The social Matrix

The social Matrix

Friday, February 24, 2012

There is no better time to misuse history  then election season. Recently, front-runner Rick Sanatorium claimed that government control of schools is “anachronistic,” and began in the age of industrialization. However, Sanatorium,a No Child Left Behind supporter, is not exactly correct.

 Advocacy  for government intervention in education is as old as Thomas Jefferson. Jefferson's writings clearly showed that he was outspoken for his support of a publicly mandated educational system.

The misuse of history is not just a product of ambitious politicians, even mass movements such as the Tea Party have misunderstood history. It is the the underlying fundamental belief of the Tea-Party, empowerment of the states and further decentralization of power, that has gathered much traction in last five years.

 However, the historical truth is more nuanced. The truth is that the constitution of 1787 was aimed at concentrating power in the center as dictated under the Articles of Confederation of 1777.

Notwithstanding, the origins of the idea of limited government, the raison de ‘etere of the Tea Party, is not without historical precedence. The founding fathers did fight against the encroaching powers of the British Crown, that levied unfair taxes against the Americans.  Although this logic may be understandable, this is not the only example of historical revisionism by the Tea Party.

A more outlandish example occurred in Tennessee where the local Tea Party movement wanted to erase the fact that the founding fathers owned slaves and mistreated Native Americans. The group is concerned that:

"An awful lot of made-up criticism about, for instance, the founders intruding on the Indians or having slaves or being hypocrites in one way or another. "

Perhaps the relationship between the founding fathers and people of color is debatable but to rewrite history simply because it causes cognitive dissonance is disingenuous and an insult to intelligence.

Moreover, the manipulation of history for political purposes, does not fall on neatly delineated ideological fault lines. The liberals are just as capable of misreading history as their ideological counterparts. Take for example Michael Moore's comparison of suicide bombers in Iraq to the Minutemen during the American Revolution or Senator Dick Durbin's comparison of Guantanamo Bay to Nazi death camps.

During the Iraq war,Arian Huffington, founder of the Huffington Post, compared the invasion of the Iraq war to the invasion of the Sicilian City of Syracuse by Athens. The only problem with this historical analogy is that they were both democracies. Furthermore, the Sicilian city that was invaded was larger than the Greek city that invaded it.

There is a good reason why George Santayana once said that "those who cannot learn from history are doomed to repeat it." Thus, if we are going to try to use history to advance political, social or economic goals lets at least keep it real.

Friday, February 17, 2012

Is Humanitarian Intervention the solution to Syria

The protest in Tunisian lit a match that sparked a revolution throughout the Middle East. Two years into this massive protest Syria struggles to find peace and tranquility amiss perpetual violence. The Al-Assad regime has promised to compromise and make political and economic concessions, but for the protesters the reforms were nominal.

 In the summer of 2011, several youth were arrested and charged with anti-government graffiti. The massive protest led to a large crackdown by security forces that resulted in the death of 55 Syrians.
Many Syrians compared the violent government actions in Daraa to what occurred in Hama 30 years earlier.

In 1982 the security forces in Syria arrived in Hama and killed 20,000 people to prevent the Muslim Brotherhood from usurping power Recently, there have been unverified reports from Sanamein that police fired in a crowd killing twenty people.

 Not every Syrian is in support of the uprisings.There have been pro-Assad rallies as well such as in Umayyad Square where supporters waved flags of support. Still, its hard to trust the intentions of the Syrian regime when countless reports show that the Syrian security forces are beleaguering the protesters into submission.

More importantly, is how should the international community respond to this crisis? On the one hand we have an obligation to protect those who are victims of violence on the other hand nations are obligated to respect the territorial integrity of sovereignty.

The Baathist Way 

Like many nations under colonialism Syria gained independence after world war two. Since 1970 the Baathist party has had a political monopoly in Syria. During that time the Syrian economy began to suffer as the country spent more on the military and less on development (Syria owed the Soviet Union $11 billion for military expenditures.) However, since 1991 Syria has opened its economy to free markets by encouraging foreign investment.

In addition, to its economic problems the relationship between Syria and the United States since the Baathist party assumed power has been volatile. Under the Carter administration the U.S. supported the brutal regime of Hafez Al-Assad and in 1976 supported Syria against Palestinians. Less than 20 years later Syria supports the United States against Saddam Hussein in the Gulf.

