November 08, 2008

The Russian-Japanese territorial dispute: four islands divided by two?

12:31 | 07/ 11/ 2008



MOSCOW. (RIA Novosti foreign news commentator Ivan Zakharchenko) - The protracted Russian-Japanese dispute on the national affiliation of the South Kurile archipelago proves that mathematical equations cannot always be used for solving political problems.

On November 5, Russian Foreign Minister Sergei Lavrov negotiated with his Japanese counterpart Hirofumi Nakasone in Tokyo. The talks merely highlighted both countries' desire to try and solve this territorial issue. Russia and Japan will not be able to sign a peace treaty to formally end World War II, unless they solve this territorial dispute.

Lavrov and Nakasone made optimistic statements at their concluding news conference in Tokyo that was preceded by Lavrov's visit to Hokkaido Island bordering on the South Kurile archipelago in connection with the 150th anniversary of opening the first Russian consulate in Hakodate and the establishment of a Russian center there.

"We will continue to negotiate the solution of the peace-treaty problem and will facilitate stronger bilateral ties, trust and mutual understanding between our peoples," Lavrov told a joint news conference on the results of his talks with Nakasone. He said this was the right way to solve the Russian-Japanese border-demarcation problem.

Nakasone advocated the kind of progress in the peace-treaty talks that would correspond to the level of Russian-Japanese relations in economic and other areas.

Moscow's stand on the issue is as follows. The South Kurile Islands were incorporated into the Soviet Union after World War II; and Russia, in turn, became the U.S.S.R.'s legal successor. Consequently, it is impossible to doubt Russian sovereignty over the islands, which was formalized in accordance with international law.

Nonetheless, Moscow is prepared to search for a mutually acceptable solution to the persisting border issue.

Russia and Japan have repeatedly referred to previous agreements including the 1956 joint declaration stating expressly that Japan would receive two islands, namely Shikotan and Habomai, if a bilateral peace treaty were signed.

This implies the archipelago's equal division. Moscow believes this would close the issue. However, Tokyo does not want to renounce its claims to the remaining two islands and has no intention of dividing four by two.

The Japanese side refers to the 1855 Shimoda commercial and border-demarcation treaty that drew the border between the islands of Etorofu and Uruppu, now part of Russia's Sakhalin Region. Everything north of this line was Russian and everything south Japanese, including the four disputed islands - Etorofu, Kunashiri, Shikotan and the Habomai Rocks.

Under the San Francisco Peace Treaty, signed in September 1951 by Japan and 48 nations, members of the anti-Hitler coalition, Tokyo ceded all rights and claims to the entire Kurile archipelago and south Sakhalin. However, the Soviet delegation did not sign the document, calling it a separate agreement between the U.S. and Japanese governments.

In 1955, Tokyo took advantage of Moscow's refusal to sign the treaty and demanded the entire Kurile archipelago and south Sakhalin back. Subsequent two-year Soviet-Japanese talks made it possible to merge both sides' positions. Tokyo then limited its claims to Habomai, Shikotan, Kunashiri and Etorofu.

Japan believes that the 1956 declaration provides an interim, rather than final, solution to the territorial problem and will sign a bilateral peace treaty only if Russia cedes all four islands.

Lavrov told Japanese journalists prior to his latest visit to Japan that any issues should be settled on the basis of compromise, and that Japan was reluctant to divide the four disputed islands by two. Tokyo also believes that a compromise is essential; but the implications are unclear.

Program of socio-economic development for the Kurile Islands

Anyone flying over the South Kuriles can see houses damaged by the 1994 earthquake. The ruins appear gloomy and desolate. The island chain is in dire need of socio-economic development for the sake of local residents and for Russia's prestige.

The local desolation prompted Tokyo to think that Moscow was ready to cede the islands because it was not making improvements. In effect, failure to resolve insular socio-economic problems would slow down the solution of the bilateral territorial problem.

In June 2007, Lavrov visited the South Kurile Islands enroute to South Korea, reacting with dismay to official Japanese criticism of his move.

The Russian Government has now started implementing the draft federal target program on the socio-economic development of the Kurile Islands (Sakhalin Region) for 2007-2015. The national Economic Development Ministry predicts that the successful implementation of the program will swell the local population by 50% to 28,000-30,000 by 2015, and that industrial output will soar by another 50%.

There are plans to accomplish the following four inter-linked objectives for development. First of all, the local transport infrastructure, primarily airports, seaports and roads, will be expanded. It is intended to expand the regional road network and freight turnover by 100% through 2015 and to fully reconstruct all airports and seaports.

Second, electricity costs must be reduced. At present, one kilowatt of electricity costs 300% more than on Sakhalin Island. There are plans to build geothermal power plants that will reduce the cost of resources by 30-50% and will also expand their production by 30%.

Could Russia and Japan jointly develop the South Kuriles?

In 2007, Lavrov proposed that Russia and Japan jointly develop the archipelago and said Russian legislation provided favorable conditions for this. He said Moscow was ready to discuss ways of amending such legislation if Tokyo considered it insufficiently reliable for doing business in the Kuriles.

Japan did not react to this proposal in any way because of its implied recognition of Russia's right to the four disputed islands, which the Japanese regard as "illegally occupied". A Japanese diplomat said Tokyo would never agree to implement economic projects under Russian legislation as long as the territorial dispute remained unresolved.

Only one objective has been accomplished so far. In the early 1990s, Moscow opened a visa-free corridor to Japanese citizens wishing to visit the South Kurile Islands, while Tokyo allows Sakhalin residents to come to Japan.

In this way, the Japanese who do not have to apply for visas get the feeling that they are visiting their home territories.

The opinions expressed in this article are the author's and do not necessarily represent those of RIA Novosti.

November 05, 2008

The Obama Campaign’s Intelligence Advisors

Source: IntelligenceOnline.com

Intelligence and security weren’t major themes in the U.S. presidential ballot. Even so, a number of experts dealt with the issues for the Democrat candidate.

Alongside the very official Senior Working Group on National Security of the Democrat campaign an informal group came together to handle intelligence questions on behalf of the Democrat candidate for the presidency, Barack Obama (voting in the election was still underway when Intelligence Online went to press). First identified by Mother Jones’ national security correspondent Laura Rozen (IOL 579), the group has been coordinated by a former National Security Council staffer, Rand Beers (see our graph below). The lack of any burning debate on intelligence matters during the campaign rather limited the work of the members, who didn’t meet that often. Some of them could be appointed to posts in a future Democrat administration, but they won’t form part of the transition team-in-waiting on intelligence for Obama if he is elected. Numerous other figures are candidates for high-level intelligence jobs in a Democrat administration, such as the former representative of the 36th district of California, Jane Harman, who was ousted in 2006 from the post of chair of the House Permanent Select Committee on Intelligence by the Democrat speaker in the House, Nancy Pelosi.

GLOBAL POWER BALANCE 2020: PERSPECTIVES



By Dr. Subhash Kapila

Introductory Observations

The global power balance has been in a churning state ever since the turn of the millennium. The disintegration of the Soviet Union enabled the United States global strategic predominance to be unrivalled and unquestioned. Concerned by United States unilateralism., Russia and China as the two nations most strategically affected set in motion two significant initiatives to offset the US predominance.

Russia under the dynamic leadership of President Putin set Russia on a course of strategic and military resurgence. This was facilitated by rising Russian oil revenues. China with significant economic resources at its disposal embarked on a strategic build-up of its strategic assets and military upgradation.

The United States decade-old strategic global predominance was now to be under challenge by Russia and China. This strategic challenge by these two nations became further accentuated as a result of United States getting inextricably tied down militarily in Afghanistan and Iraq.

The current global economic turbulence has prompted many strategic analysts to re-examine the short-term global balance of power perspectives with 2020 taken as a more identifiable time frame. Some would like to believe that the current economic melt-down could affect the global power balance and the inter-se strategic equations between USA, Russia and China. They would like to suggest that the United States as the strongest economy in the world could weather the storms, but Russia and China, and especially Russia’s resurgence and its strategic challenge to the United States could be diluted.

