May 26, 2012




Gen.V.K.Singh, who will be retiring as the Chief of the Army Staff (COAS) on  May 31,2012, will go down in history as a highly competent General, who did not deserve to be the head of the proud Indian Army despite his excellent record in the battle-field against our adversaries.

2. He proved during the last months of his tenure that to command the Indian Army, one's professional qualities and battle-field achievements alone are not sufficient. One requires leadership qualities like firmness in man management combined with fairness to subordinates and colleagues, discretion, an ability to win the respect of the colleagues and establish an atmosphere of trust with the political leadership.

3. India has been a successful democracy. Its success has been due to not only its voters and its electoral system, but also to the responsible behaviour of the heads of its institutional pillars. Our Army has always been one of the important institutional pillars of our nation and democracy.

4. In our 65 years of history as an independent nation, we have had instances of honest differences of opinion between the COAS and the political leadership and between the COAS and his senior colleagues. They were handled in a way   as they ought to be handled in a sensitive institution like the Army--- with a sense of balance, with mutual respect despite the differences, with discretion and away from the glare of publicity. We, the people, became aware of such instances long after the COAS concerned had gone into superannuation.

5. It went to the credit of those chiefs that they saw to it that their differences did not damage the trust of the political leadership and the public in our proud Army. An Army marches on its pride and its image in the eyes of the public. If the pride and the image are damaged, even the best of weapons and training will be of little avail in maintaining the battle-hardiness of the Army.

6. In his last months as the chief, Gen.V.K.Singh played to the gallery and exhibited in public a viciousness towards some of his senior colleagues, the like of which will not do credit to any institution, particularly the Army. We have had instances of viciousness in leadership in other institutions of the Government of India dealing with national security,but such viciousness was never exhibited in public and did not make the institutions the laughing stock of the public.

7. Firmness and fairness in man management is the most important quality the heads of the Armed Forces should have. The esprit de corps, which keeps them fighting fit all the time and under all circumstances, depends on those qualities.

8. Gen.Singh  showed himself to be lacking in those qualities. The Indian Army, that has never been accused or suspected of factionalism, became a breeding ground of factionalism. The relationship of mutual trust and mutual respect between the political and military leadership which has been the bedrock of our successful democracy stands eroded.

9. Over the years, there has been a demand from strategic analysts in the country for giving our Armed Forces a greater role in decision and policy making in national security matters on par with practices in Western democracies. The Government of Dr.Manmohan Singh had initiated a major exercise to see how this can be done.

10.Any decision to give the Armed Forces a greater role in decision and policy-making in defence and national security related matters has to be that of the political leadership. It would depend on its confidence in the sense of balance, discretion and responsibility of the military leadership.

11. That confidence is likely to have been eroded by the way Gen.Singh conducted himself in his sunset months as the COAS. A major casualty of his behaviour could be the exercise to associate the military leadership with policy and decision making in an increasing measure.

12. The last months of Gen.Singh as the COAS were a bad dream for the country. It is hoped that his successor  will repair  the damage quickly and make the Army once again one of the important institutional pillars of our democracy and re-establish its esprit de corps. ( 27-5-12)

( The writer is Additional Secretary (retd), Cabinet Secretariat, Govt. of India, New Delhi, and, presently, Director, Institute For Topical Studies, Chennai, and Associate of the Chennai Centre For China Studies. E-mail: Twitter : @SORBONNE75 )

May 25, 2012




Reports from Myanmar indicate that during his visit to Myanmar next week, Prime Minister Manmohan Singh will be meeting Aung San SuuKyi at Yangon (Rangoon) on May 29,2012. She has reportedly re-scheduled a visit to Bangkok, her first visit abroad since her release from house-arrest, in order to be available at Yangon for meeting our Prime Minister.

2. This gesture of hers is indicative of the importance attached by her to Myanmar's relations with India despite her past unhappiness over India's close relations with the military junta that ruled the country till the end of 2010.

3. The Prime Minister's visit comes at a time when there are reports of spreading public unrest over severe power-cuts in many towns. The unrest in the form of street demonstrations first started in Mandalay and from there has since  spread to Pegu, Monywa and Yangon.The protesters have not taken the permission of the Police for holding demonstrations which is an offence, but the Government has chosen to ignore the violation of the law in order not to provoke them further. The protesters have been using their restricted access to Facebook and Twitter to call upon people in other towns to demonstrate.

4.It is not yet clear whether the street demonstrations are spontaneous or have been instigated by anti-democracy hawks in the Army to weaken the position of the TheinSeinGovernment which has been steadily moving towards greater political reforms and opening-out to the world.

5.However, in an attempt to project the demonstrations as spontaneous, the protesters have accused  the former military government  of selling off natural gas reserves to China and pocketing the profits, while  75 per cent of the local people have no access to electricity. Electricity consumption in  Myanmar averages 104 kilowatts an hour per person—one of the lowest in the world.

6.Speaking during the opening of a local office of her National League For Democracy (NLD) on May 22,2012, SuuKyi said that the  power shortages were the  direct result of government mismanagement and called upon the Government  to give priority to increasing the power supply and to creating jobs for the unemployed youth.

7.The Government announced  on May 23  that it was purchasing  six generators from U.S.-based Caterpillar Inc., which will be air-freighted within a week, and two 25-megawatt gas-turbines to be bought from General Electric Co. The Government has blamed the Kachin insurgency for severely damaging electricity production and distribution.

8.During his visit, our Prime Minister should offer to help the Myanmar Government on an emergency basis to increase the power supply and also gift a plane-load of generators of the required capacity needed by the Government. The Prime Minister could also offer a special credit to enable the Government to repair the damages to the power infrastructure. ( 26-5-12)

( The writer is Additional Secretary (retd), Cabinet Secretariat, Govt. of India, New Delhi, and, presently, Director, Institute For Topical Studies, Chennai, and Associate of the Chennai Centre For China Studies. E-mail: Twitter : @SORBONNE75 )


May 24, 2012




The Government of India has taken the first important step towards the modernisation of our national security apparatus by commissioning a study of the apparatus as it stands today and as it ought to be to counter likely future threats from other States and non-State actors.

2.The exhaustive study, lasting nearly 10 months, was undertaken by a special Task Force headed by ShriNaresh Chandra, who has had the distinction of having served as the Defence Secretary, the Home Secretary and the Cabinet Secretary as well as the Governor of Rajasthan and our Ambassador to the US during the critical period following our nuclear tests of 1998. He is, therefore, no stranger to the internal and external aspects of national security and to the linkages between national security and national strength. The report of the Task Force was submitted to the Prime Minister on May 23,2012.

3. The exercise has now moved into the second and even more important step of implementation. Any exercise of this nature, however comprehensive, will be fruitful only if the acceptable recommendations are quickly identified and prioritised and action taken for their timely implementation.

4. The exercise entrusted by the Government to the Task Force was not a post-mortem necessitated by any national security failure or set-back. It was a forward-looking exercise meant to visualise the likely  national security tasks of the future keeping in view the evolving threats to national security as well as our requirements as a major power in the years to come.

5. The exercise undertaken by the Task Force had its tactical as well as strategic components. The tactical component related to identifying the gaps and deficiencies of today in national security management and recommending measures to remove them.

6. The strategic component had an element of vision about it. How is the security scenario likely to evolve in the foreseeable future? What kind of new threats and vulnerabilities are likely to arise for which we have to be prepared? How to create a modern national security apparatus befitting India's status as a major power and how to find the resources for it? These were some of the questions that have been sought to be addressed by the Task Force.

