“Soft despotism is a term coined by Alexis de Tocqueville describing the state into which a country overrun by "a network of small complicated rules" might degrade. Soft despotism is different from despotism (also called 'hard despotism') in the sense that it is not obvious to the people."

Tuesday, July 31, 2012

Syria's Muslim Brotherhood waiting in the wings

The fighting between the Syrian regime and rebels is intensifying. Observers say it is only a matter of time before President Bashar Assad loses his iron grip on power. But who will take over at the helm?
Syrian government forces and rebels are both claiming victory in key areas of the major commercial hub Aleppo. As fierce fighting in the northern Syrian city continued, US Defense Secretary Leon Panetta said the attacks on Aleppo were evidence that President Bashar Assad lacked the legitimacy to rule.
"If they continue this kind of tragic attack on their own people in Aleppo, I think it ultimately will be a nail in Assad's own coffin," Panetta said, speaking to reporters at the start of a weeklong trip to the Middle East and North Africa.
"What Assad has been doing to his own people and what he continues to do to his own people makes clear that his regime is coming to an end," Panetta said. "It's lost all legitimacy. It's no longer a question of whether he's coming to an end, it's when."
Many observers think the more than 16-month uprising reached a turning point when a bomb struck at the core of Assad's high command on July 18, killing several members of the regime elite including the defense minister and Assad's brother-in-law. Jane Kinninmont, Senior Research Fellow at Chatham House in London and an expert on opposition movements in the Arab world, said things could be over quicker than originally thought.
"It's anybody's guess, but the acceleration of violence since those members of the regime were killed indicates that it's a matter of months, not years," Kinninmont told DW.
Ready for action
Should the Syrian regime be toppled, the question arises who will fill the power vacuum left behind? The Syrian National Council (SNC) has acted as the international face of the revolution. But the organization has been unable to unite the various disparate rebel factions under one umbrella. The SNC secretariat convened in Qatar last week to try to agree on a transitional leadership should Assad's regime fall - but no decisions were made.
A major force being closely observed is Syria's Muslim Brotherhood. It holds the largest number of seats in the SNC and controls its relief committee - and thereby the distribution of SNC funds in Syria. The movement said it was ready for the post-Assad era.
"We have plans for the economy, the courts, politics," the Brotherhood's spokesman Mulhem al-Droubi told news agency AFP earlier this month. The group has stressed its moderate stance, saying it was committed to setting up a multi-party democracy if Assad was toppled.
Syrian rebels patrol near Aleppo, Syria, 26 July 2012.
Fighters in Aleppo, Syria's second largest city, believe they are destined to win within weeks
Though the Muslim Brotherhood has reemerged as a major political force since the turmoil in Syria began in March 2011, no one can say for certain just how popular it is within the country, said Syria expert Thomas Pierret.
"You can't reconstruct a popular base within a year's time - from abroad," said Pierret, a lecturer in contemporary Islam at the University of Edinburgh and author of the upcoming book "Religion and State in Syria."
"This is a movement in exile that has not had any activity within Syria for over 30 years," Pierret told DW "It is difficult to prove how powerful they are since they have been operating underground."
The Muslim Brotherhood was founded in Egypt in 1928 and branched into Syria in the 1940s. Originally part of the legal opposition, it was banned in 1963 when the Baath party took over office. Bashar Assad's father Hafez crushed an armed insurgency led by the Brotherhood in Hama in 1982, completely destroying the movement. Only a few members were able to flee and rebuild the group in exile.
Following own interests
Kinninmont said the stakes were high in Syria, as powers in the region were intent on following their own interests. Saudi Arabia, for example, is a key financial backer of the rebellion. It has given refuge to General Manaf Tlass, who defected in early July. He was a commander in the powerful Republican Guard and formerly a close confidant of the Assad's. Tlass said last week he would work to unite the opposition.
Bashar al-Assad and Manaf Tlass
General Tlass, seen here with Assad in 2000, was the highest ranking officer to abandon the regime
"Saudi Arabia doesn't want the Muslim Brotherhood in power," Pierret said. "They are promoting General Tlass in the media as the man with the roadmap. Saudi Arabia wants stability and sees a military leadership achieving that." A man like Tlass could head an Egyptian-style supreme military council that could keep the Syrian armed forces intact and loyal.
Western powers, meanwhile, have been unable to end the impasse at the UN over the Syrian crisis. Both Russia and China have been blocking efforts to put more pressure on Assad.
Russia, which sells arms and makes use of a naval maintenance facility in Syria, has said its rejection of sanctions was not driven by support for Assad but rather by a conviction that Syrians must decide their own fate and opposition to military intervention. But without Russia's support, diplomatic efforts would not succeed, said Kinninmont.
"The West has limited options in Syria, and Russia is one of the key players," she said. There had been talks of a Yemen-style transfer of power in which Assad would voluntarily step down and Russia could put forward his successor. "Maybe that's an alternative."
Multi-ethnic future
Whatever future political composition evolves in Syria, it will most likely include various groups, including the Muslim Brotherhood.
"It would be very difficult - if not impossible - to exclude them from any future arrangement," Pierret said. "The SNC has a place, so the Muslim Brotherhood has a place. They're very ambitious but face many obstacles and rivals in the Islamic scene."
Kinninmont pointed out that there was no guarantee for success, as the example of Libya showed - where everyone thought Islamist groups would win and they didn't. In addition, even in countries where the Muslim Brotherhood had a strong following, it still didn't win an outright majority.
"If elections were to take place, you would most likely see a coalition government which would need to include factions from religious minorities," she said. In addition, she said, it was important to recognize that Syria has a strong secular culture, especially in Damascus and Aleppo.
Power could also be dispersed across the country, said Lebanese political scientist Ohannes Geukjian from the American University of Beirut. In an interview with the German daily Badische Zeitung, he said this could evolve along the lines of Iraq's structure, with an autonomous Kurdish region, and Alawite regions along the Mediterranean coast.
"There is frustration in Syria with the level of centralization of power in the hands of a few corrupt people," Kinninmont said. "I could imagine fiefdoms controlled by different groups, with Assad possibly in control of a rump state only."
Such a model, however, would open up an entirely new can of worms: international recognition. Western, Arab and Russian interests would most certainly clash on that point, as well.
Author: Sabina Casagrande
Editor: Rob Mudge

