Politics and Governance

The most persistent and most vocal congressional criticism of the administration focuses on economic policy, especially the issue of China’s currency policy. There is widespread concern in the United States that the Renminbi (RMB) is significantly undervalued, which has an adverse effect on U.S. trade and economic interests. In the two-plus years since Treasury secretary Tim Geithner’s confirmation hearing and his declaration (later walked back by the White House) that China was manipulating its currency, congressional critics have found the administration’s efforts sorely lacking. The administration has sought to address those concerns within the context of the larger bilateral relationship, using diplomacy to try to prod the Chinese government into appreciating the RMB. But congressional dissatisfaction has been evident in the bipartisan letters that have been sent to the administration and in aggressive proposals for legislation to pressure the Chinese and the Obama administration on currency appreciation and remedies.

Locke is certain to face some tough questions on the currency issue and other facets of economic policy closely related to his tenure as Commerce secretary. In particular, he will be pressed on perennial U.S. concerns on intellectual property rights and the U.S. trade deficit with China, which rose by more than 20 percent in 2010 over the previous year. China’s recent taking of the top manufacturing spot from the United States and the persistence of the global economic crisis ensure that economic issues will continue to be high on the agenda.

Another highly-contentious issue is China’s adherence to the Iran sanctions regime. A recent letter to President Obama from Senators Joseph Lieberman (I-CT) and Mark Kirk (R-IL), sent on the eve of the Hu-Obama summit, called China’s record on sanctions enforcement and nonproliferation “inadequate and disappointing.” Kirk has indicated that he plans to use the confirmation process to force the issue of the administration’s willingness to initiate sanctions against Chinese companies that are doing business with Iran in violation of Iran sanctions laws. And on March 10, Hillary Clinton received a letter from 10 Senators from both parties (led by Senators John Kyl (R-AZ) and Robert Menendez (D-NJ)) stating: “It appears that Chinese firms in the energy and banking sector have conducted significant activity in violation of U.S. law. We cannot afford to create the impression that China will be given free rein to conduct economic activity in Iran when more responsible nations have chosen to follow the course of action we have asked of them.”

Many senators are hardly satisfied by the administration’s claim that China has begun to improve its export control regime, especially given the latest news from Iran. A recent International Atomic Energy Agency report cited concern over Iran’s lack of engagement with the agency and fears of “possible military dimensions” of Iran’s nuclear program. All of which means that the issue will come to the fore during Locke’s hearing, raising more difficulties for the administration’s efforts to improve U.S.-China relations.

The division in the administration’s China policy is not just between the executive and legislative branches. The bilateral security relationship has also highlighted differences between some in the defense and intelligence communities on what China’s military modernization and burgeoning force-projection capabilities means for the United States. On March 10th, Director of National Intelligence James Clapper labeled both China and Russia “mortal threats” to the United States.   Although he was talking about capabilities rather than intent, Clapper’s remarks undermine the administration’s efforts to frame China as a strategic partner rather than a competitor and provide additional fodder to the administration’s critics on China. Other congressionally-mandated reports have also undermined the administration’s China message: both the Quadrennial Defense Review and the annual review of Chinese military power highlighted concerns that China’s economic and military modernization will ultimately be harmful to U.S. strategic interests. Clapper’s comments will only add to that perception.

What the consistent bipartisan congressional criticism of the administration’s China policy has shown in the past, and what the Locke confirmation process will demonstrate just as vividly, is that Obama’s efforts to improve the U.S.-China bilateral relationship will continue to be challenged at every turn. That is, unless the administration finds a way to involve Congress in the strategic trust-building process it is seeking to promote with China.

First, Libya is the seventeenth-largest nation in the world. Its expanses and its desert leave military forces vulnerable and often draw them into overextending their advances; resupply, not terrain, limits military operations. Its coastline, 1770 km long, is the largest of any African country bordering the Mediterranean. The major Libyan highway runs in close proximity to this coast, affording sea access and baring exposure. One of the least forested countries in the world, it presents very few natural obstacles to military forces, a factor in the recurrent shifting of frontlines during the Libyan campaigns of the Second World War. News of rebel conquests and Qaddafi’s reconquests should therefore be treated with caution. The main questions will be: How long can any force hold ground and what are the source and delivery routes of supplies?

