Cheney and Rumsfeld: Neo-Con Stooges


November 7, 2011

NY Times SUNDAY BOOK Review

Memories of the Bush Administration: Cheney and Rumsfeld

By Alan Brinkley
Published: November 3, 2011

The Administration of George W. Bush has already produced a remarkable body of contemporary history from a large group of talented journalists and writers — Jane Mayer, Thomas E. Ricks, James Risen, Ron Suskind, Susan Faludi, Seymour M. Hersh, James Mann and many others. But in the last year, several members of the Bush administration have retaliated with books of their own.

Among the most significant are former Secretary of Defense Donald Rumsfeld’s “Known and Unknown” and former Vice President Dick Cheney’s “In My Time,” memoirs by perhaps the two most important figures (other than the president) in the years of terrorism and war. Both books have received mostly negative reviews — largely deserved.

Rumsfeld’s book is dense and bloated, although modestly candid. Cheney’s is clearly written (with help from his daughter Liz Cheney), but with the exception of its last chapters, dry, earnest and dull. None of this seems to have had much impact on their sales. Both spent time at the top of the best-seller lists.

Political memoirs are normally unsurprising, but these two books are unusual for their defensiveness and occasional combativeness in the face of the broad popular contempt so many people expressed while Rumsfeld and Cheney were in office. The two men present similar arguments. Both rarely confess to making mistakes, though they often write sharply about others who have. But the most important question that these books raise is the one of their credibility.

That the two memoirs were published in the same year and are in many ways alike should not be surprising. Rumsfeld and Cheney have had a long and intimate relationship stretching back to the Nixon administration and into the present. But even before they met, they followed similar paths into politics and government.

Rumsfeld and Cheney were the sons of middle-class families — Rumsfeld raised in Chicago, Cheney in Nebraska and Wyoming. Both attended public high schools, excelled in athletics and enrolled in prestigious colleges. Rumsfeld attended Princeton, where he was a successful athlete and a popular social figure. Cheney went to Yale, but after two unsuccessful years moved to the University of Wyoming, followed by graduate studies at the University of Wisconsin, where he hoped to get a Ph.D. in political science and become an academic.

Rumsfeld, who is nine years older than Cheney, became a member of Congress in 1962, while Cheney was still struggling through college. But in the early 1970s, their paths crossed, and they soon became close colleagues and friends. The relationship began when Cheney was a young, eager intern looking for a job in the Nixon White House. Rumsfeld — having abandoned a brief career in Congress — was director of the Office of Economic Opportunity. He hired Cheney as an aide — the beginning of a Horatio Alger-like rise — and their partnership shaped each other’s careers for decades afterward. In the aftermath of Watergate, Rumsfeld became President Gerald Ford’s chief of staff, and took Cheney with him as his “stalwart assistant.” When Rumsfeld was appointed secretary of defense in 1975, Cheney replaced him as Ford’s chief. Both men were Republicans with conservative leanings. But for many years, during which they often served simultaneously, they seemed to many people to be smart, pragmatic, non ideological young men who fit well into the moderate Ford administration.

When Jimmy Carter became president in 1977, their paths diverged. Cheney was elected to Congress in 1978, where he remained throughout the Reagan administration. In 1989, President George H. W. Bush appointed him secretary of defense, where he became a competent and generally respected figure. Rumsfeld moved into the private sector and remained there for 24 years, while staying active in a wide range of public service committees and commissions.

After the first President Bush left office, Cheney also moved into the private sector, spending time at the American Enterprise Institute in Washington before becoming the C.E.O. of Halliburton, one of the largest oil and construction companies in the world, with connections to militaries in several countries. When George W. Bush chose him as his vice president in 2000, Cheney helped persuade the new president to name Rumsfeld as his secretary of defense. Following the election, there was considerable relief that Cheney and Rumsfeld would be serving the new president, given the doubts that were being voiced about Bush’s capabilities. Even many Democrats were pleased that these competent, experienced figures would play a large role in the new administration.

Shortly before his election in 2000, when the vision of “compassionate conservatism” still seemed plausible, Bush said, “I just don’t think it’s the role of the United States to walk into a country and say, ‘We do it this way; so should you.’ ” But after the 9/11 attacks — eight months into his presidency — everything changed. “We were embarking on a fundamentally new policy,” Cheney recalled. “We are dealing here with evil people.”

