Opinions on politics, philosophy, ethics, sovereignty, freedom, moral, duty, property, economics, ownership, development, self-worth, the world. All thoughtful comments welcome. The truth is born in dialog. Imagination lights the way to follow our desires - powerful expressions of our calling.
Saturday, December 17, 2011
Russian Spring and US National Interest
from the Tale of Three Apples not Newton's, Beatles' and Steve Jobs' but the one from The Thousand and One Nights
The Khalif in Moscow seems to have forgotten that he has to check what people think of his administrators and confident in his popularity after ruling uncontested for over 12 years was unpleasantly surprised by his party's loss of more than 20 per cent of their seats in the Russian parliament regardless of the intimidation of his opponents and his control over the media (perhaps that was caused in part by the 20 per cent increase of internet penetration among the highly literate Russian population). Even worse he seems failing to acknowledge that the people have genuine concerns and dismisses the protesters in true Leninist style as paid by the West. To top it up US Secretary of State Hilary Clinton expressed her concern with the rigged elections, prompting Mr Putin to retaliate that she was instigating the protests which is hardly try. Try spending several hours outside in the Russian winter. No matter how big a fan of Mrs Clinton you may be that thought won't be enough to keep you warm. Just how shaky Putin's position is at the moment can be discerned by his nervousness and lack of confidence (this is the man who rides his horse half-naked even when Sarah Palin is not watching from Alaska) but making the allusion that the white ribbons used by the protesters look like condoms is pretty low (and exposes ignorance that condoms may come in different colors). Gorbachev too (hardly a political competitor anymore) incurred the wrath of Putin by calling for a rerun of the elections.
Having said all that most of the protesters have spent most of their creative lives under the relatively secure, stable and prosperous rule of Putin and his political allies especially if compared with the chaotic Yeltsin regime. Those are the less flamboyant KGB guys (the more extravagant ones are in London dazzling the UK public with extreme wealth obtain though unthinkable corruption) and they may continue to rule Russia for quite some time with or without Putin mostly because they are unlikely to give up their positions without a fight. On the other hand the protestors are not the workers, soldiers and sailors of the October Revolution from the previous century. They are mostly middle class people who are looking for a government that can provide for more opportunities for development and innovation besides selling oil and gas to the West and China.
And that is where the interests of the people standing in the cold in Russia coincide with US national interest. A more democratic Russia where innovation and development will create more markets for US products and more products for US markets can only benefit the US middle class.
In that line of thought it was lucky timing that Russia was accepted as a member of the WTO just when it needs a boost. US – Russia relations cannot be fully covered by the philosophy of a “reset”. They need much more creative thinking to build a whole new system of interdependence and cooperation that will not only boost domestic economies but help create the conditions for stability and prosperity across Eurasia where pockets of volatile conflicts and regional animosities threaten to blow out of proportions, not to mention the imminent collapse of Chinese communism with yet unknown and unpredictable consequences.
The most precious legacy of the G.W. Bush era is the expensive lesson that the US cannot and should not act alone attempting to resolve international issues no matter how well-intentioned and powerful it may feel. It is debilitatingly expensive and the results are at best inconclusive if not disastrous.
The cheapest and most effective way to promote US national interest globally (and in space) is through cooperation – Marshal Plan style, or Kissinger's policy towards China style or International Space Station style. That is not confined to US international experience. Post WWII French policy to entangle Germany in an EU, (I remember it was originally an US idea) but it only became successful after France started pursuing it with religious fervor, and has managed to forge fascinating unity on the Old Continent torn by the most devastating wars in human history less than a century ago, and that united continent is one of the most reliable US trade partners and military allies.
Russia has moved a long way since the stagnation of the Brezhnev era. It is not perfect but it is moving slowly forward. It's in our interest to support that movement.
… the great thing in this world is not so much where we stand as in what direction we are moving: To reach the port of heaven, we must sail sometimes with the wind and sometimes against it— but we must sail, and not drift, nor lie at anchor...
--- Oliver Wendell Holmes, Sr.
Friday, December 09, 2011
Desires and Values
In our quest for happiness conjuring plans and putting them into action to fulfill our goals to satisfy our desires we acquire knowledge that can be shared with others for the mutual benefit of reaching our goals easier and cheaper. Thus knowledge is any information that can be used for the creation of a workable way to pursue our interests. Distilling our interest from the fountain of desires bursting from the spring of life fueled by love and beauty builds the structure of the tower of wisdom. That tower will be shinier and taller if it is built on sincerity and honesty or else deception can easily lead to misunderstanding that will cause it to crumble. Because of its complexity the search of happiness is only partially achievable by reason alone. It needs the passion of divine faith to serve as guiding light in the darkness of uncertainty. Desires may be born in the quest for earthly pleasures but that is only a refection of their heavenly source and destination. To deny the moving force of desires is to deny life itself. If they are there they must serve a purpose. It might be divine if you believe in God or you can consider it natural if you believe in Nature but they have the power of an ocean wave that can drown you or give lift you high and take you far in an exhilarating ride if you have mastered the skill to use it.
