Friday, May 30, 2008

Iraq: Will We Ever Get Out?

Some interesting book review(s) by Thomas Powers in the New York Review of Books. An excerpt:
At some point the government will have to begin paying for these wars—if it can. What looks increasingly like a serious recession, complicated by an expensive federal bailout of financial institutions, may combine to convince even John McCain that the time has come to declare a victory and head for home. It's possible. But the United States did not acquire a $9 trillion national debt by caution with money. A decision to back out of the war is going to require something else—resolve backed by a combination of arguments that withdrawal won't be a victory for al-Qaeda or Iran, that it isn't prompted by fear, that it doesn't represent defeat, that it's going to make us stronger, that it's going to win the applause of the world, that the people left behind have been helped, and that whatever mess remains is somebody else's fault and responsibility.

Missing from this list is victory—the one thing that could make withdrawal automatic and easy. Its absence makes the decision an easy one for McCain—no victory, no withdrawal. But everybody else needs to think this matter through the hard way, trying to understand the real consequences of easing away from a bloody, inconclusive war. After six and a half years of fighting in Afghanistan and Iraq, the Democratic candidates for president and the public weighing a choice between them have a moment of relative quiet, right now, with the primaries nearly over and the nominating conventions still ahead, to consider where we are before deciding, to the extent that presidents or publics ever do decide, what to do.

The article is on the long side, but well worth the effort and investment of your time.

Thursday, May 29, 2008

On Phil Gramm and the subprime meltdown

David Corn, writing in Mother Jones, marshals a rather impressive amount of information to support his case that the subprime mortgage meltdown can be traced back to the legislative maneuvers of right wing ideologue Phil Gramm on behalf of Wall Street.
An excerpt:

Who's to blame for the biggest financial catastrophe of our time? There are plenty of culprits, but one candidate for lead perp is former Sen. Phil Gramm. Eight years ago, as part of a decades-long anti-regulatory crusade, Gramm pulled a sly legislative maneuver that greased the way to the multibillion-dollar subprime meltdown. Yet has Gramm been banished from the corridors of power? Reviled as the villain who bankrupted Middle America? Hardly. Now a well-paid executive at a Swiss bank, Gramm cochairs Sen. John McCain's presidential campaign and advises the Republican candidate on economic matters. He's been mentioned as a possible Treasury secretary should McCain win. That's right: A guy who helped screw up the global financial system could end up in charge of US economic policy. Talk about a market failure.

Gramm's long been a handmaiden to Big Finance. In the 1990s, as chairman of the Senate banking committee, he routinely turned down Securities and Exchange Commission chairman Arthur Levitt's requests for more money to police Wall Street; during this period, the SEC's workload shot up 80 percent, but its staff grew only 20 percent. Gramm also opposed an SEC rule that would have prohibited accounting firms from getting too close to the companies they audited—at one point, according to Levitt's memoir, he warned the sec chairman that if the commission adopted the rule, its funding would be cut. And in 1999, Gramm pushed through a historic banking deregulation bill that decimated Depression-era firewalls between commercial banks, investment banks, insurance companies, and securities firms—setting off a wave of merger mania.

But Gramm's most cunning coup on behalf of his friends in the financial services industry—friends who gave him millions over his 24-year congressional career—came on December 15, 2000. It was an especially tense time in Washington. Only two days earlier, the Supreme Court had issued its decision on Bush v. Gore. President Bill Clinton and the Republican-controlled Congress were locked in a budget showdown. It was the perfect moment for a wily senator to game the system. As Congress and the White House were hurriedly hammering out a $384-billion omnibus spending bill, Gramm slipped in a 262-page measure called the Commodity Futures Modernization Act. Written with the help of financial industry lobbyists and cosponsored by Senator Richard Lugar (R-Ind.), the chairman of the agriculture committee, the measure had been considered dead—even by Gramm. Few lawmakers had either the opportunity or inclination to read the version of the bill Gramm inserted. "Nobody in either chamber had any knowledge of what was going on or what was in it," says a congressional aide familiar with the bill's history.

It's not exactly like Gramm hid his handiwork—far from it. The balding and bespectacled Texan strode onto the Senate floor to hail the act's inclusion into the must-pass budget package. But only an expert, or a lobbyist, could have followed what Gramm was saying. The act, he declared, would ensure that neither the SEC nor the Commodity Futures Trading Commission (CFTC) got into the business of regulating newfangled financial products called swaps—and would thus "protect financial institutions from overregulation" and "position our financial services industries to be world leaders into the new century."

Candidate Nader

Ralph Nader is a dork.

I have nothing else to add.

Sunday, May 25, 2008

Are record high oil prices curbing the US's Superpower Status?

Michael Klare, author of the bestseller (and highly recommended) Blood and Oil, says yes. Check out "Portrait of an Oil-Addicted Former Superpower" here.

Here's an excerpt:
The fact is, America's wealth and power has long rested on the abundance of cheap petroleum. The United States was, for a long time, the world's leading producer of oil, supplying its own needs while generating a healthy surplus for export.

Oil was the basis for the rise of first giant multinational corporations in the U.S., notably John D. Rockefeller's Standard Oil Company (now reconstituted as Exxon Mobil, the world's wealthiest publicly-traded corporation). Abundant, exceedingly affordable petroleum was also responsible for the emergence of the American automotive and trucking industries, the flourishing of the domestic airline industry, the development of the petrochemical and plastics industries, the suburbanization of America, and the mechanization of its agriculture. Without cheap and abundant oil, the United States would never have experienced the historic economic expansion of the post-World War II era.

No less important was the role of abundant petroleum in fueling the global reach of U.S. military power. For all the talk of America's growing reliance on computers, advanced sensors, and stealth technology to prevail in warfare, it has been oil above all that gave the U.S. military its capacity to "project power" onto distant battlefields like Iraq and Afghanistan. Every Humvee, tank, helicopter, and jet fighter requires its daily ration of petroleum, without which America's technology-driven military would be forced to abandon the battlefield. No surprise, then, that the U.S. Department of Defense is the world's single biggest consumer of petroleum, using more of it every day than the entire nation of Sweden.

From the end of World War II through the height of the Cold War, the U.S. claim to superpower status rested on a vast sea of oil. As long as most of our oil came from domestic sources and the price remained reasonably low, the American economy thrived and the annual cost of deploying vast armies abroad was relatively manageable. But that sea has been shrinking since the 1950s. Domestic oil production reached a peak in 1970 and has been in decline ever since -- with a growing dependency on imported oil as the result. When it came to reliance on imports, the United States crossed the 50% threshold in 1998 and now has passed 65%.

Though few fully realized it, this represented a significant erosion of sovereign independence even before the price of a barrel of crude soared above $110. By now, we are transferring such staggering sums yearly to foreign oil producers, who are using it to gobble up valuable American assets, that, whether we know it or not, we have essentially abandoned our claim to superpowerdom.

