Afghanistan: the weak link in a stronger global chain?

The war in Afghanistan may not end well for the US; history has not been kind to foreign forces. But there are signs that it will become the key linkage in the Obama administration's attempts at redefining US foreign relations.

NATO announced today that it was restoring high-level contacts with Russia. US Secretary of State Hillary Clinton said that, amongst others, Afghanistan was an issue of "mutual concern." She also expressed her support for a conference on Afghanistan that would bring together all of the key stakeholders in the region, including Iran. From the BBC:

"If we move forward with such a meeting, it is expected that Iran would be invited as a neighbour of Afghanistan," she said.

The challenges posed by Afghanistan are shared by each country in the region (whether there by geography, choice or military alliance). Beyond the obvious interest of each stakeholder in the country's success, Afghanistan may provide the conduit for a diplomatic thaw in US-Russia (a "reset"), US-Iran relations (a handshake, maybe?). Stay tuned...

Try, try again

Last week I blogged about how New York would almost certainly face serious problems due to the loss of taxable revenue from Wall Street. Guess what?

Mayor Michael R. Bloomberg’s budget director ordered agency directors on Tuesday to cut spending by a total of $1.5 billion over two fiscal years, starting with the current fiscal year, which began on July 1. The spending reductions come as the mayor is floating the idea of a 7 percent property tax increase on homeowners, a move that could generate an additional $600 million in revenue each year.

Try again, buddy. Instead of subsidizing projects in areas that could bring in serious tax cash for the city in addition to making up the differences of rent controlled apartments, let markets developers do their job. You're still gonna be short but if you are seriously thinking about running again (and having enough support to change the laws to allow it) higher taxes ain't the ticket. Not this year.

Cotton subsidies under attack

The IHT is reporting that Brazil is seeking recommendations from the WTO on the application of retaliatory sanctions against the United States, which refuses to abandon its subsidies to cotton farmers. This is a significant development, because the WTO’s Dispute Settlement Understanding (DSU) takes a considerable amount of time to proceed to a point where sanctions are authorized. The DSU process goes something like this: 1.) the two countries try to settle their disputes through consultations. 2.) If no solution can be reached, then a panel is formed and rules on the dispute. 3.) Either the defendant country or the complainant country can appeal the ruling, in which case the Appellate Body reviews the ruling and either upholds or overturns it. 4.) If the defendant country is ruled against (complainants usually win) and does not comply with the adverse ruling after a reasonable period, then the complainant is authorized to apply sanctions. In this case, Brazil first challenged the US all the way back in 2002 (DS267: United States subsidies on upland cotton.)

Having just finished my Master’s dissertation on the WTO’s DSU, this is quite exciting. The cotton subsidies are glaringly inconsistent with America’s WTO obligations, and it would be better for the majority (the interests of American consumers, American taxpayers, international consumers, Brazilian producers vs. the interests of American producers) if the subsidies were eliminated.

It will be interesting to see how much the Appellate Body prices the trade distortion at, and whether or not Brazil’s sanctions have any effect. In my dissertation, I argued that ‘high-value’ disputes such as these tend to emphasize relative power capacities over the legal process in determining outcomes. To put it bluntly, it will depend on whether Brazil can hit the US hard enough with its sanctions to make keeping the subsidies more painful than eliminating them. According to the US Dept of Commerce, American exports to Brazil were worth $24.6 billion in 2007. That ought to give the Brazilians a hefty amount of retaliatory capacity.

Brazil is also considering initiating a trade dispute against American ethanol tariffs. International litigation is hardly an ideal way for America to develop coherent domestic policies. But if the United States is unable to produce farming and energy plans that don’t overly-privilege specific domestic sectors at the expense of the rest of the country, perhaps we can look to our trading partners to sue the hell out of us until we see the light. (That was a joke, but only just…)

(Picture by Brian Hathcock)

The return of history

Eric Posner over at the Volokh Conspiracy makes an interesting prediction:

"When historians write about the post-cold war era, which began in 1989, the date of its termination will not be 9/11/2001, as has been frequently claimed, but 8/7/2008, when Georgian forces attacked separatists in South Ossetia and Russia responded with an invasion. August 7 marks the end of American sole-superpowerdom, or hyperpowerness, or hegemony, or whatever you want to call it, an interval somewhat longer than but still very similar to the periods of global preeminence the United States enjoyed for a few years after World War I and World War II."

The war in Georgia has sparked some intense reflection on the state of international relations and American power. I agree that the American moment of hyperpower (I really love that term) is over. But this was never an unexpected development: the US used its hegemonic position after the Second World War to foster a liberal international economic order and promote stability, mutual economic cooperation, and growth. But hegemony is a concept that measures states’ relative power capacities, so by encouraging a system which facilitates world economic growth, sooner or later America’s power would decline in relation to the rest of the world. As hegemonic stability theory teaches us, a good hegemon sows the seeds of its own decline.

International relations is driven by political and economic factors. The political events by which we mark history may lead us to conclude that America’s decline is something new, but in reality the economic forces which caused it have occurred gradually since the end of World War II. Thus, while perhaps the political environment after the Cold War suggested an ‘end to history’, a cursory look at the world’s economic structure would have cautioned that, at best, history was taking a short break.

In any case, the world has certainly woken up. State relations will need to evolve to accommodate a new power structure, but I am not particularly pessimistic about a multipolar world. Today, the US is still the world’s most powerful nation politically, militarily, and economically. The United States will continue to lead but increasingly will need to engage with other nations on less favorable terms. That said, we should be careful not to overestimate the importance of Russia’s recent actions in Georgia. Economic growth has empowered both potential rivals like Russia and new partners like Brazil and India.