Monday, July 30, 2012

Live Free, Vote for Gary Johnson?

Johnson sees no difference between Obama and Romney

Presidential candidate Gary Johnson just released a bold campaign video that will resonate with a lot of political independents in New Hampshire and around the country. In the advertisement, Johnson, a Libertarian former Governor from New Mexico, says Barack Obama and Mitt Romney would give America four more years of war, more debt, more taxes, bigger government, reduced privacy, and diminished personal liberty. Johnson sees little difference between the President and his Republican challenger, Mitt Romney.
The major media and the political pundits that dominate their airwaves are offering a different narrative. Corporate media outlets rely on advertising revenue for their survival, and they get a lot of it from the Republicans and the Democrats. Consequently, they like to promote simplified sound-bites from well-funded candidates that they can portray as polar opposites. However, as Johnson points out in this persuasive ad, the major candidates may actually be more alike than different.

Johnson and fellow liberty champion, Ron Paul have been making the case that Republicans and Democrats are equivalent throughout the campaign. Many Americans agree with them, but still choose to support one of the major candidates because they fear that support for a third party candidate would lead to the election of the guy they like the least. Libertarian-leaning Republicans are not thrilled with Governor Romney, but they despise President Obama. Moderate Democrats are not thrilled with President Obama but they despise Republicans more. This election has largely been reduced to voting for the least worst candidate.
Johnson and Paul have been asking people to vote their conscience instead of selecting the lesser of two evils. It will be interesting to see if this latest message from Gary Johnson is able to change the hearts and minds of independent voters who are increasingly frustrated by the choices they are given from the Democrats and Republicans.
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Sunday, July 29, 2012

Romney’s remedy for foolish talking in London - Go to israel and talk about war against Iran

Mitt Romney to threaten war against Iran during trip to Israel as he tries to restore his foreign policy credentials after gaffe-prone London visit

    Mitt Romney will threaten war with Iran if he is elected president as he seeks to bolster his foreign policy credentials following his gaffe-filled visit to London.
    Arriving in Israel today, the presumptive Republican presidential candidate will reiterate his commitment to the preservation of the Jewish state in the face of what it sees as an existential threat from a nuclear-armed Iran.

