The Way Between War and Diplomacy–The CIA Way


December 18, 2017

The Way Between War and Diplomacy–The CIA Way

by Sajad Abedi

https://en.mehrnews.com/news/130304/The-third-way-between-war-and-diplomacy

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TEHRAN, Dec. 16 (MNA) – The American Presidents all asked the CIA when they arrived at the White House, “What should they do with it?” Often they underestimated the CIA’s analysis. These analyses described a complex world and they said the process of events was ambiguous.

Evaluation, hypothesis, probability. The White House never praised such literature. The White House often preferred analysis that were within the framework of its political intentions. On the other hand, the White House has been increasingly inclined to publicly disclose some of the information collected by the services, due to the persistent desire to attract people to their big decisions.

Instead, the presidents were heavily pushed by the secret power that the CIA possessed. The covert activities, as a “third way” between war and diplomacy, heavily attracted them. All of them have implemented programs in secret to stealthily influence the process. All of them were trying to keep their apps in use. Despite the scandals, the political and diplomatic problems caused by secret activities, none of them questioned the necessity and effectiveness of this instrument in foreign policy.

These covert measures began to expand slightly in the 1950s, at a time when the CIA’s invincible myth was formed. CIA officers, who found such actions as a source of prominence and privilege, did everything to cultivate them. This myth derives from a special cultural sign: Americans as a nation have a very positive image. America considers itself to be a nation that succeeds; it is a winner who challenges ahead of them through his will and technology. The CIA is responsible for this sweeping spirit in Washington.

Image result for The CIA@LangleyThe Agency can do it

The slogan of the CIA has long been: “The agency can do it.” Therefore, the opponents of power would not be taken into consideration because the United States needed shadow warriors to protect the country from the Soviet threat, without anyone having much to know about it. This era of trust ended in the process of deconstruction and after disclosure of the “internal” spy activities of the CIA. So the great age of complexity began, which brought fantasies and other conspiracy theories. The CIA takes ugly signs into a dangerous, rogue and out-of-control organization. But Robert Gates states: “The CIA is nothing more than a presidential organization. Every time this organization has faced trouble, it was due to the mission that the president ordered. »

In any case, this is the image of America in a world that has suffered the most pain and suffering from this country. The fact that the United States has an agency like the CIA is necessarily a two-tail razor.

The press and the Congress, in spite of the fundamental belief in the effectiveness of the CIA, served as two powerful guardian dogs to oversee the agency in the service of the President. The dynamics of American democracy, as well as the strong attachment to the constitution and individual freedoms, have made the CIA the “most transparent” intelligence service in the world. The contradiction is that the Americans know more about the secret activities (activities that are definitely the most secret and sensitive activities) to the total CIA performance. Perhaps even more are than the overall performance of other institutions, including the State Department or the Ministry of Health.

September 11 attacks occur and shake the sense of security and invincibility that the United States has plunged into. Since then, US soil is no longer a haven, and the attack has the same effect as Pearl Harbor’s attack. The outcomes of the Iraq war are being added to the most fundamental reorganization in the US intelligence community since about sixty years ago. Information services acquire new authority, many other services are formed, and some of the old networks are weakened or even destroyed, the need to focus more on the powers of information services is felt.

These changes are so far as the United States is creating a CIA over the previous organization. The new goal is to give Americans a unique look at the services. The new organization will focus it’s analyze on the analysis. That’s why we can bet that in the future less than the CIA’s inability to anticipate important events. On the other hand, because of the new reformation of the new head of the American intelligence apparatus, and the CIA has become the agency responsible for all the secret activities, it can be assumed that the CIA will (slightly) head over the next few years will be kept.

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https://bossroyal.com/kryptos-the-uncracked-sculpture/

The tension between interventionism and the previous doctrine of isolationism has led Americans to redefine the intelligence system as the “last line of defense”. In some respects, this device is the beginning and end of its power; and since the CIA has seen its strength in its mission of being as close as possible to the American enemies, that’s why today it still maintains this precious position.

The CIA actually has an almost inescapable position in the imagination as well as the American political system. The organization gives all its actors the confidence that someone, something, America is intertwined with international affairs, and its influence on the four corners of the world shines.

