Tag: Iran

Europe at sea

11798169_10153515011153011_1249660288_nOn Monday, the Hudson Institute hosted a conversation with Rear Admiral Chris Parry, Royal Navy (Ret.), entitled Europe at Sea: Mediterranean and Baltic Security Challenges.  Seth Cropsey, Senior Fellow, Hudson Institute, moderated.  Admiral Parry spoke about the challenges that Europe faces, given that it is surrounded by water on three sides, and outlined several alternative political futures for Europe.

The threats to Europe from the sea are not new.  In 1983, the USSR had a plan to attack Europe through the Central Front plus the Baltic and Mediterranean Seas. Understanding the way the Russians view the Black and Baltic Seas is crucial to understanding Putin’s motives.  They have a very short coastline on the Baltic Sea. Until they took Crimea, they had a short Black Sea coast as well.  This has always made the Russians nervous.  Russia and the Scandinavian countries also have competing claims in the Arctic.  Russia’s claims extend far beyond the UN Convention on the Law of the Sea, and Russian icebreakers now escort vessels through the Arctic.

At ~9 mi. wide, the Straights of Gibraltar are the area in which Europe and North Africa are closest.  Pictured here is a ferry traveling from Tangier, Morocco, to Algeciras, Spain.
At ~9 mi. wide, the Straights of Gibraltar are the area in which Europe and North Africa are closest. Pictured here is a ferry traveling from Tangier, Morocco, to Algeciras, Spain. PC: Eddie Grove

Europe, however, is more worried about the Mediterranean because of unstable states in North Africa and the Levant, as well as migration both by sea and overland through Turkey.  There is a risk for the return of Barbary piracy, as well as for seaborne terrorist attacks on coastal tourist areas.  Northern Europe believes that it is the responsibility of Southern European countries to deal with this.  The EU is not set up to make political decisions because it is an economic union with political pretensions.  The effort needed to run the EU saps energy from efforts to address seaborne security threats.

The Roman ruins of Kourion, near Limassol, Cyprus.  In September, 2014, a cruise ship rescued ~300 migrants thought to be Syrian refugees off the coast of Cyprus.  The migrants were persuaded to disembark at Limassol.
The Roman ruins of Kourion, near Limassol, Cyprus. In September 2014, a cruise ship rescued ~300 migrants thought to be Syrian refugees off the coast of Cyprus. The migrants were persuaded to disembark at Limassol. PC: Eddie Grove

Parry spoke about how influence has shifted, such that the important global players are now the US and the East Asian countries.  The US is well-placed to benefit from globalization. If Europe isn’t careful, it will decline and become strategically irrelevant.  In the future, Parry sees:

  1. An increase in the use of state power by non-Western countries.
  2. Small amounts of high-quality force will be decisive.
  3. Increased proxy activity, because states don’t want to directly confront each other.
  4.  WMD proliferation.
  5. Increased terrorism.
  6. Diffusion of technology and weaponry.

There will be both irregular threats from terrorism, criminality, disasters and disease, as well as renewed threats from China, Russia, ISIS, Marxist revivalists (in Greece, for example), regional aspirants and weapons proliferation.   Europe will need to contain a Middle Eastern equivalent of Europe’s Thirty Years War, ensure access to natural resources, and adapt to climate change.

Though Putin constitutes an existential threat, Parry noted that defense expenditure in Europe is declining.  NATO countries still however spend more than non-NATO countries.  It spends far more to shoot down a cheap missile than the missile costs; this unsustainable cost ratio must decrease. NATO has failed to resist coercion in Ukraine.  Hitler knew he would win at Munich because he knew the British and French wouldn’t go to war.  Putin is using traditional hard power and is confused by our lack of response.  Russia’s Baltic Sea exercises are designed to resist NATO forces.

Stockholm Harbor.  In October, 2014, Sweden detected a suspected Russian submarine in the Stockholm Archipelago and conducted a search. PC: Eddie Grove
Stockholm Harbor. In October 2014, Sweden detected a suspected Russian submarine in the Stockholm Archipelago and conducted a search. PC: Eddie Grove

Scandinavia is nervous.  Europe has become strategically dependent on the US; some European countries have armies that aren’t prepared to go to war. The UK is investing in new aircraft carriers but is hollowing out the rest of the Royal Navy. To resist coercion at sea from Russia, a change in attitude is needed.