A group of Republican neoconservatives and other political and government figures quickly gathered not only to respond to the 9/11 attacks but also, as they saw it, to restore the nation’s confidence and ideals. Cheney and Rumsfeld had privately deplored the decline of American power in the Nixon and Ford administrations during the Vietnam War.

They saw in 9/11 an opportunity to revive American power and superiority, or as Cheney put it, to “get it right this time.” Much of what happened after the attacks would very likely have occurred no matter who was in charge — the Patriot Act, the Department of Homeland Security, the building up of intelligence organizations and other changes. But from the start, Cheney and Rumsfeld began pushing for a much wider change, what the president called a “war on terror.”

But what did a “war on terror” mean? For Cheney and many others, and eventually for President Bush, it seemed to mean only one thing — a regime change that would send a message through the Middle East that, as Paul Wolfowitz predicted, would undermine radical regimes and build new ones more consistent with American ­ideals. Although it was reasonably clear that no political regime had organized the 9/11 attacks, Cheney, Rumsfeld and Bush came to believe that the regime most in need of destruction was Iraq, even though there was no evidence that the Iraqis had played any role in the terrorist events.

By late 2002, the Iraq war was on a fast track, justified by Saddam Hussein’s supposed weapons of mass destruction. There was resistance from some members of Congress, some United Nations investigators and some individuals in the State Department. But Cheney and Rumsfeld, who were among the most determined people in the administration to promote the assault on Iraq, were not deterred by the fact that the United States had never before launched a pre-emptive war. Their public argument was the presence of weapons of mass destruction in Iraq. But it soon became clear that there were no such weapons.

This discovery caused a political earthquake worldwide. The war now seemed to have no rationale at all, but Cheney and Rumsfeld quickly came up with new ones. Cheney in particular takes no responsibility for this remarkable failure of intelligence. Instead, he argues that the absence of weapons did not make Iraq any less dangerous, and perhaps more.

As he often does throughout his book, he argues through others — in this case, David Kay, who worked on the Iraq survey group that was sent to find W.M.D.’s. Cheney quotes him: “I actually think what we learned during the inspections made Iraq a more dangerous place, potentially, than in fact we thought it was even before the war.” Charles Duelfer, another survey group member, insisted (with no visible evidence) that “Saddam wanted to recreate Iraq’s W.M.D. capability . . . after sanctions were removed.”

Rumsfeld brusquely dismisses his failure to provide sufficient troops to avoid what soon became an out-of-control insurgency that continued for years. He responds in his book, as he did at the time, “Stuff happens,” a phrase he often used when confronted by failures. Among the stuff that happened was the absence of body armor in a highly dangerous country. Soldiers begged for it in vain for months during his occasional visits to Iraq. Rumsfeld’s response was that we had to fight with the Army we had. He is still fighting on the cheap, defending himself with his favorite phrase — “known unknowns” (which is even borrowed for the title of his book).

It allows him to claim that it was all but impossible to determine what the military needed. But he also presents himself as realistic enough to understand that Bush’s “Mission Accomplished” banner and his claim that “major combat operations in Iraq have ended” would “haunt his presidency until the day it ended.” And he is candid enough to admit that he should have realized that the war would be a long and difficult one, that democracy in Iraq would be unlikely and that the American administrator in Iraq, Paul Bremer, had led the country into chaos by recklessly and incompetently disbanding the Iraqi police and military, and the Baath Party government.

The fact of a war of choice was perhaps bad enough. But the Iraq war (and the Afghanistan war as well) were fought not just by weapons and battles. They were also fought by torture. Rumsfeld brushes away the charges of torture in his book by noting either that the Defense Department did not participate, or that the techniques it employed were “legal and humane.” Cheney, however, makes clear from the start that “we would have to work ‘the dark side if you will,’ ” a statement he continues to defend in his book.

Cheney insists that the “enhanced interrogation” that he helped create was not torture. Water boarding, he has said, was humane and effective because a few lawyers in the Office of Legal Counsel said so. Many of their colleagues were aghast, but they were mostly ignored and in some cases dismissed. Even some high-ranking military officers called water boarding criminal torture. So did Senators John McCain (no stranger to torture) and Lindsey Graham, both Republicans.