 

Najib Razak’s Muddled Mid-East Policy–Sheer Hypocrisy


December 16, 2017

Najib Razak’s Muddled Mid-East Policy–Sheer Hypocrisy

by Mat Sabu@www.malaysiakini.com

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COMMENT | On December 13, Prime Minister Najib Abdul Razak, in his own words, dropped everything on his lap, including a meeting with Prime Minister Lee Hsien Loong of Singapore, to attend the extraordinary summit of the Organisation of Islamic Cooperation (OIC) in Istanbul, Turkey.

The goal was to register the Muslim world’s urgency and protest against the recognition of Jerusalem as the “eternal capital of Israel.” The OIC meeting was hopeless for several reasons.

First, Najib had already affirmed to the rest of the world, that US President Donald Trump is his golfing buddy and his friend.

In his trip to Washington in September 2017, Najib even boasted that Trump personally sent him to his official car, of all places in the basement of the White House.

The above is not hearsay. It came right from the horse’s mouth: Najib. It was Najib who showcased his tight bond with Trump.

 

 

Secondly, directly or indirectly, this has strengthened Trump’s resolve to gift Jerusalem to Israel. The false step by Najib is no less damning than the mistakes of King Salman bin Abdulaziz and Crown Prince Muhammad Bin Salman (MBS) of Saudi Arabia.

Both the father and son praised Trump as a world-class leader when Trump made a trip to Saudi Arabia. Emboldened by his relationship with King Salman and MBS, Trump went one step ahead of the duo.

He immediately flew to Israel, and promised a radical change in the US policy on the Middle East. Such a radical change was, of course, the gift of Jerusalem to Prime Minister Benjamin Netanyahu (photo), whose popularity was not only sagging in Israel, but is also widely considered a dishonest and ineffective Israeli leader.

 

Second, Najib flew to Istanbul to join a chorus of leaders to admonish and reprimand Trump. But was that really the case?

The US Ambassador to Malaysia was not summoned to the Prime Minister’s Office nor Wisma Putra for a thorough dressing down. Even when the UMNO Assembly was ongoing, little attention was granted to the injustice of Trump.

Third, in a press release by Wisma Putra, the Ministry of Foreign Affairs merely affirmed that Trump should “reconsider his decision.” Wisma Putra did not express its vehemence against Trump.

Fourth, instead, it was the opposition front that raised a huge outcry on Trump’s utter betrayal to the Palestinians.

To the credit of Lembah Pantai MP Nurul Izzah Anwar, she saw the betrayal as sufficiently serious to call for the possible boycott of US goods and services in Malaysia.

 

Fifth, Pakatan Harapan chairperson Dr Mahathir Mohamad (photo),  together with Amanah and Bersatu, challenged the whole treasonous act of giving Jerusalem to Israel when there are 86 countries, be they Muslim or non-Muslim, that do not agree with Trump. Even Pope Francis of the Vatican Council was against Trump wholesale.

Thus, what is the point of flying to Istanbul to block the proverbial horses that have been let out of the stable? Trump has betrayed the Muslim world not once, but from the very beginning of his presidency. He has passed the Middle East policy to Jared Kushner, his son-in-law, who is a known Zionist.

Sixth, it shocking that UMNO and PAS still support Trump by not voicing out more openly, and by coming up with a series of measures to put a stop to this madness.

Fortunately, the 14th general election is just months away. Christians and Muslims, indeed all groups and races that are anti-Israel, can set things right: by voting out Najib, PAS and, indeed, UMNO, for coddling the Zionist conspiracy.

Malaysian foreign policy has never seen such a disaster until now. It is time to correct it with a new government that is not beholden to US Zionist policy.


MOHAMAD SABU is president of Amanah. The views expressed here are those of the author/contributor and do not necessarily represent the views of Malaysiakini.

Complacency Will Be Tested in 2018


December 15, 2015

Complacency Will Be Tested in 2018

by Stephen S. Roach@ http://www.project-syndicate.org

Despite seemingly robust indicators, the world economy may not be nearly as resilient to shocks and systemic challenges as the consensus view seems to believe. In particular, the absence of a classic vigorous rebound from the Great Recession means that the global economy never recouped the growth lost in the worst downturn of modern times.

