Foreign Policy Blogs

Demonstrators march in Sao Paulo against corruption and the government of president Dilma Rousseff. Photograph: Bosco Martin/EPA Brazilian president Dilma Rousseff’s Workers Party is on the defensive as the Petrobras case threatens to expose political corruption. Photograph: Jonathan Ernst/Bloomberg State-controlled oil giant Petrobras has racked up the corporate world’s biggest debt – estimated at around €137 billion by Moody’s. Photograph: Sergio Moraes/Reuters

The concept of the fair market and protection for consumers is based on the idea that inefficient and corrupt practices by large private companies and wayward government officials increases the cost to the consumers and the public. When the construction of a facility meant to benefit the public goes overbudget, the public ends up bearing most of the burden. The companies involved may also lose investment. Competitors, meanwhile, do not to benefit from a market fixed against their products or services, and the company that might have been able to do the job right in the first place may lose business or go bankrupt if unable to compete in a fair market. Consumer protection agencies, government-run officials, and ombudsmen defend the public’s interest, not to mention the interests of the consumer, in challenging corrupt practices in order to balance out the market and actors within it.

The Economist recently published an article on how necessary compliance measures have become such a large industry that the benefit of the enforcement action may cost the affected parties more than the offense itself. The author’s recommendations on how to streamline enforcement is rooted in a sound argument, but the example used, namely the fine given to the German company Siemens  for handing out bribes in emerging markets, should be discussed in further detail.

Often companies investing in foreign countries are not wholly limited their home country’s laws, in this case Germany, as they are subject to the laws of that jurisdiction. In some emerging economies, it is well known by local industry and foreign investors that some investment is limited by corruption. So, in order to do business in many emerging economies, companies like Siemens bribed local officials so as to crack into those growing markets. While entirely illegal in the EU and enforced by German officials, in some countries the lack of enforcement and acknowledgement of consumer protection goals leaves those who wish to play fair on the losing end of their investment.

Brazil is one of the best examples of an emerging market that has been trying to change the way business is conducted. The clearest example of this can be found in the country’s ongoing Petrobras scandal, which may even bring down the government because Brazilians are openly refusing to accept companies, not to mention a government, that wants to keep corrupt practices alive. It involves several high-ranking oil company officials, as well as other large Brazilian companies and the ruling PT party, and it illustrates how corruption and a complete lack of consideration for the public’s interests has driven an entire society into a downward economic spiral. (A detailed account in English can be read here.)

Brazilians were livid when they found out that government officials and kickbacks to Petrobras executives had raised the cost of national projects several times over. Protests broke out when investigators showed that the members of the governing PT party were profiting from the same scheme. The costs of living for the average Brazilian heavily outstripped their real wages and little action and investments were going towards improving this situation. With the revelations of corruption, Brazil’s legal community has gone not only after Petrobras, but also the other companies involved in the scandal, the country’s ruling party, and possibly the president herself.

Brazil’s burgeoning judicial independence will play a huge role in this case as resolving the Petrobas scandal is a matter of overturning a tradition of corruption in the country so that consumer protection and a respect for the public becomes a principle legal standard. Hopefully, once the culture is changed and consumer protection and public trust is achieved, the issues of an overbearing compliance industry can be addressed.

63 percent of Brazilians favor the impeachment of Brazilian President Dilma Rousseff. (Photo by Eraldo Peres/AP)

The calls for the impeachment of Brazilian President Dilma Rousseff may not be fading away anytime soon, after allegations by a convicted currency dealer recently surfaced as part of a congressional commission. The commission is looking into alleged corruption at Petrobras, Brazil’s state-run oil company, which transpired during the ten-year period Dilma served as chairwoman of the national oil company. Brazilian prosecutors accuse Petrobras executives and two dozen engineering firms of inflating their service contracts as much as 6.2 billion reais ($2.1 billion) so the excess funds could be transferred to personal bank accounts and also to political parties. Thirty-four politicians in office are also being investigated by the Supreme Court in Brasilia on suspicion of receiving bribes.

The currency dealer, Alberto Youssef, alleges Dilma and former President Luiz Inácio Lula da Silva knew about the alleged scheme, “It is my understanding that [they] knew everything.” Last month, Youssef was convicted of money laundering and sentenced to three years in prison — a reduced sentence given his cooperation with investigators. Youssef came under investigation after prosecutors uncovered evidence he had given a luxury automobile to a Petrobras executive. Youssef has also implicated the Brazilian unit of Toshiba, the Japanese conglomerate, of paying bribes to win contracts with Petrobras.

Nestor Cerveró, a former Petrobras director, has also been arrested and charged with money laundering and bribery.  Last week, Cerveró declined to answer prosecutor’s question while denying all charges against him.

Will these latest allegations by a convicted money launderer be enough to topple the President?  The majority of Brazilians are likely to believe the allegations by Youssef, as close to 70 percent hold  President Rousseff responsible for the corruption. Recent polls show 63 percent of respondents favor impeaching the president, and 65 percent rating her government’s performance as negative.  In March, the corruption scandal at Petrobras brought out the largest demonstrations since those which helped topple the military dictatorship in 1985.

Earlier attempts by an opposition party in March to put forward a petition to investigate President Rousseff resulted in being overturned by the Supreme Court due to “technical errors.” The opposition is also looking at allegations Dilma violated a fiscal responsibility law to splurge on her reelection campaign. Many analysts believe the likelihood of Dilma being impeached are low, as Brazilian law states impeachment can only occur if the alleged offense takes place during the current term of presidential office.

As always, many political events are being driven by economic considerations. Brazil’s Finance Minister Joaquim Levy is doing his best to avoid a credit downgrade through austerity programs intended to reduce the government deficit by increasing revenues and cutting spending. Yet Levy is facing growing opposition from a Congress who believe his programs will fail to stem the recession and will only harm the population. Levy’s attempts at trying to rein in one of the world’s most generous pension systems, which spends over 10 percent of GDP on retirees, suffered a major setback last Wednesday, after the lower house of Congress passed an amendment to increase pension outlays by 40 billion reais ($13.34 billion) within ten years. The amendment is yet to clear the Senate and a potential veto by Dilma, who saw lawmakers from allied parties and from her own Workers’ Party vote for the amendment.

Public anger has also been fueled by an outbreak of dengue fever — some 229 have been killed by the mosquito-borne virus so far this year — an increase of 45 percent from this time last year.  Over 750,000 cases of the virus have been reported and are serving to remind Brazilians of the sad state of their health care system, which has been highlighted in recent polls as the country’s biggest problem. Last June, in a nationwide poll by Datafolha, over 87 percent of those polled were unhappy with the health care system.

With many Brazilians still struggling financially because of the economic downturn and angry about the poor state of their health care, the calls for impeachment could grow louder should the new finance minister not be able to quickly turn the economy around. If the direct link of Dilma to the corruption alleged by Youssef is firmly planted in the minds of Brazilians, and former President Lula, himself implicated by Youssef, fails to back Dilma, the opposition and the masses could again turn to the streets in protest, and force Dilma to make a graceful exit.  Yet before taking to the streets with calls for impeachment, Brazilians would do well to ponder the bagunça (mess) this would create afterwards, and carefully consider the alternatives.

Photo Credit: CH’7K via Flickr

Dr. Philippa “Pippa” Malmgren is the Founder of DRPM Group, a firm based in London that researches risks that are not easily quantified, namely politics, policy, and geopolitics. She also founded H Robotics, a manufacturing firm in the U.K. A graduate of the London School of Economics, Dr. Malmgren is a member of the Council on Foreign Relations, Chatham House, and the Institute for International Strategic Security. She has written for Wired, The International Economy, and Monocle.

Dr. Malmgren served as an adviser on international economic issues for George W. Bush during his first presidential campaign. She subsequently joined the Bush White House, where she was Special Assistant to the President for Economic Policy on the National Economic Council and a member of the President’s Working Groups on Financial Markets and Corporate Governance. She also served as a member of the White House Office of the Homeland Defense Working Group on Terrorism Risks to the Economy.

Paul Nash of the Foreign Policy Association spoke with Dr. Malmgren about her new book Signals: The Breakdown of the Social Contract and the Rise of Geopolitics, which was published recently in the U.K. by Grosvenor House Publishing Limited.

