Diatribes of Jay

This is a blog of essays on public policy. It shuns ideology and applies facts, logic and math to economic, social and political problems. It has a subject-matter index, a list of recent posts, and permalinks at the ends of posts. Comments are moderated and may take time to appear. Note: Profile updated 4/7/12

29 June 2011

Why Obama Will Win Again (and Why I’m No Longer Donating)

[For a recent post explaining a simple way to cure our national short-term-thinking disease, click here.]

We humans are strange creatures. We fight, we struggle, we strive until the very end, even when the outcome is plain to see from the beginning. It’s almost as if we thrive on turmoil, conflict, struggle and suffering for their own sakes.

Any neutral observer could have predicted that the North would win our Civil War. It had the population, the industry, the wealth, the technology, the discipline, the willing manpower (as distinguished from slaves) and the world’s sympathy—not to mention right on its side. But we had to endure what is still our bloodiest conflict, despite all the agony since. The only reason it took so long was that Robert E. Lee, probably one of the best generals in American history, fought on the wrong side.

World War II was similar. No informed observer would have predicted that the Axis—Japan and Germany—could fight the whole world and win. The only thing that might have made a difference was Germany getting the Bomb first. But our winning that race was foreordained, too, when all of Europe’s best physicists came to our shores to avoid being trampled by the Nazi heel. Nevertheless, it took some six years and 50 million deaths to prove the point.

Runnymede was a rare counterexample. There King John looked around, saw he was outnumbered, and made a deal, which we call Magna Carta. So much quicker and less painful than war. So much more sensible. Maybe that single act of common sense and bowing to the inevitable was what led our Anglo-American culture to dominate the world.

Some elections now, especially our own, have become the moral equivalent of war. And they reveal the same phenomenon: die hards never admit how hopeless their position is until the very end.

The 2008 election was like that. The Republicans picked an aging, unstable, irascible economic illiterate, who had come down on the wrong side of every economic issue. Worse yet, they picked him as their champion in an election that was all about the economy.

When their opponent turned out to be half black, they called him every name they could think of. And they used the greatest propagandists in humans history, Fox and Rush, to try to make the name-calling stick. But they failed because the President had (and has) the knowledge, the intelligence, the character, the dignity and the grace. McCain won in a few backward places, but Obama took the nation’s productive heart by storm.

So he will again in 2012. Mitt Romney is younger and smarter than McCain. He knows a lot more about business and economics. But he’s unelectable.

Why? Let me count the reasons.

First and foremost, Romney is a jerk. He just can’t help it. When reporters asked him why none of his five strapping sons had ever served our country in uniform, he replied that they were serving it in his campaign. Apparently he had no idea how that remark might sound to people who had suffered unspeakable hardship or wounds in combat for country, or who had seen their buddies or loved ones suffer and die.

During the 2008 Republican debates, Mitt accused the President of being like Jane Fonda one day and Dr. Stranglove the next. You had to be a Baby Boomer just to understand the chop. Fonda was the liberal actress who had gone to North Vietnam illegally during the Vietnam War, and Dr. Strangelove was the bizarre character in the 1960s movie of the same name, who sought nuclear Armageddon.

In that chop, Romney made fun of talking to our enemies, which was precisely what had helped end the Cold War without a shot fired. He also ridiculed our embarrassing failure to get bin Laden; but, as it turned out, the very policies he ridiculed—pursuing Al Qaeda Central in Pakistan—were the ones that just put bin Laden away.

Mitt’s a smart guy who’s made a lot of money. You would think he might have learned something about politics in his career. But no, he’s just a good ol’ frat boy who can’t resist the glib one-liner. Recently he quipped that he, with all his millions, is “unemployed.” I’ll bet that got a nice laugh in the nation’s country clubs. But what about the bars and pool halls where real unemployed go to nurse their grievances?

Democrats and their political consultants have just endured three years of the most relentless, vitriolic and unprincipled name-calling in the history of American politics. They have learned from the best. Among other things, they have learned how to tar even admirable human qualities like education and intelligence as “elitist” and turn them against a candidate. By the time they get through with Mitt in the general election, he will be sausage, neatly packaged in bright red plastic, labeled “jerk,” “elitist” and “loser.”

And that’s not all. Mitt’s a prodigious flip-flopper. He has done triple backflips on the very issues that matter most to today’s know-nothing Republican base: abortion and so-called “Obamacare,” a version of which Mitt himself enacted as governor of Massachusetts. I’ve already written how that sort of flop-flopping looks to me. The same probably applies to most Republicans, who are much less troubled by nuances.

Based on his weathervane history, Mitt will be as easy to toast as Wonder bread. No matter that his earlier, more thoughtful positions on each issue were right. The Tea Mobbers and the party faithful don’t want thought or nuance; they want blind obedience.

And you don’t have to be a political consultant to know how to throw these bombs at Mitt. You just have to have the street smarts of a country lawyer.
“Now, Mr. Romney, were you a liar and an idiot then, or are you a liar and an idiot now? And if then, how can you assure us you won’t be a liar or an idiot some time soon again?”
You see, the GOP and their propagandists have established an iron rule of inflexibility. The only thing that excites their base is absolute orthodoxy, without the slightest thought, nuance, or amenability to change. Measured against that standard, no sentient being, let alone someone like Romney, can win.

Romney will fail the loyalty test that has become the GOP base’s sole concern. And independents and Democrats won’t vote for him because: (1) he’s a jerk, and (2) at the end of the day, despite all their pissing and moaning, they will come to understand that the President has done a pretty good job under impossible circumstances.

Could the GOP do better with someone else? Not with Tim Pawlenty. Garrison Keillor and his “Prarie Home Companion” have taught us what a unique and beautiful culture Minnesota has. Derived from Scandinavian immigrants, it took a spot with absolutely miserable weather and turned it into one of our best places to live, raise a family, and do business. Part of the secret of its success was an eagerness to help one’s neighbors and a willingness to bear taxes, miserable weather, and other hardships without complaining. Keillor taught us to laugh with and love the stoicism of his “Norwegian Lutherans.”

In his two terms as governor, Tim Pawlenty did to that beautiful state what “Neutron Jack” Welch once did to GE. He “downsized” and plundered it and its infrastructure for short-term dollars without a thought to what had made it work or anything of enduring value. Like most GOP pols today, Pawlenty rode a wave of private greed. He cut government and taxes by hiding debt in obscure boxes that Minnesotans will be stumbling over for years.

It will take some time to get that story out, but out it will come. And the true leaders of that lovely state won’t be bashful about telling it. When it does come out, Pawlenty will be toast.

Oddly enough, the only GOP candidate who might have a chance to win the general election is the one least likely to be nominated. That’s John Huntsman, Jr. He has three attractive attributes, none of which the GOP has seen in its presidential candidates since the Elder Bush, who left office nearly two decades ago.

First, as the President’s ambassador to China, Huntsman actually learned something about the world outside our borders. And what he learned is critical to our future. China likely will become the world’s number-one economy during the next presidential term. Already it’s our most important trading partner and bilateral relationship, by far. Thus Huntsman satisfies my first vetting criterion of actually knowing something useful.

Second, Huntsman is unique among our politicians in another respect. He actually speaks a foreign language fluently. Not only that, it (Mandarin) happens to be the official language of what will soon become the world’s most important country.

I have written how important understanding foreign cultures is in keeping us safe. It is equally important to success in the hyper-competitive global capitalistic economy now under construction. That’s one reason why I supported the President’s 2008 candidacy so strongly: his childhood experience in Indonesia gave him early and acute insight into how much culture matters.

If campaigns were rational exercises, Huntsman could one-up the President in both the currency of his language and cultural skills and their strategic importance. But it’s hard to do that in a party that has spent thirty years bashing the UN and foreigners and consistently pandering to our worst xenophobic and jingoistic instincts.

Finally, and most important, Huntsman possesses a quality that makes him unique among all GOP politicians. He’s a diplomat.

Roughy speaking, that’s the opposite of a jerk. Imagining Mitt Romney as a diplomat is funny enough to dispel, for a moment, my lingering depression about the state of our society and economy.

By training and experience, a diplomat like Huntsman focuses on substance, assuages bad feelings, and knows how to make people comfortable despite differences in world view and policy. That’s, of course, exactly what the President does. Huntsman could fight fire with fire.

So, unbeknownst to our chattering classes, Huntsman appears to be the only potential heavyweight in the GOP lineup. But he has a little problem of culture. Like nations and ethnic groups, corporations and political parties have culture. It’s much more important than a platform or what any candidate says.