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“World GDP growth is viewed as increasingly strong, synchronous, and inflation-free. Exuberant financial markets could hardly ask for more.I suspect that today’s consensus of complacency will be seriously tested in 2018”.–Stephen S. Roach

NEW HAVEN – After years of post-crisis despair, the broad consensus of forecasters is now quite upbeat about prospects for the global economy in 2018. World GDP growth is viewed as increasingly strong, synchronous, and inflation-free. Exuberant financial markets could hardly ask for more.

While I have great respect for the forecasting community and the collective wisdom of financial markets, I suspect that today’s consensus of complacency will be seriously tested in 2018. The test might come from a shock – especially in view of the rising risk of a hot war (with North Korea) or a trade war (between the US and China) or a collapsing asset bubble (think Bitcoin). But I have a hunch it will turn out to be something far more systemic.

The world is set up for the unwinding of three mega-trends: unconventional monetary policy, the real economy’s dependence on assets, and a potentially destabilizing global saving arbitrage. At risk are the very fundamentals that underpin current optimism. One or more of these pillars of complacency will, I suspect, crumble in 2018.

Unfortunately, the die has long been cast for this moment of reckoning. Afflicted by a profound sense of amnesia, central banks have repeated the same mistake they made in the pre-crisis froth of 2003-2007 – over staying excessively accommodative monetary policies. Misguided by inflation targeting in an inflationless world, monetary authorities have deferred policy normalization for far too long.

That now appears to be changing, but only grudgingly. If anything, central bankers are signaling that the coming normalization may even be more glacial than that of the mid-2000s. After all, with inflation still undershooting, goes the argument, what’s the rush?

Alas, there is an important twist today that wasn’t in play back then –central banks’ swollen balance sheets. From 2008 to 2017, the combined asset holdings of central banks in the major advanced economies (the United States, the eurozone, and Japan) expanded by $8.3 trillion, according to the Bank for International Settlements. With nominal GDP in these same economies increasing by just $2.1 trillion over the same period, the remaining $6.2 trillion of excess liquidity has distorted asset prices around the world.

Therein lies the crux of the problem. Real economies have been artificially propped up by these distorted asset prices, and glacial normalization will only prolong this dependency. Yet when central banks’ balance sheets finally start to shrink, asset-dependent economies will once again be in peril. And the risks are likely to be far more serious today than a decade ago, owing not only to the overhang of swollen central bank balance sheets, but also to the overvaluation of assets.

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Will the Republican Tax Plan work?

That is particularly true in the United States. According to Nobel laureate economist Robert J. Shiller, the cyclically adjusted price-earnings (CAPE) ratio of 31.3 is currently about 15% higher than it was in mid-2007, on the brink of the subprime crisis. In fact, the CAPE ratio has been higher than it is today only twice in its 135-plus year history – in 1929 and in 2000. Those are not comforting precedents.

As was evident in both 2000 and 2008, it doesn’t take much for overvalued asset markets to fall sharply. That’s where the third mega-trend could come into play – a wrenching adjustment in the global saving mix. In this case, it’s all about China and the US – the polar extremes of the world’s saving distribution.

China is now in a mode of saving absorption; its domestic saving rate has declined from a peak of 52% in 2010 to 46% in 2016, and appears headed to 42%, or lower, over the next five years. Chinese surplus saving is increasingly being directed inward to support emerging middle-class consumers – making less available to fund needy deficit savers elsewhere in the world.

By contrast, the US, the world’s neediest deficit country, with a domestic saving rate of just 17%, is opting for a fiscal stimulus. That will push total national saving even lower – notwithstanding the vacuous self-funding assurances of supply-siders. As shock absorbers, overvalued financial markets are likely to be squeezed by the arbitrage between the world’s largest surplus and deficit savers. And asset-dependent real economies won’t be too far behind.

In this context, it’s important to stress that the world economy may not be nearly as resilient as the consensus seems to believe – raising questions about whether it can withstand the challenges coming in 2018. IMF forecasts are typically a good proxy for the global consensus. The latest IMF projection looks encouraging on the surface – anticipating 3.7% global GDP growth over the 2017-18 period, an acceleration of 0.4 percentage points from the anemic 3.3% pace of the past two years.

However, it is a stretch to call this a vigorous global growth outcome. Not only is it little different from the post-1965 trend of 3.8% growth, but the expected gains over 2017-2018 follow an exceptionally weak recovery in the aftermath of the Great Recession. This takes on added significance for a global economy that slowed to just 1.4% average growth in 2008-2009 – an unprecedented shortfall from its longer-term trend.