Q: In your new book, you say that economic signals are everywhere, from magazine covers to grocery stores to military events. What exactly do you mean by “signals”?

PM: Too often we think about economic data to the exclusion of other important information that matters. There are lots of sources of information that signal what is happening in the world economy. For example, military events like the recent near misses between American spy planes and the fighter jets of China and Russia are an important signal that the peace dividend is eroding and a new conflict premium is becoming apparent. That has economic and geopolitical implications. I find that magazine covers and artwork are good signals, which can reveal important things about the state of the world economy. Record prices for artwork and hard assets reveal a loss of faith in savings. This is not surprising given that governments now penalize savers with negative returns. One problem with data points is that they are backward looking and only serve to confirm the past. If you want to prepare for the future, you have to widen the “signals,” or sources of telling information you consider, well beyond numbers.

Q: How is one able to recognize these signals and know what they mean, or how to interpret them?

PM: No one can predict the future. When I served in the White House, everybody assumed we had a crystal ball. But I really looked and there isn’t one there. The best you can do is to raise your level of awareness and preparedness. For example, when I saw that food prices were rising in Ukraine for three years, I assumed this would destabilize that country. Sure enough, Ukraine has descended into a difficult mess. Similarly, the rising bread price that preceded the outbreak of the Arab Spring was an important signal. Global food prices at that time were steady or falling.

But people don’t care about aggregate food prices. They care a lot when the price of their core food staples starts to rise. There’s a pretty strong correlation between rising prices for core foodstuffs and social unrest, and yet few people really look at this, either in markets or in foreign policy circles. I mean who follows the price of onions in India or Pork in China? Yet if these prices rise, it is sometimes enough to threaten social stability.

Q: Can signals be misread? And how do you make allowances for those signals you may have missed altogether?

PM: Sure, signals can be misread. The key thing is that everybody will (and should) interpret signals differently. They will (and should) also act on them differently. There is no one right answer for all of us. It is the diversity of opinion and capability that makes the economy strong. After all, it is a marketplace with buyers and sellers of every signal and every idea. Some will be right. Some will be wrong. And yet humans love to approach things in a binary way, asking questions like: Will the market go up or down, should I be long or short, will a country like China or Russia become a more open or a more closed society? But the reality is that some things rise in a falling market, some countries can become more open on some aspects while simultaneously becoming more closed on others. The answer is to be more focused on differences of opinion and dissent, and wary of assumed outcomes. What John Stuart Mill observed in his day still holds true: “That so few now dare to be eccentric, marks the chief danger of the time and all good things which exist are the fruits of originality.”

Q: Can signals replace the complex mathematical models that governments or corporations use to inform their decisions?

PM: John F. Kennedy hired Robert McNamara to be the secretary of defense because he thought that his heavy use of math and data at Ford (in logistics and supply chain management) could make government more efficient. In some ways, the management of data has improved the workings of government. But when it came to a mathematical analysis of what was happening in the war in Vietnam, that approach ended in tears and a lot of spilled blood and treasure. McNamara wrote: “We were wrong, terribly wrong. We owe it to future generations to explain why.” The point is that not everything that matters can be measured, as Einstein reminded us. Many things that matter need to be weighed rather than measured. The level of human pain is something we can weigh against other factors, but it is remarkably hard to measure.

Q: Can signals be integrated with Big Data? 

PM: Math and Big Data have their place. But there are other signals that ought not to be ignored just because they can’t be easily quantified. I love the quote by Daniel Yankelovich, the founder of modern polling, who said: “The first step is to measure whatever can be easily measured. This is OK as far as it goes. The second step is to disregard that which can’t be easily measured or to give it an arbitrary quantitative value. This is artificial and misleading. The third step is to presume that what can’t be measured easily really isn’t important. This is blindness. The fourth step is to say that what can’t be easily measured really doesn’t exist. This is suicide.”

So keep your eyes open for non-data signals. The willingness of a person to commit suicide over a public policy issue, for example, is something “big data” might find hard to reveal. Yet when a young vegetable seller in Tunisia or a Greek worker in Athens or a Buddhist priest in Tibet do this, it reveals a broader set of social pressures. 

Q: How can signals help governments make better public policy choices?

PM: The first thing is to understand that there is always a social contract between the government and the citizens. Citizens abide by the law and pay their taxes, and in exchange they expect the government to deliver certain outcomes, from reasonably frequent trash collection to a military.

These days, the social contract is under severe pressure because governments everywhere are too broke to fulfill the promises they have made. So they deliver less and tax more. In response, citizens who have faith and trust in a ballot box tend to use it, and those who don’t head to the streets. So it is important for government leaders to be alert to the limits of pain.

For example, in the eurozone there may well be a government commitment to the euro project, but if people begin to believe that the price of unification is that everyone from age 16 upward will never work, the public may decide the price is too high because it profoundly breaks the social contract. We may assume that Russia is [broken], and yet this does not preclude them from bringing nuclear weapons back onto the global landscape; in fact, being broke may encourage this outcome. Failure to adopt a tough stance might well break the social contract in Russia. We could make better public policy choices by being more alert to signals about the condition of the social contract.

Q: You say that innovation can alleviate wealth inequality in the United States and around the world. How does that happen?

PM: In my view, redistribution of income won’t work. The debt problem is simply too big. You could tax Americans 100 percent of their income – all of them – and still be left with a multiyear hole. So efforts to consolidate debt and spending (which have been remarkably limited so far) need to be accompanied by more growth. Happily this is occurring. For example, I see many signals that manufacturing is leaving China and Asia and re-shoring to the U.S. Midwest and Mexico. Wages in China are rising too high and too fast. Buyers care more about quality now and prefer more reliable products. So the innovations in additive manufacturing and 3D printing in the U.S., combined with China’s loss of relative competitiveness, is now challenging the Politburo. If they cannot make people rich before they get old, then they’ll face dissent. The government must support innovation of China’s business model as they move away from cheap exports to higher value-added domestic consumption.

People think of innovation far too narrowly. It is not just about some new iPhone. It is also about the ability of the citizens to redefine themselves and the work they do. It is about new business models. It is about redefining the social contract.

Q: What other signals are you seeing today in the global economy?

PM: I see signals that inflation is coming back onto the global economic landscape. It’s pretty unsurprising given that every major central bank in the world, including China’s, is doing its level best to create it. That’s the whole point of super low interest rates and quantitative easing. But even low-level inflation brings serious social problems. I think emerging markets are rendered increasingly unstable by cost pressures their citizens cannot easily manage. In the industrialized world, the rise of inflationary pressures means there is an ever deeper split between the rich, who see asset prices rise (the normal consequence of provoked inflation), and the poor who find their costs, like rent, go up (which is also a normal consequence of inflation).

This admittedly very mild inflation pressure is already enough to have enraged the leadership in China, Russia, and other emerging markets. Their view is that the U.S. and the West seek to default on them through inflation. This means much more than making a trading loss on their holdings of U.S. Treasuries. They think the U.S. is playing Russian roulette with price stability. A little higher inflation for emerging markets gives oxygen to social unrest. So they see it as the Goldfinger Problem: the U.S. defaulted through inflation in order to pay for the American Revolution; it inflated its way out of the Civil War debt this way; it “paid for” Vietnam and the Great Society Program through inflation, too. As Goldfinger says to James Bond: “Once is happenstance. Twice is coincidence. Three times is enemy action.” They are now inclined to reach for assets more aggressively in order to protect their populations from the consequences of price instability. The Chinese become more aggressive in the South China Sea because they can’t feed themselves and that’s where you find 10 percent of the world’s fish supply in a world that has record high protein prices. This draws the U.S. into the South China Sea more aggressively, too.

As a result of all this, we are seeing near misses between U.S. spy planes and Chinese fighter jets, and both countries agreeing to the establishment of a hotline between Beijing and Washington in case these planes come within less than a coat of paint of each other. The U.S. has recently announced its intention to move more military assets into the areas where China is building infrastructure in the South China Sea. It’s not hard to imagine uncomfortable results from all this.

Q: Can you talk a little more about what you call “the breakdown of the social contract and the rise of geopolitics”?