For thirty years now the GOP have built the ugliest, least diplomatic, most negative and counterproductive political culture since the pro-slavery Democrats, if not in American history. They have purposefully attracted every racist, xenophobe, conspiracy theorist, gun nut, anti-abortion fanatic, selfish and clueless petit bourgeois, demagogue, and unthinking Joe and Mary six-pack they could find. That’s their base.

And now they want to “pivot” in one election cycle and nominate and elect an intelligent, culturally sensitive, “elite” diplomat like John Huntsman, who cut his diplomatic teeth working with what most of the GOP rank and file still think of as lawless, godless, Communist, yellow hordes? Good luck. The mere cognitive dissonance would create tornadoes to rival those that recently destroyed Joplin.

So why did’t Huntsman wait for another four years, when his party might have at least begun the process of reformation that it must undergo to regain the trust of all but the greedy and feebleminded? Probably because he’s an opportunist. The Republican contenders are so lacking in talent precisely because the smart money is all on Obama, literally. Maybe Huntsman thought this would be his only time to make a splash. His name, after all, is hardly a household word, even compared to Mitt’s.

Huntsman and Sarah Palin come from different species and inhabit different moral galaxies. In normal times his resume alone would make him a credible candidate worthy of attention and respect.

But unfortunately for Huntsman (and for anyone who would like to see elections based on quality, not celebrity) the GOP have turned their party into an abomination. They have forsaken leaders like Richard Nixon—let alone Lincoln, Teddy Roosevelt, Dwight Eisenhower and Nelson Rockefeller—for college dropouts like Karl Rove and slime merchants like Glenn Beck and Rush Limbaugh. They have rebuilt a once-great party on a foundation of hate, fear, ignorance, slander and blind loyalty.

No credible candidate like Mitt Romney, let alone John Huntsman, has any chance of winning both the nomination and the presidency while the party remains in that state. The party has to regain the habit of addressing serious issues as if its members and the people it wishes to attract were serious adults.

It will take far longer than eighteen months to do that. It will take years of hard work by men and women of vision, integrity and a sense of common national purpose. Maybe Huntsman is smart enough to begin that work; I doubt Romney or Pawlenty is. And the rest would just dig the hole deeper into the sewer.

As Lincoln said, “You can fool some of the people some of the time.” But betting on Americans continuing to get stupider, cruder, more xenophobic and more ignorant while their country rots away under their feet is not a winning proposition.

Huntsman is, as far as I can tell, a good man. But so was John McCain, once. Huntsman is going to be horrified when he finds out what they did to his party while he was away. When he does find out, as he begins his campaign, he will miss his old job as ambassador in an administration based on facts and reality.

Coda: Why I'm Sitting on My Wallet Now

During the 2008 presidential campaign, I made no secret of my wholehearted support for Barack Obama, including financial support. My wife and I together donated almost $10,000 to the cause, nearly all of it to the President and his campaign.

I'm not one of those childish, fair-weather supporters who have abandoned the President—or have rashly threatened to do so—because he didn’t enact single-payer health care, cure a thirty-year economic disease in two years, or terminate two wars that he didn’t start with the same sort of sudden rout that ended our war in Vietnam.

I understand the impossible position that the GOP's scorched-earth politics and misled voters have put him in. I also know he is not only the lesser of two evils, not only the best candidate from the fields in either party, but also the best national figure whom I could conceive of running for president under any present or foreseeable circumstances.

So, while I’ve had some disappointments with the President, I am still firmly behind him. Nevertheless, despite getting five or more e-mails a day, each one sounding more outraged and desperate than the last, I’m sitting on my checkbook for now. I thought it might be useful for the President’s campaign staff and other supporters to know why.

The post above outlines my first reason. I can’t see any putative Republican opponent laying a glove on the President. He beat the Clinton Dynasty, for God’s sake, at the height of its power and with the many jobs it had created and its nice fiscal surplus still in recent memory. And then he beat the most racist and ugly campaign, by the very best propagandists, in American history. He’s had almost four years to refine his campaign and his message and build up his “ground forces.” You think that Mitt the Jerk or Michele the Moron can beat him? Only their limitless egos entice them to try.

Of course I recognize the paradox in this reasoning. If more people, like me, believe the President’s 2012 victory is foreordained, maybe fewer will donate money or work for him, and his campaign will fail.

Of course I’ll be watching for any signs of that happening. But I don’t see any yet, aside from the GOP hominids’ usual chest-beating. And anyway, I never said I wouldn’t support the President in other ways; I’m just not ready to open my wallet again yet.

My next two reasons are ones that ought to concern the campaign and other Obama supporters. The first is the flurry of e-mails I receive every day. Of course I could filter them or delete them without reading, but I don’t. I want to know if I’ve missed anything in the news. (Usually I haven’t.) So I read the first two paragraphs and sometimes half a page.

But I find them all the same. They all begin with some outrageous act of the GOP, usually one of which I’m already painfully aware. Many exaggerate that act in way that stretches credulity and reminds me of the GOP itself. Then, like some used-car salesman crying “Buy now!”, they impose an artificial deadline on my contribution and try to fill me with an artificial sense of urgency. What they don’t do is promise me any response to the GOP outrage, other than in the vaguest and most general terms.

Reading these e-mail ads, which is all I can call them, makes me feel like a disrespected consumer of a defective product. The fact that I know the President is not defective, unlike nearly all his opponents, doesn’t salve the sting.

Maybe other supporters or would-be supporters react differently. I trust that Obama and his campaigners know what they are doing. But I can only report how I feel: like a watcher of live, digital TV wishing he had a “fast forward” button to skip the annoying, repetitive, instrusive commercials. They don’t strengthen my support but make me think of myself as a pawn in a vast advertising-propaganda war among titans. That’s not a pretty feeling.

The final reason why I’m sitting on my wallet is by far the most important. From my very first, somewhat tentative blog post in support of the President, in March 2007, one facet of him and his campaign especially attracted me. I thought he was uncorrupted and incorruptible. In that very first post, I mentioned his honest family money, from royalties on his books, and his coming Internet campaign, in which I hoped small contributions from many people would help restore a semblance of democracy to the country I love.

So you can imagine my shock and disappointment on reading in the New York Times recently that the President is seeking the financial support of hedge-fund managers and, in return, promising them policies that favor their “industry.” (Mitt Romney is, too, but that’s beside the point of this discussion. Like Jesse James, presidential campaigns go where the money is.)

Now I don’t think hedge-fund managers ought to be imprisoned or their work outlawed. If I were very rich and very busy, I would probably want their services. (As it is, I handle all my own investments and some of my wife’s personally.) But I see them as having a single goal: to make themselves and the rich richer by gambling in our financial markets.

I see no larger social purpose they perform. And there is good evidence that their activities and the amount of money they control increase market volatility, contributed hugely to the 2008 meltdown, and continuously threaten a recurrence.

So I consider hedge-fund managers as dangerous social parasites that, like undesirable speech, we must tolerate in a free society. If I were in charge, I would require every one of them who handles more than a certain amount of money (say $100 million) to help fund a properly programmed electronic reporting system that would report his every trade and his fund’s weekly status, on line and in real time, to the Federal Reserve System and to the public. At the very least, we have to know what these guys are doing in and to our financial system. (And they are all guys: I have yet to hear of a hedge fund run by a woman; I think it’s something to do with a male gambling gene.)

So when I hear that the President is not only taking, but soliciting, campaign contributions from these parasites and, in return, hearing their advice on how to pretend to be regulating their business and derivatives without really bringing them under control, I cringe.

It certainly doesn’t help that I consider the risk of another meltdown in our $600-trillion derivatives market to be the single greatest danger facing our country, bigger even than our ongoing energy crisis. You can think of all those derivatives as a delicately balanced house of cards, ready to fall down at the slightest vibration, such as yet another in the ongoing series of near-defaults by Greece, or a much bigger near-default by our own country, precipitated by John Boehner’s mindless brinksmanship.

Banking and finance are not the President’s fields of personal expertise. That’s why he relied so heavily (and inappropriately, in my view) on the Geithner/Summers team. So the thought of hedge-fund managers whispering in his ear gives me nightmares despite my general confidence in his good character.

I also know that a single one of these guys, by writing a $ 10 million check, can “balance the books” on a thousand supporters like me. It’s much easier to solicit campaign contributions wholesale than retail, and the President’s campaign managers aren’t working seventy-hour weeks to make their own jobs harder.

But the dilemma still remains. How does the President get people like me to contribute when it looks as if people I want as far away from financial policy-making as possible are calling the shots with their money? Until I see a decent answer to that question, I think I’ll continue to sit on my wallet.

