Taking down communism with a dinner knife

I grew up playing the game, Rush ‘n Attack, on my 8-bit Nintendo Entertainment System.  Basically this was a game where you were an American soldier fighting your way across Russian landscapes killing Commies with a knife.  From this game alone I think I am pretty much brainwashed to distrust Russians.  The nice thing about Nintendo is whenever the Russians got the upper hand, I could just push the reset button and start over.

Barack Obama has proven with his phony Hallmark video card to the Iranians that he knows how to engage foreign powers through shortsighted Western paradigms such as multiculturalism.  Apparently, multicultural overtures to hostile regimes must have run its useful course, because the Obama administration has decided against using such tactics, and has resorted to another shortsighted Western paradigm: brazen insensitivity and ignorance towards foes and friends alike.  Obama can be considerate of Iranian holidays, but when it comes to snubbing allies, he chooses the anniversary of Russia’s invasion of Poland to announce the decision to discontinue an important strategic defense alliance with the Poles.  For those who thought Obama would bring a nice departure from Bush when it comes to foreign policy, this must be extremely disappointing.  For those of us without hopeychangey stars in our eyes, this would be a welcome turn of events, but to couple Bush’s insensitivity and ignorance, with Obama’s ineptitude and weakness isn’t the kind of synergy that is becoming for any U.S. president.

Reset with the push of a button

Where resetting a Nintendo game when things don’t go your way with the Russians was a good strategy for an 8-year-old playing a game, bringing a plastic reset button to diplomatic meeting with the Russians as a symbolic gesture indicating that we would like to return to the good ole days when Russia was the irrelevant rubble of a former empire is an indication that it wouldn’t hurt to have a Secretary of State with a brain.  Or, as George Friedman from stratfor put it, “It is hard to imagine anything as infuriating for the Russians as the reset button the Clinton administration’s Russia experts — who now dominateObama’s Russia policy — presented the Russian leadership in all seriousness. The Russians simply do not intend to return to the Post-Cold War era Western experts recall so fondly.”  Instead the Russians seem to be enjoying the era they are in.  The one where they control the energy spigot to Europe, where they have puppets in Iran and North Korea that they can lever against American interests, and where they get to deal with the first American president since Jimmy Carter that has no balls when it comes to foreign policy.  There have been two significant bull-markets since Obama took office: one in guns and bullets as ordinary Americans sense the weakness of their president and have rushed to take the matter of protecting themselves into their own hands, and one in concessions to the foreign powers that have most recently been our biggest enemies.

Where Obama’s foreign policy has mostly focused on changing atmospherics with our enemies, which our enemies perceive as a weakness to exploit, this strategy has enabled Obama to live up to his pre-presidential reputation of “voting present” when it comes to foreign policy rather than make decisions.  Unfortunately for Obama and the United States, Iran, the Taliban, Russia, and China aren’t just voting present when it comes to advancing their strategic foreign policy interests.  Unfortunately for Israel, Saudi Arabia, Iraq, Jordan, Turkey, most of Europe, Poland, and the Czech Republic, America under Obama’s leadership seems no longer interested in aggressively pursuing its strategic interests.

It is not long before Obama is going to have to make a decision on what to do with Iran and Afghanistan.  According to George Friedman from Stratfor:

Every president is tested in foreign policy, sometimes by design and sometimes by circumstance. Frequently, this happens at the beginning of his term as a result of some problem left by his predecessor, a strategy adopted in the campaign or a deliberate action by an antagonist. How this happens isn’t important. What is important is that Obama’s test is here. Obama at least publicly approached the presidency as if many of the problems the United States faced were due to misunderstandings about or the thoughtlessness of the United States. Whether this was correct is less important than that it left Obama appearing eager to accommodate his adversaries rather than confront them.

No one has a clear idea of Obama’s threshold for action.

In Afghanistan, the Taliban takes the view that the British and Russians left, and that the Americans will leave, too. We strongly doubt that the force level proposed by McChrystal will be enough to change their minds. Moreover, U.S. forces are limited, with many still engaged in Iraq. In any case, it isn’t clear what force level would suffice to force the Taliban to negotiate or capitulate — and we strongly doubt that there is a level practical to contemplate.

