fear of an AlQaeda victory in Iraq in The Daily Star. After examining Iraqi and Arab public opinion, as well as the hostility against AlQaeda of other well-armed Iraqi insurgent groups and sectarian militias, they conclude that if America leaves, AlQaeda will not inherit Iraq.

As Logan and Preble parse recent speeches by Administration figures, what emerges is not only the argument that AlQaeda's defeat in Iraq (by the US or by Iraqi forces?) will be critical to preventing AlQaeda from achieving its goal of a caliphate. That argument is supplemented by the assertion that a withdrawal by the US would be greeted by AlQaeda as a moral victory, which would in turn attract legions of bandwagonning Muslim supporters across the arc of instability.

And "P" is for Peace with Honor?

Shades of Nixon and Kissinger's "peace with honor," the President's Sunday speech expanded on the theoretical costs of America's losing credibility by prematurely withdrawing from Iraq, providing a laundry list of international audiences:

We would abandon our Iraqi friends and signal to the world that America cannot be trusted to keep its word. We would undermine the morale of our troops by betraying the cause for which they have sacrificed. We would cause the tyrants in the Middle East to laugh at our failed resolve, and tighten their repressive grip. We would hand Iraq over to enemies who have pledged to attack us and the global terrorist movement would be emboldened and more dangerous than ever before. To retreat before victory would be an act of recklessness and dishonor, and I will not allow it.

Logan and Preble respond to the President's final warning:

The jihadis will certainly claim that the American withdrawal represents a victory for their side, but they will do so whenever U.S. forces leave - be that next year, or 10 years from now. In his Johns Hopkins speech, Rumsfeld declared that a "retreat in Iraq" would tell our enemies "that if America will not defend itself against terrorists in Iraq, it will not defend itself against terrorists anywhere."

That is absurd. An American military withdrawal from Iraq would not signal that the U.S. has chosen to ignore events there; it expects all countries around the world to cooperate with it in the fight against terrorism. The withdrawal of U.S. forces from Iraq must be coupled with a clear and unequivocal message to the people of Iraq, and to the world: Do not threaten us; do not support anti-American terrorists. Meanwhile, the U.S. must continue to pursue Zarqawi and his network, just as it pursues bin Laden and his network. The world can be assured: the U.S. will take all necessary measures to carry the fight the enemy, wherever he might reside, be that in Germany, Afghanistan or Iraq.

An American military withdrawal from Iraq will hardly be a stepping stone for Al-Qaeda's grandiose plan to establish an Islamic super-state from Morocco to Indonesia. The Bush administration ought to stop inflating the costs of leaving Iraq, and take a more serious look at the benefits.

That's not to suggest that the Iraqis, the US and Iraq's neighbors shouldn't be concerned about AlQaeda taking advantage of chaos and low-grade civil war in western Iraq to maintain fluid bases of operations from which attacks outside Iraq could be carried out. The recent bombings in Amman underscore that threat. But that argues more in favor of working on the political dimensions of the non-AlQaeda insurgencies. (More on that later.) Not on casting the conflict in Iraq with Zarqawi's supporters as the battlefield on which the future of a caliphate is to be determined.

As I've argued for a long time, the US needs a "peace with honor" exit for its own political equilibrium, not for its international standing, which will be helped, not hurt, by significantly scaling back its involvement in Iraq. And I'm willing to engage in a few harmless fictions from the Administration if it's helpful to that process. But ginning up new existential battles is a pernicious distortion of the threat from terrorism America is facing as well as of the nature of the conflicts in Iraq and the Middle East. As we should already have learned from the Iraq/WMD fiasco, fashioning and executing sensible strategy is considerably more difficult when the Administration engages in fanciful threat inflation.

cross-posted at American Footprints

Times' timing

nadezhda — Fri, 16 Dec 2005 15:20:14 -0500

Note: See below for Bill Keller's initial response to the timing question.

As I noted in the sidebar miniblog, and as Praktike posts, John Yoo's fingerprints are once again on an "aggressive" reading of executive power, this time the NSA getting into the domestic surveillance of Americans -- just reported in a major article in the New York Times.

No big surprise, the NYT report was used as ammunition in the Senate cloture vote on the Patriot Act that Feingold et al (three Dem and three GOP Senators) just won in a big way -- 46 votes (47 including Frist as a procedural move). [note: Feingold has been blogging the process at TPMCafe this week]

Glad to see the Senate standing up for its version against the House. When the Senate engages in long negotiations that produce something everyone can live with, the House can't be allowed to eviscerate the deal in conference. As much as the Patriot Act, this vote is a triumph of bipartisanship in the Senate against the House/White House majoritarianism, which will hopefully have a healthy effect on the conference process in the future (e.g. the Rep Duncan Hunter's threats to water down the torture prohibitions in the defense bill). Anyway, the NYT report was helpful to the cause.