Parry also spoke about the Middle East and North Africa (MENA).  The Iran deal represents what is possible, rather than what is desirable. China and Russia have been keen to maintain Iran as a client state and suppress its nuclear ambitions. In the rush to welcome Iran into the global economy, we need to be careful about the security dimensions.  As a result of the Sunni-Shiite conflict in MENA, the “Great Satan” tag will shift from the US to Saudi Arabia.  China has invested heavily in new trade routes.  It may get the bulk of its future oil and gas from Shiite Iran and Shiite-dominated Iraq.  But China could also move into the Southern Gulf States if the US and Europe reduce their commitments there.

Like Russia, China is increasing its naval presence, sometimes disregarding the UN Convention on the Law of the Sea.   There are increasing numbers of Chinese warships in the Indian Ocean as well as Chinese ships in the Mediterranean and Chinese icebreakers in the Arctic.  China views its oil rigs as sovereign territory, which means that it believes it can base missiles and surveillance off of them. This is illegal under international law.

The European Parliament in Brussels, Belgium.
The European Parliament in Brussels, Belgium. PC: Eddie Grove

Parry outlined three different potential futures for Europe:

  1. A Eurasian future: the US drifts to the Pacific and Europe pursues economic cooperation with Russia and China.
  2. A maritime future: Parts of Europe, the US, Canada, Australia, New Zealand, Japan, and Korea together control trade on the seas.  The sea is the physical equivalent of the World Wide Web and controlling it is vital for international trade.
  3. A fragmented future: There are no eternal friends or enemies, just interests, and each country pursues its own interests.  Europe’s separatist movements could also lead to a fragmented future.
Separatist movements have gained ground throughout Europe.  Brussels (left) is located in Flanders, but is now majority French-speaking, causing linguistic/ethnic tension. Scotland's capital, Edinburgh (top right) voted against Scotland's 2014 independence referendum, but Glasgow, Scotland's largest city, voted in favor.  Cyprus (bottom right) has been divided on Greek-Turkish ethnic lines since 1983.
Separatist movements have gained ground throughout Europe. Brussels (left) is located in Flanders, but is now majority French-speaking, causing linguistic/ethnic tension. Scotland’s capital, Edinburgh (top right) voted against Scotland’s 2014 independence referendum, but Glasgow, Scotland’s largest city, voted in favor. Cyprus (bottom right) has been divided along Greek-Turkish ethnic lines since 1983. PC: Eddie Grove

According to Parry, the US now faces choices as well.  Unconventional oil and gas have been a game-changer for the US economy.  The US has to decide whether it will use this money to remain strategically dominant or turn inward.  The 2016 election will be crucial.  In the future, if it becomes clear that help isn’t coming from the US, European countries will seek accommodation with Russia and East Asian countries will seek accommodation with China. This will have major geostrategic consequences.

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The truth in criticisms of the Iran deal

Here are some criticisms of the Iran deal that contain at least a kernel of truth. I thought I might go over these, for the sake of clarifying some of the arguments pro and con:

1. It will give Iran a lot of money to do bad things with. That is true. It’s not as much money as some are claiming: perhaps $50 billion fairly quickly the US Treasury thinks, rather than the $100-150 billion deal opponents cite. Since the Iranian Revolutionary Guard Corps and its affiliates has lost a great deal (two-thirds of the country’s centrifuges and virtually all of its enriched uranium, not to mention a plutonium-producing reactor filled with concrete), the pressures to compensate it with both money and freedom to do bad things in the region will be enormous. That means more money for shipping arms to Bahrain, Yemen and above all Syria as well as compensating Hizbollah for its losses. Only by countering Iranian moves in those places can the US hope to avoid some of the consequences.