7. Such exercises are undertaken regularly in the US and other Western countries everytime a new Head of State or Government assumes office. This is the first time that such an exercise has been undertaken in our country since we became independent in 1947. It is to be hoped that this will become a regular feature and that such an exercise to ensure a steady modernisation of our national security apparatus will be undertaken at least once in 10 years.

8. National strength and national security go hand in hand. Without comprehensive national strength there cannot be comprehensive national security and vice versa. Resource priorities for the modernisation of the national security apparatus in a developing country like India cannot be the same as in Western developed countries.

9. In a country like ours the requirements of the people have to have the first priority. Even while not neglecting this, one has to find the resources for constantly upgrading our national security apparatus. How to do this? That is a difficult and complex question to which the answer has to be found by the political leadership on the basis of the various options identified by the professional experts---serving and retired.It is important to work towards a national political and intellectual consensus on the need for a time-bound modernisation of our national security apparatus and for finding the required material and human resources even while not overlooking the priorities for the common man.

10. While it is for the Government to decide on the drill to be followed for the implementation of the Task Force report, three aspects to be kept in view may be underlined:

·        Firstly, the need to take the public into confidence to the extent possible on the main features of this exercise so that it has broad public support.

·        Secondly, the need to ensure institutional and political consensus at every stage of the implementation.

·        Thirdly, the need for a standing mechanism to monitor the implementation process.

11. It would be neither possible nor advisable to make the entire report of the Task Force available in the public domain. Its assessment of the external security scenario is sensitive and could have a negative impact on our diplomacy if made available in the public domain. But its assessment of the internal security scenario and resource constraints could be made available in the public domain after suitable editing.

12. The implementation process cannot be satisfactory unless all Government departments and institutions that might be affected by the implementation positively or negatively co-operate in the implementation exercise. If they co-operate only in respect of those recommendations that are favourable them and oppose those that are not favourable, the implementation will be half-hearted. A political consensus at the central level and between the Centre and the States would smoothen the implementation process.

13. The monitoring of the implementation by the National Security Council Secretariat or by any other suitable mechanism would ensure that the recommendations do not fall in limbo. ( 25-5-12)

( The writer is Additional Secretary (retd), Cabinet Secretariat, Govt. of India, New Delhi, and, presently, Director, Institute For Topical Studies, Chennai, and Associate of the Chennai Centre For China Studies. E-mail: Twitter : @SORBONNE75  )

Terrorism and the Not-So-Exceptional Individual


May 24, 2012 | 0900 GMT


By Scott Stewart

In last week's Security Weekly, we used a thwarted underwear bomb plot, as well as the U.S. government's easing the rules of engagement for unmanned aerial vehicle strikes in Yemen, as an opportunity to examine the role of exceptional individuals in militant groups that conduct terrorist attacks. Al Qaeda in the Arabian Peninsula's (AQAP's) innovative bombmaker, Ibrahim al-Asiri, is one such individual.

Reported by AP on May 7, the news of the thwarted underwear plot overshadowed another event in Yemen that occurred May 6: a U.S. airstrike in Shabwa province that killed Fahd al-Quso, a Yemeni militant wanted for his involvement in the attack against the USS Cole in October 2000. Al-Quso appeared in a video released by AQAP's al-Malahim Media in May 2010, during which he threatened attacks against the continental United States, its embassy in Yemen and warships in the waters surrounding Yemen.

The media and the U.S. government frequently mention al-Quso's involvement in the USS Cole bombing, but they rarely discuss his precise duty the day of the attack. Al-Quso had been tasked to record the attack from ashore so that the video could be used later in al Qaeda propaganda. Unfortunately for the group, al-Quso was derelict in his duty; he slept through his alarm, and the attack went unrecorded.

Oversleeping a terrorist attack was not al-Quso's only operational gaffe. According to the 9/11 Commission Report, al-Quso had been dispatched in January 2001 to transport money to al Qaeda facilitator Walid bin Attash in Kuala Lumpur, Malaysia. The money reportedly funded the travel and initial living expenses of 9/11 operatives Nawaf al-Hazmi and Khaled al-Midhar. However, al-Quso failed to get a Malaysian visa. He was stuck in Bangkok, and bin Attash, al-Hazmi and al-Midhar had to meet him in Bangkok to retrieve the funds.

If al-Asiri gives cause to discuss the role of the exceptional individual in terrorism operations, al-Quso provides us the opportunity to discuss the not-so exceptional individual -- and how these maladroit actors nonetheless pose a threat.

Tradecraft Errors

The history of al Qaeda's war against the United States is replete with examples of jihadist operations that were foiled due to tradecraft failures. In September 1992, Ahmed Ajaj attempted to enter the United States with a poorly altered Swedish passport while carrying a suitcase full of bombmaking instructions and other training manuals and videos. Both lapses in judgment are characteristic of a novice. An alert customs inspector stopped Ajaj, who later was detained and charged with passport fraud.

Ajaj was traveling from Osama bin Laden's Khaldan training camp in Afghanistan with Abdel Basit, also known as Ramzi Yousef, the mastermind of the 1993 World Trade Center attack. An immigration inspector likewise stopped Basit, but he requested political asylum. Because he was not carrying a suitcase full of bombmaking manuals or using an altered passport, Basit later was released pending a hearing on his asylum claim. (Had he remained in custody, the 1993 World Trade Center bombing would not have been conducted.)

In another instance of tradecraft error, the would-be millennium bomber, Ahmed Ressam, fell victim to "burn syndrome" while attempting to enter the United States from Canada in December 1999. Ressam panicked when approached by a U.S. customs inspector, who was performing a routine check of the ferry on which he was traveling. The inspector was unaware that Ressam was an Islamist militant or that he was in operational mode. In fact, when Ressam lost his composure, she assumed he was smuggling drugs rather than explosives.

The 9/11 Commission Report also detailed a number of errors committed by the supposed al Qaeda elite prior to hijacking the four aircraft on 9/11. Mohammed Atta was cited for driving with an invalid license and failed to appear at the subsequent court hearing, causing a bench warrant to be issued for his arrest. Moreover, known al Qaeda associates al-Hamzi and al-Midhar entered the United States under their own names. (A flight instructor even characterized al-Hamzi and al-Midhar as "Dumb and Dumber," saying they were "clueless" as would-be pilots.) Any of these errors could have brought down the entire 9/11 operation.

More recently, we have seen cases where individuals such as Faisal Shahzad and Najibullah Zazi have shown the intent, but not the ability, to conduct attacks. While Shahzad was able to assemble a large vehicle-borne improvised explosive device without detection, the design of the device's firing chain was seriously flawed -- clearly the work of a novice. U.S. government surveillance of Zazi's activities determined that he was an inexperienced bombmaker and that he could not create the proper chemical mixture to manufacture effective triacetone triperoxide (TATP). This is common problem for novice bombmakers. We have seen several planned attacks, such as the London bomb attempt on July 21, 2005, fizzle out due to bad batches of TATP.

In another example, U.S. Army Pfc. Naser Jason Abdo was arrested and charged with planning an attack on Ft. Hood in July 2011. Abdo was brought to the attention of the authorities after purchasing smokeless powder to be used in an improvised explosive device. His furtive demeanor caused a store clerk to report him to the police.