Cheney passingly mentions other forms of enhanced interrogation in his book, but he does not describe what they were. Nor does he make any mention of the many terrorist suspects who were turned over through “extraordinary rendition” to other countries, where there was no inhibition to using torture.

By 2006, the Bush administration was falling apart. The president’s poll numbers were falling almost by the day. Democrats were on their way to winning majorities in both houses of Congress. Cheney — the most powerful vice president in American history — was becoming an increasingly lonely figure within the White House. Bush decided to make changes — in large part because of the administration’s incompetent response to Hurricane Katrina in 2005. (In his book, Cheney blames the failure on Kathleen Blanco, the Louisiana governor, for dithering.) Among the dismissed, over Cheney’s strong objections, was Rumsfeld. (The president timidly delegated Cheney to give him the news. Rumsfeld stepped down without complaint.) Cheney, of course, could not be fired as vice president. But he had now become the most toxic figure in the White House.

Cheney’s chief of staff and enforcer, Scooter Libby, was accused of leaking the identity of Valerie Plame, a C.I.A. operative, whose husband had challenged the claim that Hussein was building nuclear weapons. Libby was later convicted of perjury. The president commuted his sentence, but as Cheney writes, “I felt strongly that Scooter deserved a pardon, and I broached the subject on numerous occasions with the president.” In the last weeks of Bush’s presidency, he asked again and, when denied, says that the president had made a “grave error”; he told Bush, “you are leaving a good man wounded on the field of battle.”

That was not the only time Cheney was repudiated. In 2007, Cheney pushed hard to bomb a nuclear reactor in Syria. When the president asked who agreed with the vice president, no one, including the president, raised a hand — a hard defeat for a man whom Karl Rove had long called “management.” “I was a lone voice,” Cheney pathetically writes. (The Israelis successfully bombed the Syrian reactor several months later.) By then, Cheney was one of the most unpopular political figures in America, often ridiculed as “Darth Vader.” The polls showed an approval rating of 13 percent.

Cheney did not take his loss of power easily, and the final chapters of his book are filled with bile and contempt. It was no secret that he had been a critic of Colin Powell through much of Powell’s tenure as secretary of state. He writes that Powell was “not only failing to support the president’s policies” but was “openly disdainful of them.” (Some people in the foundering administration believed that “the president’s policies” were often Cheney’s.) He “was particularly disappointed in the way” Powell “handled policy differences. Time and again I heard that he was opposed to the war in Iraq. . . . But never once in any meeting did I hear him voice objection.”

And he was at least equally contemptuous of Secretary of State Condoleezza Rice. She had, he writes, “made concession after concession to the North Koreans and turned a blind eye to their misdeeds.”

Cheney consistently complains about what he considered her weaknesses. He also goes after Secretary of Defense Robert Gates, claiming that he was often speaking “for himself and not reflecting U.S. policy.” By the end, he even seems to be disappointed with Bush himself — a disappointment that was probably reciprocated. Although Cheney is cautious in his criticism of the president, it seems clear that he thinks Bush had slipped back into what the vice president calls a pre-9/11 mode.

Brent Scowcroft, Gerald Ford’s and George H. W. Bush’s national security adviser, said about the man he had worked with in two previous administrations: “Dick Cheney I don’t know anymore.” What had turned this capable, pragmatic, respected figure into the harsh and belligerent man who seemed toward the end to believe that only he understood the world of his time?

Part of it was that he had become “really conservative,” as he told President Bush when he was invited to join the ticket in 2000. Certainly, he was convinced that 9/11 had dramatically changed the world and had radically transformed America’s role in it. And he was disturbed that so many people did not share his views. He also had serious heart problems through much of his life, which intensified during his tenure as vice president, and though he courageously fought to keep going, his poor health may have contributed to what Scowcroft considered his change.

The angry responses to Cheney’s book are evidence of how embattled the Bush White House became in its last years, and how central Cheney’s role was. Colin Powell has accused Cheney of taking “cheap shots” in his book. He has challenged Cheney’s claim that he had forced Powell out of the State Department. Powell himself had long made clear that he would serve only four years, and he charged Cheney with lying. Powell also called Cheney’s statements in the book “the kind of headline I would expect to come out of a gossip columnist.” He added, “I think Dick overshot the runway.” Rice responded to Cheney by describing his book as “utterly misleading” and an “attack on my integrity.” Even Donald Trump, in the aftermath of his preposterous hints that he would run for president, gave an interview in which he accused Cheney of “lying.”