Despite these signs of cooperation, the relationship was not perfect.  Under the Bush administration, the president initiated the Syria Accountability Act which curtailed any advancements in diplomacy the two countries had made with each other.  At the beginning of the millienium, anti-Americanism in Syria began to intensify and during the Iraq war U.S. officials claimed that Syria aiding the insurgency in Iraq. Finally, in 2006 the U.S. embassy was attacked by islamic militants.

The military solution

In response to the recent uprisings politicians have called for military intervention. Recently, Senator Mark Kirk and Senator Jon Kyl have advocated for a military coup in Syria.  However, given the wars in Iraq and Afghanistan, it will be hard for politicians to get support from the American public.

The failures of military interventionism did not begin with the Iraq.  The most notable failed intervention occurred in the early 90s when Clinton decided to send forces in Mogadishu. After American troops were killed mercilessly during "Black hawk Dawn" Clinton realized the mission had failed horribly and decided to pull troops out.Despite the underlying altruistic intentions for intervening in Somalia,yet with 2000 Somalians considered "Collateral Damage" since "Black Hawk dawn" Somalia was a bad investment in foreign policy.

Another failed attempt at interventionism is Yugoslavia. Even the Secretary of State under Clinton, said that the intervention in Yugoslavia was a foreign policy mistake because the ethnic tensions will never end.  Although Peace keeping were sent to the small eastern European nation it did not do much. According to Human Rights Watch, NATO, in an effort to protect civilians ended up killing 500 civilians in Kosovo using airstrikes.

The Power of the Gun 

Although, many believe that the military interventions starting with the Clinton administration were more  beneficial than harmful. There are many who believe that force has a role in ending conflict.  According to Jon Western, an associate professor of International Relations at Mount Holyoke College, "Over the past twenty years the international community has grown increasingly adept at using military force to stop or prevent mass atrocities."

In the aftermath of the Bosnian genocide that ended with 7,000 Bosnian Muslims killed there were 161 war criminals who had been prosecuted under the International Criminal Tribunal for The Former Yugloslovia.  The success in Bosnia was a mix of military efficiency  and diplomatic persistence. Under Operation Deliberate Force, NATO sent in 60,000 armed troops, while American diplomat Richard Holbrooke drafted the Dayton Agreement--both actions were instrumental to ending the conflict in eastern Europe.

In addition, while many critics hold pertinacious views against American interventionism and use Iraq as a paradigm to judge all military interventionism, they simultaneously ignore the successes in Cote d'ivoire and Libya. In Cote d'ivoire UN Peace Keepers were sent to help the people dispose of their leader, President Larent Gbagbo, who refused to step down after elections resulted showed he lost and a civil war ensued leaving 3,000 people dead.

There is also non-anecdotal evidence as well. A study conducted by political Scientist Taylor Seybolt found that intensive military operations were key to obviating many ongoing conflicts in war torn areas. Moreover, according to the Human Security Report from 1992-2003 the number of world conflicts decline by 40 percent.

Part of the solution to successfully ending conflict in any part of the world is getting regional support. Good examples include, Australia's intervention in Indonesia after East Timor became independent, Cote d'ivoire, Liberia and Sierra Leone. Other examples include Vietnamese response to the Khmer Rouge in Cambodia, India's preventive actions against state terrorism in Bangladesh and Tanzanians assistance in overthrowing the brutual dictator Idi Armini in Uganda.

However, use of regional forces can be the problem and not the solution in some cases. For example, the Syrian occupation of Lebanon has intensified tension between Beriut and its northern neighbor. The Bush administration used diplomatic measures including proposing UN resolution 1559 and recalling the American ambassador to Syria.

These efforts, in addition to massive protests at Martyrs square in Beirut, in response to the assignation of pro-indepent leader Rafiqi Harari  led to the departure of Syrian troops. This might explain the violent attacks against the U.S. Embassy in Damascus the following year.

The use of regional power to intervene could get further complicated if competition for natural resources is not considered. A good example of this is when Turkey build the Ataturk Dam in 1990 and diverted water from the Euphrates away from Iraq and Syria. Syria's agriculture is heavily dependent on irrigation especially because it uses domestic cotton to support its textile industry. Regional intervention in this case might be seen as an attempt to increase control over natural resources rather than to bring peace and stability.

When the bullets run out 

In many cases millitary force is not enough. The first step to ending a civil conflict is conducting a fact finding mission such as in Darfur, Palestine or Tajikistan to understand the social, political and economic factors contributing to the problem.