As Stratfor has noted, there has been a shift in the jihadist threat. Once stemming from the al Qaeda core, the jihadist threat now emanates primarily from grassroots jihadists. While grassroots jihadists pose a more diffuse threat because they are more difficult than hierarchical groups for national intelligence and law enforcement agencies to detect, they also pose a less severe threat because they generally lack the terrorist tradecraft required to conduct a large-scale attack. Since they lack such tradecraft, they tend to seek assistance to conduct their plots. This assistance usually involves the acquisition of explosives or firearms, as seen in the February 2010 case involving Amine el Khalifi. In this case, an FBI informant posing as a jihadist leader provided the suspect with an inert suicide vest and a submachine gun before the suspect's arrest for plotting to attack the U.S. Capitol building.

The dynamic of would-be attackers reaching out for help has been seen repeatedly in the United States. In June 2011, two jihadists were arrested in Seattle and charged with plotting to attack a U.S. Military Entrance Processing Station in an industrial area south of downtown Seattle. The men attempted to obtain M16 rifles and hand grenades from an FBI informant. Notably, this trend also has been seen outside the jihadist world. On April 30, five self-identified anarchists were arrested in connection with a plot to destroy a bridge outside Cleveland, Ohio. They had purchased remotely detonated improvised explosive devices from an FBI informant.

The Cleveland group had previously discussed constructing improvised explosive mixtures using recipes they had found on the Internet. But the possibility of buying authentic C4 explosives was attractive to them because, according to the FBI criminal complaint filed in the case, the group believed the real explosives would be more powerful and destructive than homemade explosives.

Would-be attackers, such as Shahzad and the anarchists of the Cleveland group, typically do not have a realistic assessment of their capabilities and therefore tend to attempt attacks that are beyond their capabilities. In attempting a spectacular attack, they frequently achieve little or nothing. As we have previously noted, it is a rare individual who possesses the requisite combination of will, discipline, adaptability and technical skill to make the leap from theory to practice and become a successful militant in a lone-wolf or small-cell environment.

The Danger of 'Kramer Jihadists'

Through retrospective trial testimony or FBI arrest affidavits, the exploits of Abdo, el Khalifi or the Cleveland anarchists can appear almost comical. In fact, such cases often leave people wondering if ridiculous would-be attackers could be involved in terrorist activity to begin with. However, militant groups -- indeed, most organizations -- are composed of exceptional individuals and not-so-exceptional individuals. Just as the business world needs chief executive officers, engineers and assembly line workers, the militant world needs operational planners, bombmakers, foot soldiers and suicide bombers. Placed in the proper roles, these individuals can combine their efforts to produce effective results.

It is easy to dismiss novice militants as inept, but we should keep in mind that if some of these individuals found an actual terrorist facilitator rather than a federal informant, they probably would have killed many people in an attack. Richard Reid, often referred to as the "Kramer of al Qaeda" after the bumbling character from the television series Seinfeld, came very close to taking down a jumbo jet full of people over the Atlantic Ocean because he had been equipped and dispatched by those more capable than himself. Working under the leadership of exceptional individuals, even al-Hamzi and al-Midhar -- "Dumb and Dumber" -- helped hijack American Airlines Flight 77, which was crashed into the Pentagon on 9/11.

The 1993 World Trade Center bombing provides a valuable lesson on dealing with Kramer jihadists. Before the attack, a government informant infiltrated the core group of perpetrators. After the informant proved to be too difficult to handle, coverage of the group was dropped because its members were considered inept. In truth, many of them were; one suspect, Mohammed Salameh, tried to retrieve the deposit he put down on the rental truck used to transport the bomb. But this only highlights the importance of the exceptional individual -- in this case, Abdel Basit. He was sent to New York to lead what proved to be a successfully executed bomb plot.

History demonstrates clearly that even groups of bumbling aspiring attackers can be organized successfully if they are empowered by someone who provides them with means and oversight. Accordingly, authorities cannot afford to ignore bumblers, no matter how inept they may appear.

Read more: Terrorism and the Not-So-Exceptional Individual | Stratfor

May 23, 2012

Case against ‘non-interference’: New world order and clash of civilizations

by G. Parthasarathy


The Government of India has faced not even slightist criticism in Western capitals and even from its own "liberal intelligentsia" for not supporting Western attempts for effecting "regime change" in those countries labelled to be "rogue states," or said to be acquiring "weapons of mass destruction".

This Western propensity for "regime change" was justified ideologically, as the Soviet Union was falling apart and finally collapsed on December 25, 1991. In his thesis entitled "The End of History", American scholar Francis Fukuyama then proclaimed: "What we are witnessing is not just the end of the Cold War, but the end of history as such; that is the end of man's ideological evolution and the universalisation of Western liberal democracy as the final form of human government". Even as American aircraft commenced bombing Iraq in August 1990, President George Bush announced that he was making a move to "forge for ourselves and for future generations a New World Order".

While Fukuyama and Bush did not spell out what the fault-lines would be in the past-Cold War world, American academic Samuel Huntington was more explicit. In his thesis, "Clash of Civilisations and Remaking of the World Order," Huntington held the ideological conflicts of the Cold War would be replaced by civilizational conflicts "prevalent between Muslims and non-Muslims". Huntington held that the clash would be between Islamic resurgence and the demographic explosion of Islam on the one hand, and the values that western civilisation believed are universal and should be accepted by all civilisations.

Interestingly, Huntington drew pointed differences between what he called as "Western civilisations" comprising the US, Western and Central Europe and Australia on the one hand and the "Orthodox Christian World" comprising Russia, its Western and Caucasian neighbours, Serbia, Greece and Cyprus, on the other.

In Huntington's world-view, Russia, China and India are "swing civilisations" and could join either the Western or Islamic civilisations, depending on the circumstances. He noted that Russia faces Islamic separatism on its south, but cooperates with Islamic countries to counter external support for such aspirations. He added that India and China do likewise, though China is keen on undermining Western influence by close ties with major Islamic countries like Saudi Arabia and Iran. While what Huntington said about the likely view of countries like Russia, India and China, all of whom have significant Muslim minorities, makes sound geopolitical sense, one has to look at the results of what has transpired in the relations between what he calls the "Western civilisation" and the Islamic world in the years following the end of the Cold War.

Even as President George Bush spoke about a New World Order, his forces backed by his NATO allies and a coalition ranging from Australia to Syria, (now a target for "regime change"), invaded Iraq. The invasion ensured that the Iraqi invasion of Kuwait was reversed and an American military presence established in Saudi Arabia. It was this American deployment in Saudi Arabia that led to Osama bin Laden, a former CIA asset, to becoming an anti-Western jihadi, who was to mastermind the 9/11 attack. This attack triggered President George Bush's "Crusade" against Taliban ruled Afghanistan, then the epicentre for Bin Laden's "International Islamic Front for Jihad against Jews and Crusaders". Oddly enough, when the Taliban took over power in the nineties and promised to permit American oil companies to transport gas from Turkmenistan to Karachi, a US official described Taliban rule as a "factor for stability".

In the meantime, the American invasion of Iraq in 1990 led to the deaths of an estimated 35,000 Iraqi citizens. The subsequent sanctions, sanctified by the UN and peculiarly interpreted by the US, led to the deaths of and estimated half a million Iraqi children because of the absence of medicines and adequate nutrition. This led then Secretary of State Madeline Albright to comment: "This is a hard choice, but we think the price is worth it". When the second American invasion of Iraq occurred in 2003 an estimated 1,51,000 Iraqis met their deaths. Nine years after the second American invasion, Iraq has been engulfed by Shia-Sunni convulsions, superimposed on the historical Arab-Kurdish animosity.