Sincerity and faith will make communication with like-minded souls possible. You may be able to achieve faster and more impressive results through lies but those results are likely to be short-lived and will most certainly cause more harm than good in the long run. Also depriving others of your honest oppinion on your interests and the best ways to achieve them deprives the community of valuable input which may be decisive for success or failure based on the advantage gained by deliberation.
Desires lead to values through the process of defining first interests, then goals by tempering them in the furnaces of reason, faith and passion. True wisdom will not come only through reason or, faith or passion alone or by merely absorbing knowledge useful to others. It can only blossom from a constant personal quest to understand what I really want, who I really am, why do I love myself and how will that help me become a better (happier) person with the help of others and how can I help them do that.
Monday, December 05, 2011
What You See Is What You Get
What you see is what you get in live. If you know more you will get it easier. Understanding how the world works is critical to achieve ones goals easier. That knowledge comes from reflection on personal and others' experience. By reflection I mean both creating assumptions on cause and effect relationships and analyzing the result of testing these assumptions in real life. Personal experience is the most expensive but most reliable method of testing these assumptions and it relates them to our personal goals, interests or desires more closely than others. An experiment or in other words an artificial model of reality to test our theories is cheaper than real life experience but can be inaccurate or misleading due to the necessary simplification of that reality. The danger of self deception is even greater when applied to complex phenomena like society, business and especially politics.
But if personal experience leads to better knowledge wouldn't that also mean that personal theories of happiness, ethics, economics and politics are better than general ones. And indeed that is the logical conclusion. General theories are always weaker and less informative than personal ones. That doesn't meant that the are unnecessary – we need them to establish understanding between us so we can get other to help us achieve our goals which would be difficult (if not impossible unless one resorts to coercion) if we don't have a shared system of values, meanings and beliefs on the projected results of certain actions. Coercion is bad not because of some obscure commandment but because it can only achieve short lived results deceptively easy. The results will be short lived and the whole coercive enterprise a waste of resources because anything that does not develop is bound to die out. The only way to improve the results from coercion is by more coercion thus inevitably causing more resistance until the balance tips over against the perpetrator of coercive practices. It's a futile exercise and that makes it bad policy to pursue.
Saturday, December 03, 2011
Scapegoat
Wednesday, November 30, 2011
Who needs ideas?
Wednesday, July 06, 2011
Philosophy – a journey to the other world
(a quest for wisdom, love and freedom)
This world is the world we know and understand. The other world is the world of the unknown. Philosophy is the name of the ship that can take us on a voyage of exploration of that world. The controls of this ship are easy to master because the only indispensable qualification is love for wisdom. Easy as it seems it must be handled with care like any tool that can harm you or those around you if it is not applied with care and forethought especially its sharp edge called doubt. This ship will use faith as the wind that will propel it on its way and dreams to serve as stars to guide it towards the its goal.
Faith that if you work hard all your emotional, intellectual, political and economic needs will be fulfilled and the best way to do that is if you think deep, love with abandon, work hard and sincerely believe.
Democracy is the way to fully appreciate the individual thus setting them on their path to develop their full potential for a their own and consequently everyone's benefit. Though it is the most natural way for organising a society it doesn't come naturally. Humanity's inherent complexity demands the ultimate intellectual, emotional and spiritual effort to make society work. The problems often seem insurmountable but the alternative is “nasty, brutish” and deadly. Power comes from working together chasing personal happiness.
Saturday, July 02, 2011
Questions on Greece, Strauss-Kahn, Libya and ignorance
Is there anything common between the demonstrations in Greece, Libya and Syria?
Wouldn't it be good for Greece to go bankrupt as Island did? Island seems to be OK now.
Why wouldn't the US default on its debt? Again there is nothing wrong with Iceland.
Why in the case of Greece the world community represented by the IMF appears to be aganist the people while in Libya the UN Security Council and NATO appear to protect the people?
It looks like former IMF Dominique Strauss-Kahn and his accuser both demonstrated poor judgemnt. He ruined his career and she her lucrative money laundering side business. So they were both in finance and both not very clever. No wonder the financial system is plagued by crises.
Why do things go wrong?
Everything of course can be blamed on world imperialism, illuminati conspirators or the Satan himself, but the more plausible explanation will be that it is human stupidity that causes all the suffering. It is a ignorati conspiracy and the only way out is if we the reasonable stop being complacent.
The IMF and NATO offer a knee jerk reaction to serious problems. The debt is not the problem in Greece it is the symptom of inadequate development but neither the IMF nor the EU seem to be concerned with treating the causes. In Libya the lack of democracy is the problem but there is not thought about post Gaddafi reconstruction. The naïve expectation that things will just work out may backfire the way things turned out in Somalia, Kosovo, Afghanistan and Iraq.
It is our world and if we don't take care of it it will come crashing on our heads. It is not someone else's fault and someone else's failure. It is my failure too but mostly your failure. Think about it and write a passionate comment.
Monday, May 30, 2011
Is God always Happy?