According to the latest data from the U.S. Department of Energy, the United States is importing 12-14 million barrels of oil per day. At a current price of about $115 per barrel, that's $1.5 billion per day, or $548 billion per year. This represents the single largest contribution to America's balance-of-payments deficit, and is a leading cause for the dollar's ongoing drop in value. If oil prices rise any higher -- in response, perhaps, to a new crisis in the Middle East (as might be occasioned by U.S. air strikes on Iran) -- our annual import bill could quickly approach three-quarters of a trillion dollars or more per year.

While our economy is being depleted of these funds, at a moment when credit is scarce and economic growth has screeched to a halt, the oil regimes on which we depend for our daily fix are depositing their mountains of accumulating petrodollars in "sovereign wealth funds" (SWFs) -- state-controlled investment accounts that buy up prized foreign assets in order to secure non-oil-dependent sources of wealth. At present, these funds are already believed to hold in excess of several trillion dollars; the richest, the Abu Dhabi Investment Authority (ADIA), alone holds $875 billion.

Saturday, May 24, 2008

Obama proposes "new alliance of the Americas"

It appears as if Candidate Obama's foreign policy platform for Latin America would be a substantial improvement over the last eight years, and needless to say vastly preferable to a McCain platform. For example:
Speaking in Miami to the Cuban American National Foundation (CANF), previously the most hard-line and influential of the anti-Castro Cuban-American Groups, Obama promised that, if elected, he "will immediately allow unlimited family travel and remittances to the island" by Cuban Americans to "make their families (in Cuba) less dependent on the Castro regime."

He said he would maintain the U.S. trade embargo against the island as "leverage" to secure reforms there, but, in contrast to Bush and his presumptive Republican foe in the November elections, Sen. John McCain, he would pursue "direct diplomacy" with Havana "without preconditions".


Also, check out this report from the Council on Foreign Relations entitled "A New Direction for US-Latin American Relations", as well as this article from the Washington Post.

Friday, May 23, 2008

Yglesias on the "Appeasement Paradox"

Yglesias-Speak:
George W. Bush, never one to miss an opportunity for a partisan cheap shot, decided last week that a Knesset speech to mark the 60th anniversary of Israel's independence was an appropriate moment to smack Barack Obama around a bit. Specifically, Bush compared Obama's view that it might make sense to enter into some good-faith negotiations with Iran to the actions of those who appeased Hitler prior to World War II. John McCain couldn't resist chiming in: "There have been appeasers in the past, and the president is exactly right, and one of them is Neville Chamberlain."

Thus we plunge once again into an incoherent line of argument the American right has employed for decades. Of course, back in the 1930s when there was actual appeasement happening in Europe, American conservatives weren’t complaining. But after the war, conservatives started flinging the accusation willy-nilly. Franklin Roosevelt was said to have sold freedom down the river to Stalin at the Yalta conference, General Douglas MacArthur criticized Harry Truman for waging a limited war in Korea and sought to move to all-out battle between the United States and the combined forces of the USSR and China. Barry Goldwater deemed the resolution of the Cuban Missile Crisis appeasement, and Ronald Reagan termed the SALT II arms-control treaty signed by the Carter administration appeasement. In the 1990s, Bill Clinton was regularly accused of appeasing China.

Nor have Republicans been immune to the charge. When Dwight Eisenhower, having wisely sidelined the far-right elements of the GOP that wanted to "roll back" communism agreed to a meeting with Nikita Khruschev, William F. Buckley Jr. deemed it "an act of diplomatic sentimentality which can only confirm Khruschev in the contempt he feels for the dissipated morale of a nation far gone." Indeed, as Peter Scoblic has noted, even Reagan wasn't immune to the charge, facing allegations from his right flank of appeasing the Soviets after he embraced arms control and negotiated the Intermediate Range Nuclear Forces Treaty. Needless to say, none of the oft-forecast dire consequences of appeasement flowed from any of these incidents.

In part, this is all political opportunism, but on other levels it reflects a fundamental conservative misapprehension of how the world works.

One defining feature of appeasement-phobia, after all, is a curious tendency to underrate the importance of objective reality in determining the behavior of foreign countries. In a speech Tuesday on Cuba policy, McCain derided willingness to "sit down unconditionally for a presidential meeting with Raul Castro" on the grounds that this would "send the worst possible signal to Cuba's dictators -- there is no need to undertake fundamental reforms; they can simply wait for a unilateral change in U.S. policy." The idea that Cuban decision-making would hinge on a "signal" from Washington is baffling. After all, the past 50 years of failed American efforts to starve the Cuban people into rebelling against the Castro regime is better evidence than any signal that Havana has no need to back down in the face of our embargo. Similarly, Buckley worried that meeting Khruschev would signal low U.S. morale to Moscow, with unspecified dire results. And McCain says the trouble with meeting with Iranian leaders (when he's not too busy being confused about who the leaders of Iran are) is that a meeting "is the most prestigious card we have to play" and scheduling one might give the Iranians an ego boost and "confer both international legitimacy on the Iranian president and could strengthen him domestically."

That's all fine, but the premise of the appeasement frame is that we're dealing with hardcore irrational ideologues who'll stop at nothing to destroy us. Adolf Hitler actually was such a man and, not coincidentally, he wasn't particularly interested in acquiring the international prestige and legitimacy associated with a sit-down with English politicians -- he wanted a giant war. In general, the right wants us to believe that world history is littered with countries whose rulers, like Hitler, will stop at nothing short of world-domination but who also spend their evenings fondly dreaming of the chance at a White House photo-op. But that’s absurd. One shouldn’t, of course, strike a bad bargain with a foreign country just because you held a meeting, but to fear that the very act of holding a meeting is a blow to the national interest is silly. Genuine madmen aren’t going to care what “signal” we’re sending, and non-crazy people can be productively bargained with.

The truth, however, is that conservatives don't just make this mistake over and over again, they fundamentally don't understand the use of diplomacy. McCain describes Iran as "an implacable foe of the United States" but the truth is that the Iranian government made several post-September 11 overtures to the U.S. seeking to improve relations. The real implacable foe of our era is al-Qaeda, the same al-Qaeda that's recently been denouncing Iran Bush/McCain-style for an alleged plot to dominate the Middle East. But the Bush administration rejected those overtures out of hand, preferring to hold out for regime change. As Dick Cheney said of North Korea, "we don't negotiate with evil, we defeat it."

But in truth we rarely have. Rather, we've historically tried to maintain enough military strength to prevent ourselves from being defeated, while working to build up the prosperity of ourselves and our allies and watching liberal democracy -- the worst system of government except all the others -- spread as alternative regimes inevitably collapse. War and conflict are incredibly costly and destructive. Wise statesmen recognize the negative-sum nature of relating to foreigners primarily by blowing them up. Moreover, it's usually possible to reach agreements with even very bad people that both sides deem preferable to fighting. In refusing to even contemplate negotiations, conservatives are being flatly irrational, spurning offers of a half a loaf for no real reason.