But the Patriot Act's critics got a boost from a New York Times report saying Bush authorized the National Security Agency to monitor the international phone calls and international e-mails of hundreds — perhaps thousands — of people inside the United States. Previously, the NSA typically limited its domestic surveillance to foreign embassies and missions and obtained court orders for such investigations.

If the NYT had held off on this story until after the Patriot Act was extended, it would have been another Big Media travesty. I simply don't get why the NYT keeps putting themselves in the position of at least appearing to be the Bush Administration's poodles. I wonder who decided they should include in the article that they'd been sitting on the story for a year. I would have loved to have been a fly on the wall in the editorial conference on that paragraph!

On the substance, I don't understand why in the world the Administration can't comply with some simple, basic protections like a warrant. Although I'd certainly prefer that NSA didn't collect huge amounts of information of private conversations, my conscience isn't shocked that they may need to follow leads across borders back into the US. However, the FISA court procedures are super-fast and give enormous deference to the FBI and intelligence folks. If NSA needs some sort of rule that deals with their trolling large groups of phone numbers, I'm sure they could get a specific procedural waiver included in the Administration's precious Patriot Act -- something that gave the court a chance to look at the initial request, a process for dumping all the garbage info that a big sweep would collect, etc. And the Administration is so dreadfully short-sighted -- just as evidence acquired via torture may not stand up in court, evidence based on unauthorized privacy invasions may be fatal to a prosecution. Yes, hunting terrorists before they act isn't like trying to get the goods on someone who has already committed a crime, but with very small adjustments in process, they could retain the ability to "bring the bad guys to justice" even as they stop the bad guys from acting. And more fundamentally, there simply must be some basic safeguards that hold intel/law enforcement accountable to someone other than the internal John Yoos.

What's increasingly clear is that "trust us" is just as feeble an excuse as we all figured it would be. You don't have to be a libertarian, civil or otherwise, to know that it's the simple nature of bureaucracies. But it's time to break the Catch-22, that the Congress, in its oversight function, is dependent upon the Administration's discretion to decide whether to report on how they are actually using their powers.

The one encouraging thing about the NYT report was that the oversight by the FISA court and the Senate Intel Committee (Rockefeller) actually seemed to make a difference. Why? Because it gave the insiders who were opposing these measures some leverage to make their case heard. [noted: our need for the press to act as an effective watchdog, and use information from insiders who are concerned about Administration actions, is why I agree with Paleoprog that any prosecution in the Plame case NOT be based on the Espionage Act.]

But that's a bigger lesson we're learning about Congressional oversight with the Bush Administration. They steamroll over the cautions of experienced professionals inside the agencies and departments. The oversight process permits these other, somewhat wiser views -- e.g. key parts of JAG and State on torture, CIA & State on renditions -- a chance to make their case. But it's only the leaks to the press that give the Senate the leverage they need over the Administration, which otherwise is less than forthcoming about what they're doing.

And that brings me back to the NYT. Good to see they're starting to do their job.

UPDATE:Scott Lemieux of Lawyers, Guns & Money has a somewhat more colorful version of my assessment of the Bush Administration's pattern of behavior.

The Washington Post's report on the cloture vote cites Senator Specter's reaction to the news of the NSA's spying on Americans:

Sen. Arlen Specter (R-Pa.), chairman of the Senate Judiciary Committee, called the domestic spying "clearly and categorically wrong" and vowed to hold oversight hearings on the matter when the Senate reconvenes early next year after its holiday recess.

And Atrios goes straight to the heart of the matter:

How hard it is to get a damn warrant? The reason do such a thing is to simply assert that you can.

FURTHER INFO: Phil Carter may be in Iraq these days, but he's not out of touch. He points to Orin Kerr at Volokh, who recommends Judge Sand's opinion in United States v. bin Laden, 126 F.Supp.2d 264 (S.D.N.Y. 2000) (pdf) as a good place to start to understand the legal/constitutional issues. Orin notes:

While the statutory privacy laws have an exception for this type of monitoring, see 18 U.S.C. 2511(f), and the constitutional limits on e-mail surveillance are uncertain even in traditional criminal cases, the constitutionality of warrantless interception of telephone calls in situations like this is really murky stuff.