PM: I think there is a vice bearing down on every nation, every company, every family and every individual. People are caught between, on the one hand, the debt problem, which brings low growth, no income, and a loss of faith in the future, and inflation on the other hand, which raises the cost of living (even if only by a little bit). The combined pressure gives rise to a powerful political question: Why is the wealth in my society going to someone else and not to me? This question underpins social protests from the Arab Spring to election discussions in the U.S. Domestically, the inability of the government to meet everybody’s needs due to financial shortfalls means more social pressure as different parts of society jockey for the money.

Internationally, nations respond to a breakdown of the social contract by becoming more aggressive in seeking to protect their citizens from adverse outcomes.

Q: You argue that economic signals are now eliciting more than economic policy responses – that they’re also provoking military events.

PM: Yes, I think we are seeing a new twist on Clausewitz. He said, “War is a continuation of politics by other means.”

Today, I think, we are seeing military confrontation as a continuation of monetary policy by other means. The Federal Reserve and U.S. authorities will scoff at this notion. They say that U.S. monetary policy and quantitative easing have no spillover effects. This leaves emerging markets incredulous and outraged. Even if there were any such spillovers, the U.S. argues that emerging markets should just raise their interest rates and let their currencies appreciate.

Emerging markets are even more outraged and incredulous at the idea that they should have to take even more pain when the whole slowdown happened due to spending excesses and lax policy in the West. Their response is to gird for inflation by reaching for hard assets, from food to infrastructure. This creates a kind of new Great Game situation in which China and Russia focus on physical footholds wherever there are resources, from the Arctic to the Baltic, and from the Atlantic to the Pacific.

Q: What do you say to politicians or policymakers who tell you they “don’t do economics”?

PM: I say they had better “do economics” whether they like it or not, or else economics will “undo” them. There is no way to check out of the world economy. It touches our lives every day in multiple ways.

Here is an interesting example of the interface between economics and geopolitics. Russia’s prime minister recently said that if the West kicks Russia out of SWIFT, the “Russian response – economically and otherwise – will know no limits.” The defense community asks, “What is SWIFT?” because they don’t know anything about the international banking and money clearing system that it represents.The market crowd assumes Medvedev’s “no limits” language means he is threatening to announce that Russia has more gold than America and is therefore more creditworthy. But what Russia probably means is that it will put nuclear weapons and capabilities into places like Kaliningrad and Ukraine and establish a military presence in places like the Mediterranean and the Arctic. The old nuclear weapons treaties will no longer hold for Russia. Add to this Russia’s efforts to test the West by engaging in air and sea incursions, from Japan to Scandinavia, and from Britain to California. Nobody knows which planes or vessels are loaded.

So the West has to respond as if it is a nuclear threat, even if it isn’t. You might say Russia is pulling a “Ronald Reagan trick” on the U.S. Where Reagan forced them to spend (on defense) beyond their means, Russia is now forcing the U.S. and the West to do the same at the very moment there are fewer financial resources to support this. Economics and geopolitics are deeply intertwined.

Q: Is it fair to say that as economic factors are changing the balance of power between the state and the citizen, they are also causing a realignment of international political interests?

PM: I think they are. Consider this. The postwar international economic system is built on certain basic ideas. It is a U.S. dollar-based system of free trade and (relatively) free markets, supported by certain rules of the game and certain institutions like the IMF and the World Bank. Ever since the financial crisis, the U.S. and the West with Japan have focused on repairing that system. China, Russia, and others have focused on replacing it. Why? Because they feel the old system is no longer serving their interests. Meanwhile, those in the old system are surprised that anybody feels their interests are not being served. Those who want a new system are surprised that anybody thinks that the old system is still worth repairing.

This has serious practical consequences. For example, in the old days China recycled its savings into the U.S. debt market and thereby helped to drive down interest rates and drive up the size of houses and mortgages in the U.S., which led to more purchases of stuff from China and more jobs and savings for them. It was a “perfect circle.” It permitted the U.S. (and the West) to live beyond its means, and China to grow faster than normal. This perfect circle cracked under the burden of debt. Now China says: forget recycling to the U.S. – let’s put our money directly into global infrastructure that will help us generate more GDP and potentially shore up our influence over the global supply chain. One new institution they have created to do this is the Asian Infrastructure Investment Bank. The U.S. was shocked and angry when Britain decided to join the new entity. Now some 54 countries have joined. The U.S. will not have a seat at that table. All this constitutes a profound shift in the balance of power within the system and a substantial change of the system itself.

Q: Are some states – countries like Russia and China – beginning to come together in ways that pose a real threat to the supremacy of the United States?

PM: I think the U.S. remains the main superpower in the world today. It is winning back some of its lost competitiveness, while emerging markets become less productive and less competitive. I never bought into the “U.S. is toast and China is the future” story. Both countries have their strengths and weaknesses. Both are internationalizing. Both are becoming more sophisticated economies. But they are also more competitive and more confrontational with each other. The prospects for difficult conflicts are growing. It is no longer true that the alignment of their interests outweighs whatever misaligned interests may exist.

People worry about the demise of the U.S. I have the opposite worry. I am concerned about a billion Chinese workers who were expecting a better future. We cannot expect to say: I am terribly sorry but you lost your competitiveness – come back when you have a new business model. They may not go home quietly. And why should they? The promise of a better life is real. The question is: How should they get there?

Also, what does “supremacy” mean in a world where technology has transformed the battlefield. This is a world in which wars are fought in cyberspace and in space with high altitude satellites. This is a world in which the commercial competition for ownership of commodities and industrial intelligence may be more worth fighting for than wars with boots on the ground.

China and Russia are certainly compelling former U.S. allies to think about which side they are on. Countries like Australia, Singapore, Saudi Arabia and even Britain are tied to the American defense stance but increasingly dependent on China’s economy. As the U.S. and China become more confrontational, countries will feel the pressure to choose sides. We see the same thing in Germany. Germany sees that its economic future lies to the east now that growth in the eurozone is impaired. Germany depends on Russia for energy. The U.S. asked Germany to join the famous Five Eyes spying program in an attempt to strengthen their relationship.

Russia has offered Greece cash to leave the euro, the European Union, and NATO, and to join the new Eurasian Economic Union. Greece is split between a U.S.-based defense policy and a need for Russian cash.

Saudi Arabia is a U.S. defense ally. But the U.S. supports opening up to Iran and permitting them to have some kind of nuclear capability. The U.S. supported the rebels in the Arab Spring, which is obviously not helpful from the Saudi royal family’s perspective. Meanwhile, China has become a bigger buyer of its oil than the U.S. So Saudi Arabia is drifting out of the U.S. relationship and into a new one with China.

But the flip side is that manufacturing is moving back to the U.S. from China. The Chinese are becoming less competitive very rapidly due to higher costs and higher wages. The idea that China is on a linear trajectory in which it displaces the U.S. is not quite right either.

Q: Do you think the high levels of U.S. government debt held by foreigners should concern Americans?

PM: Americans, generally speaking, have no idea they owe money to foreigners. I mean nobody they know has actually taken out a loan from a Chinese bank, right? Plus, Americans tend to think there are U.S. dollars and then there is Monopoly money. Why would anyone prefer Monopoly money? It’s hard to fix a problem you don’t know you have.

Also, almost every other government has an overwhelming debt problem, including China. Relatively, the U.S. has more capacity to earn and to grow than many other less flexible and less dynamic economies. So Americans are perhaps right to be less concerned than some others about their debt problems. This does not mean the U.S. gets a free pass. But it does mean the market does not punish the U.S. as hard as some might expect.

Q: Since the end of the Cold War, there’s been a general sense that the world is now a safer place because the threat of nuclear war between two rival superpowers has greatly subsided. Do you think that’s actually the case?

PM: I think that nuclear weapons are definitely back on the landscape. Russia is bringing nuclear weapons back to the negotiating table. The interesting thing is that the Western defense community wonders why. I mean Russia is supposed to be small and weak and broke, right? The problem is that this may be exactly why a nation falls back on hard power. I follow the various occasional news stories about their reintroduction. For example, Russia has threatened Denmark with nuclear weapons. General Breedlove, the head of NATO, says Russia’s rhetoric and actions regarding nuclear capability “give pause to NATO’s decision-making.”

I think we are also witnessing the nuclearization of the Middle East. If Iran and Israel are nuclear weapons powers, then everybody else wants to be too. Saudi Arabia will be working with both Russia and China, who are keen to export nuclear capability from a revenue perspective and keen to become more deeply tied into the region from a strategic perspective. Turkey and Egypt will follow suit.