They're acting, in short, like the demonic foreigners of their own anti-appeasement rhetoric, impervious to objective reality and hell-bent on total victory no matter what the cost or how dim the prospects of success.

Growth Commission report on global economic development

Check out this interview between Foreign Policy and Michael Spence, the head of the Growth Commission.

The Growth Commission's complete report can be read (.pdf) here.

Wednesday, May 21, 2008

Assessing the attempts by free-trade fundamentalists to confuse Americans

Economist Dani Rodrik takes to his blog to confront the neoliberal head of the Peterson Institute (formerly Institute for International Economics) Fred Bergsten and his most recent editorial (in the Wall Street Journal of all places!)

Bergsten has never seen a free trade deal he didn't love, and it's gratifying to see someone lay the smack down. The fact that Prof. Rodrik is the man who took up this task - and the fact that he himself is affiliated with the Peterson Institute - makes this all the more interesting and surprising.

And no, I have no idea why an ardent fair-trader like Rodrik would affiliate himself with an institution like PI.

Saturday, May 17, 2008

Tom Engelhardt spells out the horrific consequences of invading Iraq

Tom Engelhardt, writing over at TomDispatch (republished here by Common Dreams), sets out in an organized and intellectually rigorous manner to explain why there is such a significant disconnect between public opinion regarding the war in Iraq and official policy in Washington; namely, the American people don't understand the full scope of the unmitigated disaster the ongoing war/military occupation has been. From the failure to deal with the insurgency controlled by al Sadr in Sadr (formerly Saddam) City, the nature of urban warfare, the administration's lies and the permanent nature of the occupation, this war can only be seen as a worst-case scenario come true.

US seeks to pressure Iran, not give incentives: Pentagon

As reported by the Associated Press, the US is "not trying to create incentives to bring Iran to the negotiating table but rather is seeking ways to intensify pressure to force it to change its ways," according to the Pentagon. While negotiations are clearly off the table with Iran, which Bush labels as a terrorist organization, the DoD was quick to point out that there are currently no plans to "increase in US military presence in the Gulf as a form of pressure on Iran."

So diplomacy and state-to-state negotiations is obviously off the table . . . leaving only "pressure" as a way of modifying Iran's behavior. Is this really going to work?

In the April 21 issue of the online Monthly Review, Iranian journalist Nasser Zarafshan goes much further and analyzes not only the likely US attack on Iran from the Western world's perspective, but provides insight into how Persians (both pro-US and anti-US) understand the competing claims put forward in support of American reactionary, interventionist international relations policy.

From the article:
Those who encourage foreign interference do not understand its implications and have no idea about the impacts of war on people's lives. They propagandize a vulgar formula that insinuates that anyone who opposes war and foreign interference is in support of the Islamic Republic. There is no evidence for such a claim. Those who insist on it do so in order to "terrorize" the opponents of war and foreign interference and hide their own worship of foreign powers behind it.

My position on the Islamic Republic is clear. However, I wish to remind those who mistakenly believe the aforementioned formula that the conflict in the current situation cannot be reduced to only two sides, i.e., the American government and the Islamic Republic. In this conflict there exists a third side: those who apparently are supposed to remain voiceless and helpless victims, even though they are the ones who will pay the price and suffer injury. This third side are the people of Iran, and I will attempt to look at the situation from their point of view.

Friday, May 16, 2008

Jeff Faux characteristically bearish on domestic economic forecast

Jeff Faux, the economist and journalist who founded the Economic Policy Institute, doesn't seem to write so much any more - although his last book "The Global Class War" was really excellent. His latest article for The Nation is one of the most depressing things I've read recently in terms of the stability and dynamics of the US economy. Lots of different factors are implicated in the mess here, including the fact that America is borrowing lots of money from China, the housing market will stay weak for awhile and the fact that Bush doesn't understand any economic policy, in Faux's words, other than "tax cuts."

Faux hedges by admitting that his doomsday scenario is at this point still unlikely, just not unthinkable. But with the macroeconomic conditions he runs through in his article, it doesn't seem to be an overly-bearish prediction that this could lead to the most severe economic downturn in thirty years.

The X-factor, it seems to me, is what happens to the job market, and how much unemployment results from the worlds largest financial firm retrenching and "cleaning up their balance sheet.

How authoritarian states are affected by natural disasters

Naomi Klein touches on a topic that has been completely beneath my radar, and untouched by most media sources: The impact natural disasters are having on authoritarian regimes such as China and Burma. China, hit by a major earthquake, is seeing its central government struggling to maintain the fascade of having complete control over what its citizens are allowed to see, hear and read. Klein notes however, that it is in the aftermath of a massive emergency that the state appears to be most vulnerable, especially when it can be seen to its citizens as being largely ineffective in dealing with the crisis.

In Burma, hit by a cyclone, government corruption and the chaos of the storm are providing the military with the perfect opportunity to steal international aid and simultaneously engineer genocide, enriching them beyond their wildest dreams.

Details of National Cyber Security Initiative revealed

Would an administration that had no compunction lying to the American people about the need to invade Iraq have any compunctions about spending $17 billion of taxpayer money to develop a system to spy on the web activity of ordinary citizens? I think you know the answer already. But for some details, be sure to read this blog post from Wired's Threat Level blog about an Orwellian-sounding new initiative from the federal government designed, critics such as the Senate Armed Services Committee say, not to protect Americans in the event of an attack, but rather to spy on American citizens.

And according to the Committee's report, there appears to be a significant amount of spying on US citizens being contemplated, with no public review process, in the name of e-security.

According to Wired: "While many of the specifics of the plan are classified, U.S. intelligence chief Michael McConnell told the New Yorker in January that he wants the National Security Agency to begin eavesdropping on the internet, and a McConnell aide said the spy agency was prepared to examine the content of e-mails, file transfers and Google searches without a warrant."

Update: See also: "Cyber-Spying for Dummies."

Welcome to the age of Homeland Insecurity

A sad history lesson courtesy of TomDispatch. It's hard to see how spending so much time and money on both new bureaucracies and wars with Third World dictators has made America safer and better prepared to deal with future terrorist attacks on our soil. But I look forward to the General Election, when GOP nominee John McCain will do his best to make that case. Anyway, Chalmers provides some figures to put all of the federal spending in the last 7 years in context; as well as the figures that show just how much worse off we are for it today.

Not to put too fine of a point on it, but a lot of this really comes down to the bankruptcy of the term "Global War on Terror" and what it is supposed to really mean. By employing this term of art, the Bush administration and his may enablers in Congress (both Republicans and Democrats), our government has managed to get away with bringing this nation to the verge of bankruptcy and damaging our long-term security for a generation.