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Trumpian Economics

The absence of a classic vigorous rebound means the global economy never recouped the growth lost in the worst downturn of modern times. Historically, such V-shaped recoveries have served the useful purpose of absorbing excess slack and providing a cushion to withstand the inevitable shocks that always seem to buffet the global economy. The absence of such a cushion highlights lingering vulnerability, rather than signaling newfound resilience – not exactly the rosy scenario embraced by today’s smug consensus.

A quote often attributed to the Nobel laureate physicist Niels Bohr says it best: “Prediction is very difficult, especially if it’s about the future.” The outlook for 2018 is far from certain. But with tectonic shifts looming in the global macroeconomic landscape, this is no time for complacency.

*Stephen S. Roach, former Chairman of Morgan Stanley Asia and the firm’s chief economist, is a senior fellow at Yale University’s Jackson Institute of Global Affairs and a senior lecturer at Yale’s School of Management. He is the author of Unbalanced: The Codependency of America and China.

 

Trump’s Jerusalem Rationale and its Consequences


December 14, 2015

Trump’s Jerusalem Rationale and its Consequences

The US administration seems to believe that Saudi Arabia and other Arab governments are so concerned with the perceived Iranian threat that they will put aside their long-standing hostility toward Israel. The problem is that the new Saudi crown prince’s highest priority – to consolidate his power – may lead him to reject a peacemaking role.

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NEW YORK – It is 50 years since the Six-Day War – the June 1967 conflict that, as much as any other event, continues to define the Israeli-Palestinian impasse. After the fighting was over, Israel controlled all of the West Bank, Gaza, and Jerusalem, in addition to the Sinai Peninsula and the Golan Heights.

Back then, the world saw this military outcome as temporary. United Nations Security Council Resolution 242, the backdrop to what was to become a diplomatic solution to the problem of the stateless Palestinians, was adopted some five months after the war ended. But, as is often the case, what began as temporary has lasted.

This is the context in which President Donald Trump recently declared that the United States recognized Jerusalem to be Israel’s capital. Trump stated that the US was not taking a position on the final status of Jerusalem, including “the specific boundaries of the Israeli sovereignty” there. He made clear that the US would support a two-state solution if agreed to by both sides. And he chose not to begin actually moving the US embassy from Tel Aviv, even though he could have simply relabeled what is now the US consulate in Jerusalem.

The attempt to change US policy while arguing that little had changed did not persuade many. Most Israelis were pleased with the new US stance, and most in the Arab world and beyond were incensed.

Just why Trump chose this moment to make this gesture is a matter of conjecture. The president suggested it was simply recognition of reality and that his predecessors’ policy failure to do so had failed to yield any diplomatic benefits. This is true, although the reason diplomacy failed over the decades had nothing to do with US policy toward Jerusalem, and everything to do with divisions among Israelis and Palestinians and the gaps between the two sides.

Others have attributed the US announcement to American domestic politics, a conclusion supported by the unilateral US statement’s failure to demand anything of Israel (for example, to restrain settlement construction) or offer anything to the Palestinians (say, supporting their claim to Jerusalem). Although the decision has led to some violence, it looks more like an opportunity lost than a crisis created.

What made this statement not just controversial but potentially counterproductive is that the Trump administration has spent a good part of its first year putting together a plan to resolve the Israeli-Palestinian conflict. This announcement could well weaken that plan’s already limited prospects.

What the Trump administration seems to have in mind is to give outsiders, and Saudi Arabia in particular, a central role in peacemaking. Informing this approach is the view that Saudi Arabia and other Arab governments are more concerned with the perceived threat from Iran than with anything to do with Israel. As a result, it is assumed that they are prepared to put aside their long-standing hostility toward Israel, a country that largely shares their view of Iran.

Progress on the Israeli-Palestinian issue would create a political context in the Arab world that would allow them to do just this. The hope in the Trump administration is that the Saudis will use their financial resources to persuade the Palestinians to agree to make peace with Israel on terms Israel will accept.