2. All the agreement does is buy time. Yes, that is the main thing it does, by pushing Iran back from a breakout time (the time it needs to get the fissile material needed to build a singular nuclear weapon) of 2 months or so to a year, and preventing any shortening of that breakout time for 10-15 years. But that is not all it does. The verification mechanisms put in place will be the strictest and most comprehensive installed anywhere and will last forever. The obligation Iran takes in the agreement not to pursue nuclear weapons is binding and permanent. The military option so many critics implicitly favor remains an open should Iran move in the direction of getting a nuclear weapon.

3. The verification measures are inadequate. It is difficult to prove a negative, as we all know. That is what the verification measures are asked to do. But no country has ever made nuclear weapons in facilities monitored by the International Atomic Energy Agency (IAEA), as Iran’s will be. Iranian facilities will be covered by the tightest monitoring scheme ever devised, with the real capability of detecting diversion of any nuclear material. Still, a clandestine nuclear program is possible, conducted outside monitored facilities. That is why Iranian delivery to the IAEA of answers to questions about its past activities with “possible military dimensions” (PMDs) is so important. That is due October 15, with an IAEA report due December 15. If you want an early indication of whether this agreement will be effective, watch that space.

4. Lifting of sanctions cannot be “snapped back.” Existing contracts will be grandfathered, so the legal impact of any reimposition of sanctions–which can be decided by the US and its allies over Russian, Chinese or Iran objections–will not be immediate. That’s true. But the fact of reimposition will be much more significant than the legal impact. Companies that do business with Iran will immediately dial it down, if not out, should sanctions be reimposed, if only to avoid getting into trouble with US and European financial regulations. In the longer-term, Iran will be less vulnerable to sanctions if it invests its money well and is able to develop its oil and especially gas resources. That is an inherent part of the deal.

5. The deal allows industrial-scale nuclear facilities that make Iran a threshold nuclear state. I wouldn’t rank 5000 or so centrifuges or a few hundred kilos of light enriched uranium as industrial scale or nuclear threshold. But fine if you do, because Tehran has much more than that now and would be under no obligation to give any of it up if there is no deal. Are we better off with numbers two and three times as large as will exist if the deal is not approved? Not to mention that without a deal we can expect Iran to accelerate its nuclear efforts.

6. The sanctions will hold even if the US withdraws from the agreement. It is true that the US can make life extremely unpleasant for any company or bank anywhere in the world that does business with Iran if Washington says no. But there is a high price to be paid for extraterritorial extension of our sanctions: other governments don’t like it and Iran will build an elaborate network to get around it, as they have with the existing sanctions. Especially on the Repubican side of the aisle, it should be appreciated that anti-market restrictions are unlikely to be watertight or last forever.

7. The arms and especially missile sanctions should not have been lifted. The UN Security Council imposed them in order to get Iran to negotiate on nuclear issues. Iran expected them to be lifted as soon as it had implemented its portion of the nuclear constraints. Instead they will remain in place far longer than we had a right to ask. I’d prefer they not be lifted too, but I never got a pony either.

I’m reasonably confident the Congress will not muster the 2/3 majority in both houses required to kill the deal. But if they do, we can expect most of the world (that’s everyone but Israeli Prime Minister Netanyahu) to think us deranged and to refuse American leadership on Middle East and many other issues for a long time to come. All those Gulf countries complaining about the deal now will make much more noise if the deal falls through and Iran acquires the material for a nuclear weapon in the next couple of months. Remember President Wilson, the League of Nations and the period between the World Wars? This would be at least as bad.

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Peace picks July 27-31

1. Chemical Safety and Security: TSCA Legislation and Terrorist Attacks | Monday, July 27th | 2:00 – 5:00 | CSIS | REGISTER TO ATTEND | Chemical safety and security is one of the fundamental pillars of the Chemical Weapons Convention (CWC), but the recent and ongoing use of dual-use chemicals such as chlorine in the Syrian conflict, several recent chemical accidents in the US, and congressional updating of the Toxic Substances Control Act (TSCA) have all raised these goals to a much higher level. This seminar will address three related safety and security issues: (1) new TSCA legislation in the House and Senate; (2) the Chemical Facility Anti-Terrorism Standards (CFATS); and (3) Global Partnership efforts to improve chemical safety and security of industry and transportation. The Proliferation Prevention Program will co-host this event with Green Cross International and International Center for Chemical Safety and Security (ICCSS). Speakers include: Ambassador Krzysztof Paturej, President of ICCSS Board, Michael P. Walls, Vice President, American Chemistry Council, Michal Ilana Freedhoff, Director of Oversight & Investigations, Office of Senator Edward J. Markey, United States Senate, Todd Klessman, Senior Policy Advisor, Infrastructure Security Compliance Division, Department of Homeland Security, Ambassador Bonnie Jenkins, US Department of State, Ali Gakweli, Deputy Government Chemist, Government Chemist Division, EU CBRN National Focal Point National Authority (CWC), Nairobi, Kenya. Moderators include: Paul Walker, Director of Environmental Security and Sustainability, Green Cross International and Sharon Squassoni, Director of the Proliferation Prevention Program, CSIS.