According to Benjamin A. Valentino,associate professor of Government at Darmouth College, the U.S. should shift its strategy from military intervention to humanitarian and focus on public health programs, disaster relief, and ensuring the safety of refugees who are displaced because of a conflict.

Another action that should be adopted on a regional level is the emigration of refugees to neighboring states. From 1933-1939 70 percent of Germany's Jewish population were able to leave their country as Hitler had ascended to power. This is also true of Sudanese who fled to Chad from Darfur and Chinese who escaped to Tawian during the Chinese Civil War.

In addition, just as regional countries play an important role in ending civil conflict so does the larger international community. According to UN Security Council Resolution 668 the international community has an obligation to protect against war crimes, genocides, and crimes against humanity. However, translating theory into practice is harder than it appears. The resistance from Russia and China, the largest contries in the Security Council,  is making it harder to contain and manage the crisis in Syria.

 Much of the resistance from China and Russia is for historical reasons. The accidental bombing of the Belegrade Embassy in 1999, coupled with Russian interest in Kosovo has made it harder for these three countries to (China, Russia, United States) reach a consensus on global intervention. Still, while the Russian and Chinese vetos should be condemned, The United States, should realize its veto record is not always conducive to enhancing human rights.

There is no shortage of examples, live ammunition against peaceful protesters, abuse of detainees, that demonstrate the brutality of the Syrian regime. The international condemnation and opprobrium that Bashar Al-Assad faces will only intensify if he does not show serious signs of progress.   According to Professor Stephen Zunes, Is a Professor of Politics and International Studies at the University of San Francisco:

"Decades of human rights abuses, sectarian divisions, suppression of independent civil society institutions, ubiquitous secret police, and an overall culture of fear have made it difficult to build a unified opposition movement."

 This is why a successful outcome in Syria will depend on a multilateral approach involving many countries with divergent interest. The imperious need for a comprehensive solution in Syria will  likely contain political inclusion, social reconciliation and economic justice. Like Tunisia Syria is country yearning for a revolution. Humanitarian intervention is not perfect and may have its flaws, but inaction is never the answer.    

Wednesday, February 15, 2012

Global Hunger--50 Cent Road to Mogadishu

 I never thought 50 cent would return to Africa after he his gold chain was stolen while on stage in Angola. But he came back. This time he visited Somalia. He came a few weeks ago to help solve hunger in a desolate famined environment. Last week rapper 50 cent made a trip to Somalia to help those in need. Curtis Jackson, also known as 50 cent, said he plans to provide one billion meals to those who suffer from hunger. However, as horrible as it may be, Somalia is just a microcosm of a global epidemic that is only getting worse. Unless a comprehensive solution is applied to a multi-faceted problem than food insecurity will not end.

Feeding The World 

The concern over hunger became an issue in the aftermath of world war two in 1943 when the Food and Agricultural Organization was created under the United Nations. During the 50s and 60s food surpluses in America were delivered to countries with hunger problems under public law 480. In 1996 the world community came together and pledge to reduce hunger by half in twenty years by increasing food reserves.

It is estimated that over 800 million people  globally are afflicted with hunger due to poverty, war and natural conditions. Hunger is a greater threat than AIDs, Malaria and Turbclouisis combined. Each day 25,000 people die from hunger related problems. It is estimated that by 2025 Africa will reach 1.5 billion people and that it will only be able to feed 40 percent of its population. Currently it is estimated that close to 250 million people in Africa suffered from Hunger.

One of the most obvious problems associated with starvation is weight loss and malnutrition and that it deprives a person of the necessary nutrients for survival. In South Asia (43 percent) the percentage of underweight children is higher than in Sub-Sahara Africa (28 percent)    Although, weightloss is one of the main health risk as a result of hunger there are other risk as well including chronic disease, diabetes and some forms of cancers.

Causes of Hunger--The Environment

There are a number of factors that contribute to global hunger. One reason is because of environmental factors including soil erosion, air pollution, climate change. For example, there have been many enivormentally caused shocks in the supply of rice such as the drought in Australia , Cyclone Nagris in Myanmar, typhoons in the Philippines, Cold weather in Vietnam and flooding in Bangladesh. Pest and Insects have played a role as well. In Vietnam insects were responsible for eliminating 200,000 tons of rice.