Friday, April 08, 2011
In God's Image
If we the people are created in God's image then we must have God's perfection, sovereignty, power and knowledge. Unfortunately we don't. Most people are far from perfect, easily oppressed or enslaved and often helpless. Our knowledge is frequently inadequate and ignorance causes most of humanity's troubles.
Should we then discard the notion that we were created in God's image as wishful dreaming, an unsubstantiated prejudice by an self-conceited primate that imagines itself at the top of the evolutionary ladder or food chain even if there are others who are bigger, faster, more elegant and, who knows, perhaps even smarter. The answer is: No!
Because humanity has demonstrated capability for greatness even through periods when hate, ignorance and barbarity which sometimes threatened the extermination not only of humankind but all live on Earth.
We the people have shown that we have the power to change things the way we want them if we act together. Although a group of people can act to oppress another group of people and extract short term advantage that never works for longer periods. Therefore it is in the strategic interest of everybody to act together in the name of high ideas and protect our lives, freedom and the right to pursue opportunities.
People can be coerced into submission through threats and violence and such an contraption may even achieve certain illusionary success. The truth is that sooner or later it will collapse under the weight of lack of understanding and failure to accommodate the interests of all participants like a Tower of Babel – a grand vision but lacking substance.
The answer is in personal sovereignty. If everyone is created in God's own image then the opinion of everyone matters. On the other hand only cooperation can make that personal sovereignty, safety, freedom and opportunity possible. Coming from the premise that you can only love what you know. And the person you can know best is the one closest to you – yourself. And only if you love yourself a lot you can love your neighbor a lot too (you cannot possibly love your neighbor more because it is impossible to know someone else better than yourself). Everything else comes after that including the love of God.
To sum it up: people are unique and the best judges of their own interests. On the other hand these interests can only be protected and pursued in cooperation. Politics is the mechanism of this cooperation.
Sunday, April 03, 2011
Alah Akbar
A scared middle aged Yemeni man running towards the camera repeatedly yelling Allahu Akbar his voice trembling is the picture that will remain etched in my memory from the recent pro-democracy protests in the Arab world. The fact that the man is obviously afraid and horrible things might be happening behind his back causing him to flee in terror he still is there – on the square, taking a stand, proclaiming God’s greatness. God doesn't need our assurances but we do. We shout God is Great in the secret hope that as we are created in God’s image we must be great too. And perhaps if not great we can expect great things to happen, and attempt to make these great things happen. That doesn't mean ignorant and naïve actions like burning the Koran or even worse slaughtering innocent UN employees. A Great God cannot ask for murder or burning of a book of wisdom. God is there where there is understanding. We can understand each other because we have something in common, common ancestors (as claimed in the Bible and proven by scientists), a human soul, a common Creator or Nature if you prefer that. The name doesn't matter as long as it is clear that it is the same concept regardless of how the name sounds in different languages and world-views. There is something bigger than us and yet we are in the center of events. We should except great things but they will only happen if we attempt great things, no matter how scary. Because God is Great and we are created in God’s image.
Please, sign the petition to free Eman Al-Obeidy in Libya!
Wednesday, January 12, 2011
Why Politics
Happiness is what people are after. It has two prerequisites; life (for obvious reasons) and liberty (somewhat more obscure but based on the premise that people can only pursue happiness when they are free to decide what it is and how to pursue it). To achieve happiness people make plans complete with goals, priorities, steps and dedicate resources.
Politics
Politics is about people acting together to achieve their goals easier.
Politics is the highest level of organising this cooperative action the other cheaper and often more effective methods being business and community organisations.
Politics comes where the other cheaper and more effective methods do not work.
The measure of success in politics is where the interests of the people are effectively formulated and pursued.
As government gives certain advantages to those able to exploit its inability to protect itself from corruption. Successful governments have effective mechanisms in place to prevent such exploitation. Those who do not succumb to corruption to the detriment of their citizens and ultimately to the elite too.
Relations
Most relations among people and notably the most important ones related to love, friendship and pooling resources to archive prosperity are managed without the interference of the state. The state only steps in if something goes wrong. The state defines, adjudicates and enforces rules to increase the chances that such intervention does not cause harm and helps improve the situation by providing a reasonably lasting solution. Historical experience has demonstrated that rules are best established through deliberation and that these rules have to protect the rights of every member of society in order to be stable and defensible. Thus the need for liberty which is based on the protection of rights.
When Borders Are Crossed
Most relations which do not fall under the jurisdiction of a sole government are managed between people without the interference of a government they are mostly successfully managed privately by individuals themselves or facilitated by non-government entities like travel agents, international trading companies, banks, NGOs, Churches and other religious entities as with relations within a state perhaps with the advent of new technology the role of these intermediaries will gradually decrease. When these methods fail the government needs to intervene following interests and rules.
Foreign Policy
Foreign policy is about the state policies to promote the interests of its citizens abroad. But how does the state find out what these interests are if foreign policy is not an election priority if compared to the economy and other issues.