Lastly, we should pay more attention to hypersonic technology. Nuclear weapons now may be just as destructive as they ever were. But the ability to deliver them at speed has been enhanced by modern technology. The Cuban Missile Crisis lasted ten days. These days, nuclear weapons can be delivered in minutes and seconds. Time is no longer a luxury. We need to think about managing the relationships and the dialogue well in advance of something really confrontational. As I understand it, we no longer have a hotline between Moscow and Washington. Maybe we should think about that.

Q: What does the world need in order to achieve greater geopolitical stability and security?

PM: We have to think seriously about whether the current infrastructure and rules of the game really serve the national interests of the participants. If they don’t, the system will inevitably erode. We should try to align national interests. Right now more and more countries are getting caught in the crossfire between the U.S. and China, and the U.S. and Russia. China asks Australia, Singapore, and the U.K. “Which side are you on?” In each, the economy is tied to China but the defense policy is tied to the U.S. As the U.S. and China go nose-to-nose in space and on the high seas, these countries will increasingly need to either choose sides or act as interlocutors who can talk both the U.S. and China out of doing anything stupid.

We also have to understand that weakened budgets lead to weakened borders. For example, Greece has thrown open all the detention centers for illegal immigrants because they have no cash. Now the refugee problems in the Mediterranean are exploding. The Sykes Picot Treaty borders of the Middle East are disintegrating and further contributing to this. Weak economies are also encouraging an exodus of talent, which seeks to traverse borders in search of better opportunities.

At the heart of all these forces lies economics. Stronger economics would improve geopolitics.

Relief efforts continue in Nepal. Photo Credit: Rajan Shrestha via Wikimedia Commons

The Crusades: A Complete History
By Jonathan Phillips
History Today

The crusades may not be recent history, but the number of times they’ve been appropriated by politicians in the past few years you’d think they might be. Phillips provides a fairly comprehensive history of these wars and the logic behind them.

Nepal’s Aid System is Broken. So These Lifesavers Hacked It.
By Abe Streep
Wired

As governments and international NGOs struggled to provide aid in the aftermath of the devastating earthquake in Nepal, a number of ad hoc, unregistered and unlicensed efforts have sprung up to fill the void these larger organizations have left. Wired looks at one of them, which was borne out of an bed-and-breakfast called the Yellow House.

How PTSD Became a Problem Far Beyond the Battlefield
By Sebastian Junger
Vanity Fair

Junger, who has experience with PTSD on a personal level as well, explores the history of the disorder, its effects and why it’s so prevalent in Western societies. Ultimately, he notes, it boils down to making society feel more inclusive for soldiers who have left the perils of war to return home.

The Killing of Osama bin Laden
By Seymour M. Hersh
The London Review of Books

Love it or leave it, Hersh’s “alternative narrative” of the killing of Osama bin Laden at his compound in Abbottabad has sparked conversations the world over. Hersh’s account posits that bin Laden had been held by Pakistani officials for a number of years and tries to poke holes in the official narrative presented by the Obama administration. Agree with him or not, it’s worth a read to see what all the fuss is about.

Theorizing the Drone
By Grégoire Chamayou
Longreads

What does the rise of the drone mean for modern warfare? How does it, if it does at all, change the moral calculations in war? What even counts as a drone? These are just a few of the questions French philosopher Grégoire Chamayou tries to answer in these four chapters republished by Longreads from his book Theorizing the Drone.

Blogs:

Climate Change: A Generational Challenge by Elly Rostoum
Turkmenistan and Europe’s pipe dreams by Mark Varga
International Security: We’re Doing It Wrong by Oliver Barrett
Turkey Cracks Down on NGOs by Gary Sands
Countering the Sunni-Shia Divide by Ali G. Scotten

Over at FPA.org:

Great Decisions 2015 Spring Updates by Eugene Steinberg, Paul Mutter, Daniel R. Donovan, Hannah Gais, and Jordan Stutts

A Japan Ground Self-Defense Force member guides a Cobra anti-tank helicopter onto a forward aircraft refueling point at Yakima Training Center, Wash., Sept. 4. The exercise was part of Operation Rising Thunder, a combined operation between the Army and Japan designed to increase interoperability between the two nations. (U.S. Army photo by Sgt. Cody Quinn, 28th Public Affairs Detachment)

On July 1, 2014, the Japanese government, under Prime Minister Shinzo Abe, outlined a reinterpretation of its pacifist constitution. Put in place in the aftermath of World War II, Article 9 of the Japanese constitution has been the centerpiece of its post-war pacifist identity since 1947, and details the unequivocal renunciation of war, except in the case of self-defense, as a means to settle disputes with other states. It reads:

“Aspiring sincerely to an international peace based on justice and order, the Japanese people forever renounce war as a sovereign right of the nation and the threat or use of force as means of settling international disputes.”

“In order to accomplish the aim of the preceding paragraph, land, sea, and air forces, as well as other war potential, will never be maintained. The right of belligerency of the state will not be recognized.”

The ghosts of World War II still linger ominously over Japanese society. The dangers of imperial ambition and aggressive military expansion have been ingrained within each new generation. However, as Japan pushes into the 21st century, younger generations have lost the emotional connection to the memories of the war and the political philosophy that developed in its wake. They have become increasingly nationalistic, embracing the proud traditions of Japanese history and culture and in a way aspiring to reach that pinnacle once more. Prime Minister Abe has successfully tapped into this new wave of enthusiasm cascading over Japanese society, and it has become the driving force behind Japan’s march toward rediscovering its power and influence.

In the decades since the end of World War II, the U.S., recognizing the shifting interests within the geopolitical landscape of South East Asia, encouraged Japan to increase its defense posture – working over time to slowly move them toward military normalization.

Historically, Japan has resisted contributing to regional defense initiatives, choosing instead to rely more on the Treaty of Mutual Cooperation and Security, between the U.S. and itself (an agreement that guaranteed the U.S. would protect Japan from military aggression); however, this position began to shift in the 1990s following the rise in Chinese military power, and in the recent decade has caused Japan to alter course from its pacifist doctrine. Japan is not only witnessing the emergence of a more assertive China, which is looking to exert its dominance over the region, but also a belligerent and unpredictable North Korea that is experimenting with new and more advanced weapons systems (i.e., nuclear weapons, medium and long range ballistic missile).

Even though Japan’s pacifist constitution restricts its ability to maintain a standing military, its constitution allows for the creation of a self-defense force. While the acquisition of military hardware and the build up of troops began as a humble undertaking, it has since blossomed into a highly advanced and formidable military force.

Japan’s Maritime Self-Defense Force, arguably its most important “military” branch, consists of an amalgam of highly sophisticated naval weapon systems. The Soryu-class submarine is among the worlds most advanced non-nuclear attack submarines, it is able to displace 4,100 tons submerged, allowing it to achieve 20 knots under water and 13 knots on the surface. The Soryu-class is equipped with a full compliment of 20 type 89 high-speed homing torpedoes, as well as American-made anti-ship Harpoon missiles. The Soryu-class is also capable of utilizing advanced cruise missiles, which, should the need arise; will provide Japan a preemptive strike capability.

The Atago-class destroyer, as well as its predecessor the Kongo-class, offers the Japanese a versatile surface combat platform, capable of engaging multiple threat environments. The Atago-class destroyer is outfitted with the MK-45 lightweight artillery gun, two MK-141 missile launchers, that provide up to eight ship-to-ship missiles, and a MK-15 Phalanx Close-In-Weapon-System – capable of defending against anti-ship missiles, aircraft, and littoral warfare threats.

Japan’s naval capabilities have the potential to help stifle an increasingly aggressive Chinese military posture, as well as ensure the protection of its territorial sovereignty. The deployment of these naval weapon systems can profoundly complicate Chinese, or North Korean military calculations in the region, causing them to stop and consider the ramifications of pushing for the establishment of a hegemony in South East Asia, or even, in the case of North Korea, pursuing provocative military action against Japan.