Another major factor contributing to the loss of farmland and thus decreasing the food supply is urbanization and industrialization. Although this is migration trend is happening in Africa as well most of the poverty is concentrated in the hinterlands. In China, only 7 percent of arable land  and 22 percent of the total population land is quickly being converted for industrial use.  One example of this is the billion dollar highway constructed between Hong Kong and Guangzhou which has destroyed much farmland. In the past decade Japan China and Vietnam have have reduced the land used for rice by 1.5 percent, .67 percent, and .03 percent respectively.  During the same time, the amount of land for agriculture in Australia fell dramatically from 310,000 acres to 15,000 acres.

It is not just urbanization that is causing food shortages another problem that is often overlooked is the managment of crops after the harvest. Most farmers who specialize in rice have lost money because the technology used to dry rice and store it are outdated and inefficient. One Study found that in the Phillipines 33 percent of the crops is lossed because milling, drying and storage are not done properly.

   Still, many Chinese work in the agricultural sector and 15 percent of all land is used for cultivation. One way that China and other Asian countries have tried to manage the food crisis is by turning to seafood. As a result, edible forms of algae and sea weed have been created on fishfarms. Moreover, not all land is easily convertible for agricultural uses. For example, the tropical environment in Amazon makes farming difficult  because the tropical rain washes away fertilizer and the rainforest has few plant rich in nutrients.

Are you Thirsty? Want a sip? 

Nevertheless, in order for land to be used efficiently water has to be managed effectively. In China, seven percent of the country is wetlands that is readily available for agricultural purposes. According to the World Bank, many countries will run out of fresh water by 2025. The scarcity of water is most evident throughout the Middle East and North Africa. The World Bank estimates that by 2025 there will only be 667 cubic meters per person for water in the Middle East compared with 4,780 for a person worldwide. Countries in the Middle East such as Jordan and Israel that are heavily at dependent on fresh water for agriculture might have to look at other alternatives such as desalination, recycling waste water, and cutting back on irrigation. Only Egypt can compensate for the arid region from weather shocks because of the Nile River.

 In addition,water has been a major source of conflict  such as between Arab states and Israel over the Jordan river and between India and Bangladesh regarding the Ghanges river. In fact, it is the competition for scarce resources that has caused a shortage in food supplies. Many countries throughout Sub Sahara Africa have been afflicted by wars (Angola, Sierra Leone, Angola, and the Central Africa Republic) over natural resources.

A strong example of how war can cause mass starvation occurred to the Kurds during the Persian Gulf war. Although, to be fair many of the conflicts today are remnants of the cold war and did not come into fruition from an indigenous hatred

For example, it would be an insult to history if we were to blame the current crisis in Somalia on tribal rivalry while simultaneously ignoring the fact that the Russians have supplied Somalians with AK47s in the 80s to spread Soviet-style communism or that the United States gave $35 billion to the Somalian government for "lethal assistance" presumably to contain the spread of the Soviet Union.  Many countries throughout the Middle East are also responsible for fueling the flames of conflict in the horn of Africa as well.

It is within this chaotic environment, nurtured by anarchy that the U.S. humanitarian intervention in the early 90s failed miserably and that subsequent efforts to end starvation have been severely curtailed in Somalia.

While human conflict and the environment may play an important role in the prevalence of global hunger a bigger and more complicated factor is the interdependency of macroeconomics. According to the FAO in 2008 the world spent more than a trillion dollars on importing food which was more than $215 billion in the previous year. More importantly, the cost of food in many developing countries has increased by 40 percent.

One reason is because of the price of inputs have also increased. A study by the World Bank found that 35 percent of the increase in food prices can be attributed to rising fuel and pesticides cost. One controversial reason for the inflation of food is speculation.

The Commodity Controversy

The introduction of derivatives to the farming sector allowed farmers in the United States to be guaranteed a profit set before harvest based on stocks bonds and other financial instruments. This was harmful for the buyer because most of the risk associate with supply side shocks were absorbed by the buyer and not the seller.

 "According to the FAO’s 2011 report, only 2% of futures contracts for raw materials end with the actual delivery of the product. The other 98% are traded by speculators before their expiration date."
However, not everyone believes that speculation is responsible for inflation. Others believe that supply and demand are responsible for regulating price. Speculation of commodities has very little to do with the votality in the market:

"An OECD report suggests that there is little difference in volatility between exchange-traded agricultural commodities (such as wheat and corn) and non-exchange-traded ones (such as apples and onions)."