This Author would like to maintain that the economic meltdown today is globalised in its dimensions and would therefore affect USA, Russia and China without any exception. However, Russia and China’s strategic programs directed at altering the global power balance would not be diluted. This besides other reasons, is valid, because Russia and China are not involved in any costly strategic distractions like the United States in Iraq and Afghanistan, requiring a significant outlay of financial resources.

Otherwise too, it is conceded by many economists that economies of the world surface more strongly after economic depressions.

Strategically, the historical evidence cannot be ignored that the Second World War took place within a decade of the Great Depression in which the United States was the most vitally affected.

Therefore, in strategic analysis such economic depressions may act as “speed breakers” but definitely do not bring global strategic power rivalries to a “dead end”.

With the above as an introductory background, this Paper attempts to analyse “Global Power Balance 2020: Perspectives” under the following heads:

Global Power Balance 2020 Will be Bi-polar in Nature
Multi-polarity is a Political and Strategic Myth
United States Would Have Strategic Edge Over Russia in a Bi-polar World
A New Cold War is Inevitable


Global Power Balance 2020 Will be Bi-polar in Nature

Assertions of this Author in this direction stand examined in fair detail in earlier SAAG Papers and particularly those dealing with Russia’s resurgence. This Author firmly believes that the global power balance in 2020 would be bi-polar in nature with the United States and Russia as the two poles.

Russia is being dismissively discussed in US and Western think-tanks and Russia’s resurgence is de-emphasised and devaluated. This dismissive attitude is not born out of realistic strategic analysis but wishful thinking that Russia does not emerge as a strategic challenge to United States global predominance.

The moot question that needs to be considered is that who amongst Russia and China is more strategically potent to challenge United States global predominance?

Even on current analysis the following strategic realities suggest that Russia is the foremost candidate to challenge USA and not China (1) Russia’s existing strategic nuclear weapons arsenal outnumbers the United States whereas China’s nuclear arsenal at about 400 warheads is a remote comparison (2) Russia’s existing power projection capabilities extend far beyond its immediate neighbourhood, in all dimensions – land, sea and air. China’s power projection is limited to her periphery and limited to ground forces dimensions only (3) Russia is an "energy self-independent" state and this is an essential pre-requisite of national power. Japan and Germany lost the Second World War because they were not “energy self-reliant” (4) Russia has existing strategic partnerships with many countries across the globe. China has no “natural allies” to boost her strategic power (5) Russia’s resurgence has been welcomed in many regions and more importantly in the Middle East. China is not viewed as a credible strategic challenger to the United States.

More importantly Russia has been a practitioner of global power politics in the bi-polar environment of the Cold War and successfully provided countervailing power to the United States for 45 years. Further, it needs to be noted that Russia was not defeated by the United States in the Cold War; it was Russia that defeated itself.

Russia’s current strategic and political resurgence is precisely aimed in this direction once again, namely, to reclaim her former superpower status. It has won recognition in Europe, Middle East, Central Asia and South East Asia too.

Reading between the lines one gets a sneaking feeling that the United States may prefer China as a manageable strategic rival rather than Russia. But the strategic realities indicate that the United States would in 2020 have to accept a bi-polar world with Russia as the second pole.

Multi-polarity is a Political and Strategic Myth

Multi-polarity as a desirable state in the global power balance was forcefully enunciated by China to begin with in the immediate period following the demise of the Soviet Union.

To begin with, in the early 1990s, China advocated a multi-polar world incorporating China, India, Iran and Syria with Pakistan added. Later inducements were to include France and Germany. This enunciation never took off though being repeated periodically.

So the initial Chinese model of multi-polarity comprised Asian nations with no strong strategic linkages with USA as the unipolar power. China then as the only nuclear weapons state in this grouping may have been led to believe that it would emerge as the natural leader of its proposed multi-polar grouping.

Russia today also talks of multi-polarity but one suspects that it is more for political reasons in favor of China than any strategic conviction. Russia would strategically prefer a bi-polar world at the global level and without frowning on multi-polarity at the regional level.

China, Japan and India even with the full development of their strategic strengths cannot hope to equal the strategic potential of being super-powers in the classical sense of definition of the term. They can sit on the global powers high table as associate global players, but not as “super powers”.

China, Japan and India therefore are incapable of emerging as multiple poles to bring about a multi-polar world. Only the United States and Russia qualify to be superpowers.

Available indicators suggest that the United States and Russia would be the two super-powers in 2020 and no scope exists for any of the other global players intruding into that league.

United States Would Have Strategic Edge Over Russia in a Bi-polar World

Russia today is on a fast-track course to regain her erstwhile super-power status that existed till 1991. Russia’s modernization of her strategic nuclear weapons and strategic nuclear missiles has been underway for some time. Global force projection capabilities is another primacy focus of Russia.

Russia has put her ‘Monroe Doctrine’ (discussed in an earlier paper of this Author) into effect with her military intervention in Georgia. It has put the global powers on notice that it intends making a strategic presence in the Atlantic and Pacific Oceans and the Mediterranean Sea by deploying her naval resources in these regions. It has recommenced her global strategic surveillance flights across the globe with her strategic bombers.

Russia has made significant strategic forays in the Middle East especially in countries which were known to be strong military allies of the United States. Today it has both a political and strategic foothold in the Middle East.

Russia’s strategic equations with the global rising powers are in good shape. Russia’s strategic nexus with China has not frayed as yet and her strategic partnership with India is in a vibrant mode.

Russia is using her “energy diplomacy” and “energy strategy” to achieve political and strategic influence amongst the rising power like China, Japan and India. Russia has a similar influence with “Old Europe”.

So on all counts, Russia is well on the way to re-establish itself as the second superpower and the second pole in the global balance of power.

In 2020, the United States and Russia would be the two superpowers presiding over the global power balance in a bi-polar world. However, in comparative terms the United States on present indicators in the run-up to 2020 would enjoy a strategic edge over Russia.

The United States will continue to have at its command awesome political, strategic economic and military strengths at its disposal. Russia would be hard-pressed to narrow down the differentials in these strengths in the 2020 time-frame.

A New Cold War is Inevitable

With the United States intent on devaluing Russia’s re-emergence as a superpower and Russia’s resurgence aimed at regaining that status, a Cold War is already underway.

In the run-up to 2020, one should expect that this competitive strategic rivalry between USA and Russia will acquire accentuated contours in strategic regions of the world.

One is not forecasting that a global war or clash of titans would ensue, but one certainly foresees that Cold War pattern of strategic jostling for political and military influence would ensue.

In such an ensuing Cold War environment China, Japan and India as the rising global powers would constantly be challenged to re-calibrate their policies. China stands identified as being in the Russian camp strategically and Japan in the American camp. It is India that is well-placed to become the “swing factor” strategically, provided the Indian political leadership can adroitly play the game of management of the two superpowers.

Concluding Observations

In conclusion, the only point that one would like to reiterate is that in the global power tussle in the run-up to 2020, the United States would be hard pressed to maintain its global strategic domination. It has to emerge successfully from Iraq and Afghanistan and to maintain its strategic alliance linkages that it crafted in the heyday of the earlier Cold War.

Russia would have a strategic edge over USA in the sense that in the run-up to 2020 it would have greater space for strategic maneuver and to establish new strategic linkages all over the world. Strategically it would also have single-minded focus to narrow its strategic differentials with the United States.

(The author is an International Relations and Strategic Affairs analyst. He is the Consultant, Strategic Affairs with South Asia Analysis Group. Email:drsubhashkapila@yahoo.com)

Is Assassination of Obama Britain's Next Move?

This article appears in the November 7, 2008 issue of Executive Intelligence Review.

Oct. 30—The highly probable threat that Barack Obama, especially if he wins the election on Nov. 4, could be assassinated, is currently a matter of the utmost concern among serious political circles in both political parties, Lyndon LaRouche noted today. It is therefore urgent, he added, that there be built a bipartisan commitment to deal with this threat potential. This is not a Democratic or Republican issue, but a national one.