Jack Balkin's a bit more blunt:

Once you begin with the twin assumptions that (1) emergency justifies suspension of constitutional rights and (2) that the President cannot be bound by the rule of law when he acts as Commander-in-Chief, there is very little left to restrain the President. And so he has not been restrained.

The NYT's first response to the heat to come: In response to a question about the timing of the article, Tim Grieve (Salon's War Room) has received a long fax with a statement from Bill Keller:

We start with the premise that a newspaper's job is to publish information that is a matter of public interest. Clearly a secret policy reversal that gives an American intelligence agency discretion to monitor communications within the country is a matter of public interest. From the outset, the question was not why we would publish it, but why we would not.

A year ago, when this information first became known to Times reporters, the administration argued strongly that writing about this eavesdropping program would give terrorists clues about the vulnerability of their communications and would deprive the government of an effective tool for the protection of the country's security. Officials also assured senior editors of the Times that a variety of legal checks had been imposed that satisfied everyone involved that the program raised no legal questions. As we have done before in rare instances when faced with a convincing national security argument, we agreed not to publish at that time.

We also continued reporting, and in the ensuing months two things happened that changed our thinking.

First, we developed a fuller picture of the concerns and misgivings that had been expressed during the life of the program. It is not our place to pass judgment on the legal or civil liberties questions involved in such a program, but it became clear those questions loomed larger within the government than we had previously understood.

Second, in the course of subsequent reporting we satisfied ourselves that we could write about this program -- withholding a number of technical details -- in a way that would not expose any intelligence-gathering methods or capabilities that are not already on the public record. The fact that the government eavesdrops on those suspected of terrorist connections is well-known. The fact that the NSA can legally monitor communications within the United States with a warrant from the Foreign Intelligence Surveillance Court is also public information. What is new is that the N.S.A. has for the past three years had the authority to eavesdrop on Americans and others inside the United States without a warrant. It is that expansion of authority -- not the need for a robust anti-terror intelligence operation -- that prompted debate within the government, and that is the subject of the article.

As with most such defensive responses, Keller's raises as many questions as answers. He gets the principles right. But he doesn't explain why the NYT, after months of investigation, didn't know what those of us amateurs who only vaguely follow these sorts of "legal constraints on intelligence collection" would have assumed: that disclosing that the Administration had unilaterally expanded its purported authority would not have exposed "any intelligence-gathering methods or capabilities that are not already on the public record."

On the face of Keller's remarks, it looks like the NYT editors swallowed the Administration's representations that they were being good boys and, only recently, began asking themselves whether those assurances, and the "national security" hype, were bogus. But the NYT can't come out and say in so many words that they were lied to, so we have to read between Keller's lines. It certainly appears as if the NYT finally figured out that its remaining credibility would have evaporated if the report had been published following the big Patriot Act cloture battle, given the relevance of NSA's activity to the Patriot Act debate.

[cross-posted at American Footprints]

Bolton's ba-a-a-ack! -- and how you can act (updated)

nadezhda — Thu, 15 Dec 2005 00:19:06 -0500

Steve Clemons has an extensive sneak peak of an article by Mark Leon Goldberg that will appear today in The American Prospect. Clemons adds his own intel to Goldberg's case that Bolton's back to his old tricks, undermining the Secretary of State as he pursues his own agenda. And that even though there's a new Secretary, State is once again forced to deploy the "put Bolton in the box" strategy.

As I wrote last summer, I was far less outraged than many who had opposed Bolton's appointment by his handling of the vast UN summit agenda when he arrived in New York in August. Quite simply, the draft he was presented was inconsistent with stated Bush Administration policy on a number of fronts. Only last weekend in Montreal, we saw a replay of a similar collision between a broad consensus among most developed countries over global warming and the Bush Administration's long-standing rejection of the Kyoto process. It wasn't a pretty sight, and the head of the US delegation in Montreal was none other than Paula Dobriansky, one of Steve Clemons' favorites to replace Bolton as the nominee for the UN position. So on some matters, it's clearly not the personality, it's the US policy that's the problem.

But Goldberg has lots more episodes of more recent vintage where Bolton is described as going against, or actively undermining, Rice's diplomatic efforts. Most notably re Syria. And there's lots of goodies about how Rice and Foggy Bottom are end-running the UN ambassador in order to strike deals with allies and friends. On the matter of the UN budget, which could really provoke a crisis if the US insists on not approving it by December 31, the scuttlebutt is that Bolton managed to get support from the Oval Office to overrule Rice. (See Suzanne Nossel and Morton Halperin at Democracy Arsenal.) It will be interesting to see how much intel Goldberg's managed to collect on that particular conflict.