 The importation of food is detrimental to many developing countries because the largest sector of the economy is agriculture. The oversupply of food in the domestic market causes the wages for farmers to decrease. Even highly industrial countries like America are not immune to this problem. Specifically, The US goverment has played a large role solving this problem by buying surplus commodities,  and  production controls that influence the prices.

The Answer is not the Government 

However government is not always the panacea intervention has not always worked. This has been true for much of the Middle East such as Tunisia Iraq and Syria in modern history were the government used taxation to have a monopoly over agriculture and purchased agricutural goods at below market prices. Specifically, this occurred under the Sudanese Gezira Scheme were the government pocketed the difference.

 In addition, because farmers were burden by taxes they were less motivated to produce food to be exported which had a direct impact on the amount of foreign exchange accumulated. From 1970-1985 taxation in Egypt increased by 50-200 percent;

"Egyptian price policies not only robbed the country of the foreign exchange that it could have obtained through exporting cotton but also exacerbated the food gap by retarding wheat production."

Ironically, state-owned farmers in Sudan spent more time trying to obtain foreign exchange to purchase inputs for production than managing their farms.

  Also the issue becomes further complicated because most of the foreign exchange was used to benefit the military and industry and not farmers. The government's interference in the agricultural market has caused price instability and food shortages throughout the Middle East. The trend shifted once the market was allowed to determine prices rather than have it set by the government and family farms were in control of agriculture instead of collective units.

 The problem in food production cannot always be blamed on government involvement. In Africa where many are employed in the agricultural sector only 4.5 percent of the public expenditure is for the production of crops. Moreover Official Development Assistance (ODA), for agriculture has decreased by 15 percent in the last 40 years.

The Wonders of State Intervention 

While state intervention has been harmful in some areas of the world it has been helpful in others. For example, the Public Distribution System in Kerala India, a program that guarantees households "specific quantities of selected commodities with subsidized prices," has provided 31 million tonnes of foodgrain such as wheat and rice. In 1991 the PDS system distributed ration cards to cover 95 percent of households that couldn't rely on subsistence farming. In 2006 there were close to 220 million Indian households with ration cards.

Various government programs in both Tamil Nadu and Kerala protected the public from food insecurity. For example, the rate of malnutrition has declined dramatically from 1983 to 2000 from 12.3 percent to .3 percent as the result of state-run food programs.

   Again, Indian programs such as the Midday meal and the Integrated Child Development Scheme have been instrumental in curtailing the growing threat of food insecurity in the sub-continent. Although is far from solving its Hunger problems:

Regardless of the multiplicity of causes that contribute to the global epidemic of hunger there are a variety of options to solve the problem including maintaining strategic reserves, attracting foreign investment and improving infrastructure. Biotechnology, The technology has helped increase tolerance for environmental conditions such as droughts and salinity and  most notably the green revolution, that has led to higher yields of crops allow it is an expensive procedure. Another noteworthy solution is the Comprehensive for Action plan. Still, sometimes the solution can be simpler such as giving a voice to the poor and allowing them to choose what they need from a variety of options through a voucher system. According, to Erick Werker assistant professor at Harvard Business School NGOS tend to be more responsive to their donors rather than to the people they are serving.

I applaud 50 cent for taking the time to try to solve an issue that affect billions but many westerners take for granted--a warm meal. However, if celebrities like 50 cent really want to solve hunger than they need to understand how economic issues, environmental circumstances, and social conditions converge together to create this problem. One this takes place nobody will go to be on an empty stomach.

Its All About the Money-European Crisis

In 2004 There was hardly any discussion of an impeding financial disaster. At the time, Europe wanted the Bush administration to reduce its trade and budget deficits so that the dollar could be strengthen while the value of the Euro declines. Nearly ten years later, the European economy faces a multitude of economic issues that have led to riots in Greece and elsewhere. 

The Genesis 

Originally the EU was more or less an experiment in international relations. The underlying theme was that the integration of a series of nations economically, politically and socially will decrease the probability that these nations would go to war with each other.More specifically, The new Europe created custom blocks that would open trade within the continent yet agree on trade barriers abroad. This new Europe would allow for the freedom of movement for: goods, people, services and capital. Entrance into the Euro-zone was not cheap.

To enter this prestigious club nations had to maintain low inflation, interest rates, and government debt in order to join. New nations could not increase spending to a certain point nor print money to cover unemployment benefits to attract investors.