Thursday, December 16, 2010
Life, Freedom and Wealth are Private
Business is best governed by the market but that being based on human judgement is not perfect. Its utility is in the fact that he market aggregates value judgements from a large number of people thus reducing but not eliminating the possibility of error. The danger of error exists because market choices might be made on the basis of insufficient or erroneous information. Therefore the market needs regulation by the government. The advantage is that political value judgement is formed in a manner different from that of the market thus minimising the danger of aggravating the same error. The way politics define value does not have the numerical measure that the market has and its less straightforward and well defined. That is why politics need a political theory which is based on philosophy and especially ethics and resulting theory of law and economics where it negotiates the legitimacy of its interaction with business.
Freedom is what makes us human. Bees and ants have better organised and consequently more effective and efficient societies but lack freedom and the concept of the primacy of individual interest. In contrast monkeys are on a constant vacation with few if any constraints (especially for the stronger individuals) and where food and shelter are basically free. Yet if compared to humanity their abilities to enjoy life are limited.
People unite to pursue their goals. This political activity has the potential for undesirable side effects. The first are grouped around the necessity to establish rules. That can be mitigated by negotiating the rules. The others are grouped around the potential of united people to exploit and oppress other people leading naturally to the danger of humanity obliterating itself. This threat is overcome by the elaborate security arrangements that define human history.
Faith and art define humanity and might have played a decisive role in its survival. Art and faith have an legitimate but uneasy relationship to philosophy through aesthetics and theology and to politics and business through their influence on public opinion and distribution channels and religion. Nevertheless governing faith and art using political or business tools have proved to be disastrous.
The modern democratic state based on a prosperous middle class thriving in a well regulated by an unobtrusive government market economy is the pinnacle of contemporary governance achieved through centuries of experimentation with theocracies, hereditary monarchies, primitive democracies like the ancient Greek and Roman and merchant republics like Venice and Florence. Apart from it there are states that are state only in form but not in substance which I will label collectively kleptocracies. These are states where the governing elites are concerned with providing exclusive privileges for themselves at the expense of the people they are supposed to serve.
Wednesday, July 07, 2010
Love Yourself!
Tuesday, May 11, 2010
Ethics, Rights, Identities and Interests
Ethical considerations have no meaning if they do not lead to better life for the participants in a social interaction. The road to hell is paved with good intentions (Dante). Due the complexity of modern life, though, it is often difficult to foresee the consequences of a certain action. That calls for the creation of rules of behaviour based on a concept of universal rights. It could be that in a disconnected world people can attempt to create a particular concept of rights applicable only to their group (that is what sects do) but that is impractical if impossible in an interconnected world. Rights are there to protect interests which on their part are how people perceive their need and that perception can be right or wrong. As this process itself is complicated and human beings are inherently lazy and bound to look for an easier way out we look for group identities in addition to our individual one to help us comprehend the world around us and the pursuit of our goals in it. (Additionally choosing a group identity can help us discover our true individual identity or further obscure it and destroy our personality.)
These ideas of ethics, rights, identities, and interests are constantly constructed , remodeled and abandoned in society and the more they correspond to material reality the more successful the societies and individuals employing them are. Also the fact that ideas are socially constructed does not mean that they are not real or arbitrary. The fact that they people use them to guide their actions makes ideas a powerful material force worth studying even as for most people social relations are much more important for the quality of their lives than interaction with nature. And the dependence of success and failure of any human endeavor on the relevance of ideas to reality consisting of nature and other ideas makes arbitrary choice of ideas a dangerous path to follow and therefore it is not so common.
People and communities chose ideas of ethical behavior, rights and identities based on their understanding of their interests. Therefore the study of interests seems like a good starting point for any inquiry into society and politics.
Saturday, April 17, 2010
Who Needs the Pen to Be Mightier than the Sword
Only the unique combination of Enlightenment in Western Europe (brought in part by Arabic and Muslim cultural influences both original and through their acting as an intermediary for the penetration in Europe of Ancient Indian and Chinese culture and their role for the preservation of Ancient Greek and Roman sources), combined with the advances in trade and industry brought to the initially fledgeling democracies of Switzerland and the North of Europe to culminate with the creation of the U.S.A.
The problems is that even after the end of the cold war and a seeming worldwide consensus on the fact that their is no alternative to liberal democracy and market economy as the only political and economic guarantees for aligning the interests of the individuals to create viable political and economic entities, too many of the countries whose governments proclaim adherence to the above principles (often under some international pressure) in reality develop corrupt states, harboring organized crime and terrorists and stiffing economic development while covertly or overtly abusing the human rights of their hapless citizens.
It cannot be that the citizens of these failed or failing states want this. It is against their interests. I cannot be that the people of the developed countries want them to suffer too if not so much for reasons of sympathy and compassion but more realistically because of the danger that oppression and crime in one country can easily spill over the world through mafia activities, terrorism and the actions of the corrupt state causing suffering and death regardless of borders, cultural preferences and political allegiance.