Although I have some expertise in analysis, I readily confess that I know nothing about running political campaigns. But it seems to this naive observer that you can’t have it both ways. You can’t run a campaign based on honesty, incorruptibility and the support of the little guy and seek the financial support of hedge-fund managers by promising to see things their way. You just can’t.

If the worst happens and we have another financial crash, any candidate who touched these parasites will be toast. And if I feel this way, you can be sure the Fox propaganda machine will take this ball and run with it cross-country.

I hope the President and his staff will make the right choice, at least before there is any whiff of a risk of their losing this watershed campaign. And if they do, and I hear the word, I’ll open my own wallet again.

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25 June 2011

Thinking Outside the Box: A Zero Capital-Gains Tax

Ah! That got your attention, didn’t it? Coming from a blogger who castigated the President for extending the Bush tax cuts for the rich, it’s a head snapper. A zero tax rate? Am I out of my mind?

I don’t think so. Read on.

The impetus for this idea is something that’s been troubling me for forty years. And it has nothing directly to do with the deficit or the impending catastrophe of a possible US default.

China has its five-year plans. We have our quarterly reports. If you knew nothing else about our two societies, you would predict that China would win.

And you’d be right. In real life, winning is all about planning and delayed gratification, or what I called in a previous post “second-piece waiting.” Repeated studies show that children who wait for a second piece of candy, rather than greedily devouring the first, fare better in every measure of their later life, from successful marriages to lifetime income.

We Americans are losing our lead, our “American Dream,” our standard of living and our way of life because the people who matter among us can’t think beyond the next bonus, quarterly report, or two-year election cycle.

We can’t do much about the election cycles. Our straightjacket of a written Constitution, about which our schools tell us to be so proud, has tied us in knots.

But we all know that government doesn’t matter much anymore. It’s perpetually deadlocked, and its “debates” have become little more than verbal mud wrestling. The private sector is where the action is. It’s certainly where our jobs and economic recovery are mostly likely to come from. So maybe if we can get our private sector thinking beyond 90 days, we can start to compete with the EU, let alone China, India and Brazil.

How do we do that?

Well, the current rage in economics is incentives. If you give people the right incentives, they will do right. If you give them the wrong ones, they will screw up.

The Crash of 2008 proved the latter proposition perfectly. The bankers who made predatory loans, the borrowers who took them, the investment bankers who packaged them, and the agencies that rated them all had perverse incentives, including obvious conflicts of interest. The result was a near-meltdown of the global economy, which we barely avoided by piling up all the debt we’re now fighting about.

But suppose you could change all that. Suppose you could give every business, investor and even investing consumers a strong economic incentive to think long term, to wait for that second piece of candy. And suppose you could do it with a simple change in law that any high-school graduate could understand. Wouldn’t you at least consider it?

To understand how the change would work, you have to understand a few things about our income-tax system. There are two kinds of income, which we tax at vastly different rates. The first is so-called “ordinary income.” It includes most of the money that ordinary people make: wages, salaries, and the earnings of independent contractors for their labor (for example, doctors’, lawyers’ and accountants’ fees). Ordinary income also includes most dividends from stock ownership and interest from bank and brokerage accounts.

The second type of income is called “capital gains.” It comes from investment. When you buy and later sell an investment, your gain or loss from the round trip (purchase and sale) is a “capital gain” or “capital loss.” The investment can be stock, bonds, real property (except for your own residence), precious metals, oil, or other commodities.

The difference between “ordinary income” and “capital gains” is not the really big one. For most purposes, our tax law treats capital gains much like ordinary income, as long as the investment lasts for less than one year.

But if the investment lasts longer than this one-year so-called “holding period,” we tax any gain at a much lower rate. For example, here is a comparison of the maximum (top bracket) ordinary-income tax rates and long-term capital-gains tax rates for the years 1954, 1980, and 2011:

YearMaximum Ordinary Income RateMaximum LT Capital-Gains Rate

As you can see, the differences in the top tax rates are huge, although they have been getting smaller over the last 50-plus years. (In comparison, the whole fight over the Bush tax cuts is about a few percent.) Why the difference?

Well, ordinary income is stuff you get personally and normally hoard or spend on yourself. If you’re poor or middle class, you spend it on necessities. If you’re rich, you spent it on luxuries, things like expensive clothes and jewelry, multiple homes, luxurious travel, yachts and private planes, and so forth. But in either case, you spend it on yourself and your family. It’s “personal” income.

But capital gains are different. That’s money you make from investments in your own or someone else’s business. It’s gain from money you put to work. In the best case, it creates jobs and business opportunities for others and wealth that never existed before.

The holding period, not the distinction between ordinary income and capital gains, is the key. You can make short-term capital gains by buying and selling a stock or option in a single day. In fact, with programmed machine trading today, you can make short-term capital gains in a millisecond. We tax those short-term gains much like ordinary income.

To make long-term gains and get the much lower tax rate, you have to hold the investment for a year or more. So the different tax rates, coupled with the holding period for capital gains, create a powerful economic incentive to invest in jobs, new wealth and opportunity for others and to hold that investment for a while.

The trouble is that a single year isn’t much time today. It goes by so quickly. New businesses barely get off the ground and organized in that time. A radically new product needs more time to gain market acceptance. A difficult R&D project requires much more time to prove itself. Look, for example, at how many years it has taken for Boeing’s 787 “Dreamliner” to approach the skies; and it’s still not there yet.

So if we wan’t to give business—which is the driving force of our economy and our society—a real, solid incentive to think long term, we have to increase the holding period for long-term capital gains. If we want to match the Chinese and their five-year plans, we ought to raise it to five years.

Now I can already hear business people screaming. They aren’t in business to give away something for nothing. So what do they get in return for a much longer holding period for favorable tax treatment?

Well, if we want to strengthen their incentive to think and invest long term, the best thing to do is to increase the differential between the top ordinary-income rate and the top long-term capital-gains rate. In other words, we make long-term capital gains even more (much more!) attractive than at present, as compared to ordinary income.

We can do that in three ways. We can raise the top ordinary income rate, for example, by refusing to renew the Bush tax cuts when they expire. We can lower the long-term capital-gains rate. Or we can do both.

My own thought is that we should do both. As you can see from the table above, the top ordinary-income rate is much lower than it has ever been in our postwar boom period. That’s what people like me have been screaming about. Raise the top ordinary-income rate, and we provide tax revenue to honor solemn pension and health-care promises and keep the safety net strong for future generations. At the same time, we reduce the amount that rich people waste on excessive personal consumption, as distinguished from investing in jobs.

But when you also lower the long-term capital-gains rate, you provide a strong incentive for everyone, including the very rich, to put their money to work.

If you do both, you say to rich and poor alike:
”We don’t care how rich you get. We want everyone to get rich. But we want you to get rich the right way, by building businesses that create jobs and wealth and making everybody better off. And we all know now you can’t do that overnight, except by gambling or swindling.”

”If you make your money by being patient and building something lasting, we’ll tax you lightly, maybe even not at all. But if you take income for yourself, right away, we’re going to tax you harshly. You’ll just have to wait for that second piece of candy.”
Isn’t that approach, after all, what built our postwar prosperity and the American dream in the first place?

So here’s the deal. The top “personal” tax rate goes up to 70% or so, where it was before the so-called “Reagan revolution.” The long-term capital gains rate comes down hard, maybe to zero, but only for investments held for five years or more. The result will be the strongest economic incentive in thirty years to put money to work and think long term, rather than go for the quick buck and hoard it or spend it on luxury.

The Congressional Budget Office will have a hell of a time “scoring” this proposal. Why? Because if it works the way we expect, it will restructure our whole economy. It’s not just rearranging the deck chairs on the Titanic. It’s building a whole new ship.

People who want lower taxes, which is almost everyone, will get them by investing their money in creating jobs and making our economy grow and our society richer. And because they have to hold their investments for five years or more to get the lower rate, they will start to think long term, just like the Chinese.

The precise numerical effect of these paradigm shifts will be hard to predict. But we don’t have to have exact numbers. We know this approach works because an earlier version, with a shorter holding period, built our postwar prosperity and the richest consumer society the world had ever known. Maybe we can even fold this revolutionary thinking into our budget deliberations and save ourselves from the economic equivalent of a nuclear holocaust—a default of the full faith and credit of the world’s leading economic power.

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22 June 2011

Ending the Not-War War

Today the President promised to draw down our forces in Afghanistan by 10,000 this year and by a total of 33,000 the next. Those drawdowns would more than reverse the “surge” that he ordered his first year in office.