2. Hearing to Examine Iran Nuclear Agreement | Tuesday, July 28th | 10:00 – 2:00 | Rayburn House Office Building | REGISTER TO ATTEND | Chairman Ed Royce (R-CA) on the hearing:  ‘This Iran deal is one of the most important in decades.  It reverses decades of bipartisan nonproliferation and regional policy, has several shortcomings, and demands the closest scrutiny.  Secretary Kerry and the other Administration officials will face tough questions before the Committee, as we continue our comprehensive review of the Iran deal and the Administration’s overall regional policy.’

Ranking Member Eliot Engel (D-NY) on the hearing:  “I look forward to hearing from Secretaries Kerry, Lew, and Moniz to discuss the Iran agreement. I have serious questions and concerns about this deal, and input from the Administration will be critical as Congress reviews the proposal.”

Speakers include: John Kerry, Secretary of State, Department of State, Jacob Lew, Secretary of Treasury, U.S. Department of the Treasury and Ernest Moniz, Secretary of Energy, U.S. Department of Energy.

3. Discussing American Diplomacy at Risk and the Second Quadrennial Diplomacy and Development Review| Tuesday, July 28th | 11:00 – 12:30 | The Stimson Center | REGISTER TO ATTEND | Government reform is an open ended process; large institutions that conduct our national security and foreign policies need to continually evolve, to adapt to changing realities in the international landscape, and to changes in our own society. Two recent reports address the challenge of aligning the internal structures and personnel practices of the Department of State to the 21st century world. 
 
The American Academy of Diplomacy has recently released American Diplomacy at Risk, examining how the professional foreign service is weakened by politicization and by failures to sustain relevant training and professional development for the work force.
 
The State Department itself has released its second Quadrennial Diplomacy and Development Review, looks at recent reforms and innovations to make the department more responsive in an age of partnerships and collaboration with diverse state and non-state civil society players. Speakers include: Ambassador Ronald Neumann, President, American Academy of Diplomacy, 
Caroline Wadhams, Acting Director in the Office of the QDDR, State Department
, Ambassador Barbara Bodine, Director, Institute for the Study of Diplomacy and 
Julie Smith, Senior Fellow and Director of the Strategy and Statecraft Program, Center for New American Security
. 
Moderators include: 
Ellen Laipson, President and Chief Executive Officer, the Stimson Center
.

4. Can the P5+1’s Vienna Deal Prevent an Iranian Nuclear Breakout| Tuesday, July 28th | 11:45 – 1:30 | Hudson Institute | REGISTER TO ATTEND | The Joint Comprehensive Plan of Action (JCPOA) signed earlier this month in Vienna is the culmination of a longstanding Obama administration effort to resolve the international community’s nuclear standoff with Iran through diplomatic means. A host of serious questions surround the agreement, including the complexities of international law and politics necessary to enact its provisions, and the strategic calculations that Iran’s regional rivals will make in its aftermath. But the key question remains the most practical one: Will the JCPOA, advanced by its proponents as a far-reaching and robust arms agreement, actually prevent Iran from acquiring a nuclear weapon?