Two immediate measures have to be taken: first, try to prevent such an assassination from taking place; and second, be prepared, if it does, to prevent the kind of riotous disintegration and pulverization of the nation which the authors of such an assassination would be aiming to create.

As LaRouche warned earlier this year, the British enemies of the United States have a history of assassinating American political figures, including Presidents, and they are the only credible force who could and would engineer such an action. True, Obama has recently garnered the apparently enthusiastic endorsements of leading British establishment publications, including the Financial Times and the viciously anti-U.S. Economist magazine. But, it would be highly unwise to forget the age-old tradition of betrayal with a kiss.

In the midst of the ongoing, unprecedented financial and economic breakdown crisis, there is nothing the Anglo-Dutch financial establishment wants more desperately than to destroy the constitutional, sovereign United States. Thus, the British first deployed to wipe out the candidacy of Hillary Clinton, through their asset George Soros, his creation Barack Obama, and the controlled media. At the same time, they have pulled all the strings required to block, so far, the only effective emergency economic measures that could put the U.S. back into the Franklin Roosevelt tradition, those measures proposed by Lyndon LaRouche.

Yet, as the crisis deepens, the British financiers themselves are ever more desperately afraid of an FDR reflex. Thus, the recent surfacing of their patsy Felix Rohatyn, an admitted hater of Roosevelt and LaRouche, in major European press, allegedly promoting a New Bretton Woods, in opposition to the momentum being created around LaRouche's international proposals for a new monetary system.

The looming danger, however, is that the British, having succeeded in getting "their man" into the U.S. Presidency, will decide that their objectives will best be accomplished by assassinating him. In the face of that threat, sane Republicans and Democrats have to come together as a national force, to defend the country's integrity, and adopt the policies that will save it. LaRouche has committed himself personally to accomplishing this crucial task, in the context of exercising his unique role in providing the only sound policies for stopping the global breakdown crisis.

Conceptualizing the Sunni-Shi'i Encounter in the Modern Period

15 October 2008

This study examines the issues of religious authority and legitimacy in Islam. The author compares and contrasts traditions of jurisprudence and juridical authority in Sunni and Shia Islam. The author considers the major related points of discussion among Islamic religious scholars, especially on the issue of interpretation. The study also considers the Islamic Revolution in Iran, its impact on Islamic ideology and the revitalization of the study of Islam.
© 2008 International Relations and Security Network, Center for Security Studies (CSS), Swiss Federal Institute of Technology (ETH Zurich)
Download:
English (PDF · 13 pages · 1.0 MB)
Author: Neguin Yavari
Series: ISN Case Studies
Publisher: International Relations and Security Network (ISN), Zurich, Switzerland

OBAMA:DANGERS OF INDO-PAK RE-HYPHENATION

B.RAMAN


The Presidential campaign is over. The transition drill has begun. Senator Barrack Obama will take over as the President only on January 20 next, but his immense work as the President-elect would have already begun from the moment he left the dais after making the victory speech to his followers and supporters.


2.The Americans call it the period of transition. It is during this period that the President-elect chooses his team of Cabinet members and senior officials, decides on his policy priorities and works out his goals during the first 100 days of his administration and thereafter. Those, who would constitute the hard core of his transition team, would start co-ordinating with the outgoing Bush administration.


3. Senior officials of the US Secret Service, which protects the President and the Vice-President, would have already called on him and set in place the arrangements for his security. Other officials of the Bush Administration would be calling on him and his close advisers to keep them briefed on the actions of the outgoing administration.


4. He will be the President of the US only from January 20, but he will be already entitled from November 5 to a regular briefing by the Director of the Central Intelligence Agency (CIA) and the Director, National Intelligence (DNI) on important developments in the world. The outgoing administration would not take any major decision or initiative or action without keeping him in the picture.


5. Speculation as to who could be his Cabinet members and other senior advisers had already started days before the elections in anticipation of a certain victory by him. In an article on October 26,2008, the “Independent” of the UK put its bet on the following as his possible Cabinet members:


Secretary of State: John Kerry (Senator from Massachusetts), Richard Holbrooke (former UN Ambassador), Bill Richardson (Governor of New Mexico, former UN Ambassador)


Secretary of Defence: Robert Gates (current Pentagon chief), Retd. General Wesley Clark (2004 Democratic Presidential candidate), Chuck Hagel (outgoing Republican Senator from Nebraska)


Treasury Secretary: Laura Tyson (former economic adviser to President Clinton), Timothy Geithner (President, New York Fed), Paul Volcker (former Federal Reserve Chairman)


National Security Adviser: Susan Rice (Obama's top foreign policy adviser), Retd. General Anthony Zinni (former C-in-C, Central Command), Samantha Power (former Obama foreign policy adviser)


Others: Colin Powell, possible foreign policy special envoy/troubleshooter; Hillary Clinton, health care czarina.


6.There could be surprises because he will have a political debt to pay to those who supported him and they may want some of their nominees to be accommodated.


7.India will have no special reasons to be concerned over the possibility of any of the persons mentioned by “Independent” joining the Cabinet, except possibly Holbrooke, whose taking-over as the Secretary of State could lead to a re-hyphenation of Indo-Pakistan relations, bringing back the hyphen, which had been removed by President George Bush and his Secretary of State Condolleeza Rice.


8.Another person of concern to India would be Madeleine Albright, who was Secretary of State under Bill Clinton. Though “Independent” did not mention her, she was reportedly a member of the inner circle which was advising Obama on foreign policy matters during the campaign.


9.India will also put a question mark on Colin Powell, who was particularly not well disposed towards India during the first term of Bush when Powell was the Secretary of State. It was only after he was replaced by Rice as the Secretary of State that Indo-US relations really started moving forward with many initiatives to acknowledge the importance of India as a major power on par with China. Concerns over Pakistani sensitivities ceased to be an inhibiting factor in US policy-making with regard to India. Zinni is an unknown quantity in India. He has many friends in Pakistan’s Armed Forces.


10.It is still 10 weeks before Obama takes over as the President. One does not know how the economies of the US and the rest of the world would move during this period. Till now, the US and the rest of the world have been seeing only the impact of the melt-down on the moneyed class---- banks, stock markets, business companies, people who have the money to dabble in the stock markets and to keep deposits in banks. The world is yet to see the impact on the common man, who is worried only about his day-to-day living and not about stock markets, mutual funds and banks. The impact on the common man would become evident by the time Obama takes over as the President.


11. The common people in the US and the rest of the world will be watching how he deals with the impact on their lives. Understandably, apart from rhetorical statements, Obama was sparse in his policy pronouncements on the economic crisis. His evasion was understandable because he had to take care that any unwise remarks by him did not add to the prevailing nervousness in the market. The economy would occupy a major part of his attention during his first few weeks in office.


12. His pronouncements on India and Pakistan, which were music to the ears of people in India in the initial months of the campaign, became jarring during the closing days of the campaign. In the initial months of his campaign, he praised India and supported the initiatives taken by the Bush administration in relation to India. He was very critical of Pakistan’s inadequate co-operation with the US in the war against Al Qaeda. He also criticized the Bush Administration for giving to Pakistan weapons, which it could use only against India and not against Al Qaeda, under the pretext of strengthening its counter-terrorism capability. He hardly spoke of Indo-Pakistan issues.


13.But as the campaign reached its culmination, he started speaking of the Kashmir issue in a language, which reminded one of the language of the past from the officials of the Clinton Administration. Obama’s entourage and Gen. David H.Petraeus, former Commander of the Multi-National Force in Iraq, who took over as the Commander of the US Central Command on October 31 and is presently on a visit to Pakistan and Afghanistan, have one thing in common---- they listen a lot to the assessments and recommendations of Ahmed Rashid, the Pakistani analyst, who has written extensively on the Taliban and the war against terrorism. In fact, Petraeus has reportedly nominated Ahmed Rashid and Shuja Nawaz, the author of the recently published book on the Pakistan Army called “Crossed Swords”, as members of a brains trust to advise him on a new strategy towards Afghanistan and Pakistan.


