Holbrooke's heroes

Obama's Afghanistan policy review and the following talks at the Hague are being praised for the inclusion of Iran. I've long advocated the inclusion of Iran in Afghan dealings; but a regional solution will only work if every country is involved in shaping strategy. Instead of opening the table to debate, Holbrooke and his team are essentially dictating policy. Apparently, they expect India to accept the notion that Pakistan is a victim of terrorism and a trustworthy partner. Guess what? They're not buying; nor should they be.

The fact that the Obama administration is still supporting Pakistan and now talking with Iran, without any significant conditions, is a huge slight in the eyes of India. Prime Minister Singh has essentially banked his career on the new strategic relationship with the US he helped usher in with the nuclear deal. India, after reorienting their entire foreign policy to align with the US, is being cornered into supporting their enemy, who have still not pursued the planners of 26/11 or even shared evidence.

Treating our strongest ally and partner in South Asia as an afterthought is a huge mistake. Indian elections are this month; the economy is obviously the central issue, but if Mr. Holbrooke continues to talk to India instead of with it, you better believe we will have a much less sympathetic ear in Delhi. Replacing a centrist, liberalized government with a nationalist, populist alliance hostile to most US activity isn't exactly a good change.

(Photo from Politics and Meetings)

Gallows humor

President Obama has had a rough few months. As the global economy continues its slide, what the crisis means for global trade and financial regulation will dominate discussions in London on Thursday. Rightfully so. After the economy, North Korea's impending missile launch and Afghanistan's gradual decline into disarray dominate any foreign policy discussions. With so much on his plate, not to mention health care reforms and an understaffed Administration, Iraq has fallen by the wayside. The President has admitted as much.

But lest we forget how perilous the gains we've made in Iraq are, Tom Ricks is happy to remind us:

The Maliki government is putting the screws to the Awakening movement (for those who just arrived, that's a mainly Sunni group of about 100,000 people, many of them former insurgents, who in late 2006 and 2007 arrived at ceasefires with the U.S. military presence in Iraq). The American plan was to integrate 20,000 members...into Iraqi security forces, and help the rest find other work...But the Shiite-dominated Baghdad government never really like the idea. Indeed, the first deals were cut by U.S. officials behind the back of the Iraqi government...I think Maliki's gambit is to crack down on the Sunnis while American forces are still available in sufficient numbers to back him up. This is turning into a test of strength, Sunni vs. Shiite.

Sound familiar? 

The President may be better served to focus on actually shoring up our international standing, rather than just paying lip service to the notion while using our current crisis environment to push big government, domestic programs that most independent voters hoped he would avoid.

Buying bras shouldn't be this complicated...

One of the irony's of Saudi Arabia's gender segregation is the way in which women shop for lingerie - uncomfortably and inappropriately.

As a result of labor policies aimed at preventing women from dealing with male customers, women are not employed as salespeople. This means that in lingerie stores men end up talking to women about bras/thongs/etc and checking out their bodies to determine cup sizes. On top of that, fitting rooms are banned in the kingdom, since women undressing in the close vicinity of a man is unacceptable.

Not only does this not make sense in ANY way when you consider the conservative nature of Saudi society, (in a gender-segregated society, why would men not be banned from lingerie stores?), but even in the US and Europe, men typically do not sell lingerie to women. Well, as they say in the Arab-world, HALAS! Enough!

A group of Saudi women have launched a boycott of lingerie stores until they employ women. The women are not asking to work WITH men. Far from it - they are not demanding any major shifts in Saudi culture - in fact, they are supporting it. They don't want men to be involved in this type of intimate purchase at all. They want men completely removed from the process, as you would think conservative leaders would agree with.

The boycott was launched on Tuesday by approximately 50 women who gathered at the Al-Bidaya Breast-feeding Resource and Women's Awareness Center in Jeddah, run by founder Modia Batterjee. The aim of the boycott is to pressure the government to IMPLEMENT a law that has been in existence since 2006, which mandates that only women can be employed in women's clothing stores. Reem Assad, a finance professor at Dar Al Hekma College in Jeddah says: "We are raising awareness and calling for the implementation of the law." Assad started a Facebook group which now has 1,680 members, and posted an online petition which has at this point been signed by 1,700 people.