Second, Libya’s cities and oases are islands in a sea of sand and of pivotal importance as supply depots. When the Afrika Korps was advancing in April 1941 and a new frontline was established along the Libyan-Egyptian border, the city of Tobruk was left behind in the rear of the Axis advance. The town was besieged for 240 days until relieved by the British Counteroffensive Operation Crusader. It was again besieged the following year and fell during the battle of Gazala with 35,000 men of the British Empire taken prisoner. During the same battle, another siege of a small Free French garrison in defense of the remote oasis, Bir Hakeim, substantially slowed the Axis advance and cost the Germans and Italians dearly. The Axis powers could not replace their casualties for the crucial battle of El Alamein—the turning point of the war in North Africa. Today, rebels and troops loyal to Qaddafi are battling over control of various cities including the stronghold of Surt—“Qaddafi’s Tobruk.” Holding these towns dotted along the principal Libyan highway will be pivotal. Once the rebel army establishes clear leadership, a Rommel-like strategy, with a force surrounding Surt while a mobile column of troops heads to Tripoli, is not unimaginable. It all depends how quickly the rebels can organize and build momentum and whether Qaddafi has a Montgomery-like counterstrategy up his sleeve.

Third, the most important axis of operation, as during the Second World War, is the old colonial route Via Balbo, a highway running from east to west through all of Libya. Rebel and government forces are engaging along this route. Due to the exposing nature of the terrain, air power is critical in controlling this major artery. Erwin Rommel remarked about campaigning in Africa that, “Anyone who has to fight, even with the most modern weapons, against an enemy in complete command of the air, fights like a savage against modern European troops, under the same handicaps and with the same chances of success.” His adversary Berhard Montomery concurred: “If we lose the war in the air we lose the war and we lose it quickly.” During the North Africa campaign, whichever side had air superiority had the upper hand. The German position on the Libyan-Egyptian border became untenable in June 1941 because all the Luftwaffe squadrons but Fliegercorps X were transferred to the Russian front; this meant an end to close air support. When the Afrika Korps was pushed back to its defensive line around El Agheili—where rebels and Qaddafi loyalists are currently clashing—it was just in time for the German Luftwaffe to re-establish its air superiority. Hitler had ordered Fliegercorps VII to Sicily which provided the direct air-ground support needed to push back the British forces once again all the way to the Egyptian border. For the rebels, air superiority will be the key in massing enough ground forces to take the capital of Tripoli. For Qaddafi, it is the most lethal asset at his disposal to retain power.

The Libyan campaign of the Axis and Allies during the Second World War, with its rapid advances, retreats, sieges, overextended supply lines, and mobile maneuvers, illustrates the peculiar nature of warfare in Libya. Should the forces loyal to Qaddafi not disband themselves, a prolonged struggle featuring some aspects of the North African campaigns could ensue. The end of Qaddafi, however, is not likely to come as quickly as the end of the Panzer Armee Afrika in 1943. As Bernard Montgomery stated, “The defeat of the enemy in the Battle of El Alamein, the pursuit of his beaten army and the final capture of Tripoli . . . has all been accomplished in three months. This is probably without parallel in history.” A beaten dictator on holding on to his power, however, is a sight not uncommon in modern times.

Franz-Stefan Gady is a foreign policy analyst at the EastWest Institute.

Click here to read Gady's piece in The National Interest

In a follow-up to last week’s commentary on Hard Power strategies, Ikram Sehgal explores Soft Power, which he defines as “the ability to make others do what you want, what they otherwise would not have done,” based on what an actor represents.  The currencies of Soft Power are “values, culture, policies and institutions,” as opposed to the currency of money and military strength used in Hard Power strategies.

Sehgal argues that the use of Soft Power has been on the rise in the years since 9/11 and attributes the increasing prevalence of Soft Power strategies to their success at uniting actors, as well as globalization and the diffusion of media power.  Sehgal envisions that, in the future, Pakistan could increase its projection of Soft Power by focusing first regionally and then globally.