If I could pick one bone with the statistics cited in the article, however, it would be the line noting that al Qaeda has not yet been able to replicate its attack on 9/11 on our homeland since then. This fact can easily and successfully, if dishonestly, used by future Bush apologists to claim the money spent and the wars waged were in fact all worth it, because it prevented another attack. This, of course, precludes the reality that according to our own National Intelligence Estimates, the Iraq war has served to make the US less safe against another terrorist attack than we were on September 10th, 2001.

Update: For a more recent assessment on how the war in Iraq has made us less safe, be sure to read this.

Report: The Union Wage Advantage for Low-Wage Workers

The findings from a new report published by the Center for Economic and Policy Research:
The most recently available wage data --consistent with a large body of economic research-- show a strong effect of unionization on the wage of the average worker. On average, a worker who is a member of a union or represented by a union earns about 11.9 percent more than a comparable worker who is not unionized. The statistical analysis here, however, also demonstrates that the union effect is substantially larger for workers at the bottom of the income distribution than it is for the average worker. Unionization, for example, raises the wage of a typical low-wage worker (one in the 10th percentile of the wage distribution) about 20.6 percent. Meanwhile, unions have an important, but smaller impact on higher-wage workers. For a high-wage worker (one in the 90th percentile of the wage distribution), unionization increases wages about 6.1 percent, less than one third of the impact for the typical low-wage worker.

(h/t SirotaBlog)

Wednesday, May 14, 2008

Iraqi Occupation: What is the Endgame?

This book review (actually a review of ten different books) by Pulitzer Prize-winning journalist and intelligence expert Thomas Powers appearing in the pages of the New York Review of Books explains that even though the wars in Afghanistan and Iraq should have been immediately recognized as folly by anyone who possesses even the most casual understanding of history. The current situation is tragic enough, with mounting casualties among US soldiers and Iraqi civilians, a non-functional civil society and an infrastructure battered down by decades of underfunding, and of course two decades of US-led sanction and aerial bombing campaigns. But the real tragedy is the Hobson’s choice facing the American public on deciding upon what is the “least worst” policy course for the next presidential administration.

Powers dryly observes:
No one would expect something so dramatic on the first day of a new administration but it remains a fact that the president is the commander in chief of the armed forces, and the power that allowed one president to invade Iraq would allow another to bring the troops home.

Barack Obama and Hillary Clinton in the current presidential campaign have promised to do just that—not precipitously, not recklessly, not without care to give the shaky government in Baghdad time and the wherewithal to pick up the slack. But Obama and Clinton have both promised that the course would be changed on the first day; ending the American involvement in the Iraqi fighting would be the new goal, troop numbers would be down significantly by the middle of the first year, and within a reasonable time (not long) the residual American force would be so diminished in size that any fair observer might say the war was over, for the Americans at least, and the troops had been brought home.

The presumptive Republican candidate, John McCain, has pledged to do exactly the opposite—to "win" the war, whatever that means, and whatever that takes. Politicians often differ by shades of nuance. Not this time. The contrast of McCain and his opponents on this question is stark, and if they can be taken at their word, Americans must expect either continuing war for an indefinite period with McCain or the anxieties and open questions of turning the war over to the Iraqi government for better or worse with Obama or Clinton. Which is it going to be?


Here is why we are essentially in a no-win situation regarding Iraq, and to a lesser extent in Afghanistan. Getting out of Iraq, Powers points out, will necessitate “just as much resolution as it took to get in—and the same kind of resolution: a willingness to ignore the consequences” of complete military withdrawal. The major negative consequences of beginning withdrawal in 2009 under an Obama administration would include “losing face” in front of the rest of the world for beating a retreat rather than persevering in the face of seemingly insurmountable odds until we win the war against the jihadi enemy. Another downside that we would be forced to acknowledge is the objective fact that the big winner in the region after almost seven year of prosecuting the War on Terror is Iran.


Or, as Powers puts it: “The consequence hardest to ignore will be the growing power and influence of Iran, which Bush has described as one of the two great security threats to the US. Israel shares this view of Iran. No new president will want to run the risk of being thought soft on Iran. This is where the military error exacts a terrible price. A political conflict transformed into a military conflict requires a military resolution, and those, famously, come in two forms—victory or defeat. Getting out means admitting defeat.”

Nevertheless, I still think that although a complete , albeit phased and orderly withdrawal of our troops from Iraq would be fraught with difficulty and negative consequence such as the ones anticipated by Powers, the risks of keeping our entanglement in the Middle open-ended are far, far greater.

Reflecting on the nature of these different options available to policymakers, as well as the self-conscious nature of the American people, the author concludes:
We are committed in Afghanistan. We are not ready to leave Iraq. In both countries our friends are in trouble. The pride of American arms is at stake. The world is watching. To me the logic of events seems inescapable. Unless something quite unexpected happens, four years from now the presidential candidates will be arguing about two wars in Iraq and Afghanistan, one going into its ninth year, the other into its eleventh. The choice will be the one Americans hate most—get out or fight on.

New report considers the prospect of a radically reconfigured Middle East region

The Carnegie Endowment for International Peace (CEIP), a left-of-center Washington-based foreign policy research center, came out with an important new report back in February that I only now have gotten around to reading; it is fittingly enough entitled "The New Middle East" (the entire report can be read as a .pdf here) and offers some important recommendations for how the US ought to change its foreign policy approach toward the region.

The entire report clocks in at 38 pages, probably longer than anyone except a die-hard foreign policy dork such as myself would have the requisite time and/or inclination to read. Therefore, I've taken the liberty of summing up the recommendations section. Note, however, that the report also discusses in a serious and comprehensive manner just how the Middle East has changed since 9/11.

The first, and perhaps most important concept that US foreign policymakers need to accept according to the report is that given its current military commitments (in Iraq and Afghanistan), the US cannot impose a new order on the Middle East through confrontation, but must work with regional actors that are seeking to restore a balance of power in the region. This would seem obvious enough, but given the fact that the Neoconservative elements of the Bush administration who instigated for and continue to support the US military intervention in Iraq still insist that the invasion and subsequent occupation was warranted (as a defensive posture!) I suppose necessitates its being repeated, even at this late date.

US-Iran relations are discussed as well, and given how controversial this topic is, it is not really such a surprise that the advice given will end up rubbing Hawks the wrong way. As the authors note: "Given that Iran is integral to several issues of critical importance to US and EU foreign policy—namely Iraq, nonproliferation, energy security, terrorism, and Arab-Israeli peace—avoiding dialogue with Iran is not an option and confronting it militarily would only worsen what the West seeks to improve. Iran arguably has more common interests with the United States in Iraq than any of Iraq’s other neighbors. Shared interests should lead both countries to look to Iraq as a forum to build confidence, with the intention of gradually expanding the discussion to include the nuclear issue."