    Describing that scenario as ‘the greatest threat to the world’, Romney’s official line is in marked difference to President Obama and is characterised by the ex-Massachusetts governor as ‘If you want peace, prepare for war.’

    U.S. Republican presidential candidate Mitt Romney is seen during the Opening Ceremony of the London 2012 Olympic Games at the Olympic Stadium on July 27, 2012 in London
    U.S. Republican presidential candidate Mitt Romney is seen during the Opening Ceremony of the London 2012 Olympic Games at the Olympic Stadium on July 27, 2012 in London

    Avoiding a traffic jam, Republican presidential candidate, Mitt Romney walks down Grosvenor Place in London to meet Ireland's Prime Minister Enda Kenny at the Embassy of Ireland in London
    Avoiding a traffic jam, Republican presidential candidate, Mitt Romney walks down Grosvenor Place in London to meet Ireland’s Prime Minister Enda Kenny at the Embassy of Ireland in London

    'Governor Romney has made it clear he doesn't think that Obama's policies have been sufficient,' a foreign policy adviser to the Republican candidate told The Daily Telegraph.
    'The President thinks that a nuclear Iran can be contained and deterred. He is clearly wrong.'
    Hoping to gain the backing of the powerful and influential Jewish vote in the United States following his visit to Jerusalem, Romney hopes to draw attention to the fact that President Obama has yet to visit Israel since his term of office began in 2009.
    However, the bellicose language comes after Romney’s error strewn visit to Britain on the first leg of a three country jaunt that was meant to boost his foreign policy credentials.

    U.S. Republican Presidential candidate Mitt Romney is recognised by pedestrians at Grosvenor Place in London
    U.S. Republican Presidential candidate Mitt Romney is recognised by pedestrians at Grosvenor Place in London

    Criticising London’s readiness for the Olympic Games which opened with a colourful opening ceremony last night, politicians from both sides of the Atlantic slammed the Republican for his conduct over his two days in the British capital.

    Harry Reid, the Democratic Senate leader said that it 'was not good for us as a country' to 'have somebody that's nominated by one of the principle parties to go over and insult everybody.'
    Publicly rebuked by British Prime Minister David Cameron, Romney also drew the ire of Carl Lewis, the U.S. Olympian who won nine track and field gold medals during his career.

    He is reported to have said, 'Seriously, some Americans just shouldn't leave the country.'
    Users of Twitter in Britain declared the visit to be the ‘Romneyshambles’, which is a variation of ‘omnishambles’, a phrase first used in a popular U.K. political satire series called ‘The Thick of It’.

    Israeli Prime Minister Benjamin Netanyahu opens the weekly cabinet meeting at his office on July 22, 2012 in Jerusalem, Israel
    Israeli Prime Minister Benjamin Netanyahu opens the weekly cabinet meeting at his office on July 22, 2012 in Jerusalem, Israel

    Mr Romney was careful not to complain on Friday after heavy traffic caused him to walk through the streets of London to the Irish Embassy to meet Taoiseach Enda Kenny.
    Using the visit to Israel to show his steadfast support, Romney took to a Jerusalem newspaper to pledge to 'treat Israel like the friend and ally that it is.'
    He added that ‘I cannot imagine going to the United Nations, as Obama did, and criticising Israel in front of the world.’

    Affected: The nuclear enrichment plant at Natanz in central Iran has been hit with a worm that affects automated systems... and plays AC/DC's Thunderstruck
    The nuclear enrichment plant at Natanz in central Iran 
    Mahmoud Ahmadinejad inspects the nuclear enrichment plant at Natanz in central Iran
    Aerial view
    Inspection tour: Iranian president Mahmoud Ahmadinejad inspects Natanz in 2008. The facility, seen in an aerial photo above right, has been repeatedly hit by malware

    President Obama's dealings with Israel have cooled since he announced his support for a return to the 1967 borders following any eventual agreement with the Palestinians.
    Prime Minister Benjamin Netanyahu lectured him publicly about this stand on a visit to the United States.