Click here to read Sehgal's piece in The News

The sense of alarm can only have been heightened when, this past week, the United States Secretary of State, Hillary Clinton, invoked the United States Congress to "put aside the humanitarian, do-good side of what we believe in.” She said, “Let's just talk straight realpolitik. We are in competition with China." While this is not news to the Japanese government, their sense of heightened alarm will come from an understanding of the way China’s leaders will react to the Clinton statement. It represents a fundamental abandonment of the soft rhetoric that the United States kept up for more than two years in the run-up to the state visit of China’s President Hu Jintao in January this year. The neo-cons in Washington, who spent so much effort in the first Bush Administration to compete with China in realpolitik terms, will be smiling.
The United States has hardened its position on China because of the latter’s growing cyber warfare and space capabilities. "Advances by the Chinese military in cyber and anti-satellite warfare pose a potential challenge to the ability of our forces to operate and communicate in this part of the Pacific," Defense Secretary Robert Gates told a Japanese audience on 13 January in Tokyo.

That anodyne statement brings out into the open the growing mistrust of China in the United States because of its relentless cyber operations against American targets.
Japan and the United States have formalized a cyber alliance which, according to one source, commits both sides to renouncing cyber operations against the other. If true, and it may not be, this would be a significant first in international relations. Japan’s 2010 Defense Guidelines elevate cyber warfare capabilities to a new level. In a white paper issued in May 2010 by the Information Security Policy Council, Japan made plain its need to prepare for cyber war directed at its critical infrastructure.

One reference point for Japan’s heightened concern is a series of coordinated attacks on its allies in 2009. According to Professor Motohiro Tsuchiya: “In 2009, massive scale of cyber attacks was recorded in the U.S. and South Korea, including the Department of Defense (DOD), the U.S. Congress, the Treasury, the Department of Homeland Security (DHS), Federal Trade Commission (FTC), New York Stock Exchange (NYSE), Washington Post, among others.”

The right response to cyber threats of any kind, according to Professor Eva Vincze of George Washington University, has many levels. Affirming that technology by itself is insufficient, and emphasizing the human factor, she calls for international consultations with stakeholders with a view to improving communication based on span trust.

So where does that leave Japan? It must work, as other countries are also now realizing, to mount a diplomacy of cyber security, or cyber diplomacy. This will need to engage the countries, like China, North Korea and Russia, that Japan mistrusts most. Japan will need to construct a cyber arms control agenda, including confidence building measures, with its neighbors.

Click here to read Austin's piece in New Europe

Seghal considers the “defining limitation of hard power is that those who project ‘Hard Power’ will always be held to fickle public cynosure in the long-term.”  Not all actors have the capacity to engage in Hard Power and are eager to judge those that do, based on weaknesses to the strategy.  States wishing to engage in hard power strategies are crippled, according to Seghal, by the relatively small number of tools at their disposal, namely, military intervention, economic pressure, and now, cyber war, which limits their options.  Seghal believes that when Hard Power policy fails, a country’s “credibility deteriorates [and] international cooperation diminishes as attitudes of distrust tend to grow.”  This, in turn, makes it less likely that states will engage in Hard Power when a justifiable need arises.

Seghal argues that the continued reliance upon Hard Power by nations such as the United States stems from an inability “to admit that military dominance generally does not always work.”  This perpetuates the myth that military strength can ultimately assure security – a myth that Seghal believes to be false.

Despite maintaining that  there is a time and place for Hard Power to be used, Seghal ultimately warns that “advocates for Hard Power must remember that its use in the ‘global village’ will have adverse consequences about their image, however just the cause.”

Click here to read Sehgal's piece in The News

"Not long ago at all, our partners came out actively for honest democratic elections in the Palestinian territories," Putin said. "Wonderful! Well done, lads! And it turns out Hamas wins, the same people you are calling a terrorist organization and have started to fight against." (Moscow Times).

At one level of politics, Putin’s analysis of Iran and Palestine is rational. On another level, there is a deep neuralgia in Russia about the Muslim world. Putin said that Russia was concerned about the consequences of the recent uprisings in Arab countries for Russian security. He also warned (correctly) that the events could have negative consequences for Europe. The underlying anxiety here is not unique to Mr Putin. He is showing a discomfort here many Western leaders share and that will only grow. 