Not to be out done, Japan’s Air Self-Defense Force is at the cutting edge of aviation technology. The “tip of the spear” in Japan’s air combat arsenal is the Mitsubishi F-15J – a homemade redesigned version of the American F-15 Eagle, this veteran fighter jet comes equipped with numerous air-to-air missiles, and has been in a perpetual state of evolution during its 30+ years of deployment – enjoying numerous retrofits and upgrades to its radar and electronic guidance systems.

While the F-15J is an excellent fighter aircraft, combat aviation technology has advanced beyond F-15Js current capabilities – Japan is already beginning to plan for its replacement. The Japanese, at one point, expressed interest in purchasing the Lockheed Martin F-22 Raptor, however, the U.S., for a variety of reasons, were not keen on selling it.

Japan is set to join the American Autonomic Logistics Global Sustainment Program (ALGS), which is an eight nation logistical partnership created to sustain the manufacturing and operation of the Lockheed Martin F-35 Lightning II, commonly referred to as the Joint Strike Fighter. In joining the ALGS, Japan has said that it is interested in manufacturing components for the F-35, which would mean relaxing its long established ban on the export of military hardware.

The potential inclusion of Japan in the ALGS is a major shift in Japan’s military posture, and represents a watershed moment in the transfer of military technology from the U.S. to Japan. If this agreement goes through, any doubts about the direction of Japan’s military normalization will be laid to rest. Japan possesses the third largest economy in the world, coupled with advanced manufacturing capabilities, and a massive population – Japan has the potential to reemerge as a major player on the global stage. Japanese recognize the threat environment in which it exists, and as Prime Minister Abe moves Japan toward military normalization, he has sent a clear signal to Japan’s neighbors that it will not acquiesce to a Chinese predetermined status quo and it will not tolerate military posturing from North Korea.

Over the years, China has been working toward developing the military capability that would allow it to establish an anti-access/area denial (A2-AD) zone in the western pacific (A2-AD is a strategy that focuses on preventing an enemy from conducting military operations in, near, or within a specific region). In the event that a military confrontation was to occur, the Chinese, utilizing A2-AD stratagem, want to neutralize U.S. power projection in the western pacific. This would limit the ability for the U.S. to respond to, for example, a military annexation of Taiwan, or one of the many territorial disputes currently playing out in the South China Sea. From a U.S. perspective, the emergence of a robust and formidable Japanese military will be indispensible in acting as a countermeasure to the Chinese implementing an effective A2-AD strategy.

There are many factors to consider when discussing Japan’s military normalization, however, none are more important than ensuring Sino-Japanese relations remain on an even keel. Sino-Japanese relations have a long and checkered past, mostly due to the fact that China, as well as the Korean Peninsula suffered tremendous hardship and cruelty under the yoke of Japanese imperialism. Japan’s push toward military normalization has the potential to awaken the deep seeded mistrust that has always plagued Sino-Japanese relations.

Prime Minister Abe and his Liberal Democratic Party are firmly in control of Japanese Parliament, and are unlikely to face any meaningful political challenge for several years. Recognizing this opportunity, Prime Minister Abe has taken the necessary steps to fundamentally alter the geopolitical outlook of Japan – the U.S. will play a critical role in ensuring that this shift in Japan’s military posture does not occur at a pace that would unwittingly escalate Sino-Japanese tensions. There is a delicate balancing act playing out, on the one hand the U.S. wants to bolster Japanese military capabilities, in the hopes of deterring Chinese military ambitions, but at the same time, the U.S. must maintain positive relations with Beijing – needless to say, the coming decades will require some deft diplomatic maneuvering to maintain regional stability.

If the U.S. is able to keep Japan on its course toward military normalization, without exacerbating tensions with Beijing, then the U.S., in Japan, will discover a robust and formidable partnership that can help maintain U.S. influence in the Western Pacific and South East Asia for the foreseeable future.

Mazrak camp in the tough mountainous scrublands of Yemen’s north-west border with Saudi Arabia is now home to more than 10,000 people displaced by the escalating war between the government and rebels from the Huthi clan.
Photo: Annasofie Flamand / IRIN / 201003230854400244

By Ali G. Scotten

As Gulf Cooperation Council (GCC) officials meet with President Obama at Camp David, their lobbying efforts are revolving around one question: In the event of a nuclear deal with Iran, what will the U.S. do to counter the Islamic Republic’s influence in the Middle East? The more important question, however — and one that Obama should ask them — is how they plan to stop the spread of sectarian warfare in the region.

The intensification of fighting along the Sunni-Shia divide should be of far greater concern than the challenge posed by Iran’s emergence from isolation. Sectarian hatred is drawing religious extremists from around the world to fight in Syria, Iraq and Yemen. The longer that violence continues along religious communal lines, the harder it will be to arrive at political solutions to each conflict, and the more battle training foreign insurgents will receive — experience that can be used to wreak havoc when they return home.

The transnational nature of the current sectarian conflict is largely a result of the way a number of GCC countries, led by Saudi Arabia, have attempted to counter Iran’s increasing influence in the region. For over a decade, Arab leaders have been warning Western governments of the Islamic Republic’s nefarious plan to establish a Shia empire across the Middle East — an argument based on the assumption that all Shias are sleeper agents, mindlessly awaiting orders from Iran’s Supreme Leader. The irony is that, in employing sectarian rhetoric to thwart Shia community efforts to address local grievances, these leaders have galvanized Sunni extremists, whose violence often serves to push Shias into Iran’s arms as a last resort.

Iraq and Yemen provide just two examples.

Following the U.S. overthrow of Saddam Hussein in 2003, Saudi Arabia and its allies feared that a new representative government in Baghdad would emerge as a Shia theocracy operating under Tehran’s thumb. This was despite the fact that the majority of Iraqi Shias align with the Najaf school of Shiism, which looks down on ayatollahs engaging in worldly politics, and that most Shias polled at the time didn’t see Iranian involvement in their political affairs as a positive development. However, anti-Shia rhetoric and funding from wealthy individuals in GCC countries — coupled with the U.S. de-Ba’athification program, which exacerbated Sunni fears of marginalization — drew Sunni militants to Iraq harboring the intent to spark a sectarian civil war. When the civil war erupted in 2006, Shia Iraqis had little recourse but to turn to Iranian-allied extremist groups for protection.

In Yemen, the Saudis have been bombarding Houthi rebels, whom they view to be Iranian proxies because of their Zaydi Shia faith. But Zaydis share more in common religiously with their northern Yemeni Sunni neighbors than they do with distant Iranian Shias; in fact, many Zaydis even consider themselves to be a distinct sect. As a result, until the past couple of decades, Yemen experienced relatively little in the way of sectarianism. The more assertive form of Zaydism that the Houthis follow, however, emerged in the early 1990s in response to the encroachment of Saudi Wahabbism—the brand of Sunni Islam that has inspired the Taliban, Al Qaeda, and the Islamic State—into northern Yemen, accompanied by attacks on Zaydi shrines and mosques.

This new tension, combined with the economic deprivations experienced by northern Yemenis, created the Houthi movement. During the past decade, the Houthis became more radicalized following Yemeni dictator Ali Abdullah Saleh’s six military incursions into northern Yemen, which left thousands dead. The Saudis, who supported the attacks as a means of countering Iran’s supposed influence in the Arabian Peninsula, joined the fight against the Houthis in 2009, prompting emboldened rhetoric from Tehran in support of the rebels.

Ultimately, in attacking the Houthis as Iranian proxies rather than seeking to alleviate the social and economic problems afflicting northern Yemen, Sana’a and Riyadh pushed the rebels to seek Iran’s help. Moreover, Saudi intervention in the name of countering Tehran created an incentive for the Iranians to operate in a region that held minor strategic importance to them, largely in order to prevent the Saudis from claiming that they had dealt the Islamic Republic a blow. Today, multiple flights travel each week between Tehran and the Houthi-held Yemeni capital, with many likely carrying arms (although most analysts see Saleh’s about-face in support of the Houthis, rather than Iranian weaponry, as the key to the rebels’ recent success).