Together, Rumsfeld and Cheney served through many crises and many disasters. It is not surprising that in the turbulent post-9/11 years there would be contention, disappointment, failure, sniping and broken friendships. If they had written candidly about these battles, their books would be of real interest. Instead, both men have stuck to their defensive postures. Cheney said in a television interview that his book would have “heads exploding all over Washington.”

For the most part, the explosions were tame. But perhaps the most remarkable explosion was one of Cheney’s own statements. Toward the end of his book, he boldly describes the Iraq war — one of the most disastrous events of recent decades — as a great American triumph. The fiasco that nearly destroyed Bush’s presidency was, according to Cheney, “one of the most significant accomplishments of George Bush’s presidency — the liberation of Iraq and the establishment of a true democracy in the Arab world.” If that statement isn’t an “explosion,” it would be hard to know what is.

Alan Brinkley is the Allan Nevins professor of history at Columbia University and the author, most recently, of “The Publisher: Henry Luce and His American Century.”

A version of this review appeared in print on November 6, 2011, on page BR18 of the Sunday Book Review with the headline: Memories of the Bush Administration.

 

Slyvia Nasar’s Grand Pursuit: A Review


November 7, 2011

NY Times SUNDAY BOOK REVIEW

How the Dismal Science Stopped Being Dismal

By Justin Fox (10-07-11)

Listen to the economic debates of the past couple of years, and it’s tempting to conclude that no progress has been made in the field in over half a century. There’s John Maynard Keynes on the one side, arguing for deficit spending to offset the aftereffects of a once-in-a-lifetime financial crisis. On the other side there’s Ludwig von Mises (his fellow Austrians Joseph Schumpeter and Friedrich von Hayek seem too moderate for the role), thundering that all govern­ment intervention in the economy is doomed to failure.

Keynes and Mises are of course both long dead. But it is the resilience of their ideas that makes studying the history of economics so rewarding for non-­economists. As a rule, economists don’t know much about history. So at times like these, anyone with a bit of familiarity with the giants of the past can weigh in on big economic issues with about as much authority and credibility as the credentialed experts.

This is one explanation for the continuing popularity of Robert L. Heilbroner ’s book “The Worldly Philosophers: The Lives, Times and Ideas of the Great Economic Thinkers.” Another is that once a book makes its way onto undergraduate required-­reading lists, as Heilbroner’s did, it doesn’t easily fall off. Heilbroner (left) wrote his irreverent group portrait of Keynes, Schumpeter, Karl Marx, Adam Smith and others in the early 1950s while studying for a doctorate at the New School for Social Research in Manhattan. (Mises was so marginalized at the time he didn’t rate a mention.) He died in 2005, but his book lives on, with more than four million copies sold.

That kind of success makes a tempting target for imitators, and over the past decade, word spread among economics writers that Sylvia Nasar (right) was at work on a new “Worldly Philosophers” — something to update and possibly supplant Heilbroner. Nasar is no knockoff artist; a professor at Columbia Journalism School and a former economics correspondent for The New York Times, she wrote what is perhaps the best economics-­related book of the past quarter-­century, “A Beautiful Mind,” a near-perfect biography of the game theorist John Nash.

Now Nasar’s new book, “Grand Pursuit: The Story of Economic Genius,” is here. As it turns out, it isn’t really a Heilbroner update. For one, it doesn’t make much chronological headway: the postwar giants Paul Samuelson and Milton Friedman(right) get a few pages, as does the philosopher and development economist Amartya Sen, who is still alive and writing books. But the major developments of post-1950 economics are for the most part ignored. So, for that matter, are the major developments of pre-1850 economics. Heilbroner was out to provide an easy-to-digest survey of economic thought through the ages. Nasar has set herself a task at once narrower and more ambitious. She has a story to tell, a story of tragedy, triumph and, as the subtitle says, economic genius.