Since only a few Saudi papers have written about the boycott, it has depended largely on word-of-mouth and the internet. The women who launched this campaign knew how to leverage online communications and social media to disseminate their message quickly and effectively. The impact of the campaign remains to be seen, but I am curious to see how else Saudis will chose to utilize new and social media to initiate these types of activities in the Kingdom.

Facebook goes Arabic

Facebook currently operates in 40 languages- from Afrikaans to Greek... but no Arabic... until now. 

Although Facebook has been available throughout the Middle East since it expanded beyond the US college network in 2006, it will now be fully functional in Arabic.  According to an article in the Guardian, "50 million of the world's 250 million Arabic speakers already use the internet, but Arabic only makes up 5% of global web content."

Considering the fact that there are currently over 300,000 Facebook users in Lebanon, and over 250,000 in Saudi Arabia- this should be an interesting trend to track.  Social networking is often used differently in various cultural contexts... it will be informative to see how Facebook is utilized throughout the Arab-speaking world. 

Commodity price collapse: who wins and who loses?

One of the great back stories of the ongoing economic crisis is the collapse in commodity prices, which occurred in the second half of 2008 after a record boom period lasting at least five years. The bursting of the bubble has produced clear winners and losers. Thanks to our fantastic contributors, zzzeitgeist has had excellent coverage of these repercussions. I thought I’d try to tie things together.

The biggest winners are consumers, particularly first-world automobile drivers. In the last 7+ months, oil has fallen from $147/barrel to about $37/barrel now. Economists reckon that amounts to a ‘stimulus’ of more than $240 billion. Also, now that the world food crisis has largely subsided, developing-world consumers stand to benefit from cheaper food prices. This means a lot when you spend more than 50% of your budget on food.

The mining sector is obviously a huge loser. Mining is often a boom and bust industry, because it takes a long time to develop new mining projects. It’s hard to forecast future supply/demand fundamentals (remember when this seemed like a good idea?) and unfortunately they can change drastically and rapidly, which is exactly what has happened in the last year. As a result, a number of firms are closing mines, because prices are too low to justify operating costs. Mining firms often take on a lot debt out of necessity – digging mines ain’t cheap. But thanks to the financial crisis and the disappearance of cheap credit, heavily indebted companies are suddenly struggling to stay afloat. Case in point: Rio Tinto, the world’s second largest mining conglomerate. See Rory’s excellent treatment of Rio’s debt woes here.

Finally, commodity-dependent countries suffer perhaps the worst. When prices are high, resource-rich countries are suddenly flush with cash, which they can use to advance geopolitical aims, reward cronies, or invest in infrastructure, education and health to avoid the resource curse (don’t hold your breath). Falling commodity prices have scaled back these ambitions. See Dan’s analysis of Venezuela, Rory’s take on Russia, or this money quote about Iran.

In my mind, these are the biggest winners and losers, but this list is by no means exhaustive. Falling commodity prices also have an enormous effect on agricultural trade, international cooperation, foreign direct investment, Guinea, South Africa, Australia, several Latin American countries, etc. Who else am I missing?

(photo from jeff-o-matic’s photostream)

Obama's first move in the Arab world: LISTENING

In a timely interview with Al-Arabiya news, and signaling a strong break from the Bush administration, President Obama has made it clear that his administration will "start by listening".

According to a transcript of the interview posted on the Al-Arabiya English-language website, President Obama said that he had instructed Mr. George Mitchell (former Senate Majority Leader and current Special Envoy to the Middle East for the Obama Administration) to:

“...start by listening, because all too often the United States starts by dictating... we don't always know all the factors that are involved. So let's listen. ”

I would love to say "I called it!"... but I'm pretty sure my opinion is shared by many people (far smarter than myself) around Washington and, hopefully, throughout the State Department.

"What's smart power?  This is smart power." 

Trade counterfactuals

*This post on trade represents only my own opinions.

For the sake of argument, I want to present an alternate viewpoint about President-elect Obama and trade. I’ve been thinking about it a lot about, and specifically whether or not he’s ‘bad’ for trade. He distances himself from protectionist rhetoric all the time, and he likes to reiterate that he both understands the fundamentals of trade and considers himself a free trader. And yet, the conventional wisdom among many trade watchers seems to be that he won’t pursue new agreements and that he won’t try to bring a successful conclusion to the DDA. How do you reconcile these two points of view? Is one of them wrong?