From a political point of view the easiest way to deal with one's interests may be to take care of everything on your own. Retire in the mountains, fish and hunt for dinner and forget about the rest of the world. That may be a boring but feasible and with some luck sustainable existence. The security, freedom and opportunities of civilization come with complications and danger of becoming a slave of nonessential desires and activities. But it's the only prudent way.
Proper institutions may help but ultimately its everyone's responsibility to take pursue personal goals. The care of others though gives the power and ability to pursue these goals more efficiently and effectively while mainlining a level of security and freedom impossible individually. Freedom as understood by Roosevelt in his four freedoms: "freedom from want, freedom from fear, freedom of faith and freedom of expression".
Monday, April 12, 2010
Interests and Rights
The thesis that individual interests ultimately converge to form municipal, national and international political and business institutions will be the focal point of my research. Initially the priorities of these interests can be discerned as personal above community and if rated by urgency short term as more important than long term. An qualitative prioritization of interests is possible along a modified Maslow's pyramid of needs could follow the the prioritization along the lines of security/survival issues, followed by freedom and last the existence of opportunities for building a better life. In other words: you cannot be free if you fear about your security and you cannot be sure of your safety if your fate is determined by someone else when you are not free, and you cannot be either safe or free if you are denied opportunities to work for your happiness.
Political reality is a social construct. There is no contradiction in the above statement. Political institutions are created by people acting together to pursue their common goals. On the other hand institutions impose, rules of behaviour, utilise resources and change the world in ways that affect not only the people that created them and not only in ways that were initially intended. Consequently, people can change these embodiments of their political ideas in ways they consider better suited to further their (people's) goals. The influence, growth and durability of these institutions depends on how well they work towards furthering the interests of the people involved in them and the resistance they encounter. Individual rights are a rough guide towards this stated compliance of policies with interests. The more universal recognition rights have the more people will work towards defending them consequently these rights will have more weight.
Therefore ultimately the priority of interests will be cyclical with the individual interested in promoting collective interests as this will help achieve individual goals more effectively and efficiently and the same is valid for the interdependence of short term and long term interests. While immediate needs might be more pressing especially if they involve security and survival, but planning ahead can make survival and safety much more easier to achieve. The interdependence of interests grouped by survival/security, freedom and opportunity is discussed in the first paragraph.
Conclusion
The reason why game theory often does not lead to satisfactory results when analysing real life developments. s that people tend to escalate often and fast from security/survival/sustainability concerns to attempts to secure freedom and striving towards opportunity led by the correct understanding that they are inseparably linked. That's why rebellions are possible because innovation is humanities most proven method to deal with adversity and freedom and opportunity are crucial for innovation.
Saturday, October 24, 2009
China US Economic Relations
Theoretical background
The contemporary phase of US-Chinese relationship characterized by high level of economic interdependence can be analyzed from a realist perspective. Henry Kissinger was working towards a classic “realist” balance of power arrangement by seeking closer relationship with China to counterbalance Soviet influence in Asia after the end of the Vietnam war. In Dr. Kissinger's own words with Nixon they “had ideas for the construction of peace on a global scale”. Consequently it could be argued from a constructivist perspective that this classic 'realist' foreign policy act created a reality that will develop into the most remarkable phenomenon of modern politics the economic interdependence between the world's leading liberal free market democracy and the last explicitly communist state. The impressive rise of the economic exchange between the two countries after the reforms introduced by Deng Xiaoping in 1979 led to the current situation in which they dominate world trade and global economic stability is dependent on their successful development. The management of these relations and the interlinked political and security implications require skillful economic statecraft to resolve the issues bound to arise from the unparallelled scope of the economic interdependence and the structural differences between the communist rule over an economy in transition to free market in the case of China and an economy in transition from the 'laissez-faire ' principles of the Reagan era to increasing calls for more regulation after the global financial crisis of 2008.
Historical Context
The relationship between US and China began to develop in in a new direction after Henry Kissinger approached China and the economic relationship picked up particularly after the reforms of Deng Xio Ping in 1979. Trade with the US has helped China achieve dramatic success in improving the quality of life of the most populous country in the world. Chinese political life has advanced towards more openness, democracy and accountability and the protection of private property has given the opportunity for a prosperous middle class to emerge. At the same time China remains a Communist country ruled by Communist Party which is far even from the notion of something resembling Gorbachev's perestroika, let alone more comprehensive political reforms. The remarkable economic development has been accompanied by extensive environmental damage. Some of the new rich have earned their wealth through corruption and the lack of effective judiciary to deal with the problem is due in part to the CCP opposition to political reform. The livelihood of a large part of the population though better than the starving populations of sub-Saharan Africa is still precariously close to the poverty line. The economic development is based on cheap labor and has yet to show signs of achievement into more technologically advanced areas as Japan, and the Asian Tigers have done.
The US approach to China has ranged from the desire to ensure good relations to alleviate the security threat in the 70s through the remarkable period of the growth of economic relations starting with Deng's reforms and culminating in China gaining the top spot among US trading partners and world wide prominence leading to US uncertainty as to how to treat China: as a rival, an ally or controversial partner-difficult to deal with but impossible to reject.