As they say, stay tuned.

UPDATE: Mark Leon Goldberg's The Arsonist is now online. As usual, you can follow all the action along with Stygius.

To be fair, we should note that quarrels over the US paying its way in the UN, and the potential adverse impact on international peacekeeping efforts, is not purely a Bolton-manufactured problem. Lee Feinstein has just posted a report at America Abroad on several problems rearing their ugly heads in Congress, where the funding of international programs is low on the list of priorities in budget debates. The African Union's inadequate but essential force in Darfur would be one of the casualties. As for UN peacekeeping dues, Biden is trying to make sure that a gap of $25 million gets paid. But as Feinstein points out, it's not entirely a Congressional matter.

[I]f Congress gives the administration all the money for UN peacekeeping it has requested ($1.03 billion), there will still be a $500 million gap between what Congress has funded, and the UN bills coming due. The main reason: the administration in March pushed for authorization of the critical UN mission in Sudan (to enforce the north-south agreement), but hasn't yet figured out how the US will foot its share of the bill.

This sort of foot-dragging by the US on its commitments, which is not unusual behavior for either Republican or Democratic administrations, makes Bolton's grandstanding on the UN budget all that more difficult for our friends to swallow. But according to Goldberg, that may be one of Bolton's objectives.

“The UN is simply one of many competitors in the global marketplace for problem solutions and problem solvers,” he told reporter Mark Turner [from the FT]. “If it is not good at solving problems, Americans will look to some other institution; some other organization; some other framework.”

As if in a nod toward diplomacy, he added that he hoped that those who want a stronger UN would “see the logic of our argument.” But his remarks to another British reporter just one week prior were probably more to the point. After listening to a tirade from Bolton against inefficiency, corruption, and supposed anti-Americanism at the UN during a private dinner, a Sunday Telegraph reporter in the audience asked him what he enjoyed most about the UN, to which Bolton replied, “It’s a target-rich environment.”

Campaign for the FY07 International Affairs Budget - Act NOW

So now you're all steamed up again and revisiting the Bolton battles of last summer, don't just sit there fuming. Yes, there's not much to be done about Ambassador Bolton, at least for the next twelve months until his recess appointment expires. But there is an important step coming up to help address some of the funding problems. That's the Administration's FY07 International Affairs budget request.

Right now -- until this Friday -- "sign-on" letters are being circulated in the House and Senate to register Congressional support for an increased budget. The sponsors are Senators DeWine, Feinstein, Smith and Durbin and Representatives Leach and Berman. To date, they have 103 signatures, the majority Democrats.

A bipartisan organization of foreign policy heavyweights and American businesses and NGOs, US Global Leadership Campaign, is sponsoring a campaign for people to contact their legislators to encourage them to sign on.

Here's their "tool-kit" page with links to information about the International Affairs Budget, the Congressional "sign-on" letters, the "write your legislators" campaign, how to contact legislators on a "priority" list, and even a telephone "script" if you prefer voice over written contact. Just two more days for this round. And then the campaign will gear up again when it's time to debate and pass the budget for FY07. We'll keep you posted.

[cross-posted at American Footprints]

More reactions to Krauthammer et al

nadezhda — Wed, 14 Dec 2005 05:39:19 -0500

Like praktike, two of my favorite bloggers seem to be "all tortured out" -- though each for his own reasons, and each in his distinctive style. They merit extended excerpts. (Emphasis below is mine.)

First, from the Brooding Persian, whose reaction is triggered directly by Krauthammer. (For a bit of historical perspective on Krauthammer's most recent philosophical ponderings, be sure to follow the first link below to some of Krauthammer's earlier musings.)

I should write this when I am less agitated and more cogent. Although I must confess to finding myself lately yearning for those old-time Western movies: “If you want to shoot, shoot….just don’t talk so much.”

I mean, the whole scam, I often suspect, is intended merely as justifications for (self-validating) assumptions and/or further excuses for not having to listen.

Really, when we reacted strongly to the barbarism of naked, tortured bodies, it was simply because we had women or mother issues and problems with sex and sexuality. If it was the humiliation we objected to, the pro-pain pundits thought it was pride and demanded more humiliation please!

Write or speak honestly, it is a jeremiad. Speak softly, it is whine. Be nuanced, it is pacifism. Question them, it is unpatriotic. Remind them of their history, it is anti-Americanism. Stay, they want to bring the war to you. Go, and you’re the enemy within. Mingle and have a dialogue, its dissimulation. Not mingle, it is ghetto mentality. Have a religion, it is fascism, and not have one, it is secular humanism.