The anxiety comes about because of shifting power relationships in many fields of national endeavor. On a much lower level, this was symbolized in a tantalizing way in the shock defeat of Russia by Iran (1-0) in a football friendly in Dubai on 9 February. Perhaps the patriotic, sports-loving Mr Putin was smarting from the defeat. The Dubai game, a warm-up for the Euro 2012 qualifiers, was only held in Dubai so that the Russian football federation could get the money from the TV rights involved in playing a team from the region.

More seriously though, the Putin visit to Brussels and the concerns he expressed reflect fundamental shifts in world power at a time when, with the uprisings, revolts and wars in the Muslim world, there is an historic shift under way in world politics. Russia’s relations with the European Union (EU) now look very different from three years ago. Russia has overtaken China as an economic partner of the EU and Putin is determined to make Russia and the EU partners in international security affairs as well.

At exactly the time when the world press was trumpeting the statistic that the Chinese economy had overtaken the Japanese economy, and would eventually surpass the American economy, a different data set from the IMF revealed another shift. The US economy was correctly reassigned to number two spot behind the European Union in GDP on a Purchasing Power Parity basis. And Indian GDP is within a whisker of Japan’s. The bargaining power relationships within the G20 and IMF are shifting and on the global stage have shifted in Europe’s favor.

So, the EU is not a country, some might say. Yes, but it is an “economy”, a single economy, in a world where, as a good Marxists might tell you, economics is in command. The Articles of Agreement of the IMF (Section XIII) dictate that “The principal office of the Fund shall be located in the territory of the member having the largest quota”. Well the European Union now has almost double the quota of the United States, around 30 per cent of the total for the EU compared with just over 17 per cent for the United States, and China’s un-naturally low 3.72 per cent. So the IMF headquarters really should move to Europe.

Journalistic flourishes aside, what does this growing list of re-alignments of politics and power mean? At the very least, in economic and social terms, it means that the initiative for change, the impulse for reform and the power for transformation are slipping even faster from American hands. Russia knows it and is looking for European partnership, especially to secure the southern flanks not just of Russia but of Europe as a whole.

Click here to read this piece in New Europe

The recent eruption of protests and violence in Egypt and the resignation of its President, Hosni Mubarak, lead some pundits to predict that the same movement will happen in China. However, China’s circumstances are entirely different and a similar outcome is unlikely.

Along with India and Greece, Egypt and China are two of the oldest civilizations in the world. However, both the Arab Republic of Egypt and the People’s Republic of China only established their current governments about 60 years ago. How did these two governments conduct their affairs? Why are the events that caused the collapse of the Mubarak regime not likely to happen in China?

The main issues that surrounded the downfall of the Mubarak regime appear to be the leadership and the economy.

In Egypt, Hosni Mubarak served as the only President of Egypt for over 30 years; yet in China, since Deng Xiaoping’s launch of the Open and Reform Policy in 1978, China has made orderly transitions through three generations of leaders.

The first generation had Mao Zedong at the core; the second generation from 1976 to 1992 had Deng Xiaoping ; the third generation from 1992 to 2003, had Jiang Zemin; and the fourth generation from 2003, has Hu Jintao as the core figure (General Secretary), with the prominent leaders include Wu Bangguo, Wen Jiabao, Jia Qinglin, Zeng Qinghong and Li Changchun. By 2012, the fifth generation of leaders will emerge, and the sixth generation of leaders is already being prepared.

In Egypt, the last three presidents - Nasser, Sadat, and Mubarak - all came from military backgrounds. By contrast, Chinese leaders are mostly from civilian backgrounds, and many of them are in fact engineers. While many historical great leaders have come from military backgrounds, civilian leaders tend to seek non-military solutions, and they also have a broader vision for science, business, and society as a whole.

One of the rumors is that President Mubarak was plotting to let his son inherit his presidency, which upset a lot of people in Egypt, including the military council, and resulted in a forced resignation.

When we look at the history of the People’s Republic of China, no leader has ever been succeeded by their offspring. The orderly transition of leadership, a well-planned succession, and a merit based leadership selection process has resulted in maintaining China’s stability and progress.

On the economy, both Egypt and China face a daunting task to deal with a vast number of people that need education and employment.