None of this is to say that Iran is blameless in the sectarianism game. The Saudis and Bahrainis, for instance, likely wouldn’t see their sizeable Shia populations as security threats if it weren’t for Islamic Republic founder Ayatollah Khomeini’s call in the 1980s to spread the Islamic Revolution — a call that led to the establishment of pro-Iranian revolutionary groups throughout the Persian Gulf. One such group, Hijazi Hezbollah, is widely believed to have been behind the 1996 bombing of the U.S. military barracks in Al-Khobar, Saudi Arabia. And Iran’s failure to rein in previous Prime Minister Nouri Al-Maliki’s persecution of Iraqi Sunnis contributed to the widespread alienation that allowed the Islamic State to take over much of the country’s Sunni areas with such ease. The massacres being perpetrated against Sunni civilians by Iranian-backed Shia militias in areas liberated from the Islamic State do nothing to address this problem.

At today’s meeting with Obama, GCC leaders will ask for more military assistance. While Washington is likely to grant them their wish — perhaps providing them with a missile shield — it’s unclear what more weaponry will ultimately accomplish given that most of the fighting is being waged by non-state actors who can’t be defeated through conventional military means. Already possessing the world’s fourth-largest defense budget, the Saudis have been unable to achieve definitive success against the Houthis. Instead, the fighting is spreading into Saudi Arabia, and the Islamic State appears to have used the unrest to gain a foothold in Yemen.

It’s time for the GCC to accept that the years of containing Iran are over; the Bush administration’s decision to overthrow Tehran’s mortal enemy in Baghdad made that all but inevitable. Even in the face of the most crippling sanctions it has ever seen, the Islamic Republic has been able to preserve the Assad regime in Syria and increase its influence in Iraq. Is it possible that, following the lifting of sanctions, Iran could use the billions of dollars in unfrozen assets and increased oil revenue to intensify the fighting? Yes. But it should be painfully clear by now that none of the region’s most serious conflicts can be resolved without having Iran at the table. Ultimately, lasting security will have to involve the establishment of a new regional framework that binds the Islamic Republic and the other Persian Gulf countries into a relationship that elevates economic collaboration over geopolitical confrontation.

This is unlikely to occur, however, without domestic reform in the region. All of the conflicts raging in the Middle East today — with the exception of the U.S.-inspired chaos in Iraq — were sparked by protests against repression. In this regard, it’s important to note that Persian-led Iran has only made substantive inroads into the Arab world in times of instability. This was the case following the 1982 Israeli invasion of Lebanon, which provided the context for Hezbollah’s emergence, and it’s the case in Iraq and Yemen today. Meanwhile, GCC leaders’ policies that marginalize their Shia subjects, rather than integrate them into a pluralistic national project, have created the very susceptibility to Iranian influence that the Sunni monarchs fear.

For these reasons, when President Obama’s visitors ask him how they can best counter Iran, the most honest answer he can give is, “Get your own houses in order.”

Ali G. Scotten is a Fellow with the Truman National Security Project and founder of Scotten Consulting, LLC, a company specializing in sociocultural and geopolitical analysis of the Middle East. Views expressed are his own.

via Twitter (World Bank)

Maroš Šefčovič, the European Commission’s vice president in charge of energy, has been hitting the old Silk Road in search of new gas supply contracts that would break Gazprom’s hold on the European market. Emerging from a meeting held in the Turkmen capital with representatives from Turkmenistan, Turkey and Azerbaijan, Šefčovič confidently said that the union would start importing Caspian natural gas through its long-touted Southern Gas Corridor network of pipelines by 2019. The fact that the officials also discussed the prospect of building pipeline through Iran “since diplomatic relations with Iran are developing positively” is yet another startling reminder of just how badly Europe wants to break free from Russia’s natural gas supplies.

But can the EU’s gamble pay off?

On paper, Turkmenistan would be a great match for Europe’s energy woes. To begin with, the Central Asian country sits on the world’s fourth largest gas reserve and owns the world’s second largest gas field. Historically, thanks to some perverse pipeline politics that forced the country to export the bulk of its natural gas to Russia, Turkmenistan had been one of Gazprom’s largest suppliers of gas. That is, until 2009, when the Russians unilaterally announced that they will gradually phase out gas imports from Central Asian countries (in 2015, Gazprom will buy only 4 billion cubic meters, down from 45 bcm six years ago). As a result, Ashgabat turned to China and the EU to offset the lost revenues. After Turkmen officials revealed their desire to supply Europe with 10 to 30 bcm per year, Brussels listened and quickly dispatched Šefčovič to Ashgabat.

What’s more, sealing a deal with Turkmenistan to send part of its gas to Europe would be a boon not only for the Union’s energy security but also for Ukraine’s own trials and tribulations with Russia. In late March, Poroshenko signaled his interest in resuming inexpensive gas imports from Turkmenistan, as a way to sidestep Gazprom’s whimsical pricing policy.

Kyiv’s energy policy used to be prescribed by the gas prices demanded by Gazprom, a price curve that ebbed and flowed in lockstep with Ukraine’s falling in and out of Moscow’s grace. Up until 2009, thanks to a contract signed by RosUkrEnergo’s Dmitry Firtash, Kyiv enjoyed the lowest gas prices in its history by relying on a mix of cheaper Turkmen and Russian gas. The agreement, revolutionary at the time because it was the first time Turkmen gas would make its way directly to Europe, was shredded when Firtash’s political opponent and former gas trader, Yulia Tymoshenko cut out RosUkrEnergo from the equation and signed instead a 10-year agreement with Gazprom. Because of its variable pricing technique that saw prices rise four-fold in the span of a few years, the 2009 deal proved to be a complete mess for Kyiv. Prime Minister Arseniy Yatseniuk announced that his government is now seeking a hair-raising $16 billion in damages from Gazprom before an arbitration court in Stockholm.

Today, the prospect of importing Turkmen gas to Ukraine is trickier than it is for the EU, mostly because Kyiv needs Gazprom’s pipeline network for its transport. However, Ukraine’s rightfully combative stance with Russia makes the prospect of negotiating a deal with Gazprom a tough sell. Firtash, riding high after being cleared of graft charges by an Austrian court, in what the judge deemed to be a politically motivated trial mounted at Washington’s behest, could however end the deadlock given his long-standing business connection in both Moscow and Ashgabat.

With both Brussels and Kyiv courting Ashgabat, we are now witnessing the birth of a new energy architecture in Europe that will have long lasting impacts on Russia’s capacity to use its energy weapon for political games. Unlike its ho-hum predecessor, Jean Claude Juncker’s Commission has deftly navigated the testy waters laid at its doorstep by Moscow’s aggression in Ukraine. EU Competition Commissioner Margrethe Vestager leveled a €10 billion anti-trust case against Gazprom for unfair pricing in several Central and Eastern European countries. The move is part of the Union’s Third Energy Package that wants to bolster competition in EU energy markets through a process of unbundling, or separating pipeline ownership from gas producing companies. A win for the Commission’s litigators would deal a mortal blow to Gazprom’s bottom line and would force the company to rethink its business plan. Even if the company reached an agreement with Ankara on May 7 for the building of a pipeline across the Black Sea to Turkey, the feasibility of the project has been severely questioned.

Against this backdrop, Šefčovič’s and Poroshenko’s forays in Turkmenistan seem to indicate that the tide is turning against Gazprom’s old ways of doing business. The unprecedented fall in oil prices (Gazprom’s gas prices are pegged to the barrel) and the tumble of the ruble have shaved 86 percent off the company’s net profits in 2014, a trend that will continue unless the gas company adapts its European business model in order to respect European laws. In the medium term, the message is clear: Gazprom’s can no longer claim to be indispensable in Europe.

UN soldiers provide water at a refugee camp in South Sudan. Photograph: Yna/EPA

Is a re-think of the Western-led international security enterprise needed to respond to a set of interrelated trends that have little to do with conflict between great states and far more to do with dysfunction within fragile states? The candid observer of global security trends might be inclined to respond in the affirmative given the mounting evidence that the West’s responses to vexing security challenges, especially those affecting fragile states, have yielded little positive results. In fact, in many instances, they have made matters worse.

Off-focus in an Age of Persistent Disruption

National security is the practice of protecting the state and its citizens against an assortment of threats through mixed-response statecraft, specifically, using the tools of diplomacy, defense and foreign aid. Conventional wisdom holds that the dominant and potentially most consequential threats to North America and Europe are bellicose nuclear armed rogue states like North Korea and Russia under Vladimir Putin, and of course, nuclear weapons aspirants like Iran. However, a national security orthodoxy centered on “rogues” and expressed in a grand strategy based on cold war logic is well off the mark given that today’s security landscape continues to be shaped to a far greater degree by the drivers of trends like mass migration, terrorism, and climate change than by great powers neo-colonialism.