In Iran, Ahmadinejad clearly perceives that challenging Obama is low-risk and high reward. If he can finally demonstrate that the United States is unwilling to take military action regardless of provocations, his own domestic situation improves dramatically, his relationship with the Russians deepens, and most important, his regional influence — and menace — surges. If Obama accepts Iranian nukes without serious sanctions or military actions, the American position in the Islamic world will decline dramatically. The Arab states in the region rely on the United States to protect them from Iran, so U.S. acquiescence in the face of Iranian nuclear weapons would reshape U.S. relations in the region far more than a hundred Cairo speeches.

There are four permutations Obama might choose in response to the dual crisis. He could attack Iran and increase forces in Afghanistan, but he might well wind up stuck in a long-term war in Afghanistan. He could avoid that long-term war by withdrawing from Afghanistan and also ignore Iran’s program, but that would leave many regimes reliant on the United States for defense against Iran in the lurch. He could increase forces in Afghanistan and ignore Iran — probably yielding the worst of all possible outcomes, namely, a long-term Afghan war and an Iran with a nuclear program if not nuclear weapons.

On pure logic, history or politics aside, the best course is to strike Iran and withdraw from Afghanistan. That would demonstrate will in the face of a significant challenge while perhaps reshaping Iran and certainly avoiding a drawn-out war in Afghanistan. Of course, it is easy for those who lack power and responsibility — and the need to govern — to provide logical choices. But the forces closing in on Obama are substantial, and there are many competing considerations in play.

Presidents eventually arrive at the point where something must be done, and where doing nothing is very much doing something. At this point, decisions can no longer be postponed, and each choice involves significant risk. Obama has reached that point, and significantly, in his case, he faces a double choice. And any decision he makes will reverberate.

Given the gravity of the decisions that Obama now faces, and given the fact that these problems can’t be solved by giving a speech, it is too bad that we don’t have a reset button.  This doesn’t appear to be a game that we are going to win.

Chinese Finger Trap

It is typical for Americans nowadays to be increasingly pessimistic about the future prosperity of our nation.  After all, the current economic recession is blatant proof that free market capitalism is fatally flawed and that centrally-planned economics is the way of the future.  It is also typical for Americans to believe that we are increasingly forfeiting our sovereignty to countries like China, who used to sell us much of our debt.  Their appetite for American debt is shrinking, so they pretty much have us over a barrel.  I wonder if American sentiment towards China might be exaggerated.  The following analysis is from Stratfor:

 

Modern China has turned to a state-centered finance model for this. Under the model, all of the scarce capital that is available is funneled to the state, which divvies it out via a handful of large state banks. These state banks then grant loans to various firms and local governments at below the cost of raising the capital. This provides a powerful economic stimulus that achieves maximum employment and growth — think of what you could do with a near-endless supply of loans at below 0 percent interest — but comes at the cost of encouraging projects that are loss-making, as no one is ever called to account for failures. (They can just get a new loan.) The resultant growth is rapid, but it is also unsustainable. It is no wonder, then, that the central government has chosen to keep its $2 trillion of currency reserves in dollar-based assets; the rate of return is greater, the value holds over a long period, and Beijing doesn’t have to worry about the United States seceding.

Because the domestic market is considerably limited by the poor-capital nature of the country, most producers choose to tap export markets to generate income. In times of plenty this works fairly well, but when Chinese goods are not needed, the entire Chinese system can seize up. Lack of exports reduces capital availability, which constrains loan availability. This in turn not only damages the ability of firms to employ China’s legions of citizens, but it also removes the primary reason the disparate Chinese regions pay homage to Beijing. China’s geography hardwires in a series of economic challenges that weaken the coherence of the state and make China dependent upon uninterrupted access to foreign markets to maintain state unity. As a result, China has not been a unified entity for the vast majority of its history, but instead a cauldron of competing regions that cleave along many different fault lines: coastal versus interior, Han versus minority, north versus south.

China’s survival technique for the current recession is simple. Because exports, which account for roughly half of China’s economic activity, have sunk by half, Beijing is throwing the equivalent of the financial kitchen sink at the problem. China has force-fed more loans through the banks in the first four months of 2009 than it did in the entirety of 2008. The long-term result could well bury China beneath a mountain of bad loans — a similar strategy resulted in Japan’s 1991 crash, from which Tokyo has yet to recover. But for now it is holding the country together. The bottom line remains, however: China’s recovery is completely dependent upon external demand for its production, and the most it can do on its own is tread water.