 Like most ideas, It is good in theory but theory is often far removed from reality.

The German Hegemony 

Germany's role in the European economy is as strong as Japan in Asia. The former Weimar Republic, sphere of influence in Europe is strong.

"You get an enormous sense of German Self-Righteousness, which is very difficult to take," said Francois Heisber of the International Institute for Strategic Studies. Jean-Pierre Jouyet a former french Minister for Europe said German's influence in Europe is strong, while his own country's role in shaping Europe's future is declining.  Almost half the EU's exports to China are from Germany.

"The reform of the euro will create a more German Europe, but not quite the economic Pax Germanica"

Fortunately, for Greece, Merkel decided not use a "Debt Tzar" that would have power over the Greek's GDP is the worst in Europe. Its debt to GDP ratio is 143 percent.

Greek Economy

Greece, a country that entered the EU in 1981 followed by Spain and Portugal in 1986,currently has the highest debt. Part of the problem, particularly in Greece is that wages have outpaced the rate of productivity causing the current account deficit to reach ten percent of GDP. Greece could lower wages which would lower the cost of production making prices more competitive, however with a high unemployment rate such a solution is unlikely.

Although German exercises much influence over the direction of the European Union it is currently facing what appears to be an economic standoff with Greece over its debt.

Germany's leader Angela Merkel has demanded tighter control on the Greek economy including control over Greece's tax system. Merkel is doing this because the German public is reluctant to bailout the Mediterranean country a second time. Nevertheless, the erosion of Greece's economic sovereignty has left many Greeks upset.

Notwithstanding, Greek resistance to German's proposed austerity measures, Greece's labor minister George Koutroumanis came out in support of a three year wage freeze in addition to other programs for the past two years.

Can I borrow a Dollar?

Greece is not the only country suffering from higher debt-GDP ratios as well. (Italy 119 percent and the leaders of the European Union (Germany and France) is at 80 percent, 20 percent higher than permitted by the Maastrict Treaty.

Of course it would be overly simplistic to place the blame on the economic crisis solely on  the country known for its contributions to ancient philosophy. The value of Portugal bonds in foreign currency, has continuously fallen causing the yield on its ten year bond to reach  17.2 percent resulting in a 71 percent chance of defaulting within the next five years.

Portugal's  neighbor is not immune to the economic crisis. Spain's economic performance is lackluster with barely .3 percent of GDP growth over the year. Perhaps more significant is Spain's embarrassingly high unemployment rate for young people which is more than twice the national average 22.8 percent.

Greece is often in the news for its provocative methods of protest but it is not the only country rebelling against austerity measures. Belgium has experienced its own version of opposition to austerity when unions called for a strike that compelled the country's rail network to close and left many trains and buses without drivers. International flights have been effected as well. Philippe Dubois, a railway union member outside Brussels' Midi station, told Reuters that:

"We are angry because they want to attack our pensions."

Even more prosperous countries like France were reluctant to undergo reform. In France, workers were  angered over pension reforms which have created a blockaded for fuel refineries, causing 4,000 petrol stations to run dry.

the monetary calculus-currency

The economic relations between poorer and richer nations is not the only economic issue Europe has to confront. Just as in 2004, the role of the Euro in a world dominated by the dollar will be essential to resolving Europe economic problems.

Although The United States accounts for only 24 percent of global GDP its currency dominates various economic activities such as commodity pricing and foreign-exchange reserves. however, together the Euro and and the dollar make up 80 percent of the foreign exchange reserves.

There are some signs that shift is taking place. One study found that many central bankers wanted to diversify their foreign exchange reserves and in fact there has been a 2 percent increase in non-Euro/dollar in reserves from 11 percent to 13 percent.

One of the main concepts to explain the monetary system is the Mundell Trilemma. According to this concept a nation has three levers to manipulate the monetary system. States could stabilize their currencies, allow for greater capital mobility, and controlling their domestic monetary systems. However, only two options can be applied at a time.

For example, the United States choose to allow for greater capital mobility and political autonomy over the monetary system instead of a stabilized currency. In contrary, Argentina had fixed their currency to the dollar but did not have the same political independence afforded  to it as the United States. If a country decides on a fix-exchange rate while promoting capital mobility it could lead to asset bubbles and inflation.