These folks are not going to relent until they get the precise decibel of the QUACK they aim to hear. Or is it a dance they want to see?

And then we have The Lounsbury, who has returned from MENA to the US to recuperate from a nasty illness, leaving him an inordinate amount of free time to sample the pleasures of today's American news media. He zeros in on the same argument I made previously regarding the moves to weaken habeas corpus -- the enormous long-term strategic costs to the US in the loss of "soft power" relative to the hypothetical short-term benefits, in the habeas cases, of avoiding a spot of bother. Despite being seriously under the weather, the Lounsbury remains his cheeky self.

I have followed with some bemusement the 'debates' over torture in the US media.

I have to say, they are fairly grotesque on some level.
[...]
I find it astonishing that so few US commentators understand the profound damage this entire process is doing to the US image and standing. These are not mere trifles, look to the cold hard world of finance, we still care about reputational risk, even if it is more about appearance than fact. Lose your reputation, and your transaction costs skyrocket, to say the least.

The US is losing its brand power, as it were, in the area of government. American society is largely attractive to many, the American story and its socio-economic dynamism (however exaggerated and mythologised, still relatively better than most of the world, including the developed world). However, this brand is being pissed away by bumbling fools who do not understand its importance, and think gross, short termism is strategy.

It is, in short, grotesquely stupid. As Talleyrand (a real favourite of mine, although it was likely Boulay de la Meurthe's phrase) is said to have said, "It is worse than a crime, it is a blunder."

However, it is typical of the childish, indeed often Hollywoodish manner in which the Beit Ibn Bush has conducted its affaires.

Regardless, what I found most, well, depressing I suppose, was the plebian ignoramus definitions of "US interests" as if one does not have to continually do business globally. Pure idiot insularity. Now it is well taken one can not let bleeding heart little idjit Leftist protestors who manage to be offended by anything at all dictate one's actions. However, at the same time it is rather trivially obvious that alienating, above all needlessly, large swaths of international opinion not so idiotically and knee-jerkingly opposed to American interests is counter productive.

However, the arguments being bandied about on these "news" programs struck me as rather Bolsheviki in their bizarrely ideoglurghish party line content.

In some sad ways they are perfect illustration of why I have taken to calling a good swath of the American Right, Right Bolsheviks.

Together our two friends point to why these "debates" over treatment of detainees are so immensely frustrating. The deniers/defenders of torture aren't engaged in a debate. They are repeating articles of faith based on assumptions about the way the world works, and about certain groups of people, that are simply impervious to evidence -- evidence that the US is headed down a path that's not just immoral, or a betrayal of the foundational principles of our society, or ineffective, but evidence that it's self-defeating and self-destructive.

We have leaders who are so terrified of losing a skirmish to some shapeless but vast enemy that they fail to see they're giving the game away. And as evidence continues to mount that directly contradicts or undermines the faith of their defenders, the denials get more incredible and the defense simply gets more frantic or, in Krauthammer's case, dismissive. If you think I'm overstating the hysteria from the ranks of torture deniers/defenders, please check out this remarkable example from Andrew Sullivan of, to put it kindly, a clinical case of complete cognitive dissonance.

We in the US have got sucked into this Alice-in-wonderland (or Orwellian, if you prefer) nightmare that passes for "discourse" in our media. Most of the rest of the world, which doesn't find the authority of the office of the President of the United States quite so magical or charismatic, just thinks Americans have gone bonkers!

Addendum: From an anonymous commenter on Lounsbury's post, why soft power matters tactically as well as strategically:

For every person you're able to extract any useful information from by torture, there are a thousand -- or a million -- who would freely give information if America made even a pretense of living up to its ideals. The true power of America is not that it can break people's legs -- any petty dictator can do that. The true power of America is that it represents something people want to cooperate with. By refusing to torture people under any circumstances, you take one small step toward staking out an absolute moral position. The statement "America will never torture people because it's wrong." means America stands for something. America will only be trusted when it will refuse to do some things that are wrong even if they are expedient.

The bottom line here, in case you missed it, Mr. President, is that torturing people will actually lose the U.S. far more vital intelligence than it gains. If you won't stop torturing people because it's wrong, stop torturing people because it's bad policy.