Can the JCPOA’s inspection and verification regime, which allows Iran a 24-day window to prepare – or “sanitize”—any suspected site for on-site review, provide an effective guarantee against violations? What will it mean when the JCPOA expires in 15 years under the “sunset clause” and Iran becomes a “normal” nuclear power? And how, in the meantime, will the deal’s removal of existing sanctions against currently designated terrorists and terror-connected entities – like the Iranian Revolutionary Guard Corps (IRGC) and Qassem Suleimani, commander of IRGC’s expeditionary unit, the Quds Force – complicate efforts to constrain Sunni Arab states from pursuing nuclear arms programs of their own?

Speakers include: Senator Tom Cotton, U.S. Senator from Arkansas, Michael Doran, Senior Fellow, Hudson Institute, William Tobey, Senior Fellow, Belfer Center for Science and International Affairs and Hillel Fradkin, Senior Fellow and Director, Center on Islam, Democracy and the Future of the Muslim World, Hudson Institute. Moderators include: Lee Smith, Senior Fellow, Hudson Institute.

5. Hearing: Women Under ISIS Rule: From Brutality to Recruitment| Wednesday, July 29th | 10:00 – 1:00 | Rayburn House Office Building | REGISTER TO ATTEND | Speakers include: Sasha Havliceck, CEO, Institute for Strategic Dialogue, Ariel Ahram, Assistant Professor, Virginia Tech School of Public and International Affairs and Kathleen Kuehnast, Director, Gender and Peacebuilding, Center for Governance, Law and Society, United States Institute of Peace.

6. Panel: Scorecard for the Final Deal with Iran| Wednesday, July 29th | 12:00 – 1:30 | JINSA | REGISTER TO ATTEND | In Vienna on July 14, the P5+1 and Iran agreed on a final deal, formally known as the Joint Comprehensive Plan of Action (JCPA). This report will analyze whether the JCPA addresses the Task Force’s questions and concerns about the framework agreement. Overall, the JCPA rolls back Iran’s breakout time and allows for broader verification, but only in exchange for key restrictions being removed in 8-15 years, R&D on advanced centrifuges, front-loaded sanctions relief – including up to $150 billion in unfrozen assets – with no automatic “snapback” mechanism, an end to the U.N. arms embargo against Iran and no anytime, anywhere inspections. Speakers include: John Hannah, 
Former National Security Advisor to the Vice President
Senior Fellow at the Foundation for Defense of Democracies
Iran Task Force Member, Dr. Michael Makovsky
, CEO, JINSA, Dr. Ray Takeyh, 
Senior Fellow, Council on Foreign Relations
.

7. From Ocean of War to Ocean of Prosperity| Wednesday, July 29th | 4:15 – 5:15 | Carnegie Endowment for International Peace | REGISTER TO ATTEND | Over the past two hundred years, the Western Pacific has been the stage for war, peace, development, modernization, and prosperity. Its rich resources and vital shipping lanes are essential to the well-being of all countries within its bounds. Admiral Tomohisa Takei, chief of staff for the Japan Maritime Self-Defense Force, will discuss the development of the U.S.-Japan relationship, Japan’s role in the region, and the future of a rules-based international order in the Indo-Pacific. Carnegie’s vice president for studies, Thomas Carothers, will moderate. Speakers include: Admiral Tomohisa Takei, Chief of Staff, Japan Maritime Self Defense Force, Thomas Carothers, Vice President for Studies, Director of Democracy and Rule of Law Program, Carnegie Endowment.

8. Empowering America: How Energy Abundance Can Strengthen US Global Leadership| Thursday, July 30th | 8:30 – 9:45 | Atlantic Council | REGISTER TO ATTEND | Please join Senator Lisa Murkowski, Chairman of the Senate Energy and Natural Resources Committee, and Senator Mark Warner as they launch the task force report: Empowering America: How Energy Abundance Can Strengthen US Global Leadership.  Over the past few months, with the Senators as the Co-Chairs, the Atlantic Council convened foreign policy, defense, and energy experts to assess the foreign policy considerations of the US energy boom. The task force details the nature of our energy abundance, the importance of deploying our prowess in energy innovation and technology to others, and the ways in which we can pursue our responsibilities as a global leader on energy and the environment, while leveraging our supply abundance at the same time. It unequivocally determines that America must embrace this new tool to advance our global leadership on trade and security. Speakers include: Richard Morningstar, Director, Global Energy Center, Atlantic Council, Lisa Murkowski, Senator of Arkansas and Mark Warner, Senator of Virginia. Moderators include: David Goldwyn, Chairman of the Energy Advisory Group, Atlantic Council.