The problem in Europe is that every country in the Euro-zone is effected differently from monetary policy. For example, while one country may benefit from higher interest rates (control on wage increase) another country could find it difficult to respond to high unemployment because it would need lower interest rates to stimulate the economy. However, it was the lower interest rates that caused the real estate bubble in Spain five years ago.

One solution proposed by Sarkosy and Merkel was to increase the capital ratios of commercial banks to one trillion dollars in order to help countries such as Spain and Italy. However the banks decide to pursue this option because it might harm the interest of their share holders so it decide to limit loaning as a means to increase capital. Inevitably this caused the European economy to come to a halt.


One answer to this monetary quagmire is for the Central Bank to buy bonds, however it could have inflationary consequences and some countries might feel that this would give countries with a weak economy a "license for Profligacy."

The European Central Bank was reluctant to purchase bonds because the ECB does not think that printing money is the best way to address the debt. Instead, European nations have set up a slush fund under the Fiancial Stability Facility to control the problem. The main obstacle is the agency did not have enough funds to cover countries like Spain and Italy if they become insolvent.

Still, many countries have issued bonds to help pay off their debt.  Italy hit its head on the ceiling when it sold 6 billion dollars worth of five and ten-year bonds as interest rates fell significantly. In Portugal the interest rates on bonds for 10 years reached 15.8 percent and 5-year reached 20.8 percent.

In response to a potential default in Greece interest rates have risen, however some owners of sovereign debt agreed to accept a 50 percent reduction in the value of their bonds.

 The  situation becomes more complicate in Ireland and Spain were mortgage defaults have led banks to rely on government bonds that were decline in value.

The rule of Law

Legislation has been introduced to ensure that countries are more economically responsible by establishing the European Stability Mechanism, Europe to bailout countries. The new treaty grants the European Court of Justice the authority to enforce fines, and requires all Euro-zone countries create constitutional amendment which prevent governments from going into debt. Specifically, article 260 Lisbon Treaty discusses putative measures for handing countries with spiraling debt.

Is This the End

Some scholars have concluded that the issue is a struggle between richer and poorer nations with Europe. According to political economist Barry Eichengreen from the University of California, Berkeley, the struggle is between Southern Europeans who have suffered from severe cuts making it harder to pay its debt against Northern Europeans who perceive the Southern economy plagued with "corruption" and "Laziness."

However the conflict is more nuanced. Recently,  French President Sarkozy said that Britian had "No industry left" when a reporter questioned him for suggesting that Britian should increase VAT.  Sarkozy was quickly criticized by the press and one British government source claimed that the figures were more likely 11 percent in proportion to GDP.

Recently, Europeans decided to reach a consensus and put together an economic package close to a trillion dollars to fix the economic crisis. However the concerns of Germany are legitimate as articulated by the British magazine the Economist:

 To Germans, this looked like the start of the dreaded “transfer union”, a bottomless commitment to subsidies Greeks’ early retirement, fix an Italian budget tattered by tax evasion and clear up after Spain ’s burst property bubble. “Sell your islands, you bankrupt Greeks. And the Acropolis while you’re at it,” demanded Bild, a popular tabloid. Mrs Merkel played to the gallery by suggesting that persistent euro sinners should be thrown out of the group.

While Merkel's uses tough rhetoric to appease the German's populism the truth is that the more countries that opt out of the European Union could have disastrous consequences for Germany. This is because Germany's exports have benefited from a fixed-economy as a result of a unified monetary system.

One option could be to let countries heavily burden in debt to default on its financial obligations. Lenders would lose money and the country would have to pay higher interest rates in the future but it would force Greece to be more frugal in the future.

Despite the negative press surrounding Europe's economic woes there are signs that the continent's  economy is improving. Exports are booming and unemployment is expected to fall to levels last seen in the early 1990s.

Nevertheless if European countries want to stablize the regional economy there needs to be serious reforms including liberalizing labor markets, reducing beaucracy, preventing tax evasion, raising the retirement age and privatizing industries. It may be painful but these steps would be necessary for the long-term stability of the region. 

Can We Talk About This?

As the war in Afghanistan comes to a conclusion efforts are made to increase dialogue between the Afghan gov. and the Taliban. Negotiations, moderated by Saudia Arabia, are schedule for the following weeks and the Taliban is trying to open an outpost in Doha, Qatar.

For the last decade the war in Afghanistan has overthrown a religiously draconian-led makeshift government, but has simultaneously led to the death of numerous Afghans and American as well as coalition troops.