I'm pretty skeptical personally with regard to the possibility of constructive dialogue between the US and Iran with regard to these "common interests" like Iraq. While it is true that Iraq's stability is an important issue for both countries, it is also true that both actors are pursuing radically different, and diametrically opposed agendas with regard to Iraq and other issues like nuclear non-proliferation policies.

Some more highlights from the report:

Iraq: A political solution in Iraq cannot be achieved under the current policy based on a U.S. model of what Iraq should be, rather than what it is. To move forward, the United States must acknowledge that current efforts have failed, put Iraq’s political leaders on notice that the United States will not support them indefinitely, and engage with all of Iraq’s political factions.

Israel and Palestine: The United States needs to recognize that time is running out on a two-state solution. Progress is impossible unless Hamas is brought back into the process and viable Palestinian leadership is restored.

Lebanon and Syria: The Bush administration narrative that sees Lebanon as the battleground between democracy and autocracy must be replaced by a more accurate perception of a deeply divided country where all factions invite outside intervention. The United States needs to consolidate the gains of the Syrian withdrawal from Lebanon by encouraging compromise, the election of a new president, the drafting of a new election law, and the holding of elections on schedule in the spring of 2009.

Democracy (promotion): The credibility of U.S. democracy promotion efforts has been severely undermined by the dangerous mix of grandiose rhetoric and inconsistent policies. A new policy must be based on a clear understanding of the possible consequences of democratization and a willingness to accept democratic outcomes even when not optimal from an American perspective. It must also focus on the countries where some progress is most likely.

The report concludes with:

“The United States needs a new approach to this part of the world, based less on confrontation and more on diplomacy, less on ideology and more on reality, and on a narrower definition of U.S. interests. Most of the problems discussed in this report cannot be solved, nor can they be bypassed, by creating a new Middle East, as the Bush administration tried to do. Some of the region’s problems can be alleviated through wise policy; others can at best be contained. Still others will have to be accepted for many years as part of a new Middle East landscape that has changed, but not for the better.”

Tuesday, May 13, 2008

A post-mortem of the Neoconservative agenda for reordering power relationships in the Middle East

I think the title of this post is sadly pretty self-explanatory. The following three articles, if read together, charts a brief history of the last seven and a half years of US foreign policy in the Middle East: From the conception of the idealistic (as well as fatally unrealistic) Neoconservative vision for remaking the greater Middle East/Levant into a reliable and pliant ally of the US and Israel to the demonstrable collapse of said vision. For example, In Iraq, instead of creating a pro-Western liberal democracy, the US introduced a civil war, sectarian militias, death squads and ethnic cleansing. It installed a series of ineffective dictators, Garner, Bremer, Allawi. Close to 100,000 dead Iraqi civilians, millions of refugees displaced from their homes and the transformation of the country into what our own intelligence agencies warn is an effective training ground for the next generation of jihadist terrorists, as well as a serving as a large-scale recruitment campaign for an insurgency dedicated to driving the US-led military occupation from their homeland.

The first article by journalist Nir Rosen, subbing for Steve Clemons at his blog The Washington Note gives us a thumbnail sketch of US policy in the Middle East, organized around the principle of fighting the "Global War on Terror." The policies taken together can only be viewed as a complete, systemic failure, while simultaneously adhering closely to the Pentagon/State Department playbook for successful military and economic neocolonialism (i.e. instigating a civil war, installing totalitarian dictators who are seen as loyal to US interests, etc.)

While the Iraq war and occupation is included, Rosen wisely situates that catastrophic situation within the context of other regional failures of US policy. Examples here include the US supporting the unpopular Fatah party and ignoring Hamas while negotiating a two-state solution between the Israelis and Palestinians, backing warlords in Somalia and leveraging its relationship with Lebanon (which Rosen labels a "moderate"US-friendly client Arab regime) to ensure political,military and economic domination of the region, while ensuring the security of Israel.

According to Rosen:
Given its dissatisfaction with the results of democratic elections in the region, the Bush administration continues to support autocratic regimes in Egypt, Jordan, Saudi Arabia and elsewhere, while de-democratizing existing democracies in Lebanon and Palestine. In the latter case, it is cultivating the latest breed of democracy, "the democratic regime," a new form of government which is popularly challenged, constitutionally disputed and derives its legitimacy from outside powers. The formation and preservation of regimes such as Siniora's (the Lebanese Prime Minister) has necessitated a US policy of promoting instability and national disunity, in short, a policy of"constructive instability."

While I agree with everything he says to this point, he loses me at the end when he claims: "If one dreams of a Hizballah without weapons, or a Hamas that does not engage in violent resistance, or any sort of peaceful resolution in the Middle East, then one has to begin at the beginning, with the Israeli occupation of Palestine (as well as a little bit of Syrian territory)."
I don't think it's historically accurate or particularly helpful to claim that "Palestine" is currently being occupied by Israelis, although that would be the focus of a much longer post.

The second article, this one appearing on the pages of the New York Times also concerns George W. Bush's legacy of failure for the Middle East region.

The article quotes Jon Alterman, Director of the Middle East Program at the Center for Strategic and International Studies (CSIS), stating the obvious:
It’s hard to remember a less auspicious time to pursue Arab-Israeli peacemaking than right now,” Mr. Alterman said. “The politics on the ground are absolutely miserable. US power and influence are at low ebb in the region. The Bush administration is beset by challenges — the combination of a faltering economy, persistent difficulties in Iraq and a growing threat from Iran — all at a time that the president’s popularity is at a historical low, and his administration is settling more and more into lame duck status.

It's hard to square the fact that the region is in the mess it is currently in with the proposition held by right wing Jews and the AIPAC crowd that "The Bush administration has been a strong ally of the state of Israel,"

And we are reminded of this recent embarrassment, which will also be viewed by historians as part of the sad legacy of the Bush administration:
One issue the American public has a keen interest in is the price of oil — a topic that created some embarrassment for Mr. Bush in January. At that time, with gas prices already on the rise, Mr. Bush appealed to the Saudi oil minister to give Americans some relief by increasing production — and was publicly rebuffed. He then made a private appeal to King Abdullah, with little result.


Finally, this editorial from the Lebanese paper the Daily Star serves as a reminder for its Western readers that the governments and public of nations in the Middle East region have many serious economic, cultural and political challenges facing them in the near future, many of which are actually not the fault of the US or even George W. Bush! The immediate origins of many of these challenges are demographic in nature and it is unclear how issues such as flat wage growth coupled with rising costs for food, water and energy will be dealt with, if at all.

As the article makes clear, the "new" socio-political landscape of the Middle East region that is likely to emerge in the post-Bush era in the coming years and decades will unfortunately involve the highest levels of inequality, instability and disintegrating civil society since the 1970s.

Oil dependency + US foreign policy for the Middle East = Disaster!