9. Threat of ISIS in Iraq: Views from the Ground| Thursday, July 30th | 10:30 – 12:00 | Stimson Center | REGISTER TO ATTEND | From enflaming sectarian tensions to undermining governance and economic development, the expansion of ISIS continues to pose grave risks to Iraq and the broader Middle East. Stimson and the American University of Iraq, Sulaimani (AUIS) invite you to join us for a discussion featuring views and perspectives from AUIS scholars and students examining the nature of the ISIS threat, and the related territorial, demographic and socio-economic consequences. Students from Kurdistan and other parts of Iraq will join us through video links.

10. Reviving Citizenship in Turkey through Citizen Journalism| Friday, July 31st | 1:30 – 2:30 | Freedom House | REGISTER TO ATTEND | Engin Önder is the co-founder of the Turkish citizen journalism initiative 140journos. Founded in 2012, 140journos is a collaborative information-gathering and dissemination project that has responded to the censorship and self-censorship of the official media in Turkey by taking matters into its own hands. After huge success as a Twitter-based livefeed that helped document the 2013 Gezi Park protests, in 2015 the project has transformed itself with a new approach that embraces interactive mapping, data visualization, and long-form reportage across multiple social media platforms. Önder will describe how the new 140journos is using citizen journalism to change the information ecosystem and restore the meaning of citizenship in Turkey. Speakers include: Engin Önder, Co-Founder, 140journos. 

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Energy markets: US up, Middle East down

Screen Shot 2015-07-23 at 4.00.31 PMThursday, the Atlantic Council hosted a talk on energy policy entitled “The Future of Energy Markets: The Other Middle East Revolution.” The event featured Majid Jafar, Chief Executive Officer of Crescent Petroleum as the key speaker. Richard Morningstar, Founding Director of the Global Energy Center at the Atlantic Council moderated the event.

Jafar recounted the changes in the energy markets in the past 15 years. In 2000, the price of oil was in the low teens and natural gas was $10. The US was an importing country, which meant it was building LNG terminals everywhere. The Middle East was relatively stable. More than a decade later, the price of natural gas has plummeted again, but the US has become an exporting country. The shale oil and gas boom has led the US to convert its LNG terminals for export. Equally if not more importantly, the Middle East has become very unstable.

US Private Sector

Jafar also emphasized the power of US private sector. He claimed the energy breakthrough was despite rather than because of government policy and lauded the US for its long-term strategic energy planning. The US has experienced a large drop in carbon emissions while seeing huge job creation in the oil and gas sector. In contrast, European countries, such as Germany, set ambitious targets like zero fossil fuels and made a mad dash for renewable energy sources. This move stifled the Germany economy and inflicted huge costs on Germany households and industries. Ironically, Germany is experiencing rising emissions and is having to import coal from the US.

Lessons Learned

The CEO shared three lessons he had learned from his experience in the energy industry:

  1. Do not underestimate the power of the US private sector, especially in the energy industry. Huge innovation can drive many changes.
  2. Never underestimate the ability of the Chinese public sector to complete their plans. The East-West pipeline is a classic reflection of the Chinese capability in completing large-scale projects.
  3. Never underestimate the ability of the Middle East public sector to get things wrong.

Jafar added that the unique US ecosystem cannot be replicated elsewhere. It includes infrastructure, capital markets, energy trading hubs, many small companies and a system of mineral rights. However, other countries can learn to provide better access to finance, encourage competition and transparency, and expand their private sectors.

The Middle East

The Middle East contains half the world’s proven oil and gas resources but accounts for less than a 1/3 of global oil exports and less than a 1/6 of global gas exports. The region has experienced a declining market share due to numerous conflicts, years of Iran sanctions and poor policies. Energy subsidies in particular pose major problems. The region has lost $225 billion to subsidies, which do not even help the poor people who are supposed to be the beneficiaries. The good news is that the current low oil prices provide many countries the opportunity to reform subsidies, because the gap between the market price and subsidized price is small.