In the hundred years from 1850 to 1950, economists progressed from fatalistically explaining why most of humanity was condemned to poverty or worse (theirs was the “dismal” science, Thomas Carlyle wrote) to doing something about it. One early hero of Nasar’s tale is Alfred Marshall, the 19th-century English economist who not only gave us the supply-and-­demand charts that still dominate Economics 101 classes but was the first to describe how rising industrial productivity could create higher living standards for all. Another is Beatrice Webb, an English railroad magnate’s daughter who made the case for a welfare state that would even out some (but not all) of the inequalities arising from capitalist growth.

At the core of Nasar’s narrative is an account of the economically troubled decades between the two world wars, as told through the experiences of Keynes, Irving Fisher, and Schumpeter and Hayek. The least well known of this lot is Fisher, a Yale professor best remembered today for his insistence in 1929 that stock prices were perched upon a “permanently high plateau.”

He was also the founder of modern monetary economics (his adherents include Milton Friedman and Ben Bernanke) and for a time a successful entrepreneur (he invented and commercialized a precursor to the Rolodex).

Fisher (right) believed that free markets were prerequisites for prosperity, but that their functioning could be improved with government action, mainly monetary policy by central banks. Keynes, himself a successful speculator and investor, held similar beliefs but came to espouse more aggressive government action than Fisher. Which leaves Schumpeter and Hayek.

In modern political shorthand, they were champions of free enterprise, their ideas wielded in opposition to those of the socialist Keynes. But Keynes was a capitalist, albeit a sometimes conflicted one. And Schumpeter and Hayek, while skeptical of most politicians, were far from anti­-government absolutists.

The two men’s views were shaped in Vienna in the terrible years after the end of World War I and the fall of the Austro-­Hungarian Empire. Schumpeter did a stint as finance minister in a socialist government in 1919, an episode in his life that is usually treated as a joke, but Nasar renders it as a densely detailed tragedy. Schumpeter had a sensible plan for addressing Austria’s ills, but no politician would go for it, and he was thrown out of government after seven months. Hayek spent part of the 1920s chronicling his country’s travails at an economic-­forecasting institute (founded by his mentor Mises). By the time the two made their way west in the early 1930s — Schumpeter to Harvard, Hayek to the London School of Economics — they had become understandably critical of the notion that politicians could easily fix what ailed the economy.

But they weren’t so sure that economists couldn’t come up with solutions. Schumpeter was mentor at Harvard to Samuelson, who became a great expositor of Keynes’s ideas, while Hayek befriended Keynes and in Nasar’s telling had come around by the 1940s to embracing at least a few Keynesian prescriptions.

The epic of intellectual progress Nasar wants to tell is not an unmitigated success. It doesn’t entirely square with the facts she so ably digs up. There is frequently tension between her overall theme of progress in economic thought and the individual stories she relates. And her last few chapters offer not a rousing finale, but a muddled letdown. Still, the book as a whole is made up of so many wonderful parts that one is inclined to excuse its shortcomings.

In the end, the economists whose lives Nasar describes are depicted as one more or less happy family (with the exception of Keynes’s disciple Joan Robinson (left) whose infatuation with Communism is recounted in perplexing detail), advocates of an economy with free enterprise and free markets at its core, but a significant amount of government meddling to make things work better.

In fact there was such a synthesis, its details hammered together by Samuelson, who gets a chapter late in the book but still feels under described, and by a host of other young economists who go unmentioned. Within a few decades that synthesis began to disintegrate, leaving us with the debates we witness today.

That, however, is another story. Nasar writes that since 1950 we have enjoyed an age of global prosperity that even the Great Recession has been unable to derail. A permanently high plateau of prosperity, you might say. There’s something unnerving about such confidence. But you don’t have to share it in order to appreciate this rich, in places dazzling, history.

Justin Fox, the author of “The Myth of the Rational Market,” is editorial director of the Harvard Business Review Group.

A version of this review appeared in print on October 9, 2011, on page BR22 of the Sunday Book Review with the headline: Principals of Economics.

http://www.nytimes.com/2011/10/09/books/review/grand-pursuit-by-sylvia-nasar-book-review.html

Wanted: Worldly Philosophers


November 6, 2011

Wanted: Worldly Philosophers

By Roger E. Backhouse and Bradley W. Bateman

Published: November 5, 2011

IT has become commonplace to criticize the “Occupy” movement for failing to offer an alternative vision. But the thousands of activists in the streets of New York and London are not the only ones lacking perspective: economists, to whom we might expect to turn for such vision, have long since given up thinking in terms of economic systems — and we are all the worse for it.