Moreover, the American actions had an unintended consequence that Huntington did not envisage. We now have a Shia-Sunni divide across the Arab and indeed Muslim world. Iraq, which placed its Arab heritage over sectarian concerns during the rule of Saddam Hussein, distrusts Saudi Arabia and has moved closer to Iran.

The Arab Spring, which was the outcome of popular demonstrations in Tunisia and Egypt, has produced regime change in Egypt, Tunisia, Libya and Yemen. There is no doubt that Libya's Muammar Gadhaffi was a tyrant. But, like Iraq's Saddam Hussein, he was a strong opponent of religious fundamentalism and medieval practices. According to the International Crisis Group, Gadhafi's overthrow has led to national fragmentation, with Libya coming under the control of around 100 separate militias. Libya's new Western-installed ruler Mustafa Abdul Jalil has proclaimed that secular law would be replaced by Sharia law as its "basic source" of governance. Jalil has vowed to introduce Islamic banking and revoke Gaddafi's ban on polygamy. In Egypt, recent elections have produced a parliamentary majority comprising Wahabi and Salafist elements dominated by the Muslim Brotherhood, which has proclaimed: "God is our objective, the Quran is our Constitution, the Prophet is our leader, jihad is the only way and death for the sake of God, the highest of our aspirations." In Tunisia, recent elections have produced a strong presence of Islamists in Parliament. And in Syria, a secular but brutal and minority-dominated Alawite regime is being challenged by a Sunni opposition, with significant Wahabi tendencies, backed by a coalition of the US, the European Union, conservative Gulf Arab Sunni monarchies headed by Saudi Arabia and Qatar, apart from neighbouring, secular Turkey.

These developments are going to inevitably impact on stability in the Persian Gulf, where six million Indians who remit back over $ 30 billion annually live and from where India gets over 70 per cent of its oil supplies. We have a situation wherein traditional Iranian-Arab rivalries have been accentuated by a growing, sectarian Shia-Sunni divide. To add these complications is the American determination to contain the influence of Iran's clerical rulers and roll-back its nuclear weapons capabilities. India can no longer continue to chant its mantra of "non-interference" in the internal affairs of others. While rejecting foreign-sponsored regime change, each development will have to be addressed, bearing in mind its regional dimensions and its impact on our interests, including the welfare of our nationals in West Asia and the security of our energy supplies.n

For a fistful of dollars, America and Pakistan wrangle

By Sanjeev Miglani
MAY 22, 2012


Pakistan's relationship with the United States can't get more transactional than the prolonged negotiations over restoration of the Pakistani supply route for NATO troops in Afghanistan.

Pakistan, according to leaked accounts of so-called private negotiations, is demanding $5000 as transit fee for allowing trucks to use the two most obvious routes into landlocked Afghanistan, blocked since November when two dozen Pakistani soldiers were killed in an U.S. air strike from Afghanistan. The United States which apparently paid about $250 for each vehicle carrying everything from fuel to bottled water all these years is ready to double that, but nowhere near the price Pakistan is demanding for its support of the war. It also wants an apology for the deaths of the soldiers but America has stopped short of that, offering regret instead.

The two countries will likely reach a compromise, probably sooner than later. But the whole image of so-called allied nations involved in grubby negotiations about trucking fees while there is a disastrous war going on – and leaking details of those talks – tells you how destructive the relationship has become. You would think Pakistan and the United States would try and figure how to prevent incidents such as the air strike near the Afghan-Pakistan that led to the closure of the supply route in the first place. Imagine another strike of that kind and the impact it would have on an already inflamed nation, weak as it may be. Instead negotiations went down to the wire ahead of the NATO summit in Chicago over how many more dollars Pakistan can make as a conduit for a war that has turned it into a battlefield itself.

And America, playing just as hardball, is refusing to give any quarter even though it is paying quite a high price to transport the supplies by a combination of air and land through a northern routeinto Afghanistan, bypassing Pakistan. In any case, higher trucking fees in the closing stages of the war, can only be a drop in the vast amount America spends on its military – more than the next four countries put together.

Like a marriage gone sour, it seems to draw the worst in each country. Pakistan got a last minute invite to the NATO summit in Chicago, even though it has been a key player in its war in Afghanistan but its presence seemed to only highlight its isolation. President Barack Obamawouldn't hold talks with President Asif Ali Zardari, who arguably is just as important to his path out of Afghanistan as Afghan President Hamid Karzai whom he met. Worse, Obama thanked all the countries that had helped NATO in its war in Afghanistan including the Central Asian nations through which supplies are being routed at the moment, but not Pakistan through which the bulk of supplies were transported all these years, save for the current six-month halt.

For a proud nation of 180 million people, the image of its president bounding across the hall to shake hands with U.S. Secretary of State Hillary Clinton while Karzai, the head of a nation long considered a poor cousin, confers with Obama, must rankle further. Some people back home may argue, in retrospect, that Pakistan might have been better off staying away from the meeting. The worry is Zardari, still the consummate survivor, may have given the hardliners another weapon as he heads back from Chicago with little to show for.

Islam and Nazism, twin diseases

Mohammad Merah the Muslim Murderer

Expressing the sort and degree of indignation we wish we heard more often, Daniel Greenfield writes at Canada Free Press:

There was a time when Jewish children were hunted down and killed in France. Their killers believed themselves to be members of a superior group that was destined to rule the world and enslave or exterminate members of inferior groups. The cowardice and appeasement of the French authorities allowed them to operate freely, to kill Jews and launch attacks on other countries.

What was then is now again. The occupying army doesn't wear uniforms, it wears keffiyahs. It doesn't speak German, it speaks Arabic. It doesn't believe that it is superior for reasons of race as much as for reasons of religion. It does not view all others as Untermenschen, but as infidels. It looks forward not to a thousand year Reich, but to a thousand year Caliphate.

Mohammed Merah did not chase down a French-Jewish [eight-year-old] girl, put a gun to her head and pull the trigger because he came from an economically depressed area or any of the other media spin. He was only doing what Muslims had been doing to non-Muslims for over a thousand years. He didn't do what he did because he was "radicalized", he did it because he became a fully committed Muslim. …

Between all the non-stop coverage, the expressions of grief, the political pandering, no one is stating the obvious. France has been occupied all over again. Once again, the occupation has been carried out with the consent of the authorities who have decided that cowardice is the only way. Vichy France has become Vichy Europe, Vichy America, Vichy Australia, where the blatant appeasement is disguised as honor, treason is portrayed as responsible leadership, and collaboration in the mass murder of your own people is never acknowledged as such.

Muslims have hated Jews before the telephone, the telegraph, the steam engine, gunpowder, movable type and paper currency. And now, surrounded by smartphones, credit cards and jet planes, they still hate them. That simple undeniable fact is denied by government, in every university and in every center of culture. And every one of those deniers has blood on his hands.

Not only the blood of the Jewish children murdered by Mohammed Merah. Not only the blood of Jews murdered by Muslims in France. But the blood of all those who have been killed by Muslim immigrants, no matter of what generation, in the name of Islam.

The names of Chamberlain, Petain and Quisling have become eternally infamous because they stand for appeasement and collaboration. But, then, what do we make of the names Blair, Sarkozy and Stoltenberg [Prime Minister of Norway]? What have the latter done differently from their predecessors? The left likes to pretend that its collaboration with Islam is moral, while the collaboration with Nazism was immoral. It's a distinction without a difference.