Floating exchange rage for Chinese currency.
The Chinese government has strongly resisted international pressure led by the US to float Chinese currency. The Chinese complain that now after the financial crisis the problem is not the exchange rate of their currency but the value of the dollar or more correctly not the value but the stability of the dollar which is dependent on the stability of US policy. The above conclusion of the Wang Qing, an economist from Morgan Stanley in Hong Kong make the US government responsible for exchange rates linking their stability with the stability of policy. While a link between policy and currency values may be established it is not that direct. There was no observable policy change when the financial crisis struck in the latter days of the Bush administration. It is more the adequacy of particular policy that may affect the exchange rate. In any case the huge Chinese trade surplus has materialized in US dollars mostly in the form of Treasury bonds.
“We have lent a huge amount of money to the U.S. Of course we are concerned about the safety of our assets. To be honest, I am definitely a little worried.” The problem is that The Chinese cannot undertake a massive sellout of US treasury bonds as this will cause their price to fall. But even if they hold them massive US stimulus will mean the US government selling more bonds and the market may demand higher interest rate for them than the interest rate for the bonds the Chinese hold. That scenario will result in a price drop of bonds held by the Chinese. Alternatively if the US government chose to limit the borrowing and respectively the stimulus may mean slower recovery for the US economy which will hurt Chinese exports to the US. Another scenario involves reduced US trade deficit because of the crisis resulting in less Chinese purchases of US bonds. In any case the financial crisis confronts the Chinese leaders with a difficult dilemma. The US sees the solution in encouraging Chinese domestic consumption. The Chinese government sees a solution in decreasing its reliance for its reserves on the US dollar and dependence on US financial policies outside its control, by calling (alongside Russia) for the establishment of an internationally managed reserve currency that will increase the stability of world financial markets and have the added benefit of more freedom for the financial policies of reserve currency polities like the US, the EU and Japan.
2. What China expects from the US
Budget deficit control
Following the financial crisis and the implementation of stimulus measures the primary concern of China is the US government's resolve and ability to bring the budget deficit under control. From the perspective of Chinese national interest their ability to deal with the adverse effects of the global financial crisis depend on the value of their national reserves which is dependent on US policies. Commentators speculate on whether China will continue to buy US securities to and thus finance US government spending. The obvious answer is yes because there is no substitute for US government bonds in terms of secure investment even when taking into account all the pitfalls of using them as financial reserve instruments. A logical consequence of improving trade balance between China and the US will be that China will buy less US securities as it will have less free funds to use for bonds purchases but will use the money gain from export to the US to pay for imports instead. To conclude if China had a financially viable option to switch reserves to other safe haven like IMF Special Drawing Rights or Euro they would have done so and they will not hesitate to do it if it becomes viable in the future. The current calculations though make the US dollar most attractive despite its contradictory position of serving as an international currency but held under US national control. China will continue to keep their national reserves in US dollars and attempt to influence the US government to pursue policies that will prevent the dollar from losing value.
Free trade not rotectionism
The other most important economic statecraft policy issue that China would like to see positively resolved in their relations with the US is how the administration will go about with dealing with protectionist pressures from Congress. China is understandably suspicious on the true US intentions. On one side we have the resolute declarations of president Obama on several G20 meetings warning against the dangers of protectionism and on the other the controversial imposition of tariffs on tires imported from China.
New US financial regulations to prevent crises
China is concerned with the negative impact of the current financial crisis that has exposed their economic vulnerability to events beyond their control. Understandably, China wants to see better regulation to ensure the smooth operation and predictability of the US financial system as the world trade is dependent on its health.
Increased role for China in IMF
At the 20th meeting of the International Monetary and Financial Committee of the Board of Governors of the International Monetary Fund in Istanbul the Deputy Governor of the Central Bank of China Yi Gang made a point for a larger quota for the developing nations and better monitoring abilities for the International Monetary Fund. He accused the IMF of failing to foresee the global financial crisis and blamed this failure on mismanagement stemming from skewed representation in IMF governing bodies. That is a valid Chinese complaint as they have done what was expected from them: efficiently produced goods for export and the financial collapse adversely affected them without warning. That the IMF is in need of structural and administrative reform including quota revision is acknowledged supported by the US government.
Recognition of the status of China as a market economy.
The recognition of China as a market economy affects the way the fair market value of goods is calculated to determine whether the country engages in subsidies or dumping. As China is not recognized as a market economy by its main trading partners the US and the EU they can more easily apply punitive measures against China as was in the latest case of US tariffs on tires imported from China. Theoretically the question has two sides. The first one is can China be considered a market economy? The prevalence of state enterprises and the strict control over the national currency points towards a negative answer. On the other hand the remarkable development of China towards establishing efficient enterprises including private ones successfully working towards ever increasing export capacity points to a conclusion that China is making considerable effort to implent an market driven system. The results of the latest China - US Strategic Dialogue show that there are no insurmountable obstacles on the way of US recognition of China's market economy status which will materialize sooner or later depending on political developments in both countries.