This wasn’t always the case. Course lists from economics departments used to be filled with offerings in “comparative economic systems,” contrasting capitalism and socialism or comparing the French, Scandinavian and Anglo-Saxon models of capitalism.

Such courses arose in the context of the Cold War, when the battle with the Soviet Union was about showing that our system was better than theirs. But with the demise of the Soviet Union, that motivation disappeared. Globalization, so it is claimed, has created a single system of capitalism driven by international competition (ignoring the very real differences between, say, China and the United States). We now have an economics profession that hardly ever discusses its fundamental subject, “capitalism.”

Many economists say that what matters are questions like whether markets are competitive or monopolistic, or how monetary policy works. Using broad, ill-defined notions like capitalism invites ideological grandstanding and distracts from the hard technical problems.

There is a lot in that argument. Economists do much better when they tackle small, well-defined problems. As John Maynard Keynes put it, economists should become more like dentists: modest people who look at a small part of the body but remove a lot of pain.

However, there are also downsides to approaching economics as a dentist would: above all, the loss of any vision about what the economic system should look like. Even Keynes himself was driven by a powerful vision of capitalism. He believed it was the only system that could create prosperity, but it was also inherently unstable and so in need of constant reform. This vision caught the imagination of a generation that had experienced the Great Depression and World War II and helped drive policy for nearly half a century. He was, as the economist Robert Heilbroner claimed, a “worldly philosopher,” alongside such economic visionaries as Adam Smith, John Stuart Mill and Karl Marx.

In the 20th century, the main challenge to Keynes’s vision came from economists like Friedrich Hayek and Milton Friedman, who envisioned an ideal economy involving isolated individuals bargaining with one another in free markets. Government, they contended, usually messes things up. Overtaking a Keynesianism that many found inadequate to the task of tackling the stagflation of the 1970s, this vision fueled neoliberal and free-market conservative agendas of governments around the world.

That vision has in turn been undermined by the current crisis. It took extensive government action to prevent another Great Depression, while the enormous rewards received by bankers at the heart of the meltdown have led many to ask whether unfettered capitalism produced an equitable distribution of wealth. We clearly need a new, alternative vision of capitalism. But thanks to decades of academic training in the “dentistry” approach to economics, today’s Keynes or Friedman is nowhere to be found.

Another downside to the “dentistry” approach to economics is that important pieces of human experience can easily fall from sight. The government does not cut an abstract entity called “government spending” but numerous spending programs, from veterans’ benefits and homeland security to Medicare and Medicaid. To refuse to discuss ideas such as types of capitalism deprives us of language with which to think about these problems. It makes it easier to stop thinking about what the economic system is for and in whose interests it is working.

Perhaps the protesters occupying Wall Street are not so misguided after all. The questions they raise — how do we deal with the local costs of global downturns? Is it fair that those who suffer the most from such downturns have their safety net cut, while those who generate the volatility are bailed out by the government? — are the same ones that a big-picture economic vision should address. If economists want to help create a better world, they first have to ask, and try to answer, the hard questions that can shape a new vision of capitalism’s potential.

Roger E. Backhouse, a professor of economic history at the University of Birmingham, and Bradley W. Bateman, a professor of economics at Denison University, are the authors of “Capitalist Revolutionary: John Maynard Keynes.”

A version of this op-ed appeared in print on November 6, 2011, on page SR12 of the New York edition with the headline: Wanted: Worldly Philosophers.

http://www.nytimes.com/2011/11/06/opinion/sunday/worldly-philosophers-wanted.html?ref=opinion

Note:

I also recommend Dani Rodrik’s The Globalisation Paradox: Why Global Markets, States and Democracy Can’t Coexist.

In this book, Professor Rodrik examines the story of economic globalisation from its 17th century origins through the Gold Standard, the Bretton Woods Agreement which was designed by Harry Dexter White and John Maynard Keynes that led to the creation of the International Monetary Fund and the International Bank for Reconstruction and Development (The World Bank), and The Washington Consensus of the 1980-1990s to the present day.

Although economic globalisation has resulted in unprecedented levels of prosperity to the developed economies and may be a boon to millions upon millions of poor workers in Asia (for example, China and India), Professor Rodrik argues that economic globalisation as a concept rests on shaky pillars. Its sustainability over the long term is not a given.

