Tag: United States
Reform first
Steven Cook, who knows lots about Egypt, offers an insightful analysis of its impending financial and economic problems. In a word, Egypt could go broke and the state could disintegrate:
Egypt’s economy remains shaky and the threat of a solvency crisis lingers. Indeed, the continuation of violence, political protests, and general political uncertainty—even after planned presidential and parliamentary elections—along with a hodgepodge of incoherent economic policies, all portend continuing economic decline. This in turn could create a debilitating feedback loop of more political instability, violence, and economic deterioration, thus increasing the chances of an economic calamity and yet again more political turmoil, including mass demonstrations, harsher crackdowns, leadership struggles, and possibly the disintegration of state power.
Only Gulf generosity has kept Egypt’s foreign currency reserves above the minimum required, tourism is in a tailspin, debt is close to 100% of GDP and subsidies (especially for fuel) burden the state’s budget. There are many ways in which Egypt could be sent into default. I recommend you read Steven’s trenchant account.
But much as I am taken with his account of the problems, I find it difficult to see merit in the options he discusses: US loan guarantees, US debt relief, foreign assistance to pay down domestic debt and Gulf fuel transfers. He also proposes, in the event of default, that the US support the military, provide financial assistance and restore food aid. None of this is contingent on Egyptian economic reforms.
Here is where I depart from Steven:
It is up to the Egyptians to undertake reforms to forestall this outcome. Given the fact that the Egyptians have done little in this regard, a solvency crisis is entirely plausible. Consequently, the United States has a strategic responsibility to do what it can in Egypt to prevent the causes of insolvency…
This is a slippery slope: he is proposing that the US try to prevent insolvency, even though the Egyptians have been unwilling to undertake reforms. Doing so will relieve some of the pressure on Cairo to undertake reforms, make insolvency more likely and increase pressure on the US to prevent it. Moral hazard lights are flashing.
No. That is not the path we should go down. We should encourage Egypt to put forward a plan for reform first, then provide assistance. The way to do this without putting the US on the front line is to encourage Cairo to go first to the International Monetary Fund for money. This is politically difficult in Egypt, as everyone knows the IMF will condition its assistance on reforms. But it is a lot better for the US than asking American taxpayers to pay for Egyptian fuel subsidies. And Field Marshall, soon to be President, Sisi should be expected to do unpopular things as early as possible in his mandate. He surely won’t do them as the time approaches for another election.
Steven envisages the IMF eventually playing what he calls
an important role in assisting the next government to redraw Egypt’s social contract in a way that is both politically acceptable at home and can command the strong support of the rest of the world….foreign donors will need to accept a slower reduction in subsidies than under a conventional IMF program in order to increase the likelihood that Egyptians can make headway on reforms in a coordinated and more coherent manner.
I’ve got no problem with this: a slower than usual reduction in subsidies may be necessary, though it seems to me the IMF has in fact accepted some pretty slow reductions from other countries as well. What I object to is providing unconditional US assistance and then expecting the IMF to succeed in negotiating conditions. The IMF should go first. The US can then be generous, promising its taxpayers that the money it provides will in fact finance a transition away from subsidies.
The US has gotten very little for the billions it has provided Egypt in the past. Cairo is headed back to military autocracy and its economy to insolvency. Nor has Egypt gotten rich off the aid. A lot of it was wasted on military hardware Egypt didn’t need but American companies were glad to sell. The best that can be said is that the money encouraged Egypt to maintain its peace treaty with Israel, though Cairo had ample other reasons to avoid yet another, likely unsuccessful, war once it regained sovereignty over Sinai.
We need to avoid being trapped into another several decades of fruitless expenditure on aid to Egypt. Reform first is the way to go.
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Memorial Day for the people
I have little to add to what I said the past three years on Memorial Day, so I am republishing what I wrote originally in 2011 with slight updates and a short additional paragraph:
I spent my high school years marching in the Memorial Day parade in New Rochelle, New York and have never lost respect for those who serve and make sacrifices in uniform. Even as an anti-war protester in the Vietnam era, I thought denigration of those in uniform heinous, not to mention counterproductive.
It is impossible to feel anything but pride and gratitude to those who have served in Iraq and Afghanistan, not to mention Kosovo, Bosnia, Panama and Somalia during the previous decade. Nor will I forget my Memorial Day visit to the American cemetery in Nettuno accompanying Defense Secretary Les Aspin in the early 1990s, or my visit to the Florence cemetery the next year. These extraordinarily manicured places are the ultimate in peaceful. It is unimaginable what their inhabitants endured. No matter what we say during the speechifying on Memorial Day, there is little glory in what the troops do and a whole lot of hard work, dedication, professionalism and horror.