The editorial which I have so graciously reprinted below - in its entirely - risks ruffling not a few feathers as it touches on the taboo subject of US foreign policy course in the Middle East region for the last few decades, and how it has mostly been guided by our nation's reliance on oil that is drilled in Third World nations ruled by authoritarian regimes hated by their oppressed countrymen.

"The oily truth about America’s foreign policy"
By Gideon Rachman
Financial Times: May 12, 2008

With the oil price heading upwards and President George W. Bush heading for Saudi Arabia, as part of a Middle Eastern tour, it is time to accept the truth. The pursuit of oil is fundamental to US foreign policy.

The importance of oil to American foreign policy is both obvious and curiously difficult to acknowledge in public. In the run-up to the Iraq war it was left to the left to make the argument that this was a “war for oil”. Establishment people – those in the know – rolled their eyes at this “conspiracy theory”.

Yet in recent months, both Alan Greenspan, former chairman of the Federal Reserve, and Senator John McCain have come close to saying that Iraq was indeed about oil. In his memoirs Mr Greenspan said he regretted that it was “politically inconvenient” to acknowledge that “the Iraq war is largely about oil”.

Earlier this month Mr McCain, who will carry the Republican banner in this year’s presidential election, promised an energy policy “that will eliminate our dependence on oil from the Middle East” and so “prevent us from having ever to send our young men and women into conflict again in the Middle East”.

Both Mr Greenspan and Mr McCain subsequently issued “clarifications”. Mr McCain now says that the conflict that he was thinking about was the first Gulf war of 1991. As for the Iraq war of 2003, that was about ... whatever he said it was about at the time: weapons of mass destruction, probably.

It is unfair to mock. The Iraq war was about lots of things: WMD, remaking the Middle East, democratisation, human rights, Israel, terrorism, the desire for a massive demonstration of American power. But oil was certainly among the motives. It is common to say that the Gulf is a “vital strategic area”. “Strategic” is shorthand for saying that it is home to two-thirds of the world’s known oil reserves.

However, if the invasion of Iraq was partly motivated by oil, it was a failure – in this respect, as in many others. In 2003, just before the invasion, the oil price was $26 a barrel. Today it is $126 a barrel, with reputable analysts discussing the prospect of $200 oil by the end of 2008.

Mr McCain’s promise to eliminate American dependence on Middle Eastern oil is hardly original. Barack Obama and Hillary Clinton have made similar pledges. President Bush himself swore to end America’s “addiction to oil” a couple of years ago. President Richard Nixon made similar promises after the first oil shock of the 1970s. The reality is that things are moving in the opposite direction. In 1973 the US imported 33 per cent of its oil; today it imports about 60 per cent and this figure could rise to 70 per cent by 2020. America’s transport system is still completely dependent on oil.

American politicians have, so far, responded to this problem with a mixture of wishful thinking and anger. The calls for “energy independence” are all but universal. Money has been poured into the production of biofuels, which has helped push up food prices. But no leading politician is yet prepared to say that Americans may have to adjust their lifestyles to a world of permanently higher fuel prices.

Last week Senator Pete Domenici, a Republican, issued a plaintive appeal for “more oil and lower prices”. The Democrats are pressing for the US attorney-general to bring price collusion charges against members of the Organisation of the Petroleum Exporting Countries. But any such action significantly overrates America’s power over the world’s oil producers. Opec members could retaliate by selling some of their huge reserves of dollars – which would hit the dollar and US consumers very hard. The world’s main oil producers have no shortage of potential customers. More than 50 per cent of Saudi oil is now exported to Asia.

Competition for the world’s oil supplies is intensifying. Chinese oil consumption doubled between 1994 and 2003 and will have doubled again by 2010. China’s foray into Africa is largely driven by its own search for “energy security”. The International Energy Agency predicts that in 2010 China will become the world’s largest consumer of energy. The IEA also thinks that the world’s energy needs will be 50 per cent higher in 2030 than they are today – and that we are going to become more, not less, reliant on fossil fuels.

This seems all too plausible. At present there are about 10 cars in China for every 1,000 people; there are 480 cars per 1,000 people in the US. But by 2015, China could be the world’s largest market for new cars.

While western politicians routinely worry about globalisation, they have yet to focus on a more plausible threat. It is not the outsourcing of well-paid jobs; or the inflow of cheap goods: it is the globalisation of western patterns of consumption. If the Chinese and Indians eventually eat and drive like Americans and Europeans, the current inflation in fuel and food prices could be just the beginning. The environmental implications are also obvious – and alarming.

So although the search for energy security is now central to American foreign policy, as it is for both the European Union and the main Asian powers, in the long run there is no real foreign policy fix for the problem. A future dominated by conflict over scarce oil resources – or truckling to oil-rich dictators – is not attractive.

The only plausible routes to “energy security” lie at home in the US – in the development of new technologies and in a change of lifestyles. Americans may have to drive their cars less. But it will be a brave presidential candidate who says that.


***Additional Background Reading:
Foreign Policy in Focus, "US Oil Policy in the Middle East", Jan 1997.

Seeking Alpha, "Oil, Iraq and U.S. Foreign Policy: A Way Forward". April 09, 2008.

The Meltdown Lowdown: A series of articles by Dean Baker

Dean Baker has a fantastic rundown on the mortgage/credit crisis that continues to spread over at The American Prospect here. Check it out.

Disposing of the Neoconservative "Long War Fallacy"

In an Op-Ed appearing in today's Los Angeles Times, international relations scholar (as well as the author of the bestselling classic "American Empire: The Realities and Consequences of US Diplomacy") Andrew Bacevich notes that "the prospect of permanent war now beckons" America, a conflict that will likely last decades and be of an "open-ended" nature. Back when Team Bush first started trying to sell the public on his plans for invading Iraq, the Neoconservative foreign policy illuminati who surrounded him were busy insisting to any television camera-wielding reporter they could find that they were 100% sure this would all be a piece of cake.

As Bacevich points out, by the beginning of this year "the limits of American military power had long since become apparent." Hard power- that is, reliance on firepower to solve international conflicts while simultaneously acting as if the art of diplomacy has never, ever been successfully utilized by ambassadors to achieve their objectives, proved to be spectacularly inadequate in pacifying the rapidly growing , home-grown resistance movement.

War Hawks likeJohn McCain have attempted to prove their overabundance of patriotism and manliness by insisting in their television interviews and campaign speeches that our nation's military campaign against radical Islamic jihadis like al Qaeda will last for decades to come. This is often flippantly referred to by these Keyboard Kommandos as either a "long war" or the long war.

So how has the illegal perpetual invasion and occupation of Iraq advanced any of the Neocons' noisily-proclaimed policy objectives? Well, for one thing:
Since 2001, the price of oil per barrel has quadrupled, adversely affecting all but the wealthiest Americans. Efforts to spread democracy have either stalled or succeeded only in enhancing the standing of groups like Hamas and Hezbollah. The much-hyped Iraqi nuclear threat turned out to be illusory. To sustain the overstretched American imperium, we are accumulating debt at a staggering clip. And with US soldiers shouldering repetitive combat tours, the strength of our army slowly ebbs away.