[cross-posted at American Footprints]

"Let ambition counter ambition"

nadezhda — Sat, 03 Dec 2005 15:18:02 -0500

Dave Schuler (The Glittering Eye) and I have been exchanging some lengthy comments on his blog about the domestic politics of the war in Iraq. Dave and I have similar perspectives on the war -- not only why it was a bad idea strategically in the first place but how, once the US went into Iraq, the US has had both a responsibility and a strategic national interest that compel it to try to make the best of its intervention. We also share similar views of the dynamics of the on-the-ground situation and the limited options remaining now to the US. And we both get extremely cranky when public debate disintegrates into the false dichotomy of "withdrawal" versus "stay the course." At least rhetorically, Dave's a bit more optimistic than I am. He still talks in terms of possible "victory" in the long-term, whereas I've been in "damage control" mode for some time. Still, I'd say that compared to the wide range of opinions about Iraq that you find in the blogosphere, Dave and I are more often than not on the same page (or at least in the same section of the hymnal).

Which is why I find it interesting that Dave and I have such markedly different opinions about the play of domestic politics re Iraq. At the end of an excellent discussion of assumptions underlying the "National Victory Strategy" presented by the President on Wednesday, Dave "couldn't resist" the following remark about "a good part of the Democratic Party" including at least one of what we might call war-Dems, Senator Clinton:

C’mon, folks. Lead, follow, or get the hell out of the way.

In response, I too "couldn't resist" -- commenting in part:

Sorry Dave, you should have resisted. The critiques by the “war-Dems” have been the same as the Republican Senators like McCain, Hagel, Lugar (and even increasingly Warner!) — and they’ve been on the money for the last several years in terms of where the big weaknesses have been in the Admin’s abysmal planning and execution. The changes in policy we’ve seen over the past 4-6 months under the Casey/Khalizad team are the sorts of things that “war-Dems” and the more serious of the Republican Senators have been calling for since 2003. Note Lugar-Biden attempts to deal with these issues in hearings that the media have generally ignored.

I don’t see what the war-Dems have been doing as anything other than responsible. They’re not in a position to “lead”, they surely shouldn’t be expected to have “followed” the criminally incompetent Admin without insisting on changing course, nor do I see them as “in the way.”

Dave clarified what he had meant by his off-the-cuff slap, I responded with a monstrously long essay in the comment thread, and Dave has now penned a further post that goes to what I believe is the heart of the matter. Rather than continue to bury this discussion in comment threads, and eat up vast quantities of his bandwidth, I figured I'd post my response here.

Dave's new post is appropriately titled “The President proposes, Congress disposes” -- "a play on a much older apothegm: 'Man proposes but God disposes'."

When you realize that in the Washingtonism “Man” has been replaced by “The President” and “God” by “Congress”, the meaning becomes quite clear: the President is the handmaiden of Congress and subject to its will, not the other way around.

Under our system the president has primary responsibility for the military, the conduct of foreign policy, and the administration of the departments of government:
The President shall be commander in chief of the Army and Navy of the United States, and of the militia of the several states, when called into the actual service of the United States; he may require the opinion, in writing, of the principal officer in each of the executive departments, upon any subject relating to the duties of their respective offices, and he shall have power to grant reprieves and pardons for offenses against the United States, except in cases of impeachment.
and enforcing the law. The Congress has primary responsibility for the creation, passage, and promulgation of laws (and, of course, raising and apportioning revenue).

Here’s what the Constitution says about the president’s responsibilities in formulating domestic policy:
He shall from time to time give to the Congress information of the state of the union, and recommend to their consideration such measures as he shall judge necessary and expedient; he may, on extraordinary occasions, convene both Houses, or either of them, and in case of disagreement between them, with respect to the time of adjournment, he may adjourn them to such time as he shall think proper; he shall receive ambassadors and other public ministers; he shall take care that the laws be faithfully executed, and shall commission all the officers of the United States.
It should be clear that ours is a system in which the bulk of the responsibility particularly in the area of domestic policy devolves upon the Congress; we expect leadership and courage from our Congress; when you have cowardice and venality and a willingness to wait for the President to act and then snipe you get, well, what we have now. But that’s not our system it’s a perversion of our system.
[...]
Like it or not Senators are leaders. The slim Republican majority in the Senate doesn’t absolve the Democrats in the Senate from the responsibility to lead.

Let me be very clear: I’m not just critical of Senate Democrats. I think the Senators of both political parties did not fulfill their responsibilities when they authorized the president to go to war with insufficient debate. But I further think that those Senators who voted “Nay” had a responsibility to hold their peace once our soldiers had gone into harm’s way and those who voted “Aye” had an affirmative responsibility to defend their vote and advocate the position to the American people. This is manifestly not what happened and that’s why I’m convinced that many Senators, particularly Senate Democrats, did not vote their consciences but voted with one eye (as Nadezhda pointed out) on the midterm elections and the other on the upcoming presidential primaries. Of course there will be political calculation from Senators. But there should be more than political calculation. Where is the statesmanship? We aren’t just warring factions; we’re all Americans.