14.Ahmed Rashid has been arguing for some months now that the Pakistan Army cannot be expected to co-operate wholeheartedly with the US Armed Forces in the war against Al Qaeda and the Taliban unless there is a forward movement in settling the Kashmir issue and India is pressured to cut down its presence in Afghanistan. There were not many takers for his arguments in the Bush Administration. But they have already started influencing the thinking of many who are close to Obama.


15.Will he exercise pressure on India on the Kashmir issue and its role in Afghanistan after he takes over or will he let his pre-election remarks remain without follow up action? This is a question which should worry Indian policy-makers.


16.Obama’s policy towards China is also likely to be different from that of the Bush Administration. He will continue to strengthen the US’ strategic relations with India, the foundations for which were laid by Bush and Rice, but the sensitivities of China and Pakistan could once again become inhibiting factors in determining the pace and extent of the relationship. He is unlikely to subscribe to the wisdom of building up India as a counter to China. That was the unstated wisdom behind the policies of the Bush Administration towards India.


17.Obama was supportive of the Indo-US Civilian nuclear co-operation Agreement. Many of the non-governmental experts, who were critical of the agreement, have a greater audience for their views in the Democratic Party than in the Republican Party. They would try to see that the Hyde Act is observed in letter and spirit in the implementation of the agreement. If their views prevail, one could see a slow-down in Indo-US co-operation in nuclear matters.


18.Under Bush, Indo-US relations developed like never before because he was a great admirer of India and was convinced of the need to encourage the emergence of India as a major Asian power on par with China. Obama has so far not given any indication of a similar admiration and conviction.


19.Barring John F.Kennedy, other Democratic Presidents were not very positive towards India. They always thought of India tactically and not strategically. Many major initiatives towards India came from Republican Presidents, who held office after Richard Nixon, whose dislike of India---- and particularly Indira Gandhi--- was well-known. There was a new page in Indo-US relations under Bush. This was facilitated by the decline in the influence of some Washington-based think tanks and their academics on policy-making. With the return of a Democrat to the White House, these old academic warriors are already coming out of their eight-year-long hibernation and will try to influence the new President in his thinking and policies. Their views are no different from those of the like of Ahmed Rashid.


20.We should not hesitate to make it clear to the new administration that while we are as keen as before to strengthen our strategic relations with the US, this cannot be at the expense of our vital national interests in matters like Kashmir and Afghanistan. (5-11-08)


(The writer is Additional Secretary (retd), Cabinet Secretariat, Govt. of India, New Delhi, and, presently, Director, Institute For Topical Studies, Chennai. He is also associated with the Chennai Centre For China Studies. E-mail: seventyone2@gmail.com )

CHINESE ECONOMY MONITOR---NOTE No.3

B.RAMAN
( What will be the impact of the global financial and economic melt-down on the Chinese economy? This question should be of interest to the other countries of the South and the South-East Asian region. If the Chinese economy is badly affected, they too are likely to feel the negative consequences of the down-turn in the Chinese economy. Keeping this in view, we have been bringing out a periodic "Chinese Economy Monitor" based on open information. This is the third in the series---B. Raman)

CONFIDENCE IN THE ECONOMY, THE NEED OF THE HOUR, SAYS WEN

Summing up the discussions at the Asia-Europe Meeting Summit held in Beijing, Prime Minister Wen Jiabao told the media on October 24, 2008, as follows: "We will discuss with world leaders on measures to cope with the financial crisis in a pragmatic and cooperative manner.I think what we should do to cope with the crisis can be summarized as confidence, cooperation and responsibility.We are very glad to see that many countries have taken measures that have initially proved effective. But this is not enough given the current situation, and more needs to be done.The stability of financial market is key to stabilizing the whole economy. The first important message that the two-day summit has conveyed is firm confidence, and I think confidence is the source of power to overcome difficulties."

---- Source Xinhua


2.Liu He, Deputy Director of the Office of the Central Leading Group on Finance and Economy Work, told the "China Daily" on October 24,2008, as follows: "The worsening global economic situation makes it difficult for China to predict its growth for next year.How fast China's economy will grow next year is uncertain. To a large extent, the rate will be decided by the external situation.This year, GDP is estimated to grow at 9.4 or 9.5 per cent, down from 10.6 per cent last year.However, the impact of the current financial turbulence on our economy is much less than in the rest of the world. China can use the downturn as an opportunity to restructure its economy, which has relied heavily on government investment, foreign trade and low-cost technology over the past years. When the economy is experiencing fast growth, companies are unwilling to upgrade their technologies.The slowdown gives such firms the opportunity to enhance their competitive edge through better technologies."

----Source "China Daily"


ELECTRONIC EXPORTS CONTINUE TO GROW, BUT LESS RAPIDLY

3.China's trade in electronic and information products increased during the first eight months of 2008, but the growth rate of both exports and imports decreased.Electronic and information products constitute the largest single item in terms of value in China's export basket.About two-thirds of the exports come from wholly foreign -owned manufacturing units in China----mainly from Japan, South Korea, Hong Kong and Taiwan--- 16 per cent from joint ventures and the remaining 18 per cent from wholly Chinese-owned companies. These products include mobile phones, fax machines, TV sets, computers, digital cameras and the like.During the first eight months of this year, the total value of the exports of these items was about US $ 338.62 billion , an increase of 22.53 per cent as compared to the corresponding period of 2007. The growth rate during the same period in 2007 as compared to 2006 was 24.53 per cent. Thus, the export growth rate decreased by two per centage points, but it is still high. China imported $ 246.81 billion worth of electronic and information products from January to August, up 15.45 per cent as compared to the corresponding period of 2007. However, the growth rate was five per cent lower than last year. The imports include whole products imported for sale to the Chinese consumers as well as parts imported for assembly and re-export.Trade surplus of electronic and information products increased by 46.7 per cent to US $91.81 billion , accounting for 60.4 percent of China's total trade surplus. China exported $4.12 billion worth of software in the first five months of 2008, up 45 per cent over the corresponding period of 2007.Software exports surged from $720 million in 2001 to $10.24 billion in 2007. (My comments: The total value of India's software exports is around US $ 40 billion per annum.)