Bacevich ends his editorial with two indisputedly true statements: First, the Long War has proved to be "a monumental flop." And second, the US, with rare exceptions, has demonstrated little talent for changing the way others live.

Prosecute the torture enablers

A good idea!

Saturday, May 10, 2008

The price of gas and the end of American claims to superpower status

I'm taking the liberty of reprinting Professor Michael T. Klare's most recent column in its entirety - a practice I hardly ever make use of. I think it is highly appropriate here because this is one of the rare Op-Eds that touch on an issue so important that they truly need to be closely read, from start to finish. If you are only interested in investing the bare amount of time to get a synopsis of the arguments made here, you don't yet fully appreciate just how big of a problem this is - for both the US and global economy.

An Oil-Addicted Ex Superpower:
Asia Times Online, May 10, 2008

Nineteen years ago, the fall of the Berlin Wall effectively eliminated the Soviet Union as the world's other superpower. Yes, the USSR as a political entity stumbled on for another two years, but it was clearly an ex-superpower from the moment it lost control over its satellites in Eastern Europe.

Less than a month ago, the United States similarly lost its claim to superpower status when a barrel of crude oil roared past US$110 on the international market, gasoline prices crossed the $3.50 threshold at American pumps, and diesel fuel topped $4. As was true of the USSR following the dismantling of the Berlin Wall, the US will no doubt continue to stumble on like the superpower it once was; but as the nation's economy continues to be eviscerated to pay for its daily oil fix, it, too, will be seen by increasing numbers of savvy observers as an ex-superpower-in-the-making.

That the fall of the Berlin Wall spelled the erasure of the Soviet Union's superpower status was obvious to international observers at the time. After all, the USSR visibly ceased to exercise dominion over an empire (and an associated military-industrial complex) encompassing nearly half of Europe and much of Central Asia. The relationship between rising oil prices and the obliteration of America's superpower status is, however, hardly as self-evident. So let's consider the connection.

Dry hole superpower
The fact is, America's wealth and power has long rested on the abundance of cheap petroleum. The United States was, for a long time, the world's leading producer of oil, supplying its own needs while generating a healthy surplus for export.

Oil was the basis for the rise of the first giant multinational corporations in the US, notably John D Rockefeller's Standard Oil Company (now reconstituted as Exxon Mobil, the world's wealthiest publicly traded corporation). Abundant, exceedingly affordable petroleum was also responsible for the emergence of the American automotive and trucking industries, the flourishing of the domestic airline industry, the development of the petrochemical and plastics industries, the suburbanization of America, and the mechanization of its agriculture. Without cheap and abundant oil, the United States would never have experienced the historic economic expansion of the post-World War II era.

No less important was the role of abundant petroleum in fueling the global reach of US military power. For all the talk of America's growing reliance on computers, advanced sensors, and stealth technology to prevail in warfare, it has been oil above all that gave the US military its capacity to "project power" onto distant battlefields like Iraq and Afghanistan. Every Humvee, tank, helicopter, and jet fighter requires its daily ration of petroleum, without which America's technology-driven military would be forced to abandon the battlefield. No surprise, then, that the US Department of Defense is the world's single-biggest consumer of petroleum, using more of it every day than the entire nation of Sweden.

From the end of World War II through the height of the Cold War, the US claim to superpower status rested on a vast sea of oil. As long as most of our oil came from domestic sources and the price remained reasonably low, the American economy thrived and the annual cost of deploying vast armies abroad was relatively manageable. But that sea has been shrinking since the 1950s. Domestic oil production reached a peak in 1970 and has been in decline ever since - with a growing dependency on imported oil as the result. When it came to reliance on imports, the United States crossed the 50% threshold in 1998 and now has passed 65%.

Though few fully realized it, this represented a significant erosion of sovereign independence even before the price of a barrel of crude soared above $110. By now, we are transferring such staggering sums yearly to foreign oil producers, who are using it to gobble up valuable American assets, that, whether we know it or not, we have essentially abandoned our claim to superpowerdom.

According to the latest data from the US Department of Energy, the United States is importing 12-14 million barrels of oil per day. At a current price of about $115 per barrel, that's $1.5 billion per day, or $548 billion per year. This represents the single largest contribution to America's balance-of-payments deficit, and is a leading cause for the dollar's ongoing drop in value. If oil prices rise any higher - in response, perhaps, to a new crisis in the Middle East (as might be occasioned by US air strikes on Iran) - our annual import bill could quickly approach three-quarters of a trillion dollars or more per year.

While our economy is being depleted of these funds, at a moment when credit is scarce and economic growth has screeched to a halt, the oil regimes on which we depend for our daily fix are depositing their mountains of accumulating petrodollars in "sovereign wealth funds" (SWFs) - state-controlled investment accounts that buy up prized foreign assets in order to secure non-oil-dependent sources of wealth. At present, these funds are already believed to hold in excess of several trillion dollars; the richest, the Abu Dhabi Investment Authority (ADIA), alone holds $875 billion.

The ADIA first made headlines in November 2007 when it acquired a $7.5 billion stake in Citigroup, America's largest bank holding company. The fund has also made substantial investments in Advanced Micro Systems, a major chip maker, and the Carlyle Group, the private equity giant. Another big SWF, the Kuwait Investment Authority, also acquired a multibillion-dollar stake in Citigroup, along with a $6.6 billion chunk of Merrill Lynch. And these are but the first of a series of major SWF moves that will be aimed at acquiring stakes in top American banks and corporations.

The managers of these funds naturally insist that they have no intention of using their ownership of prime American properties to influence US policy. In time, however, a transfer of economic power of this magnitude cannot help but translate into a transfer of political power as well. Indeed, this prospect has already stirred deep misgivings in Congress. "In the short run, that they [the Middle Eastern SWFs] are investing here is good," Senator Evan Bayh (D-Indiana) recently observed. "But in the long run it is unsustainable. Our power and authority is eroding because of the amounts we are sending abroad for energy ..."

No summer tax holiday for the Pentagon
Foreign ownership of key nodes of our economy is only one sign of fading American superpower status. Oil's impact on the military is another.

Every day, the average GI in Iraq uses approximately 27 gallons of petroleum-based fuels. With some 160,000 American troops in Iraq, that amounts to 4.37 million gallons in daily oil usage, including gasoline for vans and light vehicles, diesel for trucks and armored vehicles, and aviation fuel for helicopters, drones, and fixed-wing aircraft. With US forces paying, as of late April, an average of $3.23 per gallon for these fuels, the Pentagon is already spending approximately $14 million per day on oil ($98 million per week, $5.1 billion per year) to stay in Iraq. Meanwhile, our Iraqi allies, who are expected to receive a windfall of $70 billion this year from the rising price of their oil exports, charge their citizens $1.36 per gallon for gasoline.