Political reactions were predictable. The left criticized the President for not sending all our troops home on the next boat. It did so notwithstanding the fact that Afghanistan has no seaport and that no boat ever made could transport more a few percent of our troops at a time. The right criticized the President for risking the “victory” that always seems just out of reach. It did so notwithstanding the fact that many of its own rank and file now want our troops home as much as the left does.

No one really thought much about what got us into this endless war.

That’s not surprising. As test results revealed recently, history is our worst subject. What Sarah or Rush said yesterday is more important to many of us than cataclysms that murdered millions or events that changed nations just a decade or two ago. Less than twenty-two years ago, for example, the Berlin Wall fell and the Soviet Union collapsed of its own weight, ending the Cold War and a very real risk of human self-extinction. Yet most youth today, whether in the US or Russia, haven’t a care or a clue.

But to understand the President’s action today, you have to understand what came before. That’s basic.

When the hijacked planes struck the Twin Towers, a memo warning of just such an event had been sitting on the desks of President George “Dubya” Bush’s national security advisers for over two months. According to the Washington Post, “On June 30, a top-secret senior executive intelligence brief contained an article headlined ‘Bin Laden Threats Are Real.’” But the message apparently never got to the President or his attention.

Why? Because National Security Adviser Condoleezza Rice simply didn’t believe it. She was by far the most erudite and well-informed member of the Cabinet, but she had spent her whole career, mostly in academia, studying the Soviet menace and its risk of species extinction. To her, the notion that a tiny band of Islamic radicals could present a serious threat to US national security was incredible. President Bush himself had said, in the Post’s words, that he “didn’t want to swat at flies.”

So the Bush White House was completely unprepared for the attacks of 9/11. When they came, it grossly overreacted in two ways.

First, like a child’s caricature of a West-Texas sheriff, Dubya announced the so-called “Bush doctrine.” If you harbor terrorists, he declared, we will treat you as our enemy. “Dead or alive,” he actually said.

Never mind that, even at that time, Al Qaeda was believed to have a presence in some sixty countries. Never mind that one of them, Pakistan, had and has nuclear weapons and was actually trying (in part) to help us. Never mind that fighting even some of them—let alone all of them—would have been far beyond our financial and even military capacity, unless we “fought” them by loosing all our strategic nuclear arsenal and destroying the world. Dubya announced the Bush doctrine, effectively declaring “war” not only on the people who planned and carried out 9/11, not only on terrorists everywhere, but also on every country in which they might be found.

That was probably the single most childish, stupid, worthless and counterproductive announcement of foreign policy in American history. But it sounded good to some of a public ignorant of history and reared on cowboy and “Rambo” movies.

The Taliban leaders of Afghanistan saw through the idle threat. They refused to deliver bin Laden, to whom they owed allegiance, money and Islamic hospitality. And so we sent troops into Afghanistan to get bin Laden and fight the Taliban because they wouldn’t turn him over. And we’ve been there ever since.

The second bit of gross overreaction came in Iraq. Historians will debate for centuries what precise combination of motives caused Dubya to start that “war of convenience.”

They will have a tough time comprehending the truth when they find it. They will have to enter the psychological sewer of Dubya's mind and withstand the smell of a putrid combination of West-Texas macho, Oedipal desires to best his father, a lust for revenge for Saddam’s attempt on his father’s life, and some childish credit for the neocons’ facile arguments that getting rid of Saddam would change the Middle East for the better overnight. An unanswerable question will persist in their minds: how the nation that styled itself the model of democracy and reason could ever let such a man become its “decider.”

But whatever the reasons, Dubya made war on Iraq. Then he and That Idiot Rumsfeld exhausted the short window of opportunity after a successful invasion by searching for weapons of mass destruction to justify the war retroactively. Their mismanagement enabled, if not incited, the Sunni and Al Qaeda insurgency, and the rest is recent history. After close to 4,500 American combat deaths, hundreds of thousands of Iraq deaths, and millions displaced to neighboring countries, including Syria, the civil war that we triggered seems to have been suppressed.

But Iraq’s future is still uncertain, and we have increasingly less and less say about it. In a Shiite-majority country, a neighboring Shiite theocracy, Iran, has increasingly more.

That’s the bad news. The good news is that our combat role there has ended and we are getting out.

Iraq, at least, was a real war. Its objective (the only one that turned out to be real and practical) was to depose Saddam. We did that. But after accomplishing that objective we had to stay to clean up the mess that achieving that objective and our own gross mismangagement made. We haven’t cleaned it up yet, but we have at least given Iraqis a fighting chance to do so on their own. And so, consistent with out gnat-like attention span, we are getting out.

But Afghanistan was never a real war, except insofar as Dubya’s moronic “Bush doctrine” made it so. We had and have no quarrel whatsoever with the Afghani people, despite their penchant for surviving on the opium trade. We had never raised a single complaint about the Taliban’s harsh government or its treatment of women before 9/11. Our purpose in going there was to get bin Laden and Zawahiri and shut down their terrorist bases and training camps. Our quarrel was (and is) with them, not the Afghans or their leaders.

Of course smart people here knew this. The President campaigned on getting our eyes back on the ball of bin Laden and his crew. Attorney General Holder called 9/11, quite properly, the “crime of the century,” not a war. Leave it to a good lawyer to use words precisely.

But Dubya, who could barely speak English with a teleprompter, had already declared a “War on Terror.”

Now you can’t make war on a noun. It’s just an abstraction. To fight a war, you have to have an enemy. Dubya never made clear precisely who our enemies were.

Were they bin Laden, Zawahiri and their foreign jihadis? Were they the Taliban? Were they Taliban sympathizers? Were they any Aghans who didn’t jump to our order to turn over their guests and salute while doing it? For the entire duration of this non-war war, the Bushies never made any of this clear. We were fighting a non-war war with shadows.

Of course President Obama and Attorney General Holder were and are smart enough to see all this. But they had three problems.

First, it’s bad form to overturn a prior president’s doctrines and policies, especially in the middle of hostilities. No matter how stupid and counterproductive those policies may be, it’s just not done. During the entire course of our losing war in Vietnam—which from the Gulf of Tonkin Resolution to our ignominious flight from Saigon lasted nearly ten years—not once did any American leader ever say honestly, “We made a mistake; this thing’s a loser, and we’re getting out.”

Sorry, folks, that’s just not done. You have to be more subtle than that. Our leaders and our government have face to save. (And we chide the Chinese for the same reason!)

And we can’t let people who’ve lost limbs, peace of mind or loved ones think their suffering was in vain. It wasn’t. As stupid as were the policies they were ordered to support, their sacrifice got us and Afghanistan to this point, from which a better future is possible. But getting to that future requires wiser policy.

The second problem was a bit more specific. Both the President and the Attorney General are African-Americans. They have a small problem of acceptance with a significant minority of Americans. So no matter how correct and wise they are, their contradicting the declarations of their immediate predecessor as president raised and raises certain political risks. The right wing’s defense of Duyba, which grew and grows more and more shrill as time reveals the depths of his disastrous stupidity, only exacerbated this problem.

Finally, and most important, there was no strategy. When you make war against a noun, strategy is irrelevant. But once our abused troops actually got to Afghanistan, they had to figure out whom they were fighting and what they were fighting for. For a while, during Dubya’s most insane utopian delusions, it seemed as if we were fighting to convert Afghanistan into Switzerland. Good luck.

Things changed for the better when Robert Gates replaced That Idiot Rumsfeld as Secretary of Defense. They got better still when President Obama required a lengthy and extensive review of goals, policy and strategy in late 2009. But even after that long review, it still wasn’t clear whether the Taliban were our enemy or someone else.

Now it is. Under the President’s tutelage and guidance, and no doubt with Secretary Gates’ able help, we began to comprehend two things. First and foremost, assassination works. If you’re facing a very small group of very bad guys hiding out in a vast nation, you don’t have to make war on the whole nation. You just locate the bad guys and take them out.

Second, you don’t have always to do that by “remote control,” with unmanned aerial vehicles. That tactic creates resentment on the ground and often far too much “collateral damage” (our current military euphemism for killing innocent civilians by mistake). You can commission and train, in secret, a whole brigade of specialized assassins and set them to work. That’s what the President did, and that’s who executed bin Laden.

As it turns out, taking him out was just the culmination of months of successful assassination work in Afghanistan and Pakistan. The mission went so well because our modern ninjas had had plenty of practice.