Does it really matter whether the men murdering children in the name of their Fuhrer call him Adolf or Mohammed? Does it matter whether they call themselves Hans or Mohammed? Does it matter whether their fantasies of superiority are based on bad science or bad religion? What matters is the end result. A foreign enemy controls your cities, murders at will, and takes your future for his own.

The Toulouse Massacre did not come out of the blue, it follows decades of Muslim violence in France—a Kristalnacht that has been going on year after year. It will not stop here. Not while there are five million Muslim in France, some of whom are bound to pick up the Koran and take it seriously. The "radical" clerics that Mohammed Merah listened to did not innovate a new religion, there has never been any basis to the teachings of the so-called radicals other than the Koran. The only book more popular in the Muslim world than Mein Kampf. …

The question, as always, after every act of Muslim terror is how many more must die? How many? Because the killing will continue. It has gone on for over a thousand years. It is not about to stop now. Muslim leaders who condemn these acts do it for tactical reasons, not moral ones. They don't believe it's wrong to kill rebellious non-Muslims… unless the act rebounds against non-Muslims.

The difference between the "radicals" and the "moderates" is that the radicals want to engage in genocide even while they are a minority, while the moderates want to wait until they are a majority. The radicals are satisfied with killing a few Hindus, Christians, Jews, here and there. The moderates want to wait and kill millions. Neither are our allies. Both are our murderers.

There is no peace to be had with a creed that defines peace exclusively in terms of its own dominance over others.

Islam, like Nazism, is a disease of the soul, a twin sense of superiority and victimhood possessed by the angry corner dwellers of the world, who are certain that they would rule if only it wasn't for all the others holding them back. To understand a Nazi or a Muslim, you don't need to learn their creeds, just stare into the eyes of a wife beater, a pedophile or any bully, and you will see that same smirk which easily transforms into outrage, the arrogant tone that turns unctuous when it is set back on its heels, the flickering eyes that are always looking at what they can't have.

You don't need to read the Koran to understand Mohammed Merah, you can just as easily understand the Koran by reading about what Mohammed Merah did.

The day will come when … the peoples of the free world will learn what true Muslim terror really is, as the peoples of Africa and Asia, as the many other religions of the Middle East including the Jews learned, in the day of the original Mohammed.

There is nothing extraordinary about what Mohammed Merah did. You may think that there is, but that is because you are a citizen of the free world, and you have become used to that rare thing known as civilized behavior. But when your nations opened their borders to people who consider your infidel lands, the Dar Al-Harb, the House of the Sword, then civilization gets its throat cut, it gets chased down at a school, has a gun put to its head and the trigger gets pulled.

Killing children is not a shocking act in the [Muslim] Middle East … Parents routinely kill their own children for minor offenses that would hardly get an American child grounded. When they move to America or Canada, they kill their children there too, and we considerately look away. If they do that to their children, why do you think they will have any more mercy on yours?

There is no point in holding Mohammed Merah accountable for what he did, just as there was no point in bringing Nazi leaders to trial for crimes against humanity. Mohammed recognizes no form of law other than the law of Islam, just as the Nazis recognized no other form of humanity than their own. There is no common moral or legal system that we share with Islam. Equality before the law, the cornerstone of our system, is so much noise in the windy corridors of the mosque. How can the Subhuman be equal to the Aryan, how can the Infidel be equal to the Muslim?

Mohammed Merah is a mad dog and should be treated as what he is. Accountability is for those who share our moral system. It is for our own leaders who continue perpetuating the macabre myth of a religion of peace, even while attending the funerals of its victims. Accountability is for the Petains, the Chamberlains and the Quislings who have led us into this hole and keep waving in more Mohammeds to come and join the party.

The old Nazis marched in at the head of an army. The new Nazis bought a plane ticket. The old Nazis had to get by the French Armed Forces and the Royal Air Force. The new Nazis are welcomed in and anyone who says a word otherwise faces trials and jail sentences. The old Nazis deported Jews to camps. The new Nazis kill them right in the cities. And the killing will not stop until the Muslim occupation of Europe comes to an end.

Miriam Monsonego, 8, murdered by Mohammad Merah. He also killed Rabbi Jonathan Sandler and his two sons, three-year-old Gavriel and six-year-old Aryeh.

May 22, 2012

Is the U.S.-India relationship losing steam?


Posted on May 19, 2012 by chellaney

Brahma Chellaney

WASHINGTON — Was the U.S.-India strategic partnership oversold to the extent that it has failed to yield tangible benefits for the United States? Even as Secretary of State Hillary Clinton has just held detailed discussions in New Delhi, an increasing number of analysts in Washington have already concluded that the overhyped relationship is losing momentum.
The skeptics cite two high-visibility issues in particular: India's rejection of separate bids by Lockheed Martin Corp. and Boeing Co. to sell 126 fighter-jets, and New Delhi's reluctance to snap energy ties with Iran. The discussion over these issues, however, obscures key facts.

Take the aircraft deal.  Despite that setback, U.S. firms have clinched several other multibillion-dollar arms deals in recent years. These contracts have been secured on a government-to-government basis, without any competitive bidding.  But in the one case where India invited bids, American firms failed to make it beyond the competition's first round because they did not match the price and other terms offered by the French manufacturer of the Rafale aircraft and the European consortium that makes the Eurofighter Typhoon.

The most-startling yet little-publicized fact is America's quiet emergence as the largest arms seller to India. In the decade since President George W. Bush launched the vaunted U.S.-Indian strategic partnership, India has fundamentally reoriented its defense procurement, moving away from its traditional reliance on Russia. Indeed, nearly half of all Indian defense deals by value in recent years have been bagged by the U.S. alone, with Israel a distant second and Russia relegated to the third slot.

Given that India has become the world's largest arms importer and the United States remains the biggest exporter, U.S. firms are set to secure more contracts in India, which plans to spend more than $100 billion over the next four years to upgrade its military capabilities, including by buying submarines, heavy lift and attack helicopters, howitzers, and tanks.

Now consider the Iran issue. Just as the Indian rejection of the Boeing's F/A 18 and Lockheed-Martin's F-16 bids has made big news but the U.S. landing of multiple arms contracts has received little notice, India's reluctance to publicly support U.S. energy sanctions on Iran has been in the spotlight but not the quiet Indian strategy since the late 1990s to let the share of Iranian oil in India's energy imports gradually decline — a trend that has seen the importance of Iranian oil supplies for India considerably weaken.

Few in India consider Iran a friend. But given India's troubled neighborhood, with the country wedged in an arc of problematic states, New Delhi is reluctant to rupture its ties with Iran, its gateway to Afghanistan — the top recipient of Indian aid. India already has paid a heavy price for taking America's side on some critical issues in its long-running battle against Iran, even though Washington doesn't take India's side in its disputes with China or Pakistan.

The Bush administration persuaded India not to conclude any new long-term energy contracts with Iran, and — in return for a civil nuclear deal with the U.S. — abandon its plan to build a gas pipeline from Iran. New Delhi, by voting against Iran at the International Atomic Energy Agency's governing board in 2005 and 2006, invited Iranian reprisal in the form of cancellation of a 25-year, $22-billion liquefied natural gas deal which had terms highly favorable to India. That deal's scrapping alone left India poorer by several billion dollars.