When questioned about why Iraqis are paying almost a third less for oil than American forces in their country, senior Iraqi government officials scoff at any suggestion of impropriety. "America has hardly even begun to repay its debt to Iraq," said Abdul Basit, the head of Iraq's Supreme Board of Audit, an independent body that oversees Iraqi governmental expenditures. "This is an immoral request because we didn't ask them to come to Iraq, and before they came in 2003 we didn't have all these needs."

Needless to say, this is not exactly the way grateful clients are supposed to address superpower patrons. "It's totally unacceptable to me that we are spending tens of billions of dollars on rebuilding Iraq while they are putting tens of billions of dollars in banks around the world from oil revenues," said Senator Carl Levin (D-Michigan), chairman of the Armed Services Committee. "It doesn't compute as far as I'm concerned."

Certainly, however, our allies in the region, especially the Sunni kingdoms of Kuwait, Saudi Arabia, and the United Arab Emirates (UAE) that presumably look to Washington to stabilize Iraq and curb the growing power of Shi'ite Iran, are willing to help the Pentagon out by supplying US troops with free or deeply-discounted petroleum. No such luck. Except for some partially subsidized oil supplied by Kuwait, all oil-producing US allies in the region charge us the market rate for petroleum. Take that as a striking reflection of how little credence even countries whose ruling elites have traditionally looked to the US for protection now attach to our supposed superpower status.

Think of this as a strikingly clear-eyed assessment of American power. As far as they're concerned, we're now just another of those hopeless oil addicts driving a monster gas-guzzler up to the pump - and they're perfectly happy to collect our cash which they can then use to cherry-pick our prime assets. So expect no summer tax holidays for the Pentagon, not in the Middle East, anyway.

Worse yet, the US military will need even more oil for the future wars on which the Pentagon is now doing the planning. In this way, the US experience in Iraq has especially worrisome implications. Under the military "transformation" initiated by Secretary of Defense Donald Rumsfeld in 2001, the future US war machine will rely less on "boots on the ground" and ever more on technology.

But technology entails an ever-greater requirement for oil, as the newer weapons sought by Rumsfeld (and now Secretary of Defense Robert Gates) all consume many times more fuel than those they will replace. To put this in perspective: The average GI in Iraq now uses about seven times as much oil per day as GIs did in the first Gulf War less than two decades ago. And every sign indicates that the same ratio of increase will apply to coming conflicts; that the daily cost of fighting will skyrocket; and that the Pentagon's capacity to shoulder multiple foreign military burdens will unravel. Thus are superpowers undone.

Russia's gusher
If anything demonstrates the critical role of oil in determining the fate of superpowers in the current milieu, it is the spectacular reemergence of Russia as a Great Power on the basis of its superior energy balance. Once derided as the humiliated, enfeebled loser in the US-Soviet rivalry, Russia is again a force to be reckoned with in world affairs. It possesses the fastest-growing economy among the G-8 group of major industrial powers, is the world's second leading producer of oil (after Saudi Arabia), and is its top producer of natural gas. Because it produces far more energy than it consumes, Russia exports a substantial portion of its oil and gas to neighboring countries, making it the only Great Power not dependent on other states for its energy needs.

As Russia has become an energy-exporting state, it has moved from the list of has-beens to the front rank of major players. When President Bush first occupied the White House, in February 2001, one of his highest priorities was to downgrade US ties with Russia and annul the various arms-control agreements that had been forged between the two countries by his predecessors, agreements that explicitly conferred equal status on the US and the USSR.

As an indication of how contemptuously the Bush team viewed Russia at that time, Condoleezza Rice, while still an adviser to the Bush presidential campaign, wrote, in the January/February 2000 issue of the influential Foreign Affairs, "US policy ... must recognize that American security is threatened less by Russia's strength than by its weakness and incoherence." Under such circumstances, she continued, there was no need to preserve obsolete relics of the dual superpower past such as the Anti-Ballistic Missile (ABM) Treaty; rather, the focus of US efforts should be on preventing the further erosion of Russian nuclear safeguards and the potential escape of nuclear materials.

In line with this outlook, President Bush believed that he could convert an impoverished and compliant Russia into a major source of oil and natural gas for the United States - with American energy companies running the show. This was the evident aim of the US-Russian "energy dialogue" announced by Bush and Russian President Vladimir Putin in May 2002. But if Bush thought Russia was prepared to turn into a northern version of Kuwait, Saudi Arabia, or Venezuela prior to the arrival of Hugo Chavez, he was to be sorely disappointed.

Putin never permitted American firms to acquire substantial energy assets in Russia. Instead, he presided over a major recentralization of state control when it came to the country's most valuable oil and gas reserves, putting most of them in the hands of Gazprom, the state-controlled natural gas behemoth.

Once in control of these assets, moreover, Putin has used his renascent energy power to exert influence over states that were once part of the former Soviet Union, as well as those in Western Europe that rely on Russian oil and gas for a substantial share of their energy needs. In the most extreme case, Moscow turned off the flow of natural gas to Ukraine on January 1, 2006, in the midst of an especially cold winter, in what was said to be a dispute over pricing but was widely viewed as punishment for Ukraine's political drift westwards. (The gas was turned back on four days later when Ukraine agreed to pay a higher price and offered other concessions.)

Gazprom has threatened similar action in disputes with Armenia, Belarus, and Georgia - in each case forcing those former Soviet SSRs to back down.

When it comes to the US-Russian relationship, just how much the balance of power has shifted was evident at the NATO summit at Bucharest in early April. There, President Bush asked that Georgia and Ukraine both be approved for eventual membership in the alliance, only to find top US allies (and Russian energy users) France and Germany blocking the measure out of concern of straining ties with Russia. "It was a remarkable rejection of American policy in an alliance normally dominated by Washington," Steven Erlanger and Steven Lee Myers of the New York Times reported, "and it sent a confusing signal to Russia, one that some countries considered close to appeasement of Moscow."

For Russian officials, however, the restoration of their country's great power status is not the product of deceit or bullying, but a natural consequence of being the world's leading energy provider. No one is more aware of this than Dmitri Medvedev, the former chairman of Gazprom and new Russian president. "The attitude toward Russia in the world is different now," he declared on December 11, 2007. "We are not being lectured like schoolchildren; we are respected and we are deferred to. Russia has reclaimed its proper place in the world community. Russia has become a different country, stronger and more prosperous."

The reverse, of course, can be said about the United States. As a result of our addiction to increasingly costly imported oil, we have become a different country, weaker and less prosperous. Whether we know it or not, the energy Berlin Wall has already fallen and the United States is an ex-superpower-in-the-making.