So now, for the first time in a decade, we have a real strategy. Joe Biden suggested it long ago, and our sole tactical success (in assassination) has confirmed it. We’re not in a real war but a limited police action. We can use our drones and ninjas to take out Al Qaeda and the worst of its Taliban sympathizers. In so doing, give can ourselves a breather from terrorism and Afghanistan a fighting chance to evolve from the first millennium to the third.

“Why can’t we do this overnight?” the lefties want to know. Well, because it took us ten years to get to this sorry point, figure out who our enemies are, and develop a workable strategy.

Also, our blunders have changed Afghanistan beyond measure. In some ways we have changed it for the better. For example, we have encouraged educating girls, begun to train a professional army, and provided opportunities for non-opium commerce. But in some ways we have changed it for the worse. For example, we have installed Hamid Karzai and his corrupt crew, and we have done little to curtail the opium trade besides providing alternatives. Since all this is still a work in progress, we have a moral and practical obligation to make sure it all doesn’t fall apart as we leave. That takes time.

Just logistics alone take time. Even if we wanted all those 33,000 troops out ASAP, it would take more than two months to get them out, flying one 747 a day and leaving all their equipment behind. At that rate getting all our troops out would take over eight months, just for the transportation. As the president has said more than once, you don’t turn a huge ocean liner around on a dime.

When the President says “responsible” exit, he means two things. First, he means “practical and doable.” You don’t move armies and their modern infrastructure overnight. Second, he means “do no more harm than we’ve already done.” That means making sure people who’ve helped us and (through us) their country’s future don’t get butchered. It also means continuing to take out as many more of the baddest guys as we can while we leave.

At least we can feel relieved that we have a President who understands four things. First, you don’t make war on a noun; you have to decide whom you are fighting and act accordingly. Second, when you finally find a strategy that works, you stick with it. Third, you don’t remake cultures by military force; remaking cultures takes centuries, as evidenced by our own re-fighting the Civil War in almost every national election well into the twenty-first century. And fourth, no matter how stupid and disastrous it may have been, you can’t reverse a previous president’s globally announced policy without a lot of diplomacy, finesse, and delay.

The President is turning the ocean liner in the right direction, and we will get home soon.

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20 June 2011

Pakistan: A New Policy

[For a brief update on the comparison with Iran, click here.]

Recent events make clear that Pakistan, not Iran, is now the most dangerous place in the world, with the possible exception of North Korea.

Pakistan has nuclear weapons. Iran only appears to want them, and how much is anyone’s guess. With its general level of industry and technological sophistication, Iran could have had nuclear weapons years ago, at least if its people had viewed them as crucial for their own survival as we did for ours in World War II.

But Iran doesn’t have nuclear weapons yet. It may never. A large part of the reason appears to be its own political and cultural ambivalence toward them. Iran has not been expansionist for most of a millennium and is not now.

Like the former Soviet Union in its day, Iran does have lots of bluster. It insults and threatens us, Israel and some of its Sunni Arab neighbors. But the only visible, concrete steps it has taken to carry out its threats have been its slow development of medium-range missiles, its supplying terrorists, and its meddling in Iraq, with which it fought an eight-year debilitating war, after being attacked, that ended a little over two decades ago.

In contrast, the level, depth, longevity, persistence and sheer irrationality of Pakistan’s hatred for India is terrifying. Not long after it first got nuclear weapons, Pakistan attempted an invasion of the Indian-controlled portion of Kashmir that nearly precipitated the first real, bilateral nuclear war. Ever since then, the consistent obsessions of Pakistan’s military and intelligence services have been Kashmir and India.

The only comparable phenomenon in the world today is Kim Jong Il’s obsessive hatred for the far more successful Korean South. In contrast, Ahmadinejad’s bluster against Israel seems like cheap demagoguery, with neither societal consensus nor consistent planning behind it.

Despite an unstable patina of democracy, Pakistan’s army and security apparatus (ISI) seem firmly in control of the country, or at least its military and nuclear weapons. In contrast, Iran is divided three ways, among: (1) its aging clerics, (2) its politicians, including Ahmadinejad and the ever-present but low-key Rafsanjani; and (3) a “Green” popular revolution that has been suppressed for now but still simmers just below the surface.

Military control of Pakistan might not be a bad thing if its military were rational, professional, and stability-seeking like Egypt’s. But that does not appear to be the case. A recent report suggests that all of Pakistan’s eleven corps commanders, and much of the army’s rank and file, resent us and are furious at our killing Osama bin Laden on their territory. There is even some question whether they sympathize with Islamist extremists (apart from their putative value as a “weapon” against India) and, if so, how deep that sympathy goes. (What all this reveals about Pakistan’s official complicity with Al Qaeda, ambivalence, or sheer incompetence, is still unclear.)

About two years ago, I wrote a post lauding Pakistan’s democracy. I wrote that post just after its protesting lawyers and supreme court had gotten rid of Musharraf as its strong man. I expressed hope that the British-imposed culture of democracy would ultimately prevail, and that Pakistan might become a cultural and commercial leader of Central and South Asia.

But subsequent events make me I fear I was too optimistic. Pakistan in fact has three cultures: (1) a military/intelligence culture obsessed with India, (2) a tribal culture that reigns supreme in Baluchistan and the Northwest Tribal Provinces, and (3) the rational but bureaucratized British culture left over from the old colonial days. I fear that my own cultural bias may have led me to overemphasize the importance of the last.

In any case, it is now clear that our policy in Pakistan has been a failure. Decades of expensive support and “engagement” have not stopped Pakistan from developing nuclear weapons and giving them to North Korea and possibly Iran. Nor have our money and effort created the type of professional, stability-seeking armed forces that we now see in Egypt. We have managed to use our superior technology and organization to kill our worst enemy while he was hiding in Pakistan. But our doing so only elicited the kind of sullen resentment and truculence from Pakistan’s armed forces that they previously reserved for India.

So at present, only one conclusion is possible. In guiding Pakistan to evolve as a democracy and a peaceful member of the community of nations, our policy has been a complete failure.

Let me hasten to say the blame does not lie with the President. He has only followed our nation’s consistent policy for decades. He and his predecessor broke with it to fight Al Qaeda and the Taliban in Pakistan and to liquidate our worst enemy; and in doing so, they hardly had a choice. The alternative was to let bin Laden thumb his nose at us for as long as the Pakistanis sheltered or ignored him.

But a failure is a failure, whoever’s fault it may be. We have tried to bribe Pakistan with money and military hardware. That didn’t work. It just enhanced Pakistan’s dark and fevered dreams of revenge against India. We have tried to train Pakistan’s military to be professional and stability-seeking like Egypt’s. That didn’t work either. We tried (perhaps too little and too late) to assist Pakistan’s nascent democracy, but that effort mostly died with Benazir Bhutto.

So finally we just gave up. We advanced our own interests inside Pakistan, killing our own enemies there with Predators and ninjas. Our military success did nothing but enrage the Pakistanis in charge, despite the fact that our enemies are also their own. It looks as if it will take some hard experience, without our prompting, for the Pakistanis to get that point.

When everything you do fails, it’s time to let others try.

Look at a map. Some strong nations surround Pakistan. Besides India, there’s Iran and China. Beyond Afghanistan are three “Stans” of the former Soviet Union, with Russia not far away. China, India and Russia are strong, capable nations, with stability-seeking, rational foreign policies. Iran and Pakistan are potential, if not present, adversaries and potential checks on each other’s irrational dreams. (Did it ever occur to anyone that part of the reason Iran may want nuclear weapons is that Pakistan already has them and is right next door?)

Like Iran, Pakistan has a simple problem. Expressed in anthropomorphic terms, it needs to learn to get along better with its neighbors. It messes with Afghanistan simply because the two nations have such a long common border and its other neighbors are too strong, or, in the case of the “Stans’” across the way, have too strong a backer to mess with.

Pakistan needs to settle down and focus on its own economic development, modernization and democratization. So do we. We have failed utterly in teaching Pakistan that lesson, perhaps because we are having trouble learning it ourselves. We may not be the best teacher.

Maybe it’s time now to let Pakistan’s neighbors (including Russia, a neighbor by proxy) have a try. We might also involve rational Islamic nations, such as Turkey and Egypt. After all, the neighbors have much more at stake than we if things go wrong.

We should not cut off aid to Pakistan cold turkey (pardon the expression). Doing so would only further inflame resentment and might destabilize the regime. But we should cut aid down gradually and substantially and impose conditions on it.