    Despite his comments, Romney raised $2 million at two fundraisers for American expatriates at London’s Mandarin Oriental hotel late on Thursday. 

    The Massive Ordnance Penetrator is nearly five tons heavier than any other bomb in the military's arsenal and is made to pulverise underground targets
    The Massive Ordnance Penetrator is nearly five tons heavier than any other bomb in the military’s arsenal and is made to pulverise underground targets

    Senior bankers, lawyers and former ambassadors paid up to $75,000 to mingle with the candidate. 
    It has also been revealed today that the United States Air Force has perfected a 30,000 pound bunker-busting bomb.

    The world's largest conventional bomb, the Massive Ordnance Penetrator (MOP) is 20ft long and Micahel Donley, the US Air Force secretary said it is available 'today'.

    Read more:

    Another war time President? No thanks.

    Advisor: Romney would back Israeli strike on Iran

    JERUSALEM (AP) – A senior adviser said Mitt Romney would back an Israeli military strike against Iran aimed at preventing Tehran from obtaining nuclear capability.
    "Iran is closer to nuclearization than it was when President Obama took office. It is hard to feel that the events of the last three and a half years have strengthened America's posture and promoted the prospects of peace," Romney told Hayom, a conservative Israeli publication bankrolled by billionaire casino mogul Sheldon Adelson. Romney was still in the U.S. when he spoke to the paper, though his remarks weren't published until Friday, when he was already abroad.
    In the interview with Ha'aretz, Romney urged caution in supporting rebel forces in Syria. He's previously said the U.S. should do more to arm the opposition there, but reports this week say Islamist terror groups could now be an element of rebel forces, prompting caution from U.S. officials.
    "I think it is important for the responsible nations of the world to seek to understand which forces in Syria represent real change, rather than the kind of destruction that might occur if al-Qaeda were to seize the development of chaos and assert leadership in some significant way in Syria," Romney said Friday.
    Romney will meet with Israeli Prime Minister Benjamin Netanyahu and a host of Israeli security officials. He'll also meet with Israeli President Shimon Peres and the leaders of Israel's political opposition. Romney will also hold a meeting with Palestinian Prime Minister Salam Fayyad, though his advisers say he didn't have time to meet with Palestinian Prime Minister Mahmoud Abbas.
    He'll also deliver a speech in Jerusalem, where advisers say he will "lock arms" with Israel. Romney doesn't plan to outline specific policies in the address, which he'll make outdoors near the historic Old City.
    Romney plans to spend the evening dining at Netanyahu's home — the Israeli leader invited Romney and his wife to break the fast for the Jewish holiday Tisha B'Av. The holy day, celebrated Sunday, commemorates the destruction of two temples in Jerusalem. Romney and Netanyahu have known each other since both were young businessmen at Boston Consulting Group in the 1970s.
    On Monday, Romney plans a fundraiser with top American supporters in Israel, some guests have flown in from the U.S. specifically for the event. His campaign has barred reporters from covering his comments to the 50 or so wealthy backers who will gather at the luxurious King David Hotel— all of whom will have donated $50,000 or raised at least $100,000. Keeping the remarks private is a change from how Romney handles fundraisers in the United States, where a group of reporters are allowed into events held in public spaces like hotels.
    Expected among the attendees is Adelson, who has pledged to spend $100 million to defeat Obama and who has given millions to a third-party group supporting Romney's presidency.
    While Romney is left to implicit contrasts with his Democratic opponent, Obama has been focusing on Israel, signing legislation on Friday increasing military and civilian ties between the U.S. and Israel. And he authorized the release of an additional $70 million in military aid for Israel, a previously announced move that appeared timed to Romney’s trip.