Image result for Trump and KushnerPresident Donald J. Trump and his Mid-East Expert-Advsor Jared Kushner

 

The problem is that the only plan to which this Israeli government is likely to agree will offer the Palestinians far less than they have historically demanded. If so, the Palestinian leaders themselves may well determine it is safer to say no than to sign on to a plan sure to disappoint many of their own people and leave them vulnerable to Hamas and other radical groups.

The Saudis, too, may be reluctant to be associated with a plan that many will deem a sellout. The top priority for the new Saudi leadership under Crown Prince Mohammed bin Salman is to consolidate power, which the prince is doing by associating himself with an effort to attack corruption in the Kingdom and by pursuing a nationalist, anti-Iranian foreign policy.

But neither tactic is going entirely according to plan. The anti-corruption effort, while so far popular, risks being tarnished by selective prosecution of offenders (which suggests that it is more about power than reform) and reports about the crown prince’s own lifestyle. And the anti-Iran efforts have become inseparable from what has become an unpopular war in Yemen and diplomatic embarrassments in Lebanon and Qatar. Meanwhile, ambitious plans to reform the country are proving easier to design than to implement, and are sure to alienate more conservative elements.

The problem for Trump and Jared Kushner, his son-in-law who leads US policy in this area, is that the Saudis are likely to prove much less of a diplomatic partner than the White House had counted on. If the new crown prince is worried about his domestic political standing, he will be reluctant to stand shoulder to shoulder with an American president seen as too close to an Israel that is unwilling to satisfy even minimal Palestinian requirements for statehood.

Image result for Richard N. Haas on JerusalemRichard N. Haas

All of which brings us back to Jerusalem. Trump argued that recognizing the city as Israel’s capital was “a long overdue step to advance the peace process and the work towards a lasting agreement.” More and more it appears that Trump’s move will have just the opposite effect.

Alabama–How Doug Jones Beats Roy Moore


December 14, 2017

Alabama–How Doug Jones Beats Roy Moore

Doug Jones beats Republican Cowboy Roy Moore, thanks to Black Alabamians, Barack Obama, Civil Rights Icon. John Lewis  and Charles Barkley

The Republican Party sold itself cheaply for the sake of an Alabama Senate seat—and it didn’t even get the win. On Tuesday night, Doug Jones, the Democrat, declared victory over Roy Moore, who is facing multiple allegations of predatory behavior toward teen-agers, by a margin of one and a half per cent. It was close, but, as President Trump, who had endorsed Moore and encouraged the Republican National Committee to rush funds to the campaign in the final stretch—which, to its shame, it did—said in a tweet, “a win is a win.” (Moore also had the full support of the Alabama Republican Party.) In particular, black Alabamians appear to have turned out in force for Jones.

His campaign had appealed for their support as a community. Charles Barkley, the retired basketball player and native Alabamian, campaigned for Jones, and President Barack Obama recorded a robocall. (Trump did one for Moore, in addition to tweeting for him.) Turnout was markedly higher in counties with large black populations.

These voters were the ones who defended the state’s respectability. Jones said, in his victory speech, that “this entire race has been about dignity and respect . . . This campaign has been about the rule of law. This campaign has been about common courtesy and decency and making sure everyone in this state, regardless of which Zip Code you live in, is going to get a fair shake in life.” But he wasn’t only talking about teen-age girls. Moore had made his bigotry explicit, and the Republican Party had tolerated it. Jones placed the full Moore in front of voters, and he won.

Image result for Obama and Barkley support Doug JonesCharles Barkley with Doug Jones

There had been a certain amount of amazement that any Democrat, even Jones, a respected former U.S. Attorney who had successfully prosecuted some of the murderers in the Sixteenth Street Baptist Church bombing case, had a chance, given how Republican Alabama is. But it is Moore who should never have gotten this close. There is no alibi in this story for the members of the Republican establishment who, after Moore defeated their preferred candidate, Luther Strange, sighed and supported him, only to back away when the Washington Post broke the story of Moore’s alleged molestation of a fourteen-year-old girl when he was a lawyer in his thirties, and his pursuit of others only slightly older. That was followed by more, similar accounts; Charles Bethea reported, for The New Yorker, about how Moore had been a notorious presence at a mall in Gadsden. (Moore has denied the allegations.)