At the core of the Rodrik argument is a trilemma: we cannot simultaneously pursue democracy, national self determination and economic globalisation. Give too much power to governments and you have protectionism (that is, beggar thy neighbour policies). Allow unfettered markets and that leads to an unstable world with no social  safety net for, and little political support from those it is supposed to help. We need sane globalisation.

The Harvard Don says that ” [W]e need to accept the reality of a divided world polity and make some tough choices. We have to be explicit about where one nation’s rights and responsibilities end and another nation’s begin. We cannot fudge the role of nation states and proceed on the assumption that we are witnessing the birth of a global political  community. We must acknowledge and accept the restraints on globalisation that a divided global polity entails. The scope of workable regulation limits the scope of desirable globalisation.(author’s own). Hyper-globalisation cannot cannot be achieved, and we should we should not pretend  that it can.”(p.232)

He concludes with a call for a paradigm shift in the way we think of economic globalisation: “We can and should tell a different story about globalisation. In stead of viewing it as a system that requires a single set of institutions or one principal economic superpower, we should accept it as a collection of diverse nations whose interactions are regulated by a thin layer of simple, transparent, and commonsense traffic rules. This vision will not construct a path towards a ”flat’ world–a borderless world economy. Nothing will. What it will do is enable a healthy, sustainable world economy that leaves room for democracies to determine their own futures”. (p.280)–Din Merican

The Globalisation of Protest


November 6, 2011

The Globalisation of Protest

by Joseph E. Stiglitz (11-04-11)

The protest movement that began in Tunisia in January, subsequently spreading to Egypt, and then to Spain, has now become global, with the protests engulfing Wall Street and cities across America. Globalization and modern technology now enables social movements to transcend borders as rapidly as ideas can. And social protest has found fertile ground everywhere: a sense that the “system” has failed, and the conviction that even in a democracy, the electoral process will not set things right – at least not without strong pressure from the street.

In May, I went to the site of the Tunisian protests; in July, I talked to Spain’s indignados; from there, I went to meet the young Egyptian revolutionaries in Cairo’s Tahrir Square; and, a few weeks ago, I talked with Occupy Wall Street protesters in New York. There is a common theme, expressed by the OWS movement in a simple phrase: “We are the 99%.”

That slogan echoes the title of an article that I recently published, entitled “Of the 1%, for the 1%, and by the 1%,” describing the enormous increase in inequality in the United States: 1% of the population controls more than 40% of the wealth and receives more than 20% of the income. And those in this rarefied stratum often are rewarded so richly not because they have contributed more to society – bonuses and bailouts neatly gutted that justification for inequality – but because they are, to put it bluntly, successful (and sometimes corrupt) rent-seekers.

This is not to deny that some of the 1% have contributed a great deal. Indeed, the social benefits of many real innovations (as opposed to the novel financial “products” that ended up unleashing havoc on the world economy) typically far exceed what their innovators receive.

But, around the world, political influence and anti-competitive practices (often sustained through politics) have been central to the increase in economic inequality. And tax systems in which a billionaire like Warren Buffett pays less tax (as a percentage of his income) than his secretary, or in which speculators, who helped to bring down the global economy, are taxed at lower rates than those who work for their income, have reinforced the trend.

Research in recent years has shown how important and ingrained notions of fairness are. Spain’s protesters, and those in other countries, are right to be indignant: here is a system in which the bankers got bailed out, while those whom they preyed upon have been left to fend for themselves. Worse, the bankers are now back at their desks, earning bonuses that amount to more than most workers hope to earn in a lifetime, while young people who studied hard and played by the rules see no prospects for fulfilling employment.

The rise in inequality is the product of a vicious spiral: the rich rent-seekers use their wealth to shape legislation in order to protect and increase their wealth – and their influence. The US Supreme Court, in its notorious Citizens United decision, has given corporations free rein to use their money to influence the direction of politics. But, while the wealthy can use their money to amplify their views, back on the street, police wouldn’t allow me to address the OWS protesters through a megaphone.

The contrast between over-regulated democracy and unregulated bankers did not go unnoticed. But the protesters are ingenious: they echoed what I said through the crowd, so that all could hear. And, to avoid interrupting the “dialogue” by clapping, they used forceful hand signals to express their agreement.