That said, it is a mistake to forget those who serve out of uniform, as we habitually do. Numbers are hard to come by, but a quick internet search suggests that at at least 2000 U.S. civilians have died in Iraq and Afghanistan, plus quite a few “third country” nationals. They come in many different varieties: journalists, policemen, judges, private security guards, agriculturalists, local government experts, computer geeks, engineers, relief and development workers, trainers, spies, diplomats and who knows what else. I think of these people as our “pinstripe soldiers,” even if most of them don’t in fact wear pinstripes. But they are a key component of building the states that we hope will some day redeem the sacrifices they and their uniformed comrades have endured.
Iraqi and Afghan civilians killed number at least 100 times the number of American civilians killed. Numbers this large become unfathomable. Of course some–and maybe more–would have died under Saddam Hussein or the Taliban, but that is not what happened. They died fighting American or Coalition forces, or by accident, or caught in a crossfire, or trying to defend themselves, or in internecine violence, or because a soldier got nervous or went beserk, or….
Memorial Day in this age of “war among the people” should be about the people, civilian as well as military, non-American as well as American, not only about the uniform, the flag or the cause.
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Landslide
According to exit polls, Ukrainians Sunday gave Petro Poroshenko a landslide mandate in the presidential poll. While voting in the eastern provinces of Donbas was sparse, turnout elsewhere was high and the margin over also-ran Yulia Tymoshenko was so wide that it is difficult to see how even Russian President Putin could question the legitimacy of the result. The Ukraine crisis is not over, but Poroshenko’s election could open the way to a negotiated political settlement, which is his often expressed preference. Poroshenko has not favored NATO membership for Ukraine and has pledged to protect the rights of Russian speakers, but he also favors stronger ties to the European Union.
Russian President Putin has reason to be content. His red line is NATO membership for Ukraine. Poroshenko has indicated he will not cross it, though he occasionally suggests Russian intransigence will make him reconsider the proposition. Putin will plump for maximum self-governance in Donbas, to allow Russian speakers the kind of de facto ethnic independence Serbs have in Bosnia. He will also want Poroshenko to attract lots of money from the EU and the International Monetary Fund, so that Russia will get back the money it loaned Poroshenko’s predecessor.
While likely to oblige Putin’s interest in getting his money back, Poroshenko has his work cut out for him. He has pledged to visit Donbas first, including to thank the Ukrainian security forces who have tried–without much success–to restore order there. Parliamentary elections are not due until 2017. There appear to be no plans to bring that date forward. The parliament has been an important player since previous President Yushenko abandoned his post. Its slate of priorities will be daunting: Ukraine needs to phase out its expensive energy subsidies, attract private investment, end oligarchical cronyism and cut back on corruption.
Europe has some serious thinking to do in light of the Ukraine crisis. Its dependence on Russian natural gas, its weak military forces and its diplomatic clumsiness–all closely related–should make not only Brussels but the 28 member state capitals think harder about what it takes to sustain a coherent and successful foreign and security policy.
If in fact the Ukraine crisis now heads in the direction of a peaceful denouement, the Obama administration will have reason to boast that its low-key diplomatic approach has produced a decent result. Particularly important was the decision not to listen to experts who advised agreeing with Putin to postpone the election.
But even if things go well now with Ukraine, Washington needs to rethink policy towards a Russia bent on expanding its hegemony in what it considers its “near abroad.” NATO expansion in particular needs presidential attention: Montenegro and Macedonia are technically qualified and could be admitted at the Summit in Cardiff, Wales in September, but Macedonian membership will require President Obama to deliver bad news to Athens. A broader package of moves closer to NATO would be ideal, one that includes Kosovo, Bosnia, Sweden and Finland. I am hesitant about Georgia, a country NATO is in no way capable of defending. But letting Putin know that NATO is determined to expand to those countries that it can defend, that meet the membership criteria and that want to join will limit his ambitions and encourage those who seek a democratic future.
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This is important
Russia’s President Putin says he will respect the outcome of Sunday’s presidential election in Ukraine. This is important, if true.
There is good reason to doubt his word. Moscow in general and Putin in particular have prevaricated throughout the crisis in Ukraine. Underhanded would be a compliment to the stealth Russian takeover and eventual annexation of Crimea. Russian troops remained on the border with Ukraine, despite Putin’s insistence that they were withdrawn. His security services have sometimes led and often fed the takeover of government offices in Donetsk and Luhansk provinces, where he could readily create disorder this weekend. His policy has essentially been one of promoting disorder, then complaining about it and portraying Russia as the only hope for preventing harm to Russian speakers.
Why might Putin behave differently this time around? It is hard to know exactly who is saying what to whom, but it appears that the Europeans and Americans have mounted a reasonably credible threat of more severe financial sanctions if Russia or its surrogates disrupt the election. Putin has acknowledged that the targeted sanctions already imposed have hurt Russia. Sentiment in Donbas, as the most affected provinces are known, is mixed, with considerable loyalty to Ukraine.