I also freely acknowledge that the greatest incompetency of the Bush Administration has been in communicating with the American people, with the Iraqi people, and with the world. But the Administration doesn’t have sole responsibility for communicating with the American people. Congress has substantial responsibilities in that area, too.

I share Dave's visceral commitment to what at times seems like an old-fashioned notion of separation of powers, with each branch responsible for playing its part and protecting its prerogatives in order for the system's checks and balances to work. Since I began blogging, one of my recurrent themes has been that our checks and balances haven't been working properly in recent years.

Dave and I are also certainly on the same page in believing that Congress has not been living up to its responsibilities. In my view, only the courts have provided an occasional check on executive power. I am personally hopeful, with the first small indications of a reassertion by the Senate of its institutional prerogatives, that a rebalancing is starting to emerge.

I don't, however, put Congress' failure down to sheer cravenness on the part of either individuals or their respective parties. Instead, I see several (hopefully transient) structural factors that have recently inhibited the sort of Democratic leadership Dave calls for -- or encouraged the media to ingnore attempts at constructive leadership by either Democrats or Republicans on the Hill -- while producing a quasi-parliamentary arrangement that fits poorly with the US system.

As Jack Balkan points out in a very nice short essay on the subject of checks and balances, James Madison's assumptions didn't include political parties. When US parties start acting as cohesive blocks, the system's potential weaknesses become glaring. Even before 9/11, some political trends had converged to produce a far more disciplined party-based organization (running the House, extending into the Senate once the party took over the White House, and maintaining its power base through especially effective political-financial connections) than has traditionally been the case in our national politics.

When one party hits the rare "constitutional trifecta" as Balkin calls it -- when all three branches of government "are working more or less together to achieve the party's goals" -- a parliamentary-style system is likely to emerge. And today, the power base that supports the GOP's trifecta is unusually insulated from voter sentiments by the current arithmetic of geographic representation. (See e.g. Hacker & Pierson's The Center No Longer Holds in the NYT Mag from a couple of weeks back.) The cohesion of this party-based organization has been more financial and electoral than ideological. It remains to be seen whether it can renew its cohesiveness now that its primary strengths -- electoral (Bush's popularity) and financial (DeLay-KStreet connection) -- are eroding and ideological fissures are widening.

It is my strong hope that we've not been going through a permanent change in America's political system. Rather, I prefer to believe that we've encountered a sort of perfect storm that has produced an excess of executive power which will be soon begin to be corrected. The combination of 9/11's trauma and the peculiar (to the US) polarizing style of this White House and GOP congressional leadership, when combined with the related growth of executive-branch patronage, has overridden the inherently conservative brakes of our system, not only in the legislative branch but within the executive branch itself. It's not simply the problem of the so-called "Mayberry Machievellis" who ignore substantive policy issues in favor of a purely political calculus. We have seen a widespread pattern of the Bush Administration trying to run a government via little groups of ideologically-committed but inexperienced appointees who bypass the bureaucracy (whether civil service, foreign service, military or intelligence). These practices have served neither the Bush Administration nor the country well.

Post-invasion Iraq and Katrina are two sides of the same coin. Organization Theory 101 teaches us that when you don't involve the folks with experience who are going to have to execute policy in your policymaking or planning, then when it comes time for action and you put your foot on the accelerator, you won't get to where you want to go. The engine may reve, but the connections to the gears and steering are missing or broken. This has not been a problem for the Bush Administration exclusively in the realms of military action or homeland security. The Administration has also been hollowing out the most professional and effective, and least partisan, parts of the bureaucracy, such as Justice and Treasury, and seeding the second tier of departments and agencies with political hacks and ideological naifs. The costs to the government and the nation are increasingly visible, and Congress is finally starting to push back on the appointment process.

In recent months, as more buried problems from Bush's first term start rearing their ugly heads in the press and Senators of both parties increase their pointed critiques of Administration policy, we're starting to hear indirectly from government, military and intel professionals who have been bypassed by the White House (or the Vice President's office) and its political apparatus in the departments and agencies. The whole "torture" and "detainees" issue is a perfect example -- the WH, OSD and DoJ ignored the accumulated wisdom of both the government departments and the military. The bipartisan opposition in the Senate, being led as much by Republicans as Democrats, is starting to give voice to those views. The same has been happening with a number of aspects of the Administration's military, political and diplomatic efforts in Iraq and the Middle East more boradly. Jack Murtha, John Warner, Chuck Hagel, John McCain and Joe Biden each have a different approach for the future course the US should take. But though their conclusions differ, they are all reflecting the facts and opinions they are regularly receiving from officials and officers who have been unable to be heard within the Administration's own decision-making processes.