    Robert Fisk: Syrian war of lies and hypocrisy

    The West's real target here is not Assad's brutal regime but his ally, Iran, and its nuclear weapons


    Has there ever been a Middle Eastern war of such hypocrisy? A war of such cowardice and such mean morality, of such false rhetoric and such public humiliation? I'm not talking about the physical victims of the Syrian tragedy. I’m referring to the utter lies and mendacity of our masters and our own public opinion – eastern as well as western – in response to the slaughter, a vicious pantomime more worthy of Swiftian satire than Tolstoy or Shakespeare.

    While Qatar and Saudi Arabia arm and fund the rebels of Syria to overthrow Bashar al-Assad's Alawite/Shia-Baathist dictatorship, Washington mutters not a word of criticism against them. President Barack Obama and his Secretary of State, Hillary Clinton, say they want a democracy in Syria. But Qatar is an autocracy and Saudi Arabia is among the most pernicious of caliphate-kingly-dictatorships in the Arab world. Rulers of both states inherit power from their families – just as Bashar has done – and Saudi Arabia is an ally of the Salafist-Wahabi rebels in Syria, just as it was the most fervent supporter of the medieval Taliban during Afghanistan’s dark ages.

    Indeed, 15 of the 19 hijacker-mass murderers of 11 September, 2001, came from Saudi Arabia – after which, of course, we bombed Afghanistan. The Saudis are repressing their own Shia minority just as they now wish to destroy the Alawite-Shia minority of Syria. And we believe Saudi Arabia wants to set up a democracy in Syria?

    Then we have the Shia Hezbollah party/militia in Lebanon, right hand of Shia Iran and supporter of Bashar al-Assad's regime. For 30 years, Hezbollah has defended the oppressed Shias of southern Lebanon against Israeli aggression. They have presented themselves as the defenders of Palestinian rights in the West Bank and Gaza. But faced with the slow collapse of their ruthless ally in Syria, they have lost their tongue. Not a word have they uttered – nor their princely Sayed Hassan Nasrallah – about the rape and mass murder of Syrian civilians by Bashar's soldiers and "Shabiha" militia.
    Then we have the heroes of America – La Clinton, the Defence Secretary Leon Panetta, and Obama himself. Clinton issues a "stern warning" to Assad. Panetta – the same man who repeated to the last US forces in Iraq that old lie about Saddam's connection to 9/11 – announces that things are "spiralling out of control" in Syria. They have been doing that for at least six months. Has he just realised? And then Obama told us last week that "given the regime's stockpile of nuclear weapons, we will continue to make it clear to Assad … that the world is watching". Now, was it not a County Cork newspaper called the Skibbereen Eagle, fearful of Russia's designs on China, which declared that it was "keeping an eye … on the Tsar of Russia"? Now it is Obama's turn to emphasise how little clout he has in the mighty conflicts of the world. How Bashar must be shaking in his boots.

    But what US administration would really want to see Bashar's atrocious archives of torture opened to our gaze? Why, only a few years ago, the Bush administration was sending Muslims to Damascus for Bashar's torturers to tear their fingernails out for information, imprisoned at the US government's request in the very hell-hole which Syrian rebels blew to bits last week. Western embassies dutifully supplied the prisoners' tormentors with questions for the victims. Bashar, you see, was our baby.
    Then there's that neighbouring country which owes us so much gratitude: Iraq. Last week, it suffered in one day 29 bombing attacks in 19 cities, killing 111 civilian and wounding another 235. The same day, Syria's bloodbath consumed about the same number of innocents. But Iraq was "down the page" from Syria, buried "below the fold", as we journalists say; because, of course, we gave freedom to Iraq, Jeffersonian democracy, etc, etc, didn't we? So this slaughter to the east of Syria didn't have quite the same impact, did it? Nothing we did in 2003 led to Iraq's suffering today. Right?

    And talking of journalism, who in BBC World News decided that even the preparations for the Olympics should take precedence all last week over Syrian outrages? British newspapers and the BBC in Britain will naturally lead with the Olympics as a local story. But in a lamentable decision, the BBC – broadcasting “world” news to the world – also decided that the passage of the Olympic flame was more important than dying Syrian children, even when it has its own courageous reporter sending his despatches directly from Aleppo.