Now the U.S. energy embargo against Iran has pushed international oil prices higher, significantly increasing India's oil bill. The embargo also threatens to undercut India's import-diversification strategy by making it place most of its eggs in the basket of the Islamist-bankrolling, Saudi Arabia-led oil monarchies that continue to play a role in South Asia detrimental to Indian interests. In fact, thanks to the U.S. embargo against Iran, the swelling coffers of the iron-fisted oil sheikhdoms are set to overflow, increasing their leverage in the region and beyond.

Lost in the U.S. public discussion is an important fact — the declining share of Iranian crude in India's total oil imports as part of a conscious Indian effort to reduce supply-disruption risks linked with the lurking potential for Iran-related conflict. Since 2008 alone, Iranian oil imports have swiftly fallen from 16.4 percent to 10.3 percent. Given India's soaring oil imports and search for new sources of supply, the Iranian share is set to decline further, even without India's participation in the U.S. embargo.
Make no mistake: India shares U.S. objectives on Iran but the exigencies of its regional situation compel it to toe a more cautious line.

The repositioning of the U.S.-India relationship was never intended to be transactional. Rather it was designed as an important geostrategic move to underpin Asian security and serve the long-term U.S. and Indian interests. But even if the relationship were viewed in transactional terms, the U.S. has reaped handsome dividends.

On Iran, the right course for U.S. policy would be to encourage India to continue reducing Iranian oil imports by granting it a waiver from American sanctions law — as Washington has to Japan and nine other countries — and by helping to finance the retrofitting of Indian refineries that presently have a technical capacity to process only Iranian oil.

More fundamentally, just as the Bush administration exaggerated the importance of a single deal with India, contending that the nuclear deal would be fundamentally transformative, it is an overstatement that the U.S.-India relationship today is losing momentum. The geostrategic direction of the relationship is irreversibly set — toward closer collaboration. Even trade between the countries has continued to grow impressively, from $9 billion in 1995 to $100 billion in 2011. While it is too much to expect a congruence of U.S. and Indian national-security objectives in all spheres, the two countries are likely to deepen their cooperation in areas where their interests converge, such as ensuring Asian power equilibrium.

Barack Obama had stroked India's collective ego by inviting Indian Prime Minister Manmohan Singh for his presidency's first state dinner, leading to the joke that while China gets a deferential America and Pakistan secures billions of dollars in U.S. aid periodically, India is easily won over with a sumptuous dinner and nice compliments.

The mutual optimism and excitement that characterized the blooming U.S.-Indian ties during the Bush years, admittedly, has given way to more realistic assessments as the relationship has matured. Geostrategic and economic forces, however, continue to drive the two countries closer. Indeed, Obama's recent pivot to Asia has made closer U.S. strategic collaboration with India critical.

(c) The Japan Times, 2012





India-US relations have neither burgeoned as much as the enthusiasts may have wanted nor withered as much as the skeptics may have anticipated. The relationship is neither in an impasse nor is it set to surge ahead dramatically.


The welcome improvement in India-US ties does not automatically mean a convergence of interests on thorny issues.


On Iran, for example, our differences are real. The US is pressuring India to scuttle its relationship with Iran, which India is resisting.


The inconsistency of the US position on Iran and Pakistan in relation to India is glaring. This weakens the US case on Iran in India's eyes.


The US wants India to disengage itself from Iran which is not India's adversary but engage Pakistan which is one.


It wants, moreover, to retain the freedom to disregard India's concerns while maintaining a  level of relationship with Pakistan that it feels its national interest requires. At the same time, it wants to constrain India's choices vis a vis Iran irrespective of the requirements of India's national interest.


India has interests in Iran that go beyond the US-Iran relationship, just as the US has interests in Pakistan that go beyond the India-Pakistan relationship.


What is different in the two cases is that while India is doing nothing to boost Iran's capacity to directly threaten US security, US policies bolster Pakistan's capacity to directly threaten our security.


The US wants India to recognize the frightening danger of Iran's nuclear conduct and its involvement in international terrorism and therefore join it to squeeze Iran politically and financially. We are being asked to sacrifice our national interest for the sake of the larger interest of the international community as seen by the US and its allies.


For India, Pakistan's nuclear conduct with China's support and its long standing use of terrorism as an instrument of state policy is far more of a problem. Yet, while recognizing the reality of Pakistan's doings, the US and its allies do not seek to squeeze Pakistan politically and financially.


The US threatens to use military means to prevent Iran from going nuclear, but it continues to give military assistance to Pakistan even when, according to its own assessments, Pakistan is rapidly expanding its nuclear arsenal and is blocking negotiations on the Fissile Missile Cut-off Treaty at Geneva in order to amass more fissile material as a riposte to the  India-US nuclear deal.


It is in this background that Hillary Clinton's heavy handed diplomacy on the Iranian question during her India visit earlier this month should be considered.


She thought she would convince our public that Iran should be prevented from acquiring nuclear weapons as its leadership intended to use them to wipe Israel off the map. Why Iran should commit national suicide by such recklessness was not explained.


She made far too much of Iran's involvement in the terrorist attack in New Delhi against an  Israeli embassy member to persuade us of Iran's unspeakable terrorist affiliations when the US has been long equivocal about the terrorist attacks India has suffered at  Pakistan's hands for over two decades leading to the carnage at Mumbai.


India cannot see Iran as a bigger terrorist threat to international security than Pakistan.


Her open pressure on India to reduce oil supplies from Iran was not wise either. The US is not unaware of India's energy compulsions and other valid reasons why it should maintain a viable relationship with Iran.


If placating Congressional opinion is a factor driving the US to put pressure on countries like India, the Indian government has also to take cognizance of parliamentary opinion which is against succumbing to US pressure on Iran.


Hillary Clinton was also ill-advised to publicly commend India for already reducing its oil purchases from Iran. This suggested that India was meeting the US demand, despite its protestations otherwise. Knowing the political sensitivity of the issue, why give ammunition to the opposition to attack the government?


This deliberate raising of the salience of the Iran issue to India-US ties and making it a test case of sorts for the strategic relationship is low-yield diplomacy in the long run as pressure breeds wariness. 


Why Hiillary Clinton felt the need to visit India just before the scheduled strategic dialogue between her and Foreign MInister Krishna next month in Washington is not clear.


It is one thing if the intention was to make some positive announcement on India-US relations on Indian soil to capture maximum attention. But if it was to mobilize support on Iran, FDI in retail or canvas for US nuclear suppliers, then the timing and the purpose can be questioned.


On Iran, the Prime Minister rightly reminded her that with the global economy in crisis, oil prices rising and India needing an additional 10 million tons, we could not afford to reduce oil supplies from Iran.


Foreign Minister Krishna acknowledged in his joint press conference with Clinton that Indian imports from Iran had in fact declined for commercial and technical reasons. The Petroleum Ministry has since declared officially that oil imports from Iran would be 15.5 MTs in 2012-13 as against 18.5 MTs in 2010-11 and 17.44 MTs in 2011-12.


Has India acted under US pressure or has it been forced to reduce imports because of payment and shipping insurance problems, as well as the reluctance of private sector companies and banks to risk losing access to the US financial sector because of the draconian US sanctions on Iran?


In either case, India's legitimate strategic needs have had to yield to US's dubious strategic calculus. This underlines the present limits of the strategic partnership between the two countries.