-------Source: Xinhua

FOREIGN EXCHANGE RESERVES CONTINUE TO BULGE; YUAN ASSETS PREFERRED TO DOLLAR & EURO

4.The People's Bank of China, which is China's central bank, reported on October 13,2008, that the country's foreign exchange reserves surged to 1.9056 trillion U.S. dollars through September. The figure was up by 32.92 per cent as compared to the first nine months of 2007. Foreign exchange reserves grew by 47.7 per cent during the first nine months of 2007 as compared to the corresponding period of 2006. Thus, the growth rate has dropped by 14.8 per cent.China overtook Japan to become the world's largest holder of forex reserves in February 2006. Till June,2008, the foreign exchange reserves were growing by 35.73 per cent. This came down to 32.92 per cent by September-end,2008. During the first three quarters of 2008, China's trade surplus decreased by 2.6 per cent year-on-year to 180.9 billion U.S. dollars. There was a flow of 377.3 billion U.S. dollars to the forex reserves in the first three quarters. In September, the reserve build-up expanded by 21.4 billion U.S. dollars, compared with rises of 36 billion U.S. dollars and 39 billion U.S. dollars in July and August, respectively. The monthly increase was averaged at 41.9 billion U.S. dollars in the first nine months, still higher than an average 38.5 billion U.S. dollars recorded last year. The average monthly increase for the third quarter alone was 32 billion U.S. dollars, and higher than market expectations. The country's trade surplus had been expanding by more than 27 billion U.S. dollars each month in the third quarter, which also overran market expectations. Tan Yaling, a China International Economic Relations Society economist, said the growth in forex reserves also indicated a growing interest in yuan assets as a haven for investment amid the global turmoil. "Under the current financial crisis that originated in the United States and with the euro also softening, China's yuan-denominated assets appear relatively safer and created an influx of foreign investment, which also contributed to the growth in the third quarter." Zhang Bin, a Chinese Academy of Social Sciences researcher, said the U.S. financial crisis had a limited impact on the country's huge forex reserves, as the forex supervisor had diversified the holdings so as to avert some risks. Through September, the M2 -- a broad measure of money supply, which covers cash in circulation plus all deposits -- grew by 15.29 per cent from a year ago to 45.29 trillion yuan (6.7 trillion U.S. dollars). The M2 growth was 0.71 percentage points lower than the previous month. The figure had fallen for the fourth consecutive month as the government's tightening measures started to take hold. Tightening policies, including several interest rate hikes, since the end of last year, adopted to fight soaring inflation and overheating risks, however, had recently been replaced by two rate cuts in less than a month. Such moves were taken to boost the domestic economy amid worries over the deepening global financial crisis. Through September, the narrow measure of money supply, M1, was up 9.43 percent to 15.57 trillion yuan, again lower than the 11.48 percent rise in August.The central bank report also claimed that the country's financial system remained stable. Outstanding local currency loans expanded 14.48 percent to 29.65 trillion yuan. The growth was 0.19 percentage points higher than the previous month. Outstanding loans in foreign currencies, however, rose 30.86 percent to 269.2 billion U.S. dollars, compared with a gain of 37.84 percent in August. The report said local-currency deposits were up 18.79 percent to 45.49 trillion yuan, while foreign-currency deposits grew 9.37 percent to 174.2 billion U.S. dollars. Local-currency transactions on the inter-bank market reached 9.49 trillion yuan last month. Average daily transactions were 451.9 billion yuan, up 17 percent year on year.

---- Source Xinhua
ASSESSMENT

5.My comments: While the toy industry is in a state of serious crisis due to a steep fall in demands from the US, the electronic and information products industries, which contribute nearly 60 per cent of China's trade surplus, continue to do well. There has been a decline in orders as compared to 2007, but not very high. However, if this decline expands in the coming months, that could add to the difficulties faced. The foreign exchange reserves continue to bulge despite a slight drop in trade surplus.The fall in the flow of reserves due to a slight drop in trade surplus has been compensated by a flow of money from foreign investors, who prefer yuan-denominated assets to US dollar anf Euro denominated ones.One does not know how much of China's foreign exchange reserves has been invested in the US Treasury bonds. If these bonds lose in value as a result of the melt-down in the US, that could aggravate the difficulties. The Chinese leaders and officials are projecting a picture of confidence that they will be able to keep their economy stable. Whether their confidence is justified or not would be evident only by January. Presently, the electronic and information products and textiles industries are doing well on the basis of the export orders received before the melt-down started in the West. What inpact the melt-down has on post-September orders would be evident only by January. The present Chinese worry is over the spectre of unemployment as the export orders come down. How healthy is their banking system? An answer to this question is not yet available.

(The writer is Additional Secretary(retired), Cabinet Secretariat, Govt. of India, New Delhi, and, presently, Director, Institute For Topical Studies, Chennai. He is also associated with the Chennai Centre For China Studies. E-mail:seventyone2@gmail.com )

A Quiet Deal With Pakistan

By David Ignatius
Tuesday, November 4, 2008; Washington Post

Pakistan is publicly complaining about U.S. airstrikes. But the country's new chief of intelligence, Lt. Gen. Ahmed Shuja Pasha, visited Washington last week for talks with America's top military and spy chiefs, and everyone seemed to come away smiling.
They could pat themselves on the back, for starters, for the assassination of Khalid Habib, al-Qaeda's deputy chief of operations. According to Pakistani officials, he was killed on Oct. 16 by a Predator strike in the Pakistani tribal area of South Waziristan. Habib, reckoned by some to be the No. 4 leader in al-Qaeda, was involved in recruiting operatives for future terrorist attacks against the United States.
The hit on Habib attests to the growing cooperation -- in secret -- between the United States and Pakistan in the high-stakes war along Pakistan's border with Afghanistan, which U.S. intelligence officials regard as the crucial front in the war on terrorism.

The CIA had been gunning for Habib for several years, including a January 2006 Predator attack that produced false reports that he had been killed. The agency has needed better human intelligence on the ground, and improved liaison with Pakistan's Inter-Services Intelligence agency, or ISI, may help.
Behind the stepped-up Predator missions in recent weeks is a secret understanding between the United States and Pakistan about the use of these drones. Given Pakistani sensitivities about American meddling, this accord has been shielded in the deniable world of intelligence activities. Officially, the Pakistanis oppose any violation of their airspace, and the Pakistani defense minister issued a public protest yesterday about the Predator raids. But that's not the whole story.
The secret accord was set after the September visit to Washington by Pakistan's new president, Asif Ali Zardari. It provided new mechanics for coordination of Predator attacks and a jointly approved list of high-value targets. Behind the agreement was a recognition by the Zardari government, and by Pakistan's new military chief, Gen. Ashfaq Kiyani, that the imminent threat to Pakistan's security comes from Islamic terrorists rather than from arch-rival India.
The approved target list includes, in addition to al-Qaeda operatives, some Afghan warlords who were once sheltered by the ISI, including Gulbuddin Hekmatyar, the Haqqani family network and Taliban leader Mohammad Omar. Also on the target list is Baitullah Mehsud, often described as the leader of the Pakistani Taliban.
The ground war in the tribal areas is the Pakistanis' responsibility, and they report some recent success. The most aggressive campaign has been in the district of Bajaur, just east of the Afghan province of Kunar. In August, the Pakistani military began attacking al-Qaeda and Taliban fighters there. When troops were stymied by a network of tunnels, the Pakistanis called in their own air attacks.
Tribal leaders in Bajaur, angered by the fighting, began turning against the militants, according to Pakistani officials. The Pakistanis claim similar success in mobilizing local tribes in the border districts of Dir and Kurram. Next, they say, they plan to take the ground war into North and South Waziristan, where al-Qaeda has its most important refuges.
A confidential Pakistani military report on the recent fighting in Bajaur and neighboring provinces counted 1,140 insurgents killed or wounded and 197 captured. Civilian casualties totaled 848 killed or wounded, plus 400,000 refugees.
The United States is quietly helping by sending at least 25 Special Forces soldiers to train Pakistan's Frontier Corps. But the Americans, recognizing public sensitivity to foreign interference, are keeping a low profile.
What's different on the Pakistani side isn't just the secret cooperation with America. There was lots of that under the previous president, Pervez Musharraf. What's new is that Zardari and Kiyani are working openly to build popular support for their operations against the Muslim militants. An example was testimony on the terrorism threat last month to a secret session of the Pakistani parliament by Pasha, the new ISI chief, which was widely reported.
And Kiyani seems determined to stop Musharraf's practice of using the ISI to maintain contact with the Afghan warlords. He has cleaned house by appointing new heads for the service's four main directorates, in addition to the new chief.
U.S. military and intelligence chiefs applaud Pakistan's cooperation. But they're still nervous. The U.S.-Pakistan relationship hangs by a slender thread; Pakistani pride sometimes prevents officials from taking full advantage of the relationship, and America's embrace has sometimes been politically fatal for pro-American leaders, such as Musharraf.
And it's an inherently unstable arrangement: Pakistan's leaders publicly decry U.S. attacks, and the United States, with a wink and a nudge to its ally, keeps on attacking.

November 03, 2008

What Is the Real New Bretton Woods?

This reprinted article appears in the October 31, 2008 issue of Executive Intelligence Review.

by Lyndon H. LaRouche, Jr.

[PDF version of this article]

This article, dated Sept. 24, 1998, originally appeared in a New Federalist pamphlet.