For what it’s worth, I don’t think the two positions are incompatible. I agree that is unlikely that Mr. Obama will do much on trade for the first year or two of his presidency. But this only in part because of the financial/economic crisis over which he will preside – part of it is purposeful as well. Free traders tend to look at the big picture: the aggregate benefits of freer trade outweigh the concentrated losses, and society as a whole gains. Mr. Obama recognizes this, but he is also much more in tune with the distribution of these gains. In other words, his departure point is different.

I think that in Mr. Obama’s mind, the postwar consensus on trade has unraveled. And the public has grown much more skeptical about the benefits of globalization and much more wary of the downsides. In this climate, it is possible that simply continuing the current trade policy is no longer sustainable. To make people more accepting of future trade deals, it might mean that you need better unemployment assistance, better infrastructure investment, better retraining schemes and better health care that is less tied to employment. And Mr. Obama is very eager to do all of these things.

So while trade watchers may be wary of Mr. Obama’s short term stance toward trade, his intended investments in an enhanced social safety net may actually make it more feasible to conduct ambitious trade deals in the future. The remaining question (aside from whether or not this is accurate!) is whether or not the US can afford to take a trade pause while other nations are racing forward.

Any thoughts? This is just a hypothetical counterfactual. Feel free to tear it apart in the comments section.

Raid Syria? Actually, that's a terrible idea.

The implications of the US military strike into Syria are manifold. Counterinsurgency 101 tells you to eliminate all insurgent safe havens, but there will be serious negative consequences that might outweigh playing Al-Qaeda whac-a-mole in Syria.

But first, it is confusing as to who actually ordered the strike into Syria. It would appear that the White House has delegated the responsibility for ordering strikes into insurgent sanctuaries to the military commander of Central Command, David Petraeus.

Wow.

We take from Clausewitz that war is merely the continuation of politics by other means, but is it acceptable to give the Pentagon the ultimately political choice of when to potentially start a war? Clausewitz, and I say a definite no- even though Petraeus is a pretty good guy. And there could also be confusion as to who even ordered this particular attack. This is also a tad worrisome.

Syria is granting insurgents and terrorists safe haven in their countryside, as I discussed in the previous post, and this was getting on Iraq and the US’s nerves. But perhaps who ever thought it would be a good idea to conduct a US raid in Syria was banking on Syria’s response to be similar to Israel’s bombing of their suspected nuclear reactor last fall? (Which was rather muted at the time.) But Israel bombed a remote region that was closed off to the Syrian public, and the US sent ‘copters in the middle of the day near a pretty large town. It is hard to just write that off… It might be a little more expensive in the short run than a quick helicopter trip into Syria, but I would advocate that Iraqi and US forces man the border and we work towards getting the Syrian police to roll up the undesirables that might run amok along the Euphrates. Violations of sovereignty tend to upset people.

Most Syrians desperately would like to be free from Iran’s sphere of influence and rejoin the international community sans sanctions. Anyone who has taken an Iranian-made taxi in Damascus will sympathize. The Syrian government had recently been making overtures towards the west, but this raid is likely to set that back a quite a ways.

Finally, one must wonder what this will do to the SOFA (Status of Forces Agreement) negotiations back in Baghdad. Iraqis want the US military out of Iraq, and since it is a now a democracy (that’s a good thing, right?), the government needs to respond. The raid into Syria has thrown yet another wrench in the equation. And I’ll bet that it’s a pretty big wrench.

Raid Syria? Sure, why not?

This past summer I backpacked through much of Syria, and the guys at Zeitgeist have asked me to share a few thoughts on the recent raid by US forces into Syria.

First, a little back ground info:

On October 26th, the United States raided a village on the outskirts of the Syrian town of Abu Kamal, which is right on the Iraq border. Four American helicopters entered Syrian airspace in the middle of the afternoon (rather bold, I’d say) and the raid resulted in the death of Abu Ghadiyain, Al-Qaeda's senior coordinator who was operating in Syria. This is the first attack of this nature by US forces into Syria, and Syria’s government was none too pleased, labeling the raid “criminal” and “terrorist aggression.”

Russia, Venezuela, France, China, Iran, North Korea, and a host of other nations condemned the attack with varying degrees of strong language. Iraqi government officials also voiced extreme displeasure with the raid- the said they didn’t sign up to have Americans invading other countries’ sovereign territory while using Iraq as their base.