In the last 30 years, the Egyptian government has reformed the highly centralized economy it inherited from President Nasser. The pace of structural reforms, including fiscal and monetary policies, privatization and new business legislations, helped Egypt to move towards a more market-oriented economy and prompted increased foreign investment. The reforms and policies have strengthened macroeconomic annual growth results which averaged 5% annually, but the government largely failed to curb the growing problem of unemployment and underemployment among youth under the age of 30 years.

In this period China has followed its own socialist market economy and become the world's fastest-growing developing country, with average growth rates of 10% for the past 30 years. China has lifted 300 million people, about four times the size of Egypt’s entire population, out of poverty.  Certainly, China still has a lot of work to do, but its amazing accomplishment is clear.

China’s success is largely due to its long term planning strategy-the Five Year Plans. Moreover, China is committed to stay on the course of its Five Year Plans and not by piecemeal legislation.

China's overall economic construction objectives were clearly stated in the Three Step Strategy set out in 1978:
Step One—double the 1980 GNP and to ensure that the people have enough food and clothing. This was attained by the end of the 1980s;
Step Two—quadruple the 1980 GNP by the end of the 20th century. This was achieved in 1995 ahead of schedule;
Step Three—increase per-capita GNP to the level of medium-developed countries by 2050, at which point the Chinese people will be fairly well-off and modernization will be basically realized.

The 12th Five Year Plan will be adopted in March 2011. Those who are interested in having a deeper understanding of China’s future direction should study the plan and watch the events unfold. China will stick to its plan.

In most democracies, the citizen’s trust and satisfaction with their own government is critical to the success of the nation, and China is no exception. Let us take a look at how most Chinese people view their government. According to 2010 Pew Survey, “China is clearly the most self-satisfied country. Nearly nine-in-ten Chinese are happy with the direction of their country (87%), feel good about the current state of their economy (91%) and are optimistic about China’s economic future (87%). Moreover, 64% of Chinese have a very favorable view of their own country, a self regard that exceeds that among Americans (48%), Russians (43%), Germans (12%) and Brazilians (31%).”

Citizen confidence leads to productivity, investments, and stability. When the citizens are satisfied, the government can conduct its functions; business can produce goods and services, and people can work and provide for their family.

For centuries, China has suffered from natural disasters, unwise policies, foreign intervention, and internal struggles, and there have been many lessons learned. However, today’s China is one that deals with its foreign relations in both diplomacy and defense; engages in the development of its business and scientific capability; protects and regulates the sustainable use of its natural resources; enforces and regulates fair and responsible business practices; determines and enforces civil laws of property and conduct; provides public goods and services for the well-being of the community as a whole, such as infrastructure, vaccination programs, disaster relief, basic healthcare, subsidized housing, public education and public utilities.

While there might be some similarities between Egypt and China in their long civilization, and the moving from a centralized economy to a market economy in the last 30 years, the difference is that China has maintained an orderly transition of leadership, and an economy planning process that is producing results. Most importantly, China’s people are satisfied with their own government.

Click here to read this article online

Sehgal

Writing for The News, Ikram Sehgal discusses the inevitable challenges facing the new leadership in Egypt—and the possibility that more dominos will fall in the region.

Click here to read Sehgal's follow-up piece in The News

You can listen to this program or read the story here.

“The erosion of common values is growing in a world that is increasingly becoming more complex and interconnected as well as undermining public trust in leadership, future economic growth and political stability,” Sehgal writes.

In heated discussions about terrorism, Indian and Pakistani representatives were, as often is the case, very much at odds with each other—and Sehgal was disappointed with the Indian contributions. But he admires the way the Indian private sector is leveraging its Davos contacts, suggesting Pakistani businessmen should do the same. He also reflects on the possible implications of the Egyptian military’s response to the protests in that country for the Pakistani military.

Many of the world’s leaders including President Sarkozy, Chancellor Merkel, President Medvedev and former U.S. President Bill Clinton addressed  panels at Davos.  Sehgal concludess: “Davos provides a unique platform for leaders of governments, civil society, industry and the media as well as a wide spectrum of decision-makers to trade ideas on how to solve common pressing problems.” 

Click here to read Sehgal’s article online