Further, the West’s well-resourced military enterprise – led by the United States – cannot begin to mitigate, much less resolve, the root causes of the most consequential drivers of 21st century insecurity. In an era where great states conflict is most likely to be fought using the mechanism of finance and trade (e.g., sanctions) vs with destroyer squadrons and Army divisions, the convergence of political dysfunction, underdevelopment, and extremist ideologies, most now be recognized as the premier threat to international peace and stability.

An obsession with readily definable, deterable and trackable “rogues” is counter-productive in an era that is increasingly being defined by trends that have little to do with Putin and Khatami and everything to do with imploding states across the across the Middle East and North Africa (MENA). The toxic forces circulating within, and emanating from, failing states like Somalia, Sudan Yemen, Eritrea, Syria, Iraq, et al., continues to spill across regional borders, and increasingly into the West’s own bowls of prosperity in the forms of terror and mass migration, spiking angst, or at the very least, deep concern, from Albania to Sweden.

Fragile States Spillage – A New Normal

The up until recently under-reported exodus of Western, Northern and Eastern African youth from their tumultuous homelands into Libya (itself a failed state), and across the Mediterranean sea, is an example of fragile states spillage that has the potential to cause chronic social and economic pain across Western Europe. Many Southern European nations with their already sky-high unemployment rates, dismal growth numbers and stressed welfare systems are not prepared to absorb hundreds of thousands of young, low-skilled migrants. Given the worsening conditions across the MENA — to include the deepening desperation — the waves of migrants will be persistent and perhaps even more intense in the years to come.

There is even concern that violent extremist individuals might be mixed in with legitimate African refugees on any of the numerous illegally-operated ferries making the crossing.  The specter of stowaway terrorists amid persistent waves of unskilled foreigners landing penniless and hungry at Europe’s doorway is a stiff wind in the sails of European xenophobia generally, but islamophobia more specifically. One British columnist, in response to the migration crisis, called for “gunboats” to be used on refugees – and referred to the migrants as a “plague of feral humans.” Though this is hardly a representative sentiment of the vast majority of Europeans it does underscore the potential for a nationalistic backlash that could lead to minor or major political reordering across some of the most affected nations.

Fragile states spillage has precipitated a revolution in geo-security affairs that has come as a surprise to national security practitioners. Here, many now find that they are increasingly planning more foreign humanitarian assistance operations than war-fighting operations. But although each of the human insecurity-linked trends are by themselves problematic, some are more concerning than others due to the sheer scope of the problems and their exceedingly long resolution timelines. But perhaps the trend of most concern – one that is the most underappreciated and underreported – is one that should be the easiest to understand and most important to mitigate.

Young boys are usually recruited from within the locality, lured by money and a sense of purpose in fighting for the community [Al Jazeera Media Network & Reuters]

The Raw Materials of Terror

The youth bulge is a stage of development where a country reduces infant mortality but birthrates stay the same or increase. It is a trend that is compounding instability over large swathes of the MENA. In Sub-Saharan and North Africa about 40 percent of the population is under the age of fifteen, and almost 70 percent is under thirty years old. It’s not surprising, then, that there exists a tremendous imbalance between young men in need of meaningful employment and available jobs. Frustrated youth don’t have productive options to choose from, so many are compelled to leave their home countries, join a local illicit network (e.g., gangs), pledge to a terror group or resort to petty crime (the gateway to not-so-petty crime) to satisfy their unmet needs. The net outcome is that before age twenty, many young men become national liabilities versus national assets.

Boys with unmet psychological, spiritual and physical needs across the MENA are ripe for recruitment into violent religio-political groups like Al-Shabab, Boko Haram, and the Islamic State in Iraq and Syria. But this is not the narrative that the architects of the counterterrorism fight want to hear. It causes no small amount of dissonance to learn that the foot soldiers of terror (really, at-risk youth whose communities and countries have failed them) are not innately evil and that most are even be redeemable. However, the itch to be seen as doing something (normally that “something” is lethal) must be scratched in order to appease a fearful public which is largely not aware of the key ingredients of which the transnational “terrorism” concoction is composed.

The youth bulge and other drivers of national instability and insecurity cannot be responded to with the West’s security apparatus. There’s no denying that a robust set of traditional military and intelligence capabilities is needed to deter great states aggression as well as to eliminate bad guys who are imminent threats, however, hard power should be the lesser applied compound in the prescription designed to cure terrorism. Developmental and national capacity building goods and processes  (often referred to as soft power) aimed at improving affected population’s human security represent a way forward that is likely to achieve the best security results over the long term.

President Obama in his 2015 National Security Strategy (NSS) stated, “The use of force is not, however, the only tool at our disposal, and it is not the principal means of U.S. engagement abroad, nor always the most effective for the challenges we face.” Though the administration persistently promises that hard power is not the “principal means of U.S. engagement abroad,” one could be forgiven for being skeptical of this pronouncement after even a cursory review of the national security balance sheet.

Uncle Sam’s military expenditures come in at over twelve times the spending of diplomacy and foreign humanitarian and development programs (more precisely, $610 billion to $50 billion). Surely, the U.S. administration and Congress can do a better job of adjusting spending priorities so that there is a more reasonable balance between hard power spending and the soft power tools that can effectively address the drivers of expanding insecurity in key parts of the world.

A Smarter Approach

Smart Power is a concept first introduced by Joseph Nye (former Assistant Secretary of Defense under President Clinton) and centers on investing in alliances and institution building as a means to enhance stability and achieve sustainable security outcomes. When practiced wisely, it is inspired by American core values and informed by scholarly analysis of observable trends versus biases towards a familiar set of threats and trends. Nye shared in a Huffington Post article in 2007 that, “Though the Pentagon is the best trained and best resourced arm of the government, there are limits to what hard power can achieve on its own. Promoting democracy, human rights and development of civil society are not best handled with the barrel of a gun.”

For smart power to gain traction, conventional notions of national security must yield to a far broader, nuanced and fact-fueled understanding of threats to international security. New goals, doctrines and strategies together would form the basis of a new international security orthodoxy, which brings closer to its center human security concerns. The premise that international security can be preserved principally with conventional war prowess must be discredited and more balanced and sensible framework for understanding (and responding to) security threats be brought to the fore. A policy of strategic patience which resists reflexive kinetic responses and is expressed principally through conflict resolution and development efforts must be sold to the American public as the most prudent way forward.

Lastly, President Obama’s NSS states that the solution to the fragile states challenge “rests in bolstering the capacity of regional organizations, and the United Nation system, to help resolve disputes, build resilience to crises and shocks, strengthen governance, end extreme poverty.” Such an approach (clearly not yet fully implemented) is smart power manifest, where victories are harder to quantify, take a long time to achieve, but are ultimately more effective than costly and controversial approaches like the target lists centric counterterrorism program. It’s time for the international security playbook to be revamped so that a human security centered smart power approach becomes America’s grand strategy for leading the world into an increasingly tumultuous 21st century.

German Ambassador to India, Michael Steiner (L) listens to Dr. Hubert Lienhard (R), Chairman of the Asia-Pacific Committee of German Business (APA), speaking during a joint news conference in New Delhi, India, 11 July 2014. MONEY SHARMA—EPA

Charities and citizen advocacy groups are having a tough time these days in some large developing countries. Both Russia and China have increasingly tightened restrictions on their activities, as well as other non-governmental organizations (NGOs). Now it is India’s turn, as Prime Minister Narendra Modi’s government announced on April 27 the cancellation of registrations for close to 9,000 foreign-funded NGOs, citing the failure of the NGOs to file returns. Tensions between foreign NGOs and the Indian government have long existed, although some fear under Modi’s watch oversight of NGOs is increasing.

Some NGOs have been placed on a “watch list,” rumored to include such well-known NGOs as the Climate Work Foundation, the Danish International Development Agency,  Greenpeace, Hivos, Mercy Corps, and the Sierra Club. Other NGOs have had their bank accounts frozen.  Among those targeted is the Ford Foundation, based in New York, which currently funds programs in India to promote livelihood among the poor, advocacy for economic and social rights, good governance, and women’s reproductive health.  Since starting its operation in 1952 under Jawaharlal Nehru, India’s first prime minister, the foundation has funded some $508 million. These programs are now required to receive permission from India’s home affairs ministry before any money gets transferred to recipients.