I took a whirlwind road trip of eastern Syria this summer, which included a visit to the town of Abu Kamal. After sugaring up my mukhabarat (secret police) escort that had been following me as I visited archeological sites on the Euphrates, I was able to visit the border crossing, pictured below, on the condition that I didn’t take any pictures.

The Syrian border guards were pleasant, and they said at most only five or six cars cross from Syria into Iraq each day. This, however, is not the impression you get from Abu Kamal, which was bustling with the types of commerce that you would expect in a remote town that Iraqi insurgents use as a safe haven. From the plethora of desert-going American SUVs, many with Iraqi license plates (and some with Texas DMV stickers still on their windows), it was clear that more than a half dozen vehicles were crossing from Syria into Iraq near Abu Kamal.

So indeed, there are Iraqi insurgents in Syria. And some even have Osama Bin Laden bumper stickers. Abu Kamal, and the whole of eastern Syria, is a pretty wild place. In counter-insurgency lingo it could be classified as a “sanctuary.”

But what to do about it? And what are the implications from this raid? More to follow in a few minutes...

A black lining

Well the world is falling apart but there's a little bit of good news...Oil futures closed today below $90.

But as Brad Setser points out, the Gulf monarchies will feel a pinch in the coming year and that may spell even more bad news for the US economy. Sovereign wealth funds have certainly taken a hit in the recent downturn and exporters the world over are feeling the pinch from these losses; coupled with the downturn in prices, they probably won't be inclined to keep pumping money into Wall Street institutions.

The lower costs of consumption will most certainly be happily accepted by Americans given the coming winter. But the secondary implications for international oil exporters may also shape the next administration's initial foreign policy. Venezuela recently had to cut spending for the next year; Iran will probably be next. Domestic regimes who can no longer lavishly spend on their constituents will probably not be accepted as readily. Rogue leaders - weather in Iran, Venezuela, or Russia - may have trouble holding onto power when they can't continue propping up ill-designed economic systems with booming oil revenues. This is great news for the next administration - whoever is in charge.

Foibles not follies

There's another beleaguered executive making news and his name isn't Bush. Soon to be former Prime Minister of Israel Ehud Olmert sat down for an interview this week to discuss the state of Israel. Typical of a politician, Olmert has now called for action that needs to be taken when he can do nothing about it (he resigned due to corruption charges earlier this month but remains the interim PM until a new government is formed). His formerly astringent stances have been softened into calls for a unified, realistic strategy of engagement and dialogue with Palestine, and more importantly, Iran.

It's convenient that Olmert chose this moment to reshape his own policy views. The Israeli stock market has been largely unaffected by global credit problems and with the New Year just around the corner, his interview is front page news. And the right type of front page news, an about turn from his corruption battles the past few months. Olmert now knows an Israeli withdrawal from the West Bank, along with a partition of Jerusalem, is the bare minimum for sustained peace.

Just as important, given the recent rumors about preemptive strikes on Iran, is Olmert's assertion that Israel must act within the international system in addressing the threat of Iran. For all the rabble rousing both candidates spout regarding Iran, it is important to note this about turn. Ahmadinejad is up for re-election in June 2009. His apocalyptic, "Hidden Imam" brand of Islam not only contradicts the Ayatollah's more compromising Mashad understanding which values preservation, but is quickly losing support from the populace. His control of the nuclear program is dangerous but overstated, just like his rhetoric. Olmert's realization that unilateral action is even more dangerous than Ahmadinejad represents a correct and noteworthy policy shift. It may be a particularly weak turn given his current position, but it is one worth supporting.

All quiet on the Western front?

Any talk of Afghanistan these days usually revolves around its porous border with Pakistan. Common sense wisdom says that Tailban militants are hiding out in the terrain that straddles the desolate area known under a variety of guises: FATA, Warizistan, North West Frontier Province.

While it's certainly true that funds and arms pour in from Pakistan, well-founded rumors are also circulating that Iran is smuggling arms and cash in exchange for drugs to the Taliban over the western border as well. This is scary, probably true, and should be just as high on our security agenda as the Pakistani border. Iranian influence was what caused, in part, the severe sectarian strife in Iraq. It's pretty obvious that's the last thing we need in Afghanistan. And it is certainly true that the violence once contained in the south and east has been increasing in the western countryside.