Image result for roy moore on horseback ridingRoy Moore riding into political oblivion taking the RNC with him

But to have supported Moore before the stories of the teen-agers emerged, as the Senate Majority Leader, Mitch McConnell, did, including with funds from PACs beholden to him, was to support Moore after he had confirmed that he did not believe that Muslims should be allowed to serve in Congress. That alone ought to have been disqualifying. How would Republican senators have looked their Muslim constituents in the eye (and there are Muslim Americans in every state)? How would they have looked at themselves in the mirror? The support from McConnell and others also came after Moore had talked about instituting criminal penalties for homosexuality. It came after Moore said that America had been great during the era of slavery when, he argued, family ties really mattered. It came after a rally at which he referred to Native Americans and Asian-Americans serving in the military as “reds and yellows.” It came after he mooted theories about birtherism and all manner of conspiracies, human and divine. (This included suggesting that the 9/11 attacks were God’s punishment for, among other things, America’s acceptance of reproductive rights and “sodomy.”)

In the last week of the campaign, CNN ran a story about a 2011 interview in which Moore said that many of the nation’s problems could be solved by getting rid of every amendment to the Constitution after the Tenth, which would include everything from emancipation and full citizenship for black Americans to the right of women to vote. For Republican leaders to act blindsided that such a man might have other character flaws is a dubious position.

Richard Shelby, Alabama’s other senator, and (since the end of the Dixiecrat era) a Republican, caused a stir by saying, on the Sunday before the election, that he could not vote for Moore because Alabama “deserves better.” Instead, he used his absentee ballot to write in “a distinguished Republican name,” which he declined to specify. Jones and others trumpeted Shelby’s position, and it may have made a difference; 1.7 per cent of the votes were write-ins, a proportion greater than Jones’s margin of victory and higher than what Alabama usually sees. Perhaps it also helped to keep some Republican voters home. And yet Shelby, when it comes down to it, was still encouraging a vote for someone other than Jones, the only person who could beat Moore; and he waited until two days before the election to do it. (He did get his say in before a final rally at which Moore’s wife, Kayla, decided to defend her husband against charges of religious bigotry by saying, “One of our attorneys is a Jew.”) Simply driving people away from electoral politics is not, in the long term, a healthy answer to the problem of candidates like Moore in a functioning democracy.

Image result for Screw you racist Steve Bannon

The Unkempt Racist Steve Bannon

The Republican Party had an opening, early on, to mount a real write-in campaign; it didn’t take it. There is little for anyone in the Party to take credit for now. Steve Bannon, the President’s former strategist and adviser, associated himself with the Moore campaign, and Tuesday was a significant loss for him, though it would be a mistake to underestimate what his prominence in the campaign also gained him, in terms of his efforts to position himself at the nexus of a political network. But, although Bannon was more visible, he was not alone, either in his proximity to Moore or in his raw opportunism. Or in his capacity for rationalization: on Wednesday morning, Trump tweeted, “The reason I originally endorsed Luther Strange (and his numbers went up mightily), is that I said Roy Moore will not be able to win the General Election. I was right! Roy worked hard but the deck was stacked against him!”

Moore lost because Jones beat him. He did so with the help of the national Democratic Party, and its associated resources, but also by presenting himself as a person who believed in certain principles and in the state of Alabama. He also, notably, won without backing away from his support for reproductive rights. He will have to run again in three years—since this was a special election for a seat left open by the appointment of Jeff Sessions as Trump’s Attorney General, Jones doesn’t get a full term. That will be a tough race, but, if nothing else, Jones will again have a better shot than any Democrat has had in a while. One of the criticisms that Barack Obama, among others, levied against Hillary Clinton’s campaign is that it did not work hard enough to persuade voters who weren’t already inclined to vote for her to change their minds. A Democratic win in red Alabama, as peculiar as this race was, may encourage more ambitious outreach in the midterms. It should.

The corruption of the Republican Party is not, or is not simply, one of tolerating candidates with personal flaws. (The Democrats have a measure of that, too.) It has been ideological. Doug Jones, with his hard-fought campaign, saved the Republicans from having to sit next to a gaudy incarnation of the present-day G.O.P. in the Senate chamber. But the ugliness is still there, and the Republicans can choose either to confront it or to debase themselves further. They might start in the coming days, as Moore, whose speech on Tuesday night, after the results came in, was a dark and Psalm-punctuated whine, said that he wouldn’t concede because he expected a recount. (The margin, though, was too large to trigger an automatic one.) For the moment, congressional Republicans appear busy trying to rush the tax bill through before Jones shows up and cuts their majority in the Senate to a single vote. McConnell indicated on Tuesday that he had a backup plan for that: stall on seating Jones until the new year. He did manage, after all, to kill Obama’s nomination of Merrick Garland as a Supreme Court Justice by delaying it until Trump became President. But some reckonings can’t be put off forever.