Both the leading candidates, Petro Poroshenko and Yulia Tymoshenko, were rivalrous protagonists in the post-Orange Revolution scandals of 2005. Both also supported the pro-European Union popular uprising that chased former President Yanukovych from office. Putin never had much use for him and has kept him at arm’s length since he abandoned his post in Kiev.
Putin’s acceptance of the outcome of Sunday’s voting would pull the rug out from under the pro-Russian separatists, who conducted an ambiguous “referendum” on the political status of Ukraine earlier this month. But it would only be the start of a long and difficult transition in Ukraine, which is a semi-failed state. Since 1989, it has done not much better than mark time, with an economy that shrank in the 1990s, grew until 2007 and then struggled again. This year will be awful. Energy subsidies and lack of domestic production from ample resources have made Ukraine heavily dependent on Russian natural gas and transit fees for gas shipped to the west.
Governance is even worse than the economic figures suggest. Corruption is rampant. Yanukovych is widely believed to have stolen billions. The administration is still highly centralized, but without the capacity to govern effectively or deliver services in the provinces. The authorities, especially in the relatively industrialized east and south, lack legitimacy with a population that feels deprived and alienated.
The International Monetary Fund and the European Union are stepping in with substantial funding, but they risk throwing good money after bad if they don’t insist on reform. Tymoshenko on this score was an enormous disappointment during her time as prime minister. She is unlikely to win the election. Chocolate King Poroshenko is believed to be the front runner, with some possibility of meeting the 50% threshold required to be elected in the first round.
Putin can live with Poroshenko, who would hopefully attract enough Western support to enable Ukraine to pay its substantial debts to Russia. Moscow will press for constitutional reforms that allow Donestsk and Luhansk to establish themselves as an autonomous region, akin to the all-but-independent Republika Srpska in Bosnia. That would be going too far for the EU and US, but ample decentralization on a non-ethnic, geographical basis is certainly part of the solution in Ukraine. The West will prescribe national dialogue, constitutional reform and parliamentary elections, staples of today’s efforts to re-establish legitimate authority in failed and failing states. That is not an easy road, but if Sunday’s election embarks Ukraine on that path it will be doing far better than if Putin diverts it to more instability and conflict.
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Undaunted
America’s admirably frank ambassador to Libya Deb Jones answered a lot of questions at the Stimson Center this afternoon about Libya, where an American citizen militia leader, Khalifa Hiftar, has been whacking extreme Islamist militias he holds responsible for political violence in Benghazi and Tripoli. This comes on top of more than a year of struggle in the country’s parliament between Islamists and secularists, a semi-abortive election of a constitution-drafting committee, expiration of the parliament’s mandate, resignation of one prime minister and failure to confirm a new one…. The US military calls this a goat rope.
Deb though was undaunted. She refused to criticize Hiftar for his attack on extremists, among whom the United States counts many of its enemies in Libya. The Syrian war and chaos in Egypt are sources of trouble-makers in Libya (as presumably it is for them). She noted (but did not endorse) that Hiftar wants the parliament to step aside and the constitution drafting committee to take over. She hopes he will contain his political ambitions and satisfy himself with taking out the bad apples.
Beyond that she was reluctant to say what precisely Washington would like to see happen. Training of the General Purpose Force by the US, Italy and Turkey is continuing, but its relationship to Libyan governing institutions, which are still rudimentary, is not clear. The Libyans will have to decide what they want.
They have their share of issues to resolve, which Deb characterized along these lines:
- what to do about a “political isolation” law that prohibits former Libyan officials from the Gaddafi era from playing a political role, thus excluding a lot of competent people;
- how to deprive the militias of their political power (“neutralize” them, not in the physical sense);
- how to sort out the confusion of executive and legislative authority in the current constitutional declaration;
- what to do about decentralization of governing authority;
- how Libya’s ample oil and gas resources and revenue will be shared.
The Libyans are going to need help getting these things done, but their absorptive capacity is limited. As Deb put it, there were more people in the room at Stimson (fewer than 100) than there are Libyan officials able and willing to interact to good effect with foreigners. It would be easy to overwhelm them, to no good effect.
The US diplomatic effort she suggested is like a dentist’s drill: a big, complicated piece of (interagency) machinery culminating in a pointy end that has to be wielded with skill to have a good effect. Mixing metaphors: it would be easy to give Libya too much love. There are also pretty severe limitations on what the embassy can do. Its personnel do not visit Benghazi or Derna. Security is tight. Deb gets out, but the embassy is “lean.”