As a possible nuclear power with delusions of dominance and influence throughout Central and South Asia, Iran's role in Afghanistan offers a chance to pursue a more fruitful strategy of engagement and stabilization in both countries. The US can either rebuff Iranian efforts unilaterally in which case arms will continue to flow into Afghanistan and probably increase. Or measured steps can be taken to allow Iranian efforts greater importance. Iranian desire to expand their regional influence through aid efforts is a concern but much less than an increase in their arms smuggling. Iran has been a heavy giver in the international reconstruction effort and was a vital lynchpin in negotiating the Bonn Agreement, which established Afghanistan after the fall of the Taliban. They want a greater role in guiding the future of Afghanistan and if they aren't given a seat at the table will continue to destabilize our efforts in the country.

Their role gathering support from normally aloof countries, with little desire to be tied to an American led invasion, was vital to securing international and regional support in 2001. Let's treat it as such and give them something better to do in Afghanistan than run guns.

(Photo: fallenwattle)

An oily predicament

This sentence caught my eye in the dead-tree version of the Washington Post this morning:

"An oil drop of $30 a barrel is significantly more damaging to Iran's economy than UN Security Council sanctions," said Karim Sadjadpour, an associate at the Carnegie Endowment for International Peace. "That's a loss of about $75 million per day in oil revenue. A further drop in prices could play a decisive role in the June 2009 presidential elections, for it could deflate [President Mahmoud] Ahmadinejad's populist agenda."

Common sense, perhaps, but still quite powerful.

To the shores of Tripoli...

Condi Rice arrived in Libya today to meet with the country's leader, Col. Muammar Qaddafi. Though he may not house pirates, and is no longer an official terrorist, Libya is still a country with a long way to run. Encouraging as it is that Rice is the first American official to visit since Nixon in '57, the meetings will not, and should not, be all hassa.

Don't get me wrong, Libya is one of the most successful revisions of the past twenty years. Transitioning from nuclear armament and state-sponsored bombings to an embrace of capitalism is a mighty task in any society. But like Cuba, Libya is another example of an authoritarian state embracing market reforms. Leezza, as Qaddafi apparently calls her, must keep in mind that despite their leader's recent change of heart, the Libyan people still face a startlingly high level of oppression.

While it is true that Italy's recent colonial apology "smacks of self interest", that does not mean it should be ignored. Strategically speaking, the US would be irresponsible to ignore Libya's tack to the center just because of Qaddafi's continuing rule. The country controls too much gas and oil that Continental Europe and China are actively pursuing. The US should take measured and sensible steps to engage in this process. Rice must normalize diplomatic relations so American firms can actively participate in the run for foreign investment but attach conditions (human rights, greater press freedom, etc) to any direct government aid. While it may be unsettling for an older generation that remembers Pan Am 103 or, like McCain, the Tripoli pirates (too harsh?), to get used to the idea of Libya as a trade partner, we must welcome Qaddafi into the fold of global capitalism and use the subtle sway of our dollars to encourage greater transparency and freedom.

I personally will follow this with cautious optimism and hope that this story serves as a model for today's failed states that look like Libya did 20 years ago. I'm talking to you North Korea.

A new boom in town?

The Washington Post reported today on a Saudi program to build 15 new cities meant to stimulate economic growth beyond oil production. A few thoughts.

-Technology is the way to go in this endeavor. If you have an untrained workforce (see below), more money than God, and a landscape not particularly adapted to any ecological pursuits then cutting-edge technologies are a good bet. Learn them, perfect them, and advance them.

-You better believe that incorporating social development aims (women may be allowed to drive!) with greater economic freedoms necessitates political reform. If the royal family does not initiate it themselves then someone else will. And that's less than ideal - for us and them.

-Thankfully management, though not regulatory oversight, will be conducted by the private sector. Only if the royal family respects the decisions and actions of the foreign managers will this be successful. If done properly it will avoid increasing an already inflated bureaucracy. Let the people do their jobs.

Saudi Arabia has weathered one oil boom already. Their industrial and infrastructure development work during the 1970s was the correct move but was not enough to avoid the "oil curse" (26 years later this is more relevant than ever). More than foreign capital and petro-dollars are needed to make this economic reconstruction a success. The most important step remaining is a complete overhaul of the educational system. If this is done quickly and extensively, perhaps native sons can fill the new cities.