Many link the crackdown on Ford’s activities to their support of human rights activist Teesta Setalvad, who has fought for the rights of victims of the 2002 riots in Gujarat — during which Modi acted as chief minister of Gujarat. The riots followed the torching of a train carrying Hindu pilgrims, which killed 59 people. Hindu mobs then attacked Muslims, resulting in the death of over 1,000 people, mostly Muslims. Given his Hindu nationalist background, Mr. Modi stands accused of failing to quell the violence against Muslims in 2002, and has recently been criticised for his silence on several anti-Muslim incidents taking place since he assumed power.

In March, the Gujarat government condemned the funding by Ford of a trust to support the victims, accusing Ford of interfering in the “internal affairs” of India and “of abetting communal disharmony.” Some analysts attribute the move as an attempt by the Modi government to appease Sangh Parivar, the coalition of right-wing Hindu nationalist groups, started by members of the Rashtriya Swayamsevak Sangh (RSS), who support Modi’s Bharatiya Janata Party.

Last June, a report by India’s Intelligence Bureau leaked to the media accused Ford, Greenpeace, and Hivos of hindering India’s growth through their active opposition to nuclear, mining and power projects.

While registrations for close to 9,000 NGOs have been cancelled, by some estimates there are 3.2 million NGOs operating in India, of which some 40,000 are registered. An attempt by the Modi government to clean up the registration process is needed, as well as more transparency, but the effort should not turn into a witch hunt to target specific groups, such as those who are trying to protect the environment or fight for human rights. The German Ambassador to India, Micheal Steiner, recently added his concerns at an event in Delhi, stating “NGOs are doing impressive work in India,” adding, “I think the fundamental approach should be to support their work.”  U.S. Ambassador Richard Verma went further, warning of a “potential chilling effect” should the Modi government continue to crackdown on NGOs.

While scrutiny of the activities of NGOs is certainly necessary and justifiable, any perceived bias against those NGOs operating in the environmental or human rights space risks driving many NGOs out and making it difficult for those that remain to operate effectively. Should the Modi government chose to impose new regulations on the operations of all NGOs, this will likely slow the operations of the many NGOs who are having a favorable impact on the quality of life in India.

International NGOs, such as the Danish International Development Agency, the Ford Foundation, Greenpeace, and Mercy Corps, operate across many countries and regions, and with constraints on their funding, must choose among worthy nations.  In making that choice of where to deploy funding and resources, two key factors are local operating conditions and how effective that capital can be deployed to produce real change. Should international NGOs decide India’s operating conditions are too onerous, and efforts to produce real change too distant, it will be up to the Indian government to fill the void with effective programs of its own, lest the Indian populace suffer.

The vast majority of scientists agree that human activity has significantly increased greenhouse gases in the atmosphere — most dramatically since the 1970s. Yet, global warming skeptics and ill-informed elected officials continue to dismiss this broad scientific consensus. As a generational challenge, climate change seems to be victim to a failure of communication. It is badly in need of a framework to help reduce the gap between what is understood by the scientific community, and what the public and policymakers need to know.

Susan Joy Hassol, a climate change communicator, analyst, and author who has been making climate science accessible for 25 years. Director of Climate Communication, Susan helps scientists communicate more effectively and provides information to policymakers, journalists, and others. She has authored and edited numerous reports, written an HBO documentary, and appeared on national media. In her recent talk, ClimateTalk: Science & Solution, given at a TEDx event, Susan discusses how a resolution of the climate communication failure is essential to unleash our ability to solve the climate problem. 

I had a chance to catch up with Susan during her visit to speak at the Massachusetts Institute of Technology (MIT) our discussion:

Climate change. Would you say it is the most important challenge we face this century?

Oh, yes. Left unchecked it’s an existential threat to civilization. It’s the mother of all challenges, in that by tackling climate change, we’d also address a range of other challenges like job creation, health issues, social equity, environmental protection and security concerns.

But just because it’s the most important challenge doesn’t mean it’s the most daunting. We have almost everything we need to solve it: the technologies, the policies, and recent polls show that there’s broad public support across political lines for climate action. It won’t be easy, but nothing important ever is. It will be quite cheap, though, compared to the consequences of inaction.

Is the challenge in tackling and generating action on climate change largely a communications failure?

Communications failures are major obstacles to action. They range from language confusion, both inadvertent and deliberate, to the disinformation campaign designed to sow doubt about the science, to the way the media handle climate – the minimal coverage, the undue airtime given to contrarian views, and a general failure to connect the dots between what we’re experiencing and the human influence on climate.

But while these failures have been obstacles to action, they’re not insurmountable. There are ways forward.

What do you see as the top hurdles in bridging the gap between science and policy action with regards to climate change?

The top hurdles include the partisan ideological divide – the “toxic tribalism” that has infected the climate issue, and the disinformation campaign that deliberately muddies the waters – and they’re not unrelated. It’s hard to get sufficient policies enacted in the U.S. when the leadership of one political party still largely denies the science. The disinformation campaign fuels that denial. And the scarcity of media coverage is a hurdle because people tend to prioritize what’s “trending,” so climate change just doesn’t reach high priority status for most people.

Ten years from now — and realistically speaking — do you see concrete, substantive action happening on climate change? What is your hope?

It depends on whether we can achieve the political breakthroughs necessary. It’s not primarily a problem of science or technology. It’s primarily a political problem. If we can summon the leadership and political will to bridge the ideological divide and agree on solutions that provide wide-ranging benefits, it’s my hope that in ten years we’ll be well on our way to changing our trajectory and ensuring our future. We can do this.

Are there any angles that the discourse on climate change is not leveraging? Ideology and faith, for instance?

Some people are working diligently in those arenas. For example, Bob Inglis is engaging his fellow conservatives and Katharine Hayhoe is reaching out to her fellow evangelical Christians. And how about Pope Francis! Not only is he engaging the world’s 1.2 billion Catholics, he makes a moral case for climate action that reaches many others too.

This is where the critical importance of trusted messengers comes in. People are much more likely to accept an idea when they hear it from someone with whom they connect on values. So there’s an important role for identifying and promoting trusted sources for various audiences.

If you could, how would you solve climate change?

I would implement globally all the policies and technologies we can already see working in various places. These would include properly pricing all energy sources to include all of their real costs to society; instituting strong energy efficiency standards on everything that uses energy, from cars to appliances; removing all subsidies from carbon-based fuels; and instating policies that encourage the use of renewable energy. To do all this, I’d draw on the talents of brilliant people who are making these things happen in cities, states, and countries around the world now.

How can the public — especially the younger generations — effectively engage and drive action around climate change?

I think becoming politically engaged on all levels – your university, city, state, and region – is key to driving action. Each college or town can serve as a laboratory for what works and can be an example for others to follow. You can let your political leaders know that climate change is a top priority issue that will determine your vote. Young people can pursue careers in clean energy and other avenues that use science, technology, and policies to ensure a healthy future. And for all of us, it’s time to raise the profile of climate change – to bring it to the front burner.

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Patan, Nepal (Photo: cpcmollet via Flickr).

Nepal, Before and After the Earthquake
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Text by Jon Mooallem/Photographs by Giles Price

With pictures as beautiful and saddening as the text that describes them, The New York times Magazine depicts the beauty of Nepal and its people, and the destruction of their country after a major earthquake last week.

The Right to Blaspheme
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By David Frum

In response to the attempted terror attack in Garland, T.X., David Frum makes the distinction between hate speech and blasphemy, and what freedom of speech entails.

The Aesthetic Failure of ‘Charlie Hebdo’
The New Republic
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In the months following the Charlie Hebdo shooting in Paris, a debate has broken out about the satire magazine’s refusal to modernize its message.

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The Manhattan Project was the secret U.S. initiative to construct an atomic bomb to help end World War II. Keeping it hidden from enemies was obvious, but the extent to which it was hidden from the thousands of employees is surprising.

A League of His Own
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Bloomberg Business published an in-depth feature on the divisive FIFA president, Sepp Blatter, and the political orchestrating he navigates while controlling the world’s most popular game.

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