The writer is a former Foreign Secretary

Doug Casey on Taxes and Freedom, Part II

The Daily Reckoning Presents


Doug Casey on Taxes and Freedom, Part II


                        In yesterday's edition of The Daily Reckoning, we featured Part I of a provocative interview with Doug Casey about taxes and freedom...and whatever else was on his mind.

"Taxation is force alloyed with fraud," Doug declared in Part I of the interview. "It's theft, pure and simple. Most people basically admit this when they call taxation a 'necessary evil,' somehow mentally evading confrontation with the fact that they are giving sanction to evil. But I question whether there can be such a thing as a 'necessary evil.' Can anything evil really be necessary? Can anything necessary really be evil?..."

In Part II, Doug expands upon this assertion. Enjoy!

Louis James: Tax Freedom Day this year was April 17.

Doug: That means that all the work the average guy does until April 17 goes to pay for the government that failed to protect him on September 11, 2001, failed to protect him from the crash of 2008, and continues failing him every day. We pay for an organization bent on doing not just the wrong things, but the exact opposite of the right things in economics, foreign policy, and everything else we've talked about in all our conversations. It's rather perverse that Emancipation Day — the day the first slaves in the US were freed in the District of Columbia in 1862 — is April 16. But what is a slave? He's someone who is deprived by force of the fruits of his labor. Sound familiar? I disapprove of slavery, in any form — including its current form.

However, Tax Freedom Day is an incomplete way of looking at things. What's the cost to business forced to install equipment to meet government regulations? That's not paid as a tax, but it's a serious burden. There's something called Cost of Government Day that's a somewhat more inclusive estimate of the burden the state imposes on the average guy...

L: I just looked for that too and don't see that a date for 2012 has been announced yet; but Cost of Government Day for 2011 was August 12. According to that estimate, the average US taxpayer slaved away for about two-thirds of the year to pay for the state and got to keep only a third of the fruit of his labor for his own benefit and improvement.

Doug: That may be a more accurate way of looking at the burden of government the average guy has to bear, but it still doesn't even begin to address what economists call "opportunity cost." Basically, I don't just look at what the state we have costs us in cash, but in terms of the innovation and growth we don't have because of government policies, laws, and regulations. This covers everything from new medicines to all sorts of new technologies to different forms of social and business organizations to the cleaner intellectual atmosphere I think we'd have without government propaganda machines cluttering it up.

I don't believe in utopia, but I do believe our world could be far freer, healthier, and happier than it is today — without any divine intervention, magic, or changes in the laws of physics. Just a different path, every bit as possible as the one we've taken to where we are today... Without any major differences in technological development and without assuming that people would spontaneously become angels, the average standard of living worldwide would be much higher if...America had stayed out of WWI, or had not ratified the 16th Amendment to the Constitution, or had not elected FDR.

L: Okay, but those things did happen, and we live in the world we have today — the one you call a prison planet. How should people try to do what's right in such a world without ending up in jail?

Doug: First, it's important to think about what's actually possible, because people will not even try to reach for what they are sure is impossible. The world needs idealists to challenge us all to aim higher... including idealists willing to go to jail for what they believe in, like Henry David Thoreau. But even he said that while he encouraged all people to disobey unjust laws, he wouldn't ask those who support families to get themselves locked up and leave their families destitute.

So my take is as we started out saying: It is both ethically and practically imperative to starve the beast. The less cooperation of any sort we give the state — but especially the less money we give it — the less mischief it can get into. We're unlikely to get politicians to vote for getting the state off our backs, out of our pocketbooks, out of our bedrooms, and out of other people's countries as a matter of principle, but we could see the state get out of places it doesn't belong simply for lack of funds. And if everybody treated minions of the state with the contempt they deserve, most of them would quit and be forced to find productive work. As Gandhi showed us, civil disobedience cannot only be an ethical choice, but a very powerful force for change.

L: Any specific advice?

Doug: Get a good accountant, take every deduction you can, and look for ways to legally reduce your tax burden. For example, our readers should know that charitable contributions in the US get deducted after the alternative minimum tax wipes out your other deductions. That means that a substantial fraction of every dollar you give a registered 501(c)(3) nonprofit does not go to the federal government.

Now, as you know, I don't believe in charity, at least not in the institutional sense, but wasting money on charities is far, far better than giving it to the government to use bombing innocents and creating enemies for generations to come. And if that charity happens to be something like the Institute for Justice, the Fully Informed Jury Association, or any of the other libertarian think tanks dedicated to reducing the size and scope of government, you get to help fight the beast and starve it at the same time.

L: I do my economics and entrepreneurship camps in Eastern Europe under the auspices of the International Society for Individual Liberty — of which I should disclose that I am a director. I have to admit that it pleases me greatly to see funds that would have gone into making bombs to drop on foreigners and hiring more goons in uniform to oppress people at home redirected to something I consider constructive.

But what about the international diversification question: can that help reduce your tax burden back home?

Doug: It's different for different countries, and each individual should consult a tax specialist with the details of his or her own case, or proposed case. However, there is an exclusion for Americans who live abroad for a whole tax year — it was around $100,000 the last I looked. So there are very good tax reasons for Americans to live abroad. There are even better reasons for Canadians, Europeans, and almost everyone else to leave their native country — many can live 100% tax-free. I guess it's just a sad testimony to the medieval-serf mentality that most people suffer from that few people take advantage of this. They're born someplace, and they stay rooted there, like a plant. Oh well, everybody basically makes his own bed, reaps what he sows, and gets what he deserves...

However, as appealing as the "permanent tourist" idea is, I recommend international living first and foremost as a way to protect your assets. As we've discussed before, real estate in foreign countries cannot be repatriated or confiscated by the government that thinks of you as its milk cow. There is nothing illegal or nefarious about buying real estate abroad, and it could come in very handy if things get really chaotic back home, wherever that happens to be.

L: Okay... any investment implications to discuss?

Doug: Sure, but nothing new to our readers. Starving the state-beast is the right thing to do, ethically and practically, but I believe the state's days are numbered anyway. The thing to be aware of is that the beast won't go quietly, and in its death throes it can do a lot of harm. Still, like Nietzsche said, "That which is about to fall deserves to be pushed."

In the meantime, much higher taxes are on the way. More and more currency controls are coming. You may have heard that the US is contemplating a law denying issue or canceling the passport of anyone accused of owing more than $50,000 in taxes. I expect the transformation of what was once America into a police state to continue, and I expect other "developed" nations — especially Europe, Canada, and Australia — to follow suit. And this will happen whether or not the global economy exits the eye of the storm as I expect it to.

So you want to rig for stormy weather and invest for continuing crisis. Own gold for prudence, speculate on related stocks and others that may benefit from government profligacy, and as we've just been saying, diversify your assets and personal living arrangements internationally.

The day is coming when your local government may stop seeing you as a milk cow and start seeing you as a beef cow, and you want to have options before that day.


Doug Casey
for The Daily Reckoning

India’s rise as an Asia–Pacific power: rhetoric and reality

Strategic Insights 58 - India's rise as an Asia–Pacific power: rhetoric and reality
Monday, 7 May 2012
India's emergence as an Asian power—and eventually perhaps as an Asia–Pacific power—has wide implications for the region and consequently for Australia. This paper, authored by Dr Sandy Gordon, considers those implications as they relate to three closely related areas: the restraints that act on India's security strategy and limit its strategic reach; its ambitious goals in the Indian Ocean region; and its emerging role in shaping the geostrategic structure of the Asia–Pacific region, which must simultaneously accommodate China's rise and America's relative decline.