Egypt is a good example. It has committed to reforming energy subsidies, because they are unsustainable and divert money from important areas of investment that create jobs. Egypt’s spending has been divided between debt service, salaries and subsidies, which left the government with little to spend on investment, infrastructure and jobs.

Another problem with the region is the dominance of national oil companies, which hinder competition and positive performance. When an energy minister is also the chairman of the oil company, there is no difference between the regulator and the regulated, which hurts policymaking. Some countries, such as Kuwait, Iran and Saudi Arabia, have realized this and partnered with private investment companies. Jafar said he is not calling for complete privatization, merely a bigger role for the private sector in developing state assets.

Iraq

Jafar also detailed Iraq’s important role in the energy world. The failing state is responsible for 40% of global oil export growth despite failure to pass hydrocarbon legislation, a lack of internal consensus on energy policy and the ISIS presence. Iraq’s production is nevertheless at an all-time high, making it the second biggest producer in OPEC. If Iraq gets its act together, it could produce 6-12 million barrels of oil per day. Iraq may have larger oil reserves than Saudi Arabia—at least 300 undrilled structures lie in the Western desert.

The Kurdistan Regional Government (KRG) has done well in passing legislation, working with private companies and essentially getting the policy right. But it faces implementation challenges because the Baghdad government is unable to pay the KRG for its oil. In southern Iraq, the latest market methods have been used with transparent bidding rounds involving private companies. However, the decision to sign service contracts was a bad one, because it means southern Iraq has to pay private oil companies a fixed fee regardless of the price of oil. With the oil price collapse, southern Iraq can no longer afford to pay the companies and is discouraging investment. A new contract model is needed where companies receive a percentage of the government’s oil profits, as opposed to a fixed fee. More importantly, a stable security environment is needed to encourage continued investment.

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Fear of diplomacy

Sorry I can’t embed John Oliver’s commentary here at peacefare.net, but it is worth a few minutes to go enjoy it over at Youtube.

I can however offer this

from Connecticut’s Senator Chris Murphy, who is less funny but easily more interesting. His talk this morning at the Carnegie Endowment put the nuclear deal in the context of a Washington that is shies away from diplomacy–too risky–and tilts instead towards war, for which America is amply well-prepared. He also suggested that rejection of the deal would leave the US no other serious alternative, as the multilateral sanctions, constraints on Iran’s nuclear program and international inspections would evaporate.

This is the vital link in the logic that should lead to support for the deal even among those who don’t like it. Rob Satloff, whose writing I generally admire, argues that it is a false logic. The Congress can reject this deal, he suggests, and still get a satisfactory outcome. I find his argument thoroughly unpersuasive, stringing together an unlikely sequence of events that doesn’t even get us far into the future without resorting to war. Nor does he consider the reaction of the other countries that negotiated the deal.

Senator Murphy is far more realistic. He understands, I think, that rejection of this deal would be the equivalent in our time of Congress’ rejection of President Wilson’s League of Nations. It would put the US in the position of going to war as the only remaining resort rather than implementing an agreement four other permanent members of the UN Security Council find acceptable. Even Saudi Arabia and Israel, now strident opponents of the Iran nuclear deal, would not applaud the US as Iranian missiles rain down on Tel Aviv and the Kingdom’s oil fields. Instead they will be arguing for US ground forces to stop the barrage.

What happens if we reject the deal and refuse to destroy the Iranian nuclear program? Then Iran gets nuclear weapons quickly. Anyone worried about Iranian troublemaking in the region–an entirely well-founded concern–would then have a lot more to be concerned about. A nuclear Iran would no doubt throw its weight around more rather than less.

The Senator made a few other points worth mentioning in his post-speech conversation with Karim Sadjadpour. Even with the deal in force, he thinks the US will retain the right to impose sanctions on Iran for reasons other than nuclear issues. He suggested we would do so if Iran were to execute a terrorist bombing of Israeli tourists, for example. The Senator admitted that US companies are likely to be at a disadvantage in the competition for Iranian business. He thought US anti-bribery legislation would help to protect the business Americans do from capture by regime hardliners.