National political dialogue is what Libya needs. Several countries, including the US, have appointed special envoys to help with that process. The dialogue process launched under former Prime Minister Ali Zeidan is continuing. Some people believe it is too closely associated with him to have much good effect. But some process of that sort is necessary to resolve the two big issues that drove the Arab uprisings, not only in Libya: legitimacy and dignity. Restoring both and overcoming the legacy of humiliation by illegitimate regimes will be no quick or easy task.
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Staff ride!
What interesting days I’ve just spent with the SAIS strategic studies students on their staff ride to study the Shenandoah campaign of 1862!
These were among Stonewall Jackson’s best weeks, when he repeatedly defeated numerically superior Union forces in a valley that appeared to lead directly to Washington DC. Jackson’s concentration of forces in space beat the Union effort to concentrate its forces in time. Achieved against inept Union generals, Jackson’s success drew thousands of soldiers away from the Union effort to lay siege to Richmond, distracted President Lincoln and boosted Confederate morale. This side show had important, though far from decisive, effects.
I won’t try to run down the eleven sites we visited during the two days, with presentations at each one by participants giving the perspective of one or another contemporary observer on the events of that particular place. Roles included not only generals but also aides, spies and citizens as well as presidents Lincoln and Davis. All orchestrated by an extraordinary team of students with military precision.
Just to offer one illustration: I played the role of Richard Garnett, a West Point graduate and Conferederate general who displeased Jackson by withdrawing the “Stonewall” brigade (ironically from a stone wall) during the first major battle of the campaign on March 23, 1862 near Kernstown, Virginia. Garnett, whose men were out of ammunition and faced defeat at the hands of a superior Union force, thought he had saved the brigade from unnecessary slaughter that would have discouraged reenlistments and weakened the confederacy. Jackson didn’t agree and charged him with neglect of duty, but his court martial was never concluded. Garnett was killed leading his men into Pickett’s charge at Gettysburg.
The “strat” students are mainly focused on military operations, which are more interesting when recounted on the spot by people who have done a lot of research than they are in the often dry and difficult to follow narrative accounts in Civil War tomes. I came away with a finer appreciation for the mil ops side of things, but also with a lot of questions about its interaction with the civilian world.
Those questions start with the political objectives of the war and the effort to keep clarity and unity of purpose. There were problems on both sides in 1862. Lincoln initially made preserving the Union his political objective, but in fact he was contemplating a shift, which he made in January 1863 with the Emancipation Proclamation freeing the slaves in rebel states. During 1862, he still needed to try to keep on board for the Union cause both radical anti-slavery Republicans and Democrats like General McClellan, who wanted to compromise with the “peculiar instituiton.” He did this partly by appointing politicians as army officers. Their military ineptness and political competitiveness accounted for much of the poor performance of the Union in the 1862 valley campaign.
The Confederate war objective was recognition as an independent country. For this it was vital to prevent a seige of Richmond, which it is arguable Stonewall Jackson helped do. But Jackson’s squirreling up and down the valley killing lots of Union troops and many of his own did little to assist the Confederacy’s diplomacy. England, which had an economic interest in the South’s cotton (as well as good reason to fear competition from the industrializing North), was increasingly anti-slavery in popular sentiment. No one was likely to recognize the Confederacy until it could prove its mettle in a major engagement north of the Mason-Dixon line. Jackson’s antics were nowhere near sufficient to meet the political requirements.
The Union errors were compounded, ironically, by rapid communications, which gave Lincoln the sense he could manage the war from the White House. He had no in-theater commander during the 1862 valley campaign but tried to coordinate Union forces either on his own or through Secretary of War Stanton. The orders were often muddled, late, ignored or misinterpreted. Intelligence was also a problem. The population of the Shenandoah valley was mostly rebel sympathizing. Stonewall Jackson often had better, more timely intelligence (and maps) than the bumbling Union commanders.
Local citizens suffered a good deal from the fighting, but in this early stage of the war they were more collateral damage than target. Hospitals would sometimes serve the wounded of both sides. Prisoners were often released. Looting and pillaging were associated with particular units. Things would get a lot worse for civilians over the next three years.
We don’t usually think of the American Civil War as an identity conflict. But in a way it was. Many of the Confederate officers had not been in favor of secession, or even slavery, but their first loyalty was to Virginia or some other state, not the Union. Many of the Union officers cared little for abolition, but were loyal to the United States. Forced to choose, they chose.
This identity dimension of the conflict raises serious questions about the war and its aftermath. Would it have been possible to negotiate an earlier end to the war? What would that have meant for slavery? Even with the complete defeat of the Confederacy in 1865, the South managed after Reconstruction to institute segregation and economic practices that subjugated and impoverished former slaves. Our current commitment to equality really dates from 100 years after the Civil War and is still not fully effective. We disagree on how it should be implemented, from voting rights to college admissions. Are we still haunted by identity issues? Are the fights over getting to Washington DC, now conducted at polling places rather than in the Shenandoah valley, still more about identity than about the issues we debate?
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