    Then, of course, there's us, our dear liberal selves who are so quick to fill the streets of London in protest at the Israeli slaughter of Palestinians. Rightly so, of course. When our political leaders are happy to condemn Arabs for their savagery but too timid to utter a word of the mildest criticism when the Israeli army commits crimes against humanity – or watches its allies do it in Lebanon – ordinary people have to remind the world that they are not as timid as the politicians. But when the scorecard of death in Syria reaches 15,000 or 19,000 – perhaps 14 times as many fatalities as in Israel's savage 2008-2009 onslaught on Gaza – scarcely a single protester, save for Syrian expatriates abroad, walks the streets to condemn these crimes against humanity. Israel's crimes have not been on this scale since 1948. Rightly or wrongly, the message that goes out is simple: we demand justice and the right to life for Arabs if they are butchered by the West and its Israeli allies; but not when they are being butchered by their fellow Arabs.

    And all the while, we forget the "big" truth. That this is an attempt to crush the Syrian dictatorship not because of our love for Syrians or our hatred of our former friend Bashar al-Assad, or because of our outrage at Russia, whose place in the pantheon of hypocrites is clear when we watch its reaction to all the little Stalingrads across Syria. No, this is all about Iran and our desire to crush the Islamic Republic and its infernal nuclear plans – if they exist – and has nothing to do with human rights or the right to life or the death of Syrian babies. Quelle horreur!

    Wednesday, July 25, 2012

    What do you think?