At a March 18, 1998 conference in Washington, D.C., I presented a formal statement of my proposal for the adoption of a "New Bretton Woods" policy. This was presented as an action to be initiated by the President of the U.S.A. It represented then, as now, the only feasible alternative to the continuation of a then already ongoing process of disintegration of the world's financial and monetary system.

Later, during late August of this year, following fresh, thunderously ominous escalations of Japan's and Russia's ongoing financial and monetary crises, a limited, but significant number of prominent figures and institutions began to echo my "New Bretton Woods" proposal; the proposals from these bankers and others were more limited in scope than my own, but were otherwise competent. Among sane bankers, there was general recognition of the urgency of four crucial facts which I had stressed in my proposals:

That, despite the dead-headed ideologues who refuse stubbornly to face the overwhelming evidence: the era of "globalization" has come to a screaming collision with long-looming reality. Either we reverse the process of "globalization," and return immediately to international economic relations premised upon the sovereign nation-state as the highest authority, or there will be no recovery from the present process of disintegration of the international financial and monetary system.
That the model of economic policy, of nations, and among nations, must be a return to nothing different than the spirit and methods of protectionism employed throughout post-war reconstruction, measures modelled closely on the protectionist actions prevailing through 1958.

That strictly enforced capital and exchange controls must be instituted by the authority of sovereign nation-states, with no substitution for the sovereign authority of the nation-state by old or new international agencies of any kind.
That there must be a strictly protectionist policy of large-scale, but highly selective expansion of credit for production and trade in tangible products of agriculture, infrastructure, and manufacturing, a protectionist policy which boosts production and trade in these areas, but sharply constricts credit-flows in other areas. Financial speculation, above all, must be put out of business, and the unpayable masses of so-called "derivatives" obligations simply cancelled as if they had never existed.

More recently, as might be expected, a number of fakers jumped in, notably Britain's fading Prime Minister, Tony "Cheshire Cat" Blair, claiming themselves to be the authors of proposals for a "New Bretton Woods." What the latter have presented, like Blair, is pure deception and dangerous incompetence. Meanwhile, all competent authorities agree that the required specifications for a "New Bretton Woods" are precisely those which I presented officially, from Washington, this past March 18.

Unfortunately, some persons, who ought to have known better, have been taken in by charlatans such as Blair. Such duped persons have said of my "New Bretton Woods" proposal: "Yes, you were the first to propose it, but, now, many others have taken over the proposal, squeezing you out of the picture." If such persons had thought before speaking, they would not have been duped by such foolish, and potentially dangerous, false propaganda.

What Tony Blair, for example, could never seem to understand, is, that "God is not prepared to negotiate the laws of the universe with the kind of financier-oligarchical interest which Blair represents."

The essential fact of the present situation, is, that during the period from the 1962 Cuba Missile Crisis through the 1972 establishment of the foolish "floating exchange-rate monetary system," and also the "new world order" which Britain's Thatcher, France's Mitterrand, and the U.S.'s Bush put into effect during 1989-1992, the hegemonic governments and other monetary authorities of this planet installed a series of fundamental changes in direction of policy-shaping. All of these changes have combined to produce the global financial, monetary, and economic catastrophe now in its final phases.

To cure that sickness, you must remove the cause of that disease. Either, all of the fundamental changes in economic and related policy of the past thirty-odd years must be reversed, and that abruptly, and now, or else the planet as a whole will be plunged into a "new dark age," echoing Europe's mid-Fourteenth Century "new dark age," but, this time, on a global scale. Such are "God's laws." Against such laws, sane governments will not quibble. That disposition for quibbling between right and wrong, for demanding that God behave "more democratically," is the reason Tony Blair's political career is on the way to the garbage-dump; similar penalties await those who delude themselves that Tony Blair is proposing "a New Bretton Woods" reform.

What the Self-Doomed Lunatics Suggest

From among those fools who demand that God respond "democratically" to the expressed reluctances and other sensibilities of Blair and other politically suicidal types, there are certain objections raised, which are so typical that it is useful to identify and address them here.

Objection Number One: It was John Maynard Keynes who designed the Bretton Woods system; therefore, "New Bretton Woods must mean that we are going back to Keynes."

Objection Number One is essentially false. The policy which President Franklin Roosevelt revived for the U.S. recovery from the Great Depression of the 1930s, and the 1939-1945 mobilization for war, was modelled upon two precedents: the 1861-1876 mobilization launched by President Abraham Lincoln, and the U.S. revival of the methods of the 1861-1876 mobilization for conduct of World War I. These were what are known to all competent economists as the "American methods" of U.S. Treasury Secretary Alexander Hamilton and the world's leading Nineteenth-Century economist Henry C. Carey. These are methods directly opposed to the versions of "free market" doctrines of both Adam Smith and Keynes.

Admittedly, after the untimely death of Franklin Roosevelt, the Wall Street gang joined with London in a policy of systematic undermining of every policy which Roosevelt had launched prior to his death. Nonetheless, the dominant features of the Bretton Woods system, through 1958, were predominantly based upon the anti-"free trade," "American methods" associated with the U.S. economic mobilizations of 1861-1876, 1914-1917, and 1934-1945.

Objection Number Two: "Obviously, no one would suggest actually going back to the Bretton Woods policies of the 1940s and 1950s."
Why not? Every deviation from those policies of the 1940s and 1950s has resulted in nothing but a long, accelerating process of decline of the post-Kennedy U.S.A., a decline which has produced no net effect to date, but the present global catastrophe. Any sensible person would consider nothing different than returning to policies which were proven successful, to replace subsequent changes which have proven cumulatively disastrous.

Objection Number Three: "The world has changed since 1958. We have to start from perpetuating those changes. We can not turn back the clock of history."

When, in 1819, the reactionary Holy Alliance of Clement Prince Metternich imposed the fascist-like Carlsbad Decrees on Germany, the Prussian court philosopher who defended these reactionary measures was a fellow known as G.W.F. Hegel. Hegel typifies those immoral creatures who blame society's changes for the worse upon some occult authority which they identify by such terms as "the World-Spirit," the "Spirit of the Times," or "Popular Opinion." The fact of the matter is, that those things which a Tony Blair, for example, says we must not change, are precisely those post-1962 changes which are the cause for the downward spiral of the world's economy up to the present verge of total disintegration. It was those who made these changes, who, in fact, "turned back the clock of history"; it is our responsibility to re-set the clock.

Objection Number Four: "Obviously, no changes can be made without the consent of all of the nations."

Why not? That sort of nonsense was what apologists for Chamberlain's and Daladier's Munich Pact with Adolf Hitler called "Peace in Our Time." When the issue is survival, the principle is, that those who can and will, must do; let the rest learn their lesson, and catch up later. I have pointed out, repeatedly: if the Presidents of the U.S.A. and China can reach agreements with a crucial minority of other nations, on a new financial, monetary, and economic relationship among themselves, those nations must act, whether other nations object to this, or not. Some nations, like some individuals, seem to learn only from the hard knocks of experience. No patriotic American, for example, has ever waited for assent from the British monarchy or Commonwealth.

The fact is, that if the U.S.A., together with China, India, Russia, and also Germany and [France], can reach a suitable relationship among themselves, the majority of the world will support such a partnership. A partnership, including key nations of the developing sector, a partnership representing the majority of the population of this planet, is the needed, winning combination. Those who refuse or are simply reluctant, will perhaps have to learn the hard way: perhaps that is real democracy in action.

Objection Number Five: "The New Bretton Woods must be a new supranational authority which decides whether or not individual nations will have the right to use temporary measures such as capital and exchange controls."

No workable agreement will subvert the sovereign rights of any nation-state to sovereign measures such as protectionism in general, or capital and exchange controls in particular. Sovereign partners will, rather, agree to coordinate their sovereign decisions, and will set their sovereign policies according to a principle of informed mutual advantage. They will never alienate their sovereign rights and powers to a supranational authority....