While official Chinese policies may be concerned with the continuing dominance of the Communist Party and Marxist ideology from the Russian (and Yugoslav) experiences suggest that the true interests of the ruling elite may be the more material than ideological centering on the perpetuation of their economic power. The metastasis of corruption feeding on China's economic boom points int that direction Bearing that in mind three scenarios can be discerned for the future development of China. The most desirable, but maybe not the most probable will be the gradual political development of the Chinese society towards democracy following the consolidation of the market principles in the economy. The most dangerous would be a slip backwards under the pressure of economic duress into the oppression and belligerence of the Mao era. The most probable though will be the collapse of the Communist party and transfer of power into the hands of corrupt officials and mafia like structures. US inducement for democratic reforms in China may diffuse the dangers of chaotic collapse of communism and the and the considerable security implications that may cause. Ultimately it can be concluded that there is a convergence of interests between the Chinese Communist Party, the entrepreneurs and the people of China and that leads to peaceful economic development as a way to solve all problems facing modern China. That position can find understanding in the US and the rest of the world because it is in harmony with the long term interests of all countries interested in developing economic relations with China on a win-win basis.
Wednesday, October 14, 2009
Why Love and Who Are You?
Tuesday, October 13, 2009
Sovereignty, Human Rights, Responsibility to Protect
Historically people have organized in territorially distinct and independent states to build up the power and security necessary for achieving their goals of prosperity and peace. When a government either fails to fulfill its mandate or malevolently turns against the people, they can overthrow it and install a government according to their will.
The contemporary globalized world and modern weaponry added an international twist to the above classic postulate. In the modern world a small group of people can terrorize a large population using advanced weapons and ruthless tactics. The international community can and does help people under the danger of extermination or other grave deprivations of human rights.
Public support and national interest, as perceived by governments, will make humanitarian intervention a likely and acceptable policy alternative, but the analysis will not be complete if we do not contemplate the possibility to avoid humanitarian intervention altogether or at least minimize the involvement as much as possible . Such an alternative seems even more tempting from the perspective if possible casualties and unavoidable material costs to both intervening and target countries. Politics as part of the universe are intolerant to power vacuum and the absence of a proper democratic institutions based on an economy driven by private property.1 Still it is tempting to avoid intervention to avoid risking life and treasure facing the uncertainty of success. While success military operation may be elusive and the costs unpredictable failure to act almost certainly lead to consequences that are even worse than a failed intervention. The examples of Rwanda, Sudan and Somalia where armed intervention to stop human suffering and restore civil society was withdrawn, insufficient or non existent have become fertile ground for terrorism and organized criminal activities including trafficking of people, arms and drugs and finding willing recruits among the desperate population.2 Alternative approaches to force and end to humanitarian abuses using persuasion, economic sanctions or arms embargoes rarely achieve anything as in the case of Saddam Hussein after the Gulf War, Slobodan Milosevic (who manged to destroy Yugoslavia) and Sudan's al Bashir.3 In general these attempts to avoid armed humanitarian intervention result in prolonging the suffering of the victims as in the case of Bosnia, directly causing hardship for the innocent as with the economic sanctions against Iraq after the Gulf War and being forced to intervene in the end as in Bosnia, Afghanistan and Iraq.
Even if there is a trend of among democratic governments and international public opinion towards favoring armed humanitarian intervention when the circumstances call for it that does not eliminate the need to explore the ethical and legal acceptability of coercive interference into other countries affairs. The post cold war theory has developed from attempts to justify humanitarian interventions under Chapter VII if the UN Charter through the report of the ICISS to the "2005 World Summit Outcome." United Nations General Assembly, 2005. confirming in its Articles 138 and 139 a refined Responsibility to Protect doctrine. It combines the theory of sovereignty as responsibility to protect with implied international responsibility to help a state fulfill that responsibility all the way to intervening with force and take charge if the state fails to protect its citizens. This justification of intervention is limited to four distinct cases of severe humanitarian abuses: genocide, war crimes, crimes against humanity and ethnic cleansing.4 The declared universal acceptance of the Responsibility to Protect doctrine is due to the fact that it is based on established and widely accepted concepts as sovereignty as responsibility, just war, theory, the four Geneva conventions, the Convention for the Prevention of Genocide and the added crime of ethnic cleansing. The solid theoretical work done by the ICISS composed of leading authorities on the subject also contributed to that end. That declared acceptance though does not translate into more effective humanitarian action.