 

We therefore shouldn’t be surprised that there seem to be signs that China is falling apart.  The current Uigher uprising can probably be passed off as an irrelevant regional conflict, or it can be interpreted as a symptom that the Chinese economic wonder of the last decade is screeching to a halt.  The problem for China is that if the dollar is significantly devalued, it might set off a financial crisis in China that will make our crisis look insignificant.  It’s hard to say who has who over a barrel.  It is probably more likely that the relationship between the Chinese and American economies is more like a Chinese finger trap.

Iranian Elections are Like This

Iran’s election results are in, and the winner of this election cycle’s Rock ‘em Sock ‘em tournament is Mahmoud Adiminijad!  Man what a fight!  And folks, things are just starting to heat up!  Even though the Grand Ayatollah was at the controls of each fighter, spectators are now claiming the fight was rigged.

Taking a play right of their previous colonial oppressors playbook, Persian punks are taking to the streets.  They’re burning buses and fighting with police, just like a good old fashion English soccer riot.

On the other side of the globe, leaders in the West who had doubled down on Mousavi, are discussing the results with the media like those who just lost a bet discuss the results with their bookie.

But the most important message to the Europeans will be that Europe is where you go for photo opportunities, but Turkey is where you go to do the business of geopolitics.

-George Friedman

In one of my weekly email updates from Stratfor, there was an analysis of Obama’s trip to Europe.  Of course the American media has been distracting us from what was really going on there.  The left wing media (pretty much all of the media) couldn’t stop telling us how “successful” this trip was, but it was certainly hard to find evidence of what they were referring to.  The right wing media found a few pieces of evidence that Obama was completely obliterating our national sovereignty.  However, no one was talking about what really happened.  Which is why I am becoming a big fan of Stratfor, and George Friedman in particular.

Consider the following analysis from the email I received with my input in green:

The Russian Dimension

Let’s diverge to another dimension of these talks, which still concerns Turkey, but also concerns the Russians. While atmospherics after the last week’s meetings might have improved, there was certainly no fundamental shift in U.S.-Russian relations. The Russians have rejected the idea of pressuring Iran over its nuclear program in return for the United States abandoning its planned ballistic missile defense system in Poland and the Czech Republic. The United States simultaneously downplayed the importance of a Russian route to Afghanistan. Washington said there were sufficient supplies in Afghanistan and enough security on the Pakistani route such that the Russians weren’t essential for supplying Western operations in Afghanistan. At the same time, the United States reached an agreement with Ukraine for the transshipment of supplies — a mostly symbolic gesture, but one guaranteed to infuriate the Russians at both the United States and Ukraine. Moreover, the NATO communique did not abandon the idea of Ukraine and Georgia being admitted to NATO, although the German position on unspecified delays to such membership was there as well. When Obama looks at the chessboard, the key emerging challenge remains Russia.  Since we don’t know if Obama is much of a chess player, I will translate this into a better metaphor.  ”When Obama looks at the basketball court, the key emerging challenge is a big, tall, bearded Russian center…”

The Germans are not going to be joining the United States in blocking Russia. Between dependence on Russia for energy supplies and little appetite for confronting a Russia that Berlin sees as no real immediate threat to Germany, the Germans are not going to address the Russian question. At the same time, the United States does not want to push the Germans toward Russia, particularly in confrontations ultimately of secondary importance and on which Germany has no give anyway. Obama is aware that the German left is viscerally anti-American, while Merkel is only pragmatically anti-American — a small distinction, but significant enough for Washington not to press Berlin.  In addition, Germans aren’t that good at basketball, so tying them into the metaphor is pretty difficult.

At the same time, an extremely important event between Turkey and Armenia looks to be on the horizon. Armenians had long held Turkey responsible for the mass murder of Armenians during and after World War I, a charge the Turks have denied. The U.S. Congress for several years has threatened to pass a resolution condemning Turkish genocide against Armenians. Barack Obama along with Nancy Pelosi have been big supporters of this resolution. The Turks are extraordinarily sensitive to this charge, and passage would have meant a break with the United States. Last week, they publicly began to discuss an agreement with the Armenians, including diplomatic recognition, which essentially disarms the danger from any U.S. resolution on genocide. Although an actual agreement hasn’t been signed just yet, anticipation is building on all sides.