Russia is back and Latin America is its new play ground

03.11.2008

For almost two decades, even long after its turn around in 1999, the Russian elites continued to believe in the West, much longer than they ever should have. To that end, Russia refrained from encroaching on the American play ground, Latin America. With the Monroe Doctrine, the US has seen to Latin America, especially to Central America, as it's personal play ground, where national governments are over thrown as would be and policies are shoved down everyone's throats as desired. The area was kept hands off by Russia, even while the West continued, driven primarily by the Anglo-Americans, to surround and encapsulate Russia from all sides. Outside of some weapons sales to Venezuela or some nice words to Cuba, Russia was gone from Latin America and with no plans on returning.

That all changed, of course, as so many other things did, when the Anglo-American Trotskytes, the Neocons, attempted to restart the Cold War and to renew their sagging fortunes. They poked the bear, not directly, but by using their proxy Saakashvili. What they found was not a hibernating bear but the renewed Russian Imperial eagle of the Holy Third Rome. That point was driven home all the more by the endless stream of relentless lies that flowed forth. With the lies came the malice that had previously been ever so lightly disguised, except that it was disguised no longer. Now even the Russian liberals were shocked and dismayed by what they found that the West, particularly the Anglo-Americans really were, once the fairy dust settled from their eyes.

Now no sphere is off limits and Russia has roared back into Latin America. The response? The response both from the Anglo-Americans and the Latin Americans has driven one thing home clearly not only to Moscow but the world: the Anglo-American Empire is teetering. It is not over, it is not dead but it will cede territory as it starts its long retreat. In other words, except for some words and confusion there has been no response from the Trotskyte Neocons.

From the Latin Americans, the response is loud and clear.
1. Cuba is in talks about setting up air defense, new Russian bases and a space center.

2. Mexico is Foreign Minister Patricia Espinosa for trade talks and political cooperation.

3. Nicaragua has come out in support of Russia's recognition of Abkhazia and S.Ossetia by also recognizing them, as it too seeks to get closer to Moscow.

4. Columbia has sent Defense Minister Juan Manuel Santos to discuss combined military efforts against terrorism, drugs and possible equipment deals. Columbia is looking at fighters and helicopters and radar systems, just like the ones Venezuela bought.

5. Venezuela, not only purchasing equipment, but it has now hosted Russian bombers and navel assets on maneuvers and is in talks about permanent facilities.

6. Bolivia is following Venezuela's lead and in return Gazprom will invest in Bolivia's infrastructure, along with Total.

7. Brazil has invited Gazprom to invest in their pipelines.

More is on the way, of course as more nations in Latin America sense weakness and defect.

The point to Washington has always been the same and has always been ignored: do not provoke fights you are not prepared for. Be it the War of 1812, be it Iraq, be it a new Cold War it is hell bent on igniting. Washington as always knows the thrill of adventure, never once contemplating how much the ticket for the ride will cost.

Stanislav Mishin

The article has been reprinted at the permission of Stanislav Mishin and can be found on his blog Mat Rodina

Source: Pravda.Ru URL: http://english.pravda.ru/russia/economics/106655-russia_latin_america-0

Baghdad to Paris: The undying axis

3 Nov 2008


France tries to re-brand itself in Iraq: From an image of 'the dictator's closest ally,' Paris seeks to move toward one of 'the people's best friend,' Andrew D Bishop writes for ISN Security Watch.

By Andrew D Bishop for ISN Security Watch


"We are opening our door to France, and are inviting it to take advantage of the opportunity we are offering it. It would be as much your interest as ours."

This quote, recounted by journalist Chris Kutschera in his Black Book of Saddam Hussein, is one that could well be attributed to Iraqi Prime Minister Nouri al-Maliki who just a few months ago invited French Foreign Minister Bernard Kouchner to provide his country with "high quality military equipment."

Yet, the open-ended offer is one that was in fact extended by Saddam to then French prime minister Jacques Chaban-Delmas in June 1972, over three decades ago.

Nothing better than this quid pro quo can convey the permanence of mutual interests in the close relations Paris and Baghdad have enjoyed ever since the early days of the Baath regime. France was in Iraq from the start, and now that its dictatorial partner has gone, it seems poised to take another run at living up to the war-torn country's expectations.

Helicopters without borders

The story was broken just a few weeks ago by French daily Le Figaro's veteran reporter Georges Malbrunot: Paris could soon be selling up to 50 helicopters to Baghdad in order to boost the nation's security apparatus.

Though the details of this possible transaction remain undisclosed, the Associated Press has reported that the original deal would be for "30 surveillance and rescue helicopters, with an option to buy 20 more."

Very little is known about the specifics of the product being discussed, but Stratfor - a US forecasting group - tells ISN Security Watch that the Iraqis could be looking at SA-341 or SA-342 Gazelle light multi-role choppers, which could be used to secure Iraq's borders and oil fields.

Because production of this model ceased in the mid-1990s, the aircraft originally designed by the Marseilles-based and world-leading helicopter maker Eurocopter would have to be sold second-hand by the French armed forces to their Iraqi counterpart.

This procedure, Stratfor explains, could be warranted by the fact that "the Gazelle was used by the Iraqi military during Saddam's tenure, so there would be a certain familiarity, possibly some surviving parts and specialized tools and potential attraction because of that."

One reason for not choosing American-made helicopters is that "there are some cases where US companies do not offer the right product" and Iraq has "long experience with non-US equipment," as recently illustrated by Baghdad's multiple purchases of Russian Mi-17 Hip transport helicopters.

Overall, as one Iraqi official told the AP in Paris, "Iraq needs to renew its military capacity, and needs to have several arms suppliers, not just one state.

"Baghdad is seeking to increase its bargaining power against the United States in the political and military realms, and the bilateral contracts currently under discussion fit into that perspective," a leading observer of Iraq's reconstruction added for ISN Security Watch.

Grief all around

Clearly, Iraq has plenty to gain from broadening the scope of its foreign relations, which have been marked by Washington's crushing involvement in the country's sluggish reconstruction since 2003.

"The Iraqi arena is open to British companies and British friendship," Iraqi Prime Minister al-Maliki announced in the Times of London just a couple weeks ago.

But the overtures do not stop there.

Alexandra de Hoop Scheffer, a lecturer-researcher at the Paris Institute of Political Studies (Sciences Po) as well as the author of Hamlet in Iraq (CNRS, 2007), reminds ISN Security Watch that already in July 2004, Baghdad had invited France and Germany to begin training the country's security forces - an offer taken up at the time by Berlin only.

More surprising, however, is Paris' desire to reverse course and follow al-Maliki's invitation not to "allow ourselves to be controlled by what happened in the past," which referred to France's friendship with Saddam throughout his reign.
Indeed, the renewal of French arms sales to Iraq could prove a costly move politically and financially.

For one, the refurbishment of the Paris-to-Baghdad axis is likely to upset the Quai d'Orsay's regional strategy of engagement. "The contracts currently being discussed naturally worry Iraq's neighbors - Kuwait, Iran, Saudi Arabia - who do not wish to see a too powerful Iraq re-emerge on the military level," Scheffer said.

Jean-Paul Hébert, who heads the Paris-based Interdisciplinary Research Center on Strategic and Peace Studies, adds that France's Middle East policy appears somewhat desultory, focusing on Saudi Arabia and the United Arab Emirates one day and on Iraq the next.

More importantly, he warns, Paris runs the risk of angering the US by meddling in what seems to have become its new backyard. Unless, he adds, the current deal is part of a trade-off for President Nicolas Sarkozy's willingness to support Washington's mini-surge in Afghanistan, which may or may not be the case.

Skeptical about the ongoing discussions, Hébert points to a final anomaly in the French move: With Iraq's finances still in dire condition and the country's heavy legacy of bad credit, it remains difficult to understand why Sarkozy would want to re-engage with Baghdad at this point.

It may be that there is much more in it for France than selling 50 converted helicopters.