    Good Mideast Dictators by Robert D. Kaplan

    July 25, 2012 | 0903 GMT
    By Robert D. Kaplan
    It is often said that the Arab Spring proves American support for Middle Eastern autocrats for more than half a century was wrong because the policy did not bring peace or stability. Nonsense. For any policy to remain relevant for so many decades in this tumultuous world is itself a sign of success. Support for moderate Arab monarchs and secular dictatorships was part of a successful Cold War strategy for which there is no need to apologize. It helped secure the sea lines of communication between the oil-rich Middle East and the West, on which the well being of Americans depended. What was the United States supposed to have done? Overthrow a slew of regimes across a vast swath of the earth for decades on end because those states did not conform with America's own historical experience and political system? Or should we not have had diplomatic relations with these regimes in the first place? No responsible American statesman would choose either of those options. What were Henry Kissinger, Zbigniew Brzezinski and James Baker supposed to have done? Not seek Arab-Israeli troop disengagement accords and peace agreements because their Arab interlocutors were not democratically elected? Remember that thus far, Israel has only concluded peace agreements and disengagement accords with Arab dictators, men who had the luxury to throw their opponents out of power when they opposed such deals.
    A basic rule of foreign policy pragmatism is that you must work with the material at hand: because it is dangerous and costly to replace regimes thousands of miles away from home when they do not correspond to your values or liking. Throughout the Cold War and the two decades following the end of communism in Europe, autocrats constituted the material at hand in the Middle East even as the technology of social media was not yet available to undermine those regimes.
    But has the Arab Spring actually toppled Middle Eastern autocrats? Only partially. In North Africa, three of five regimes and their apparatuses have been replaced if you count Egypt; in the Levant, none have been replaced, though Syria's now hangs by a thread; and in the Arabian Peninsula, only Yemen's Ali Abdullah Saleh has fallen -- and his supporters remain influential. That adds up to a record of regime change of about a third. Of course, more will fall. In Syria, this will happen perhaps any day now, and that will trigger changes throughout the region. Moreover, the Arab Spring has led to political reform in Morocco, Oman and elsewhere. Finally, the Arab Spring has affected the overall psychology of the Middle East. Everywhere regimes are nervous about public opinion to a degree that they were not before the original revolt in Tunisia at the end of 2010.
    The regimes that have fallen, and that still might, were long overdue to collapse. Zine El Abidine Ben Ali in Tunisia was an uninspiring security thug in a society already too sophisticated for that sort. Moammar Gadhafi in Libya was a tyrant out of antiquity encased in self-delusion. Hosni Mubarak in Egypt was barely cognizant because of age and illness, and even that did not signal his fall; rather, his fall was deemed necessary by a military establishment that did not want his son, who never served in uniform, to succeed him in power. Only in Yemen was a dictator's fall not necessarily inevitable. Saleh had remained in power for a third of a century by manipulating tribal politics in a country where geography was not friendly to central control, and he still had his wits about him at the end. But generally speaking, it has only been the worst autocrats who have been overthrown. Those less noxious regimes, mainly in the Gulf, have survived until now.
    Syria, of course, appears to constitute an autocracy whose base of support is melting rapidly. By the time you read these words, it may no longer exist. Though in Syria, like in Egypt, we still have to distinguish between the fall of a man, a family dynasty and a regime. Thus far in Egypt, we have merely had a coup; the military still rules as it did under Mubarak. In Syria, there are numerous possibilities, not all of which signify complete regime change, though complete regime change there is the likely outcome. The bottom line is that the Arab Spring is not synonymous with democracy. Democracy has made substantial inroads in Tunisia but fewer elsewhere. The results of Egypt's elections have been undermined by continued military control. Libya may have held elections, and it may even have elected an enlightened moderate. But there are few institutions with which to project power beyond greater Tripoli. Democracy is not only about voting. It is also about capable organizations of government.
    Alas, the Arab Spring can be defined as a crisis in central authority, in which old orders in a sizable minority of countries have proved untenable even as new and freer orders are struggling to emerge. Those new and freer orders, moreover, will not always prove more edifying than what they replaced. Simply because a people can vote does not mean they will choose individuals who will govern according to the liberal values of the West. Democracy does not guarantee good government; it only guarantees the ability to register the political and emotional health of a given population at a given moment. It is famously said -- and truly said -- that Hitler was elected in a democratic election. While Chinese communist leader, Deng Xiaoping may have improved the material well being and advanced the personal freedoms of more people in a shorter space of time than any man in history. Finally, democracy may be a public good in and of itself. But democratization can be a long, tortuous and deeply destabilizing process.
    The basic truth about the Arab Spring is that it has brought us not only more freedom but also more complexity. Rather than one man, one telephone number and one email address to deal with in case of international crises involving this country or that, Washington now has to take into account the sentiments of dozens of people in the political power structure of a given Arab capital. It used to be easy to determine who held real authority in order to get something specific done or to resolve a crisis. Now it can be a matter of theory, the latest rumor or a piece of intelligence.
    More complexity means that it is not entirely clear that the political changes in the Middle East since early 2011 are necessarily in the interest of the United States. The United States as a mass democracy generally supports the expansion of civil society throughout the world, and the Arab Spring is for the most part in line with that. But America is at the same time a status quo power that seeks to preserve the present power arrangement because it keeps America in a position of relative dominance.
    Through it all, the most interesting countries to watch may be those least in the news: the constitutionally evolving monarchies of Morocco and Oman and the sheikhdoms in the Gulf (Bahrain excepted) with oil money to spend on their small populations in order to bribe them toward quiescence. Some of them are, to varying degrees, peacefully experimenting with more liberal political orders, proving that the best kind of progress is often the most gradual kind, the kind that fails to attract headlines.

    Read more: Good Mideast Dictators by Robert D. Kaplan | Stratfor 

    Tuesday, July 24, 2012

    Greece, Spain, Italy and now France

    Thomas Pascoe

    Thomas Pascoe worked in both the Lloyd's of London insurance market and in corporate finance before joining the Telegraph. He writes about the financial markets. His email is