I think Dave and I agree that a more robust system of Congressional (and especially Senatorial) oversight would and should have brought those voices and views to the fore years ago. As I see it, however, better late than never. I think we are starting to see a natural and healthy process of rebalancing, although it will be a noisy and acrimonious process. But then, it takes a good deal of noise and acrimony to effect a rebalancing when the system has gotten so far out of whack.

My principal disagreement with Dave is that I do not see the noise as the actions of a minority political party adopting the role of "parliamentary opposition" or failing to embrace the fact that "we're all Americans" when it comes to issues of war and peace. We should not be surprised by an occasional "parliamentary opposition" stance taken by the Democrats, primarily in the House given the way it's run. And perhaps on the Alito nomination in the Senate, especially if his files keep producing a stream of worrisome evidence of his opinions and habit of thought on some key issues.

But on the Iraq war, I don't see a "parliamentary opposition" emerging or likely to emerge. The Democrats have agreed to disagree among themselves for the past three years. As the debates heat up, they are already reverting to form (and to the incentives of the US system of constituency representation), with a considerable variety of individually-defined and rather nuanced positions. I assume that Reid and Pelosi won't even try for a unified party position on the war, since they know better than anyone it's like trying to herd cats. As the President's power has started to erode, the same phenomenon, by the way, has been emerging on the Republican side in the Senate, though the critiques of the President's performance by Republican Senators are more implicit than explicit.

Instead, we're likely to see more and more highly charged debates over policy positions that are, on close examination, difficult to distinguish. Battles to the death over distinctions without significant differences may simply be the way the American political system deals with disagreements over war, as Ed Kilgore has recently reminded us.

I had one of those old-guy moments today when I suddenly remembered a moment in the debate on Vietnam which reminds me of the odd disjunction between the relatively small policy differences dividing most Democrats and many Republicans on Iraq, and the big tonal and intepretative differences they sometimes convey.

In the famously fractious 1968 Democratic National Convention in Chicago, the big platform debate over Vietnam (note to young people: this was back when big platform debates were still possible) involved a majority plank which endorsed free elections in South Vietnam to create a coalition government including the National Liberation Front (the political arm of the Viet Cong), and a minority plank endorsing a coalition government including the NLF that would be required to sponsor free elections. The policy distinctions between these two planks were about as meaningful as today's difference between supporters of a benchmarked withdrawal from Iraq based on estimated dates, and a timetable withdrawal contingent on benchmarks.

Yet at the time, these two proposals were almost universally described by the news media as "pro-war" and "anti-war" platform planks.

The lesson is this: So much as many of us might wish to focus on the policy details of proposals about what to do now in Iraq, you can't take the politics out of politics, and the "tonal" or "contextual" implications of various proposals, despite their substantive similarity, matter a great deal.

The challenge of reconciling policy with political imperatives isn't unique to Democrats. Praktike and I have written repeatedly on the huge gap between the President's political rhetoric on Iraq and the evolving (and improving) policies being adopted by both the military and the State Department in his second term. The primary virtue of what the President accomplished in his speech this week was to narrow the rhetoric/reality gap, as did his spokesman in somewhat disingenously claiming that Senator Biden's proposals represented Biden's embrace of the President's own strategy, as described by Eric Martin.

These sorts of "failures to communicate" that Dave bemoans are, in part, driven by political considerations of the White House and politicians of both parties positioning themselves with the electorate. Let's hope for all our sakes that the politics this time serves a broader purpose than acting as a circular firing squad of Democrats. At the close of Jack Balkin's admittedly partisan essay on the structural reasons for recent failures of Congressional oversight, he asks:

If Congress won't perform its assigned function of oversight, the only recourse is the American people. Will they become sufficiently engaged to put our constitutional system back in order, and once again let ambition counter ambition?

Many media commentators, especially the purveyors of "moderation" and the "pox on both your houses" punditocracy, argue that the Democrats shouldn't run so heavily against the performance of the Bush Administration since Bush won't be on the ballot in 2008. But that misses the point that one of the major political themes running across both domestic and foreign policy is a rebalancing of the system of powers. It's in the interest of the health of the body politic that we "once again let ambition counter ambition."

[cross-posted at American Footprints aka Liberals against Terrorism]