The Turkish opening to Armenia has potentially significant implications for the balance of power in the Caucasus. The August 2008 Russo-Georgian war created an unstable situation in an area of vital importance to Russia. Russian troops remain deployed, and NATO has called for their withdrawal from the breakaway Georgian regions of South Ossetia and Abkhazia. There are Russian troops in Armenia, meaning Russia has Georgia surrounded. In addition, there is talk of an alternative natural gas pipeline network from Azerbaijan to Europe.

Turkey is the key to all of this. If Ankara collaborates with Russia, Georgia’s position is precarious and Azerbaijan’s route to Europe is blocked. If it cooperates with the United States and also manages to reach a stable treaty with Armenia under U.S. auspices, the Russian position in the Caucasus is weakened and an alternative route for natural gas to Europe opens up, decreasing Russian leverage against Europe.

From the American point of view, Europe is a lost cause since internally it cannot find a common position and its heavyweights are bound by their relationship with Russia. It cannot agree on economic policy, nor do its economic interests coincide with those of the United States, at least insofar as Germany is concerned. As far as Russia is concerned, Germany and Europe are locked in by their dependence on Russian natural gas. The U.S.-European relationship thus is torn apart not by personalities, but by fundamental economic and military realities. No amount of talking will solve that problem.  What about trash talking?  For as good as Obama is at listening, I bet he can talk smack.

The key to sustaining the U.S.-German alliance is reducing Germany’s dependence on Russian natural gas and putting Russia on the defensive rather than the offensive. The key to that now is Turkey, since it is one of the only routes energy from new sources can cross to get to Europe from the Middle East, Central Asia or the Caucasus. If Turkey — which has deep influence in the Caucasus, Central Asia, Ukraine, the Middle East and the Balkans — is prepared to ally with the United States, Russia is on the defensive and a long-term solution to Germany’s energy problem can be found. On the other hand, if Turkey decides to take a defensive position and moves to cooperate with Russia instead, Russia retains the initiative and Germany is locked into Russian-controlled energy for a generation.

Therefore, having sat through fruitless meetings with the Europeans, Obama chose not to cause a pointless confrontation with a Europe that is out of options. Instead, Obama completed his trip by going to Turkey to discuss what the treaty with Armenia means and to try to convince the Turks to play for high stakes by challenging Russia in the Caucasus, rather than playing Russia’s junior partner.  “Pick n’ Roll baby!”

This is why Obama’s most important speech in Europe was his last one, following Turkey’s emergence as a major player in NATO’s political structure. In that speech, he sided with the Turks against Europe, and extracted some minor concessions from the Europeans on the process for considering Turkey’s accession to the European Union. Why Turkey wants to be an EU member is not always obvious to us, but they do want membership. Obama is trying to show the Turks that he can deliver for them. He reiterated — if not laid it on even more heavily — all of this in his speech in Ankara. Obama laid out the U.S. position as one that recognized the tough geopolitical position Turkey is in and the leader that Turkey is becoming, and also recognized the commonalities between Washington and Ankara. This was exactly what Turkey wanted to hear.

The Caucasus is far from the only area to discuss. Talks will be held about blocking Iran in Iraq, U.S. relations with Syria and Syrian talks with Israel, and Central Asia, where both countries have interests. But the most important message to the Europeans will be that Europe is where you go for photo opportunities, but Turkey is where you go to do the business of geopolitics. It is unlikely that the Germans and French will get it. Their sense of what is happening in the world is utterly Eurocentric. But the Central Europeans, on the frontier with Russia and feeling quite put out by the German position on their banks, certainly do get it.

Obama gave the Europeans a pass for political reasons, and because arguing with the Europeans simply won’t yield benefits. But the key to the trip is what he gets out of Turkey — and whether in his speech to the civilizations, he can draw some of the venom out of the Islamic world by showing alignment with the largest economy among Muslim states, Turkey.  

Where the American media seemed mostly concerned about the messages that were being sent to Islam, Apparently, the messages that are being sent to Russia are more important.  Managing geopolitical relations with Turkey to offend the Russians and develop leverage against Europeans, might be something that Obama could actually be good at.