A game of political comeback

As the European Council on Foreign Relation's senior fellow Daniel Korski told ISN Security Watch, "It's not sure the weapons sale in and of itself is so significant, but it has to be seen in the context of a larger French review of its Middle Eastern policy."

Though it was among the first countries to restore diplomatic ties with Baghdad - as early as April 2003 - and despite its invitation of Iraqi president Jalal Talabani in November 2006, France remained surprisingly absent from the US' war turf for many years after Saddam Hussein's demise.

That was until the election of President Nicolas Sarkozy in May 2007.

Since that time, Scheffer says, "the policy advocated by [former French president] Jacques Chirac of staying clear from Washington's position has given way to a 'rapprochement' with the United States on the Iraqi issue concerning the importance of finding a common solution to the difficulties of returning to peace and reconstructing the country."

"One of the strongest illustrations of this new policy, Scheffer adds, was French Foreign Minister Bernard Kouchner's visit to Baghdad in August 2007. This was the first visit of a French minister of foreign affairs to Iraq since 1988 and marked a true break with the policy of 'non-intervention' sponsored by Jacques Chirac."

Recently asked by Syrian political analyst Sami Moubayed why "France is still absent from Iraq five years after the overthrow of Saddam Hussein," Kouchner, speaking to Forward magazine, an English monthly in Syria, replied that quite to the contrary, "In less than nine months, I visited Iraq twice. Each time, I made a point of spending several nights there and during my second trip I visited different parts of the country - the Shiite south, Baghdad, Kurdistan - in order to emphasize France's interest in the country."

For anyone who can read between the lines, what this means is that Paris' "rapprochement" with the US on the Iraqi front may in fact be yet another way to undermine Washington's influence in the region.

For Moubayed, who interviewed Kouchner during his September visit to Syria, the current helicopter deal is "part of a greater French strategy followed by Sarkozy to re-establish France in places that Paris had lost under Chirac, which applies to countries like Iraq and Syria."

To some extent, this scheme may well pay off, for as Stratfor analysts put it: "An increasingly international influence and presence may be welcome by some [of Iraq's] neighbors wherever it comes from just simply as an erosion of US influence in Baghdad."

Milk the cow… if you can

All in all, France is trying to re-brand itself in the minds of Iraq's leaders. From an image of "the dictator's closest ally," it is seeking to move toward one of "the people's best friend."

This may well explain its attempt "to position itself, like the United Nations Assistance Mission to Iraq (UNAMI), as a mediator, a dialogue facilitator between Iraq's political forces," as Scheffer puts it.

By promoting the Iraqi people's right to regain full sovereignty and control of its land, Paris is also making sure Baghdad recovers the right to choose its trading partners, which fits perfectly with Kouchner's efforts to boost French companies' interest in the Middle Eastern resource-hub.

The Quai d'Orsay's argument that the helicopter deal currently being discussed is one that aims to contribute to the Iraqisation of the country's enduring conflict fits this mold. As Stratfor told ISN Security Watch, "Whether Iraqisation of the country is going to happen or not is irrelevant to the French, they just want to sell weapons and if Iraqisation means more weapons sales, then more power to them."

Quite evidently, Sarkozy and his team are dreaming of a French-fueled rebirth of Iraq's economic and military potential. Yet if there is anything Paris has learned from the fallout of its clash with Washington over the run-up to the war of 2003, it is that it can no longer count without the US in its Middle Eastern policy.

Hence, though Moubayed may be right to point out that "the French are returning to Baghdad," one should probably believe Iraqi spokesman Jawad Bashara when he says that his country's overture to Paris is not about "replacing the Americans, or rejecting them.





Andrew D Bishop is a graduate student of European politics at the London School of Economics. He is also a freelance journalist and a blogger at WhatYouMustRead.

The Future of US Foreign Policy

by Mara Caputo

If history teaches us anything, it may be that grandiose promises are made to be broken. Perhaps nowhere has this lesson been taught more frequently than the classroom of US presidential politics, where abandoned campaign pledges have been strewn across the political landscape of twentieth century American elections.

In 1912, candidate Woodrow Wilson campaigned to keep the US out of World War I, while President Wilson committed troops in 1917. Franklin Roosevelt made the same promise in 1940 not to send American boys "into any foreign wars," only to enter World War II a year later. Lyndon Johnson also quickly reversed himself by sending American ground troops to Vietnam in 1965, and Richard Nixon's 1968 allusions to a nonexistent “secret plan” to get American troops out of the war further eroded the public's trust.

In 1992, candidate Bill Clinton promised to take a strong position on Bosnian atrocities and against China's "butchers of Beijing," only to be criticized for foot-dragging on these human rights issues. And the current President George W Bush's 2000 pledge to project a “humble” foreign policy and withhold US troops from “nation-building” missions provide the most recent examples of broken election promises.

Even the current presidential candidates have acknowledged the oft hollow ring of the campaign pledge. When launching his presidential bid in February 2007, Senator Barack Obama said as much.

"All of us running for president will travel around the country offering 10-point plans and making grand speeches; all of us will trumpet those qualities we believe make us uniquely qualified to lead the country. But too many times, after the election is over, and the confetti is swept away, all those promises fade from memory, and the lobbyists and the special interests move in, and people turn away, disappointed as before, left to struggle on their own."

This US election, voters have been presented with two candidates standing on foreign policy platforms that promise to renew America's sagging reputation and troubled role on the world stage in the wake of a two-term Bush presidency. The reform-minded political identities constructed by each campaign - particularly the “change” mantra of Senator Obama - have created impossibly high expectations for the next president.

And the overwhelming international popularity of Senator Obama only magnifies those expectations; his compelling personal biography that bridges cultures and countries coupled with his eloquent pronouncements for a rejuvenated American diplomacy and multilateralist foreign policy have elevated his appeal to a near messianic-like cult-of-personality among admirers.

But as presidential history has demonstrated, the gap between campaign promises and performance in office has often remained wide. And sometimes the bigger the promise, the wider the gulf between vision and reality.

But why the chasm? Naturally, unforeseen challenges requiring difficult decisions often necessitate policy reversals. Wilson's pacifist promises gave way to a war declaration only following German submarine attacks against US shipping. Roosevelt reneged on his promise not to enter World War II immediately after the surprise Japanese bombing of Pearl Harbor. Similarly, Bush changed his mind about nation-building following 9/11 - with some prodding from a highly influential Vice-President Dick Cheney.

Also, the campaign trail is free of the institutional complexities that dog an elected president. Candidates are liberated to make any pronouncements they wish, but once elected, they are bound by bureaucratic realities. Fulfilling campaign promises, for example, would be impossible for a president who faced overwhelming resistance from the Congress. And the deeply ingrained institutional conservatism of the foreign policy establishment presents another challenge, further winnowing the potential to implement policy promises.

Despite such institutional constraints and the long list of memorable campaign reversals, studies show - perhaps to the surprise of cynics - that the majority of candidate pledges are ultimately implemented. Rutgers University Professor Emeritus Gerald Pomper concluded that between 1944 and 1976, presidents converted about 70 percent of their party's platform into policy. American University Professor Emeritus Jeff Fishel echoed these findings in his book Presidents and Promises, demonstrating that Presidents John F Kennedy through Ronald Reagan fulfilled their campaign promises about 66 percent of the time.

In the end, then, it appears campaign pledges do offer some valuable guidance about the priorities and intended path of a future president, even if they do not account for the unpredictable, yet inevitable, detour of circumstance.

Election observers would be wise to be neither overly cynical nor euphoric about the next president's prospects for implementing his campaign promises. Instead, the pundits should turn an eye to history to construct a more nuanced and realistic outlook for the next four years.

As famed historian Gordon S Wood noted: “By showing that the best-laid plans of people usually go awry, the study of history tends to dampen youthful enthusiasm and to restrain the can-do, conquer-the-future spirit that many people have. Historical knowledge takes people off a roller coaster of illusions and disillusions; it levels off emotions and gives people a perspective on what is possible and, more often, what is not possible.”

Mara Caputo is an ISN Editor.