The Senator was hesitant on one issue: restoring diplomatic relations with Iran. That’s a long way off he suggested. He admitted that the US will need a real presence in Iran to ensure implementation of the agreement but was unwilling to commit to an interest section, suggesting instead that the IAEA inspectors might suffice.

In my view, they won’t, because their remit is entirely technical. I served seven years abroad in US embassies working nonproliferation issues. I think we need our own people in a diplomatically protected facility in Tehran, if only on two and three week trips. But maybe the time is not yet ripe for that proposal. Let’s get the agreement through the uphill fight in Congress first.

PS: If John Oliver didn’t satiate your taste for videos, try this less funny one from Jon Stewart last night (with President Obama).

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Legacy

We all worry about our legacy. President Obama must too. But unlike most of us he has a lot of people telling the world what his will be.

The current favorite is the Iran nuclear deal. I doubt that. Does anyone even remember that it was Bill Clinton who made a nuclear deal with North Korea? It fell apart in George W’s administration. Even that is not remembered, I suppose because the list of his failures is long.

If the Iran nuclear deal falls apart soon, sure it will tarnish the Obama brand. But let’s assume the implementation of the Iranian nuclear deal goes reasonably well. If 10 or 15 years from now Iran makes a dash for a nuclear weapon, will anyone blame Barack Obama, or will they understandably blame his successor’s successor? And credit him with delaying what was inevitable.

There have been lots of “legacy” proposals these past six months. The two most prominent, quite rightly focused on domestic policy, have been

  • Obamacare, which survived its test in the Supreme Court;
  • gay marriage, another Supreme Court win.

They will no doubt be counted as important milestones on the way towards a more just society, but really not legacy-defining.

A far stronger candidate in my view is this:


source: tradingeconomics.com

That’s a rapid recovery from the 2008 economic implosion, followed by six years of relatively steady if modest growth, likely to be extended to eight years while much of the rest of the world continues to stagnate. Simultaneously, US government debt has leveled off:


source: tradingeconomics.com

This good economic news is important for American foreign policy. Without it, there would be little hope that Washington could muster the resources needed to engage–even to the extent it has–on major issues like Moscow’s military challenge in Ukraine and Beijing’s somewhat less military challenge in the South China Sea.

In addition, there is the good news about US energy production:


source: tradingeconomics.com

Combined with the decline in global energy prices, this dramatic shift is denying resources to some of our adversaries and providing a serious boost to the American economy.

All that good economic news–rarely credited today but likely to be all to obvious in the future–should not however obscure the very real bad news from the Middle East. Apart from the failure of the Administration’s efforts to resolve the Israel-Palestine conflict, we’ve got a civil war in Syria that has killed upwards of 300,000 people and displaced close to half the country’s population, sending 4 million abroad as refugees. We’ve also got a civil war in Libya, allowed to flourish in the aftermath of a successful intervention. And another in Yemen, where Washington is half-heartedly supporting a Saudi intervention that appears to be making things worse.

Just as important: the war against Islamist extremists that began in 2001 in Afghanistan has been notably unsuccessful. Fourteen years later, a few thousand extremists in two countries have metastasized to tens of thousands in more than a dozen countries, despite hundreds of drone strikes and air attacks.The Australian global terror hotspotsNeither our military might nor our propaganda capabilities have succeeded in stemming the tide. They have arguably made things worse. The American non-governmental organizations are rightly protesting continuation of an approach that simply has not worked.

When it comes to foreign policy, these failures in the Middle East and in the fight against Islamist extremists are likely to be a bigger part of President Obama’s legacy than the nuclear deal. If he wants to worry about something, he should put these things at the top of his list. A serious effort now to enable Syrian moderates to begin governing inside Syria, coupled with a serious European effort to make sure the UN’s Libyan mediation unifies that country’s rival governments and parliaments, would do a great deal to fix the broken Middle East. These are largely diplomatic challenges, not military ones.

We would still be facing terrorist challenges elsewhere. If we want to deal with them, it is clear enough that military means will not suffice. We need a much stronger civilian mobilization, in partnership with other countries and international organizations. More on how to make that part of Barack Obama’s legacy in a later post.

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