The alternative
Public support and national interest, as perceived by governments, may make humanitarian intervention a likely and acceptable policy alternative, but the analysis will not be complete if we do not contemplate the possibility to avoid humanitarian intervention altogether or at least minimize the involvement as much as possible . Such an alternative seems even more tempting from the perspective if possible casualties and unavoidable material costs to both intervening and target countries. Politics as part of the universe are intolerant to power vacuum and the absence of a proper democratic institutions based on an economy driven by private property.1 Still it is tempting to avoid intervention to avoid risking life and treasure facing the uncertainty of success. While success military operation may be elusive and the costs unpredictable failure to act almost certainly lead to consequences that are even worse than a failed intervention. The examples of Rwanda, Sudan and Somalia where armed intervention to stop human suffering and restore civil society was withdrawn, insufficient or non existent have become fertile ground for terrorism and organized criminal activities including trafficking of people, arms and drugs and finding willing recruits among the desperate population.2 Alternative approaches to force and end to humanitarian abuses using persuasion, economic sanctions or arms embargoes rarely achieve anything as in the case of Saddam Hussein after the Gulf War, Slobodan Milosevic (who manged to destroy Yugoslavia) and Sudan's al Bashir.3 In general these attempts to avoid armed humanitarian intervention result in prolonging the suffering of the victims as in the case of Bosnia, directly causing hardship for the innocent as with the economic sanctions against Iraq after the Gulf War and being forced to intervene in the end as in Bosnia, Afghanistan and Iraq.
Even if there is a trend of among democratic governments and international public opinion towards favoring armed humanitarian intervention when the circumstances call for it that does not eliminate the need to explore the ethical and legal acceptability of coercive interference into other countries affairs. The post cold war theory has developed from attempts to justify humanitarian interventions under Chapter VII if the UN Charter through the report of the ICISS to the "2005 World Summit Outcome." United Nations General Assembly, 2005. confirming in its Articles 138 and 139 a refined Responsibility to Protect doctrine. It combines the theory of sovereignty as responsibility to protect with implied international responsibility to help a state fulfill that responsibility all the way to intervening with force and take charge if the state fails to protect its citizens. This justification of intervention is limited to four distinct cases of severe humanitarian abuses: genocide, war crimes, crimes against humanity and ethnic cleansing.4 The declared universal acceptance of the Responsibility to Protect doctrine is due to the fact that it is based on established and widely accepted concepts as sovereignty as responsibility, just war, theory, the four Geneva conventions, the Convention for the Prevention of Genocide and the added crime of ethnic cleansing. The solid theoretical work done by the ICISS composed of leading authorities on the subject also contributed to that end. That declared acceptance though does not translate into more effective humanitarian action.
How to define a successful intervention?
A simple and clear definition would be one that has achieved its aims with minimum casualties and maximum efficiency. There are several difficulties with attempting to apply this definition to real life cases. The first obvious one is with the aims of the intervention. It could be the stated goals in that case Somalia was a successful intervention as the US and UN forces helped distribute humanitarian aid. Many observers, analysts, experts and the general public do not agree with a positive assessment of the Somalia operation.5 Another approach would be to deduce an implicit goal for all humanitarian interventions as lasting peace which would involve state building. Assessing the efficiency of an armed intervention can be even more difficult than assessing the effectiveness. While obviously less causalities is better how can the level of acceptable casualties be defined? The Kosovo campaign with zero casualties for the intervening forces is a champion of effectiveness. On the other hand the intervention in Afghanistan is praised for the low level of troops involved and consequently low cost but the slow progress and mounting casualties will hardly make it a good example to follow. It comes back to the opening question:What is a successful intervention?
There are two well documented examples of armed intervention and subsequent policies which led to unsurpassed positive humanitarian results: Japan and Germany after WWII. Even if the war itself was of the classic aggressive, defensive type the mass atrocities committed by the Japanese and German armies made the Allied victory an humanitarian relief operation of epic proportions. Post WWII development also contributes to the concept that promoting economic development and democracy as the US did in Western Europe and Japan leads to a state of peace and stability in these regions. The Soviet block managed to provide for basic economic needs but the suppression of democracy led to an explosion of organized crime and corruption after the fall of communism. From another point of view the US intervention in Haiti stopped abuse and restored a semblance of democracy but failure to prompt democracy with economic development led to the predictable crumbling of the fragile democratic institutions.
To prevent the regrowth or metastasis of the root causes for intervention the need for state building including creating viable opportunities for sustainable economic development and reform in the most important spheres of public life as media freedom, law reform and the rebuilding of civil society.
In the case of Somalia, initially the United Nations Security Council resolution 794 (1992) authorizing UNITAF calls only for establishing of a secure environment for humanitarian operations. It can be argued that this limited objective prevented more decisive action towards disarmament of the marauding militias and ultimately undermined the success of the operation. Alternatively others argue that that the change of mission from humanitarian aid to nation building led to a decline of public support by pursuing an seemingly unattainable goal even before the tragic events in Mogadishu that triggered the withdrawal of US forces.8 Later with resolution 814 (1993) the UN Security Council raised the goals by including state building right when the newly created UNISOM II force lacked the number and resources to accomplish the task
Wednesday, September 30, 2009
Confused and Dazzled
are stunning, beautiful, painful and absurd.
You made me and I'm making you
every second, day after day,
but still don't understand
all whats and hows and
most importantly most whys.
But even if I don't know why
I feel what's good and what is bad.
It helps me stumble along my path
and not go mad