Chief among those conditions should be that every Pakistani officer, or at least every one who benefits from our aid, attend a war college here for at least two years. There he will learn how to soldier professionally. We will teach him that his first duty is to the Pakistani people and their welfare, not to a religion or to Muslims in Kashmir, and that obsessive hatred of India and the West is counterproductive. We will also teach him that Pakistan’s people include all tribes and all religious sects. This instruction just might help turn Pakistan’s jihad-susceptible army into something resembling Egypt’s.

As we cut down aid, we should ask Pakistan’s neighbors to take up the slack, but on the civilian side. And we should ask them, too, to do everything they can to help divert Pakistan’s obsessive hatred of India into something more constructive. Russia, which has good relations with Germany after suffering the most disastrous invasion in modern history, could be helpful in this regard.

Of course we should continue liquidating our own enemies, even inside Pakistan, including leaders of Al Qaeda Central and irreconcilable Taliban. We should try to do so with as much cooperation and trust between us and the Pakistanis as may be possible. And we should try to limit civilian casualties and infringements of Pakistani “sovereignty“ as much as we can manage.

But we should make clear that we consider these enemies to be criminals, not state actors, and that we have a vital national interest in capturing or killing them if Pakistan can’t or won’t do so. We should also make clear that Ayman al Zawahiri—albeit nothing like the gifted propagandist that bin Laden was—is next on our list, and we will not rest until he has been captured or executed, preferably with Pakistan’s help.

Finally, to help sweeten this bitter pill, we should repudiate and forswear the so-called “Bush Doctrine”—that anyone who harbors terrorists is our enemy. We are not going to go to war with Pakistan, a nation of 170 million people with nuclear weapons on the opposite side of the globe, which has never done us any direct harm and which gave us Khalid Sheikh Mohammed. That much should be obvious to anyone with the slightest trace of pragmatism and realism. It is childish to make threats whose idleness is self-evident.

But we are going to use our superior technology and military might to defend ourselves against terrorists wherever they may hide, not just by huddling behind legal and physical barriers in our homeland, but by offensive police action, including assassination. That, too, should be obvious to anyone who can face facts without flinching.

To further sweeten the bitter pill, we can and should make it our policy to stay as far away from the Kashmir dispute as possible. We have no dog in that fight, except to see it settled as quickly and peacefully as possible. So we should not go out of our way to liquidate extremists or jihadis whose sole focus is Kashmir, whether Taliban or independents. India can and should take care of itself. But whenever jihadis or terrorists collude with Al Qaeda or others with us as a target, or in an attempt at global jihad, they will be fair game.

We could hardly do less to defend ourselves and our interests. That, too, ought to be obvious to anyone who can reason. Pakistani forces can help us and earn our genuine gratitude or sit on the sidelines and be embarrassed. Or they can oppose us, get hurt, and alienate the best and most reliable friend the Pakistani people (as distinguished from their government) have in the world today.

There will never be a full-scale war between us and Pakistan. There is too much at stake for both sides for that to happen, even by mistake. It is remotely possible that we might have to undertake significant military action inside Pakistan to keep its nuclear weapons from falling into the hands of indigenous extremists or stateless terrorists. But that would not be a “war.” Nor would it precede or follow any sort of general invasion or occupation. We simply don’t have the troops, the money, the interest, the reason or (after Afghanistan and Iraq) the staying power.

And, lest we forget, Pakistan and we are on opposite sides of the globe. That simple geographical fact gives us no more reason for mutual paranoia than we and the old Soviet Union once had.

Nevertheless, we have vital strategic and tactical interests in defending ourselves against criminal terrorists who might use Pakistan as a staging ground or its grudge against India as an excuse to plot against us or our allies. And we have the means to do so, without remotely bankrupting ourselves. Therefore our relationship with Pakistan may be prickly (to say the least) for the foreseeable future.

That is an unavoidable fact of life. Our relationship will get less prickly as we convince Pakistanis that the fate of Kashmir is for them, the indigenous people and India to decide peacefully, and that we have common, strong and self-evident interests in fighting terrorists and Islamic extremists.

One last point: insofar as concerns the Taliban, we are getting more discriminating. After ten years in Afghanistan, we are learning to distinguish the “irreconcilable” Taliban, who are friends of Al Qaeda and bent on global jihad, from those whose aims are purely local and whose means are sufficiently civilized to make them candidates for local coalition governments. Most of our “success” in Afghanistan so far inheres in our identifying and assassinating many of the irreconcilable ones. As long as we have substantial force in neighboring Afghanistan, we should continue our policy of working with Taliban whose goals are local and whose means are relatively civilized and neutralizing the rest. With our drones and stealthy ninjas, we don’t need armies on the ground to do that.

So our policy would have only three new elements. First, it would rely on neighbors to reinforce the message that extremism and anti-India grudges are bad for Pakistan and that democratic reform (including women’s rights) and economic development are Pakistan’s future. Second, it would reduce our monetary aid and condition it on Pakistan’s army and intelligence services becoming more professional and more focused on Pakistan’s welfare, rather than enmity towards India. Third, it would rely on complete honesty and forthrightness about our policy and intentions—and their limitations—insofar as concerns Pakistan’s territory and sovereignty.

This is a long-term policy, with no guarantee of success. But what else have we got? We could continue our existing policy of massive, unsupervised military aid, most of which gets diverted into private bank accounts or feverish plans to attack India. And we could continue pretending to cooperate and make nice, with increasing suspicion and distrust on both sides. But those courses of action would put us squarely within Albert Einstein’s definition of insanity.

Update: 6/23/11

In an article headlined “A Divine Wind Blows Against Iran’s President,” the New York Times today confirmed recent reports of a serious and growing split between Iran’s President Ahmadinejad and its Supreme Leader Ayatollah Ali Khamenei. The report suggested, however, that the Ayatollah holds most of the strings of political power, and that it will take someone both cleverer and more popular than the loopy Ahmadinejad to break them.

The brief history of this 1999 conflict is complicated. But you can read the essential details in the following online sources: The India-Pakistan Conflict: Part 3 1965-1999 [scroll down to “The Calm Before the Storm”] and The India-Pakistan Conflict: Part 5 Aftermath.

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16 June 2011

Lack of Imagination IV: Technologies of Freedom

Reported Recent Developments
Why We Need to Do Better
How We Can Do Better


This is my fourth in a series of posts about how we Americans could change the world with a little more imagination.

The first discussed the use of small, remotely piloted aircraft as weapons against terrorists, other asymmetrical fighters, and clandestine developers of WMD. The second and third covered ways to get the Chevy Volt to market and to market it successfully, against the background of the supreme importance of electric cars. (I’m happy to confess that subsequent events in the electric-car market have made those posts largely obsolete.)

This post describes how we can use half-forgotten Cold-War technologies to spread freedom and break down the invisible walls of national prisons like Iran, North Korea, and Syria.

The immediate impetus for this post was a recent piece in the New York Times. That article reported how we are financing the development of informal, ad hoc cell-phone networks and mini-Internets that no government authority can shut down. It described semi-public work financed by our State Department but hinted at more secret and therefore more serious projects.

Reported Recent Developments

The Times article focused on two readily available technologies: (1) cell phones and (2) the Internet. It described how even amateurs can convert individual cell phones and portable computers into nodes for small, independent cell-phone networks or miniature, localized intranets.

These technologies have three advantages. First, they use presently available—and often ubiquitous—commercial devices like cell phones and portable computers (laptops, netbooks or tablets). Often all they require is software modifications, in the form of upgrades to firmware or cell-phone SIM cards.

Second, to the extent they are software based, these technologies of freedom are easy to transfer and install, even under the very noses of hostile authorities. Software is intangible. It can go anywhere electricity or radio waves go, and just as fast. So to the extent that technologies of freedom require only software upgrades, dissenters and freedom fighters can “smuggle” them intangibly and instantaneously.

The third advantage is that these technologies of freedom are cheap. The Times article describes a State Department program using hackers and other Internet aficionados, whose total cost is $ 2 million. By today’s standards for civilian projects, let alone military ones, that is less than pocket change; it’s pocket fluff.

Why We Need to Do Better

But these cheap projects also have two key failings. First, they ultimately require ground-based communication. Either they use the ordinary Internet or cell-phone infrastructure, which consists of microwave or cell-phone towers and fiber-optic cable, or, in more primitive areas, copper or coaxial cable. Or they rely on ad hoc ground-based wireless systems.

Therefore all these methods of transmitting signals have one thing in common. They are terrestrial. If by cable, they can be tapped, cut or interrupted. If by wireless, they can be detected, intercepted, jammed or blocked. In either case, they can be monitored, often without communicators’ knowledge, rendering dissidents and freedom fighters vulnerable to arrest, intimidation, coercion and liquidation.