In many ways, Russia is an outlier in modern international relations and may need to be treated as such. Its wealth is based largely on strategic energy reserves. It is a bully when it comes to trade (look at its relations with the EU regarding natural gas.) But if you look at the other BRIC countries, you see economies with strong global links that have an interest in systemic stability. It is more likely that such countries can become “responsible stakeholders” in the global political-economic structure.

History clearly isn't over. But then again, it never was.

(Related: see Rory’s excellent treatment of the resurgence of nationalism over at IPE Journal)

On Georgia and Russia

Reports are coming in that a peace plan has been agreed by Georgia and Russia. The details remain largely unclear, but French (and current EU) president Sarkozy, who helped broker the deal, assures that Georgia's territorial sovereignty will be guaranteed by the "spirit of the text." Whatever that means, an end to hostilities is welcome news in and of itself: this has truly been a nasty little war, and our deepest sympathy goes out to everyone who has been affected.

There has been an enormous amount of quality analysis of this mini-war from every conceivable angle. I imagine the military types in particular are falling over themselves for a chance to analyze how Russia's army has performed in a large-scale conventional military operation. We here at Zeitgeist have had several conversations about how we could add to the debate. Rather than trying to analyze the outcomes or their implications, we want to try to provide a framework for understanding why the major players behaved as they did (or in some cases, didn't.)

In situations like these, international politics looks a bit like a high-stakes card game. Each player makes a bet and wins or loses depending on how the other players react. In this particular hand, we had:

President Mikhail Saakashivili; President Saakashivili knows that tensions with Russia over South Ossetia and Abkhazia have been brewing for a very long time. Also, he perceives his own personal credibility to rest in large part on whether he can keep his election promises to bring the breakaway regions under control. He understands the power disparity between Russia and Georgia, but calculates that any response would have to be limited, because the terrority nominally belongs to Georgia, and also because Georgia has been seriously courting Western allies for the past few years. They have a disproportionate number of troops in Iraq and have upgraded their military with American weapons technology. Mr. Saakashivili doesn't think that the West will stand idly by if Russia does overreact.

President Medvedev/Prime Minister Putin; Leaving aside any discussion of who's actually in charge, Russia is keen to maintain hegemony in its 'near abroad', the area which comprises the former Soviet Union. The color revolutions and reorientation of Ukraine and Georgia toward the West have infuriated Russia, and Russia perceives Georgia's desire to join NATO as a direct threat. Combine all of this with the fact that Russia believes that NATO helped facilitate Kosovo's secession from Serbia. Russia is therefore looking for any plausible reason to further destabilize Georgia by encouraging the breakaway regions, both to punish Georgia and send a message to the West.

EU President Sarkozy; The European Union is keen to not antagonize Russia, a key energy supplier for much of Western Europe. Most of Europe is also much less enthusiastic about Georgia joining NATO than the United States. There is almost no chance that any European country would forcefully intervene in the conflict. Any actions would likely be primarily face-saving (carefully condemn the use of violence and work for any sort of deal that stops hostilities as soon as possible.)

President Bush; Georgia was a key pillar of Mr. Bush's freedom agenda, and relations between the two countries have been especially strong during his tenure. Mr. Bush is clearly unhappy with Russia's actions, but his hands are tied. He is personally extremely unpopular, American troops are busy fighting two other wars, and the injection of American forces into the conflict would be tantamount to a serious escalation. The US pushes a tougher rhetorical line than the EU and agrees to help transport Georgian troops back from Iraq to take part in fighting, but is highly unlikely to intervene otherwise.

Given the motivations and limitations of the main players, it is perhaps a bit easier to understand why things happened the way they did. Unfortunately, this was not a card game. This was real life, and there were real consequences.

Leisure vs. consumption

French President Nicolas Sarkozy (pictured right with his supermodel wife) has been quite busy of late, whether it's modernizing France's military (insert requisite joke here), or, perhaps even more drastically, dismantling the mandatory 35-hour work week. This was actually a central campaign promise of M. Sarkozy's: travailler plus pour gagner plus (work more to earn more.) Under the new legislation, it will be easier for employers to set longer working hours, which should allow workers to make more money.

I don't imagine many étrangers, particularly North Americans, will have much sympathy for the fact that the French may have to work more. Americans in particular tend to put in long hours and if we do it, the reasoning goes, why shouldn't they? But then an equally valid question becomes: why do Americans work so much?

I think the answer to both questions speaks to general differences in cultural preferences/norms. Americans value higher consumption. The French, as well as most of Western Europe, value leisure highly. As a result, welfare-maximizing individuals in both countries pursue these goals: in the US we put in more hours at the office and earn more money, so we get to come home to our nice McMansions and flat-screen TVs, while in France you've got less fric ($$$) but you can duck out at 3 and go meet your buddies in a cafe to discuss how meaningless life is.

Jokes aside, I do think my main point holds: Western Europeans tend not to be as rich as Americans, but a large part of this is because they place a higher premium on leisure time. So if you want to laugh at how ridiculous the idea of a mandatory 35-hour French work week is, it's probably worth keeping in mind that the French find our 55+ hour weeks equally absurd. Which lifestyle do you think is better?

 

N.B. for simplicity I left out some important caveats about the French work week, like the fact that most French people work more than 35 hours and use it to build up vacation time or that French workers are the fifth-most productive per capita in the world.