  • Amy Davidson Sorkin is a New Yorker staff writer. She is a regular Comment contributor for the magazine and writes a Web column, in which she covers war, sports, and everything in between.

 

Populist Plutocracy and the Future of America


December 13, 2017

Populist Plutocracy and the Future of America

By Nouriel Roubini
http://www.project-syndicate.org

In the first year of his presidency, Donald Trump has consistently sold out the blue-collar, socially conservative whites who brought him to power, while pursuing policies to enrich his fellow plutocrats. Sooner or later, Trump’s core supporters will wake up to this fact, so it is worth asking how far he might go to keep them on his side.

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NEW YORK – Donald Trump won the US presidency with the backing of working-class and socially conservative white voters on a populist platform of economic nationalism. Trump rejected the Republican Party’s traditional pro-business, pro-trade agenda, and, like Bernie Sanders on the left, appealed to Americans who have been harmed by disruptive technologies and “globalist” policies promoting free trade and migration.

But while Trump ran as a populist, he has governed as a plutocrat, most recently by endorsing the discredited supply-side theory of taxation that most Republicans still cling to. Trump also ran as someone who would “drain the swamp” in Washington, DC, and on Wall Street. Yet he has stacked his administration with billionaires (not just millionaires) and Goldman Sachs alumni, while letting the swamp of business lobbyists rise higher than ever.

Trump and the Republicans’ plan to repeal the 2010 Affordable Care Act (Obamacare) would have left 24 million Americans – mostly poor or middle class, many of whom voted for him – without health care. His deregulatory policies are blatantly biased against workers and unions. And the Republican tax-reform plan that he has endorsed would overwhelmingly favor multinational corporations and the top 1% of households, many of which stand to benefit especially from the repeal of the estate tax.

Trump has also abandoned his base in the area of trade, where he has offered rhetoric but not concrete action. Yes, he scrapped the Trans-Pacific Partnership (TPP), but Hillary Clinton would have done the same. He has mused about abandoning the North American Free Trade Act (NAFTA), but that may be just a negotiating tactic. He has threatened to impose a 50% tariff on goods from China, Mexico, and other US trade partners, but no such measures have materialized. And proposals for a border adjustment tax have been all but forgotten.

Trump’s bullying tweets against US firms that move production offshore or undertake tax inversions have been no more than cheap talk, and business leaders know it. Manufacturers who fooled Trump into thinking they would keep production in the US have continued to transfer operations quietly to Mexico, China, and elsewhere. Moreover, international provisions in the pending tax legislation will give US multinationals an even greater incentive to invest, hire, and produce abroad, while using transfer pricing and other schemes to salt away profits in low-tax jurisdictions.

Likewise, despite Trump’s aggressive rhetoric on immigration, his policies have been relatively moderate, perhaps because many of the businesspeople who supported his campaign actually favor a milder approach. The “Muslim ban” doesn’t affect the supply of labor in the US. Although deportations have accelerated under Trump, it’s worth remembering that millions of undocumented immigrants were deported under Barack Obama, too. The border wall that Trump was going to force Mexico to pay for remains an unfunded dream. And even the administration’s plan to favor skilled over unskilled workers will not necessarily reduce the number of legal migrants in the country.

 

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https://www.salon.com/2016/12/26/what-populist-revolution-so-far-donald-trump-is-supercharging-the-failed-republican-policies-of-the-past/

All told, Trump has governed like a plutocrat in populist clothes – that is, a pluto-populist. But why has his base let him get away with pursuing policies that mostly hurt them? According to one view, he is betting that social conservatives and white blue-collar supporters in rural areas will vote on the basis of nationalist and religious sentiment and antipathy toward secular coastal elites, rather than for their own financial interests.