As a communications system, the Internet is a headless horseman. We designed it during the Cold War to provide reliable point-to-point communication with absolutely no central control or command point. Internet communications “packets” proceed from surviving node to surviving node, in essentially random order, and still get to their intended destination (if it, too, has survived) in a form that allows them to be reassembled in good order. No doubt the new cell-phone intranet technologies work on the same principles.

But our DARPA, which funded development of the original Internet protocols, never designed them to be undetectable. That goal was beyond the project’s purview because: (1) we wanted the system for our own internal use and (2) its primary goal was to insure the survivability of our internal communications whenever more than one node survived, even in a nuclear war.

Making random communications undetectable inside a prison nation is a more difficult problem. In that context we must assume that all communications are, in theory, subject to monitoring, interception, jamming and/or blocking. After all, there are only two known ways of communicating electronically: (1) over cable (whether copper wire, coax or fiber optic) or (2) by “wireless,” i.e. by radio energy (which includes microwave, infrared and ultraviolet radiation).

The problem of making free speech undetectable is a particularly difficult one with standard equipment. Cell phones, microwave towers, and even Bluetooth devices use standard and well-known frequencies and protocols. Their communications run along terrestrial cables, among terrestrial towers, or in open airwaves. So authorities in prison nations don’t have to be geniuses or technological innovators to capture and disrupt them. For these reasons, hackers and Internet jockeys are never going to save free speech entirely or protect its unauthorized practitioners reliably.

How We Can Do Better

Physics is not magic. Even secret communications must proceed by wire or wireless. We don’t know any other ways. But that doesn’t mean communications can’t be much better hidden than with standard cell-phone and computer devices running on standard frequencies.

During the Cold War, we developed a number of advanced technologies for the purpose of hiding communications from the most advanced and sophisticated listener (then presumed to be the Soviet Union). They included such things as as “burst” transmissions, frequency alterations before or during transmission, and directional focus.

Most of these technologies we developed in the era of discrete transistors, before widespread use of integrated circuits. Now we can package them in small, cheap, ultra-low-power devices, permitting their use in tiny, high-battery life, portable machines.

Another, even simpler technology is directional antennas. Long-known radio technology makes it possible to focus radio transmissions in a tight beam. (Laser beams are much tighter still, but their technology is more exotic and expensive.)

We can design small, collapsible directional antennas whose tight directional profile makes detecting their use difficult, if not impossible, unless the detector sits precisely in the small angular range intended for transmission. If the transmission is directed is upward—for example, toward an artificial satellite stationed high above—it is almost impossible to detect except from an aircraft that happens to be in exactly the right airspace at exactly the time the transmission occurs.

We already have a commercial system of such satellites. Known as Iridium, it makes wireless communication possible between any two points on Earth, without any cell-phone towers or other ground-based physical infrastructure.

The original hand-held devices for Iridium were much bigger and heavier than cell phones. But no doubt they could be made smaller and lighter today; the original models are nearly two decades old.

More detail on these technologies is neither necessary nor desirable. In any event, many of the details are still secret, and I am not in the know. Some details undoubtedly lie moldering unused in the annals of Cold-War technology, or in weapons systems seldom if ever used.

But three points are worth mentioning. First, taking these technologies out of cold storage, implementing them and reproducing them widely would be both easy and cheap with modern integrated-circuit technology, including ASICs (application specific integrated circuits). Second, it is unlikely that any prison country, with the possible exception of China, could develop effective countermeasures during the next ten years.

Detecting these advanced clandestine transmissions is much harder than generating them. A would-be spy has to contend with a fourfold infinitude of frequency, duration, transmission angle and encryption. No one foreign nation (possibly excluding China) has a ghost of a chance of developing countermeasures before the Arab Spring and its Persian counterpart have their day.

Third and most important, this technology is not very expensive. An entire course of development would almost certainly cost less than a single B-1 bomber. And because we have already developed most of the necessary basic technology, if not its modern, miniaturized counterparts, its wider use could provide lucrative opportunities for our private industry (under military secrecy, of course).


I hope our government is even now sponsoring development and application of these powerful technologies of freedom. It may be doing so in secret. Since I’m not in the know, I have no way of knowing whether it is or is not.

But if it’s not, it should be. No other nation, with the possible exception of Russia, has the capability of matching or countering this technology. And, with the Cold War over and a healthy supply of indigenous oil and gas, Russia now has even less interest in suppressing legitimate struggles for freedom than we do. Witness its acquiescence in NATO’s support for freedom in Libya, once its client state.

So, with the possible exception of China, no authoritarian nation has the interest in, or any reasonable prospect for, developing countermeasures in the foreseeable future. By the time a prison nation like Iran, North Korea or Syria (let alone Zimbabwe) learns to develop countermeasures, an indigenous liberation movement is likely to have succeeded.

The Arab Spring proves the enormous potential of indigenous liberation movements for overturning tyrants, even if we have already forgotten the proof of earlier movements in the Philippines, South Africa and the Ukraine. In the worst of circumstances, all these movements need is reliable, undetectable means of communication.

Modern technologies, which most prison states do not possess, can provide them. We are the world’s leader in those technologies, and we can make them available quickly and astoundingly cheaply.

We should do so. We should not relegate the technologies of freedom to hackers, Internet mavericks and other amateurs. Instead, we should use these advanced and robust technologies, which we spent so much to develop during the Cold War, for a better and more noble purpose than mutually assured destruction.

We should use them to spread freedom everywhere while the opportunity lasts. Doing so will be the cheapest and most cost-effective investment in a safer and saner world that we will ever have the chance to make.


Not only does Nissan have an all-electric car, the Leaf, in production now. Ford and several competitors have announced their own similar products, and the New York Times recently reviewed three new brands of small electric cars for city driving. Apparently the managers of car companies are now fully aware of the potential of and necessity for all-electric vehicles. For my preliminary thoughts and still unresolved conclusions on competition among the Volt, Leaf and Ford Focus, click here.

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11 June 2011

The Manhattan Dragon and Sir Cyrus of Vance

[For even more rapid than usual confirmation of this post, click here.]

One of the oddest and least-noticed things about our recent and ongoing economic collapse is its origin. Its epicenter and wellspring were and are a single, small island that our forebears once bought from native Americans for $24 in wampum.

Manhattan is the culprit. There mortgage-backed securities, derivatives, collateralized debt obligations, credit-default swaps and other toxic “innovations” sprang from the fevered brows of our self-righteous apostles of greed. So did the rotten culture of gambling and swindling that has overwhelmed not only us poor consumers, but later most big banks as well.

Like many others, I have written (1 and 2) about the dangerous concentration of financial power in Manhattan that made those banks “too big to fail.” But the concentrated power wasn’t just financial. Over the last two years we have learned how a single firm, Goldman Sachs, has infiltrated the highest councils of executive government, even in a Democratic administration that had promised fundamental change.

We have watched with growing disappointment as that power has prevented any change from seriously affecting Wall Street. No one has gone to jail for perpetrating history’s second-greatest financial catastrophe on the nation and the world. Instead, the big banks and the very people who caused it are back to business as usual, earning billions from taxpayer bailouts and looking forward to more easy money.

So few people in so little space. You would think that the rest of the nation would have made short work of them—just as a body’s immune system rejects a tiny abscess.

But it didn’t. It hasn’t. And it might never.

Why? Because unbeknownst to most of our 308 million people, Manhattan has seized control of every lever of power in our society, with the possible exception of the military.

It’s not just Goldman Sachs’ almost complete penetration of the Executive Branch. Wall Street, with its enormous profits (made in large part on taxpayers’ backs) has bought Congress lock, stock and barrel.

Our antiquated Constitution and Senate rules don’t make that hard to do. You don’t have to buy the whole thing. Just buy a few small minds from a few small states. With filibusters and Senate “holds,” they’ll make sure that nothing you don’t approve ever happens. And I’ve just reviewed how the South, with a tradition of self-submission that only an engrained culture of bossism can explain, lives in Manhattan’s pocket.

So much for the executive and the legislative branches. The judiciary signed on enthusiastically in January 2010, with the Supreme Court’s infamous Citizens United decision. It declared business corporations “people,” like you and me, able to use their huge profits to propagandize us and corrupt our leaders.

Of course Wall Street’s banks are not the only corporations in the land. But a few years ago the finance sector (which they dominate absolutely) accounted for 41% of all our nation’s business profits. That perilous vital statistic dropped a bit as the crisis deepened, but it’s probably gone back up again since.

As Jesse James (who robbed them) observed, banks are where the money is. So Wall Street, which controls the banking industry, controls the money, which controls the pols. Nice and simple, isn’t it?