Australia's Strategy

May 22, 2012 | 0900 GMT


By George Friedman

Australia is one of the wealthiest countries in the world, ranked in the top 10 in gross domestic product per capita. It is one of the most isolated major countries in the world; it occupies an entire united continent, is difficult to invade and rarely is threatened. Normally, we would not expect a relatively well-off and isolated country to have been involved in many wars. This has not been the case for Australia and, more interesting, it has persistently not been the case, even under a variety of governments. Ideology does not explain the phenomenon in this instance.

Since 1900, Australia has engaged in several wars and other military or security interventions (including the Boer War, World War I, World War II and the wars in Korea, Vietnam, Afghanistan and Iraq) lasting about 40 years total. Put another way, Australia has been at war for more than one-third of the time since the Commonwealth of Australia was established in 1901. In only one of these wars, World War II, was its national security directly threatened, and even then a great deal of its fighting was done in places such as Greece and North Africa rather than in direct defense of Australia. This leaves us to wonder why a country as wealthy and seemingly secure as Australia would have participated in so many conflicts.

Importance of Sea-Lanes

To understand Australia, we must begin by noting that its isolation does not necessarily make it secure. Exports, particularly of primary commodities, have been essential to Australia. From wool exported to Britain in 1901 to iron ore exported to China today, Australia has had to export commodities to finance the import of industrial products and services in excess of what its population could produce for itself. Without this trade, Australia could not have sustained its economic development and reached the extraordinarily high standard of living that it has.

This leads to Australia's strategic problem. In order to sustain its economy it must trade, and given its location, its trade must go by sea. Australia is not in a position, by itself, to guarantee the security of its sea-lanes, due to its population size and geographic location. Australia therefore encounters two obstacles. First, it must remain competitive in world markets for its exports. Second, it must guarantee that its goods will reach those markets. If its sea-lanes are cut or disrupted, the foundations of Australia's economy are at risk.

Think of Australia as a creature whose primary circulatory system is outside of its body. Such a creature would be extraordinarily vulnerable and would have to develop unique defense mechanisms. This challenge has guided Australian strategy.

First, Australia must be aligned with -- or at least not hostile to -- the leading global maritime power. In the first part of Australia's history, this was Britain. More recently, it has been the United States. Australia's dependence on maritime trade means that it can never simply oppose countries that control or guarantee the sea-lanes upon which it depends; Australia cannot afford to give the global maritime power any reason to interfere with its access to sea-lanes.

Second, and more difficult, Australia needs to induce the major maritime powers to protect Australia's interests more actively. For example, assume that the particular route Australia depends on to deliver goods to a customer has choke points far outside Australia's ability to influence. Assume further that the major power has no direct interest in that choke point. Australia must be able to convince the major power of the need to keep that route open. Merely having amiable relations will not achieve that. Australia must make the major power dependent upon it so that Australia has something to offer or withdraw in order to shape the major power's behavior.

Creating Dependency

Global maritime powers are continually involved in conflict -- frequently regional and at times global. Global interests increase the probability of friction, and global power spawns fear. There is always a country somewhere that has an interest in reshaping the regional balance of power, whether to protect itself or to exact concessions from the global power.

Another characteristic of global powers is that they always seek allies. This is partly for political reasons, in order to create frameworks for managing their interests peacefully. This is also for military reasons. Given the propensity for major powers to engage in war, they are always in need of additional forces, bases and resources. A nation that is in a position to contribute to the global power's wars is in a position to secure concessions and guarantees. For a country such as Australia that is dependent on sea-lanes for its survival, the ability to have commitments from a major power to protect its interests is vital.

Deployment in the Boer War was partly based on Australian ideology as a British colony, but in fact Australia had little direct interest in the outcome of the war. It also was based on Australia's recognition that it needed Britain's support as a customer and a guarantor of its security. The same can be said for the wars in Korea, Vietnam, Iraq and Afghanistan. Australia might have had some ideological interest in these wars, but its direct national security was only marginally at stake in them. However, Australian participation in these wars helped to make the United States dependent on Australia to an extent, which in turn induced the United States to guarantee Australian interests.

There were also wars that could have concluded with a transformation of the global system. World War I and World War II were attempts by some powers to overthrow the existing global order and replace it with a different one. Australia emerged from the old political order, and it viewed the prospect of a new order as both unpredictable and potentially dangerous. Australia's participation in those wars was still in part about making other powers dependent upon it, but it also had to do with the preservation of an international system that served Australia. (In World War II there was also an element of self-defense: Australia needed to protect itself from Japan and certainly from a Japanese-controlled Pacific Ocean and potentially the Indian Ocean.)

Alternative Strategy

Australia frequently has been tempted by the idea of drawing away from the global power and moving closer to its customers. This especially has been the case since the United States replaced Britain as the global maritime power. In the post-World War II period, as Asian economic activity increased, Asian demand increased for Australian raw materials, from food to industrial minerals. First Japan and then China became major customers of Australia.

The Australian alternative (aside from isolation, which would be economically unsustainable) was to break or limit its ties to the United States and increasingly base its national security on Japan or, later, on China. The theory was that China, for example, was the rising power and was essential to Australian interests because of its imports, imports that it might secure from other countries. The price of the relationship with the United States -- involvement in American conflicts -- was high. Therefore, this alternative strategy would have limited Australia's exposure to U.S. demands while cementing its relationship with its primary customer, China.

This strategy makes sense on the surface, but there are two reasons that Australia, though it has toyed with the strategy, has not pursued it. The first is the example of Japan. Japan appeared to be a permanent, dynamic economic power. But during the 1990s, Japan shifted its behavior, and its appetite for Australian goods stagnated. Economic relationships depend on the ability of the customer to buy, and that depends on the business cycle, political stability and so on. A strategy that would have created a unique relationship between Australia and Japan would have quickly become unsatisfactory. If, as we believe, China is in the midst of an economic slowdown, entering into a strategic relationship with China would also be a mistake, or at the very least, a gamble.

The second reason Australia has not changed its strategy is that, no matter what relationship it has with China or Japan, the sea-lanes are under the control of the United States. In the event of friction with China, the United States, rather than guaranteeing the sea-lanes for Australia, might choose to block them. In the end, Australia can sell to many countries, but it must always use maritime routes. Thus, it has consistently chosen its relationship with Britain or the United States rather than commit to any single customer or region.

Australia is in a high-risk situation, even though superficially it appears secure. Its options are to align with the United States and accept the military burdens that entails, or to commit to Asia in general and China in particular. Until that time when an Asian power can guarantee the sea-lanes against the United States -- a time that is far in the future -- taking the latter route would involve pyramiding risks. Add to this that the relationship would depend on the uncertain future of Asian economies -- and all economic futures are now uncertain -- and Australia has chosen a lower-risk approach.

This approach has three components. The first is deepening economic relations with the United States to balance its economic dependencies in Asia. The second is participating in American wars in order to extract guarantees from the United States on sea-lanes. The final component is creating regional forces able to handle events in Australia's near abroad, from the Solomon Islands through the Indonesian archipelago. But even here, Australian forces would depend on U.S. cooperation to manage threats.

The Australian strategy therefore involves alignment with the leading maritime power, first Britain and then the United States, and participation in their wars. We began by asking why a country as wealthy and secure as Australia would be involved in so many wars. The answer is that its wealth is not as secure as it seems.

Read more: Australia's Strategy | Stratfor