But how long can anyone be expected to support “God and guns” at the expense of “bread and butter”? The pluto-populists who presided over the Roman Empire knew that keeping the populist mob at bay required substance as well as diversion: panem et circenses – “bread and circuses.” Raging tweets are meaningless to people who can scarcely afford a dignified living, let alone tickets to the modern-day Colosseum to watch football.

The tax legislation that Republicans have rushed through Congress could prove especially dangerous, given that millions of middle-class and low-income households will not only get little out of it, but will actually pay more when income-tax cuts are phased out over time. Moreover, the Republican plan would repeal the Obamacare individual mandate. According to the nonpartisan Congressional Budget Office, this will cause 13 million people to lose health insurance, and insurance premiums to rise by 10%, over the next decade. Not surprisingly, a recent Quinnipiac poll found that a mere 29% of Americans support the Republican plan.

Nevertheless, Trump and the Republicans seem willing to risk it. After all, by pushing the middle-class tax hikes to a later date, they have designed their plan to get them through the 2018 midterm elections and the 2020 general election. Between now and the midterms, they can brag about cutting taxes on most households. And they can expect to see the economic-stimulus effects of tax cuts peak in 2019, just before the next presidential election – and long before the bill comes due.

Moreover, the final legislation will likely lower the federal deduction for mortgage interest and eliminate deductibility for state and local taxes. This will hit households in Democratic-leaning states such as New York, New Jersey, and California much harder than households in Republican-leaning states.

Another part of the Republican strategy (known as “starve the beast”) will be to use the higher deficits from tax cuts to argue for cuts in so-called entitlement spending, such as Medicare, Medicaid, food stamps, and Social Security. Again, this is a risky proposition, given that elderly, middle-class, and low-income Americans rely heavily on these programs. Yes, the working and non-working poor who receive welfare payments or food stamps include minorities who tend to vote for Democrats. But millions of the blue-collar, socially conservative whites who voted for Trump also rely on these and similar programs.

With the global economy expanding, Trump is probably hoping that tax cuts and deregulation will spur enough growth and create enough jobs that he will have something to brag about. A potential growth rate of 2% won’t necessarily do much to help his blue-collar base, but at least it could push the stock market up to its highest point ever. And, of course, Trump will still claim that the US economy can grow at a rate of 4%, even though all mainstream economists, including Republicans, agree that the potential growth rate will remain around 2%, regardless of his policies.

Whatever happens, Trump will continue to tweet maniacally, promote fake-news stories, and boast about the “biggest and best” economy ever. In doing so, he may even create a circus worthy of a Roman emperor. But if gassy rhetoric alone does not suffice, he may decide to go on the offensive, particularly in the international sphere. That could mean truly withdrawing from NAFTA, taking trade action against China and other trading partners, or doubling down on harsh immigration policies.

And if these measures do not satisfy his base, Trump will still have one last option, long used by Roman emperors and other assorted dictators during times of domestic difficulty. Namely, he can try to “wag the dog,” by fabricating an external threat or embarking on foreign military adventures to distract his supporters from what he and congressional Republicans have been doing.

For example, following the “madman” approach to foreign policy, Trump could start a war with North Korea or Iran. Or he could post further inflammatory tweets about the evils of Islam, thereby driving disturbed and marginalized individuals into the arms of the Islamic State (ISIS) or other extremist groups. That would increase the likelihood of ISIS-inspired attacks – for example, “lone wolves” blowing themselves up or driving trucks through crowded pedestrian areas – within the US. With dozens, if not hundreds, slain, Trump could then wrap himself in the flag and say, “I told you so.” And if things got bad enough, Trump and his generals could declare a state of emergency, suspend civil liberties, and transform America into a true pluto-populist authoritarian state.

You know it’s time to worry when the conservative Republican chairman of the Senate Committee on Foreign Relations, Bob Corker, warns openly that Trump could start World War III. And if you’re not convinced, consider the recent history of Russia or Turkey; or the history of the Roman Empire under Caligula or Nero. Pluto-populists have been turning democracies into autocracies with the same playbook for thousands of years. There’s no reason to think they would stop now. The reign of Emperor Trump could be just around the corner.

*Nouriel Roubini, a professor at NYU’s Stern School of Business and CEO of Roubini Macro Associates, was Senior Economist for International Affairs in the White House’s Council of Economic Advisers during the Clinton Administration. He has worked for the International Monetary Fund, the US Federal Reserve, and the World Bank.