Did I forget anything? Oh, yes! There’s the “Fourth Estate,” the purveyors of news and shiners of light into dark places. What about them?

Well, TV news is a joke. Except for the PBS News Hour, you might as well read a tabloid. Real news comes from the few remaining serious print media, whose reporters have mostly become “talking heads” for the TV shows. Anyway, TV news is also centered in Manhattan, where all the studios and anchors are.

And what has happened to our print media? They have become just as concentrated as finance, and in precisely the same place.

National politics has degenerated into slapstick comedy (or tragedy, take your pick). Apart from continuing job losses in government, the only real news worth knowing today is what’s happening in the private sector, i.e., in business. After all, as the GOP keeps reminding us, that’s where most of our jobs come from.

But, as you may have noticed, there are no real local print media any more, at least none that have any clout. The Internet has killed them all off. Only our three national newspapers—the New York Times, the Wall Street Journal, and the Washington Post—have survived with any substantial readership. They have not just won the field. They occupy it. Only their stories garner well-written on-line comments from every state and many foreign countries.

But there’s the rub. If you read them all closely, as I have, you will see something interesting. The Times has been moving more and more into business lately, trying to challenge the Journal, which is a self-described business newspaper. The competition between them is so fierce that the Post doesn’t go there much any more. It has relinquished most business coverage to its two stronger competitors. Then it retreated into national and regional politics, relying on its home-court advantage in Washington, D.C.

So we’re left with just two big and prestigious newspapers vying for national supremacy in business and related news, which (apart from foreign affairs) is all the news that matters today. And where are they both located? In Manhattan, of course. Even the PBS News Hour, the last credible outpost on the Boob Tube, is there.

Now, if finance not too long ago accounted for 41% of all the entire nation’s business profits, how much more important do you think it is in Manhattan? Take a guess.

When Wall Street caught a cold in 2008 and early 2009, tens of thousands of Manhattanites lost their jobs. Wall Street dominates Manhattan. It keeps real property prices high. It keep people in restaurants, bars and theaters employed. And it subsidizes all the lawyers, accountants, and other professionals who serve it. Do you think anyone in a position of leadership in New York City is ever going to bite the hands that feed them?

So there you have it. Executive Branch. Legislative Branch. Judicial Branch. National Media. Local business, government and consumers. Check, check, check, check and check. Manhattan in general, and Wall Street in particular, control them all.

Ever wonder why basic financial reform is so hard? Ever wonder why Elizabeth Warren, the best qualified financial regulator since the New Deal, is still waiting in limbo to begin her work? Look to Manhattan, with its professional gamblers, swindlers and bedbugs. And of course no one in Manhattan is going to challenge the island’s national supremacy because Manhattanites like it and the high life it brings. There is no ego so strong as one that inhabits Manhattan.

If you think this picture is distorted, just think about the news. We live in a huge, diverse and enormously productive nation of 308 million people. We’ve got Microsoft and Boeing in Washington State (with Boeing’s HQ now in Chicago). We’ve got Silicon Valley in the Bay Area (with Apple and Google), Route 128 in Boston, and Silicon Gulch (with Dell) in the Roundrock-Dallas corridor. We’ve got biotech centers in San Francisco, San Diego, Boston, New Jersey, the Research Triangle and parts of Philadelphia. We still have enormous manufacturing plants in the Midwest and South, aerospace in Washington State, Southern California and Texas, and the movie industry in both Northern and Southern California. And then we have our great breadbaskets in California’s Central Valley, the Midwest, and large parts of Texas and the South. They feed us and much of the world.

How much do you hear or know about all these very real industries? We do hear about things that matter to Manhattan: delays in Boeing’s Dreamliner (because Wall Street flies), Apple’s latest iThings (which Streeters and their children love), and the latest, greatest social networking Internet fad (ditto). But what do you hear about all those others places and industries?

As far as we know from the news, the rest of our national world might as well not exist. We see it only through a glass darkly, and then only when something goes terribly wrong, a Manhattanite makes a killing with an acquisition or merger, or a Streeter is in the dock for malfeasance.

Remember that famous New Yorker Magazine cover by Saul Steinberg, showing Manhattan in detail and San Francisco and Japan as mere points in the distance? That’s how we now see our entire nation, from the Manhattanite’s point of view. And we don’t even know we’ve got blinders on because our eyes and ears are now all in Manhattan, where finance rules and no one dares challenge it.

It stands to reason that this sad condition will be hard to change. Any anti-Manhattan crusader from outside Manhattan will get no news coverage, no contributions from Wall Street, and no attention from Washington. But what about one from Manhattan itself? Can New York City’s news oligopoly ignore a reformer from among its own?

Enter Cyrus Vance, Jr. He’s the District Attorney for Manhattan, and he recently served Goldman Sachs with a subpoena. Apparently he’s going to follow up on a strong suggestion in a Senate Report that Goldman misled investors in the lead-up to the 2008 crash and that its chief executive, Lloyd Blankfein, perjured himself before the Senate committee that wrote the report. In other words, Vance may be making the first real bid to put someone, anyone, responsible for the global economy’s near destruction and the misery of tens of millions in jail.

Vance comes from good stock. His father, the late Cyrus Vance Senior (1917-2002), was Secretary of State under Jimmy Carter. More important, he had been Deputy Secretary of Defense under Lyndon Johnson but had resigned in protest, on principle, over Johnson’s war policy during the Vietnam War.

Will good breeding tell? Stay tuned. The Senior Vance was a noble and dedicated public servant. Maybe Junior will be, too.

Beyond him, it’s hard to see who might be our savior. Manhattan’s dominance is so complete and so little noticed that no one else seems to have a clue.

Crack reporter Matt Taibbi has described Goldman Sachs as a “great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money.” But even that colorful metaphor is weak in two respects. First, it’s not just Goldman Sachs. It’s the whole island of Manhattan.

Second, it’s not just a vampire squid that you can knock off your face with a good punch. It’s an enormous dragon whose fire breathing has sucked the oxygen, money, power, information and life out of the rest of the country. It has Americans trapped in a cave of disinformation and powerlessness and is herding us toward a decadent plutocracy, with itself at the core.

Who can fight back? Who can restore geographic balance?

One thing is clear. No clueless idiot who, in Shakespeare’s words, “struts and frets his hour upon the stage and then is heard no more” is up to the task. That rules out all of this cycle’s crop of presidential contenders, including Mitt Romney, a cardboard caricature of the clueless, arrogant frat boy (1 and 2), who changes his so-called fundamental values with every shift of the political winds.

As for the President, it’s hard to see him playing the role. As good and smart a man as he is, he’s in too deep with Manhattan already, and he shows no signs of backing out.

Slaying the Manhattan dragon is a job for a young man like Vance. He will have to be very smart and very careful. The smooth Wall Street gangsters didn’t take control of the nation by being stupid or soft. Remember Eliot Spitzer? Sexual peccadilloes used to be private, but not any more, and certainly not with so much at stake.

The dragon will exploit the tiniest weakness or defect to immolate and destroy its enemies. And Vance will not be a popular man in Manhattan for going after it.

But he has a good incentive. Not next year, but maybe somewhere down the road, there’s a presidency in it for him if he succeeds. And breaking the Manhattan dragon’s death grip on the nation is a first and essential step in any rational plan for national renewal.

Update June 13, 2011:

Barely had the foregoing post been up thirty hours before this story in the New York Times confirmed it. Headlined “Obama Seeks to Win Back Wall St. Cash,” it reports that the President, a “few weeks before announcing his re-election campaign, . . . kicked off an aggressive push . . . to win back the allegiance of one of his most vital sources of campaign cash[,]” namely, Wall Street and its hedge-fund managers.

Anyone who believes that hedge-fund managers serve a valuable, let alone vital, societal function hasn’t been paying much attention during the last three years. But lest you think the President is special in kissing their diamond rings, the article also reports that Mitt Romney, the leading Republican candidate, is “using his background as a venture capital executive and his policy proposals to woo financial-industry donors,” including hedge-fund managers unsatisfied with the depth of the President’s bows.

What does all this mean? It means precisely what I argue above, that Wall Street and Manhattan control both parties and the country. And one of their two principal mouthpieces, the New York Times, gloats about it publicly within thirty hours after I point this out. I doubt the Times’ reporters or editors read this blog, but the coincidental timing sure makes it seem a taunt.

Truly I feel like the medieval peasant waiting for Saint George to slay the dragon. Godspeed, Sir Cyrus of Vance. The beast you must face is powerful, and you may be our last hope.

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