    Why France is on the road to becoming the new Greece

    This is France, not Greece
    The euro is headed south today against all comers except The Great British Krona (as FT Alphaville calls sterling) which is engaged in a nosedive of its own. The reason this time? Spanish 10 year debt is yielding 7.5pc, half of what it ought to yield but enough to spook markets not yet ready to face the inevitable deflation of what has long been a bond super-bubble.
    This bubble is particularly evident in France. The debt levels which the country has are as unsustainable as Britain’s, yet its policies are more irresponsible and its remedies more restricted. Although it is considered a core country in the eurozone, France’s economic profile now bears more resemblance to Greece’s the Germany’s.
    Public debt in France is at 86.1pc of GDP (146pc if ECB liabilities and bank guarantees are included). The projected budget deficit this year is 4.5pc, with France having exempted itself from the EU’s instruction to bring deficits down to 3pct by the end of the year.
    These numbers are not unusual in the context of eurozone economies in general. What distinguishes France is the lack of political will to address them and, as a consequence, a projected debt to GDP ratio which would place it firmly amongst the PIIGS grouping,
    2010 paper by the Bank of International Settlements – cited by economist John Mauldin in his brilliant recent dispatch on ‘hidden lions’ – sought to model the likely effects of three separate policy paths by European governments. These range in severity from governments essentially carrying on as they are, to the most extreme austerity the authors believe to be politically possible, a gradual downwards movement in government spending while age related entitlements are frozen.
    The results are captured in the graphs below, which show public debt/GDP projections:
    At first glance you would be forgiven for thinking that the authors had simply copied and pasted the French graph into the Greek column:
    Even under the most savage of these austerity models, French public debt reached 200pc of GDP within 30 years. Using the baseline scenario, debt reaches 400pc of GDP in the same time frame thanks to an aging population, relatively high structural unemployment and perpetual over-spend in government.
    The worst case scenario is not unique to France. Of the eurozone countries both the Dutch and Greece would fare as badly as France were the base case to turn out to be correct. Unlike France, the Dutch are able to exert significant control on their own destiny through austerity measures. The best case scenario sees Dutch debt under 100pc of GDP.
    The figures also outline the extent of the British problem. Not only will current spending and demographic patters leave Britain facing a similar debt to GDP ratio to the French 30 years down the line, but interest payments alone would reach 26pc of GDP.
    That said, the British and the Americans both have two options not open to eurozone France. Firstly, they can continue to print paper to honour their debts and thus sustain otherwise impractical debt payments. I suspect both will do this, although it will devalue the savings and wages of their citizens.
    Secondly, both have the option of cancelling the bond issues purchased by their central banks using Quantitative Easing. In a stroke, this would reduce public debt back to less than 50pc of GDP. This is politically impossible for the eurozone given that costs and benefits would be felt very differently across the different sovereigns.
    Japan, the other vitally important debtor state in the global economy, also has a get out which is closed to France. While its debt levels are out of control, its borrowing costs are low thanks to Japanese pensioners investing their life savings in government bonds. Irrespective of global demand, domestic appetite for debt will keep rates low.
    France has access to none of these remedies – it must therefore rely on making cuts domestically. This is why the euro arrangement is so difficult for many eurozone countries – Germany will not allow them to 'cheat' in the way that Britain and the US are doing by debasing their currencies.
    Enter stage left Monsieur François Hollande. At a time when France is in dire need of a plan to re-invigorate private industry, reduce spending and encourage the return of capital, the French have elected a man committed to driving capital from the country and increasing government spending still more.
    Mr Hollande’s attempts to rectify the French problem have so far involved the following:
    These reforms may have had some chance of working in the 1960s, when there were sufficient exchange rate and immigration controls in Europe to prevent the mass exodus of people and capital overseas. They have not the slightest prospect of working now.
    Britain discovered, when it raised taxes on what it termed the ‘super-rich’, that these do not raise any additional income. The very wealthy now are too footloose to submit to any taxation regime they decide in iniquitous. Those who get hammered tend to be the mid-level operatives nearing the end of their career. The really big catch often gets away.
    As it is, Hollande’s policies rely on the political view that Orwell believed he discerned in Dickens, the notion that rich people should be nicer and more amenable to taxation, and that were this the case all would turn out for the best.
    This is not likely to happen soon. France’s economic course makes bankruptcy under the present system likely, her political course makes it inevitable. She is too large to be bailed out, but will eventually need to print currency to honour her debts. To do that she will need to leave the euro.
    France's economy can and will survive for some time yet in its present form. The sharks are circling other bodies in the water, and until the bond markets make borrowing costs today's problem and not tomorrow's, the issue can be deferred. The time will come, however, when France's domestic inaction will translate into a break-up of the currency as a whole. The hour is not yet known, but the course seems set.