They are right that something is wrong about our “system.” Around the world, we have underutilized resources – people who want to work, machines that lie idle, buildings that are empty – and huge unmet needs: fighting poverty, promoting development, and retrofitting the economy for global warming, to name just a few. In America, after more than seven million home foreclosures in recent years, we have empty homes and homeless people.

The protesters have been criticized for not having an agenda. But this misses the point of protest movements. They are an expression of frustration with the electoral process. They are an alarm.

The anti-globalization protests in Seattle in 1999, at what was supposed to be the inauguration of a new round of trade talks, called attention to the failures of globalization and the international institutions and agreements that govern it. When the press looked into the protesters’ allegations, they found that there was more than a grain of truth in them. The trade negotiations that followed were different – at least in principle, they were supposed to be a development round, to make up for some of the deficiencies highlighted by protesters – and the International Monetary Fund subsequently undertook significant reforms.

So, too, in the US, the civil-rights protesters of the 1960’s called attention to pervasive institutionalized racism in American society. That legacy has not yet been overcome, but the election of President Barack Obama shows how far those protests moved America.

On one level, today’s protesters are asking for little: a chance to use their skills, the right to decent work at decent pay, a fairer economy and society. Their hope is evolutionary, not revolutionary. But, on another level, they are asking for a great deal: a democracy where people, not dollars, matter, and a market economy that delivers on what it is supposed to do.

The two are related: as we have seen, unfettered markets lead to economic and political crises. Markets work the way they should only when they operate within a framework of appropriate government regulations; and that framework can be erected only in a democracy that reflects the general interest – not the interests of the 1%. The best government that money can buy is no longer good enough.

Joseph E. Stiglitz is University Professor at Columbia University, a Nobel laureate in economics, and the author of Freefall: Free Markets and the Sinking of the Global Economy.

Copyright: Project Syndicate, 2011.
http://www.project-syndicate.org

Selamat Hari Raya Aidil Adha, 2011


November 5, 2011

Selamat Hari Raya Aidil Adha, 2011

Dr. Kamsiah and I wish all our Muslim Brothers and Sisters here in Malaysia and around the world and also men and women of goodwill everywhere a Happy Aidil Adha or Hari Raya Haji, which falls on Sunday, November 6, 2011. Tomorrow is a special day when Muslims from all corners of  the world assemble in Mecca to perform the Haj at the Kaaba. 

Our own Prime Minister Dato Seri Najib Tun Razak, his wife Datin Seri Rosmah Mansor and his beloved mother, YABhg Tun Rahah binti Mohammad Noah together with other members of his delegation in Mecca as guests of His Majesty King Abdullah of Saudi Arabia are in Meeca to also perform the Haj.

Leaving politics aside, we wish the Prime Minister and Datin Seri Rosmah and their delegation Selamat Hari Raya Haji and pray for their safety and good health.

We  extend our prayers to our friends and relatives and fellow Malaysians who are also in the Holy Land to fulfill their obligation in the performance of the Haji.

To those of us who are at home, we say have a good time on this special occasion after our prayers in the morning.

May Allah The Most Merciful and the Most Compassionate Bless you all with safety, continued good health and happiness and shower His Blessings on our country.–Dr. Kamsiah and Din Merican

Your Entertainment for the Weekend


November 4, 2011

Your Entertainment for the Weekend

Dr. Kamsiah and I have chosen some of finest female vocalists of a bygone era to entertain you with tunes that will surely bring back memories of years gone by. Then they made great evergreens and we hope our choices are acceptable to you.

There is first Petula Clark rendering two of her classics, followed by Lulu who made a big hit out of the theme song from the movie, To Sir With Love, starring Oscar Award winning actor Sidney Poitier (for his lead role in Guess, Who’s Coming to Dinner with Hepburn and Tracy).

Last but not least, Joni James who is a favorite of Din’s and his contemporaries in the 1960s at the MU’s Second Residential College in Pantai Valley sings six tunes which were popular then including her tribute to Ingrid Bergman.

A great weekend ahead and let us leave our cares behind now and enjoy what we have chosen for you.–Dr. Kamsiah and Din Merican

Petula Clark

Lulu

Joni James

A Tribute to Ingrid Bergman