The reasoning behind the invasion was clear: Afghan is a safe haven for Al-Qaida yet ten years after the war in Afghanistan surprisingly  the majority of Afghans do not know about 9-11.

Although many on the left are quick to criticize the war, albeit for legitimate reasons, yet many on the Left seam to ignore or downplay the brutality of the Taliban's regime on the local Afghan population. Its worth listing some of the Taliban most notorious actions including:

  • Stoning to death homosexuals
  • Chopping off the hands of petty thieves at the national soccer stadium
  • The ruthless treatment of women including one incident where a woman struggling with grociers was beaten because her Burqa started to uncover her face.

Interestingly enough, Afghanstan history reveals that the Taliban is not the only regime to use force to suppress its citizens. During the reign of Abdur Rahman Khan in 1895, 100,000 people were killed at the hands of the Iron Amir.

More than a hundred years later people in Central Asia are rejoicing at the defeat of another brutal government: the Taliban. Young children flew kits, men danced, and women breathed a  sign of relief. Although Bush is heavily criticized for his foreign policy, much of it deserved, the Afghanstan strategy was not a complete failure. For example, Laura Bush helped create a U.S.-Afghan’s Womens Council that brought in $70 million in private donation funds to empower women in the region.

Furthermore it is also worth noting that there has been progress recently as well. In 2009 the coalition and Afghan security forces conducted a military operation known as Operation Omid (which means hope in the local language) As a result the Helmand River  and some of the surrounding area have begun to stabilize.  In addition, many of the security goals have been achieved including a decrease in causalities by 20 percent from 2009-2010, and an increase in both the Afghan army and police force by more than 9,000 and 11,000 its targeted goals respectively.

Still, there is a myriad of issues that need to be address. One in particular is the fracturing of people based on religion, and ethnicity. Ethnic groups are divided tribally and geographically. The Hazra (18 percent) is concentrated mostly in the center whereas Uzbeks (8 percent) are located in the northeast.
The ethnic fragmentation in Afghanistan is a complicated social calculus. The ethnic composition in Afghanistan consist of seven distinct groups; Tajiks, Uzbeks, Hazaras. During the civil war in the 1990s Afghans fought along ethnic lines. The main ethnically-driven motivation for the civil war was the political monopoly the Pashtuns held over the rest of the population for over a century.

Ethnic tensions were not always the raison detere for conflict in Afghanistan. The 1929 overthrow of Amanullah Khan and the rise of the People’s Democratic Party of Afghanistan were ideologically based. Still, even though the Taliban is mainly a religious-based organization, it has difficulties recruiting minority ethnic groups.  Perhaps it did not help the Taliban campaign when in 2001 they massacred 170 innocent civilians in a province mainly populated by Hazaras.

Another major issue is political reform. While the governance in the Helmand province has improved the rest of Afghanistan is need of serious reform.  The potential for true democratic reform is hampered by the patronage system controlled by Karzai along with the lack of political parties that are fundamental to democracy. While the adoption of a formal constitution by 502 delegates, which guarantees equal rights for all citizens, should be celebrated, its worthless if nothing changes in reality.

Overall, There are two main approaches the U.S. government has taken toward the war in Afghanistan, Counter-terrorism and counter insurgency. The former, supporter by Joe Biden, focuses on killing enemy combatants, and the later focuses on building relationships with members of the community. While the Counterinsurgency maybe more expensive in the short-term you can not simply win a war by killing people. This is true especially given the urban nature of this particular war and the challenges faced in intelligence gathering.

Some degree of engagement with the Taliban is going to be necessary to ensure stability in Afghanistan. I don’t know what will happen once the Taliban is offered a seat at the table. I was hoping George Mortesen’s famous book “ Three Cups of Tea” would provide provide some useful insight into the lives and concerns of the Taliban only to find out Mortesen’s experience was mostly fictionalized.

Still, we had ten years of counterterrorism operations, including drone attacks, bombings, and police raids, its time we try a new approach. Negotiations may not work but we owe it to the world and Afghan people to at least provide alternatives to violence.

Russia-the political economy of corruption

The United States isn’t the only superpower gearing up for a heated political performance, Russia’s Vladimir Putin, is looking to seize the crown of the Kremlin for the march 4,  election. In a 5,000 word article for Russian business newspaper “Vedomosti” Putin explained his platform for improving and stabilizing the Russian economy.

We need an economy with competitive industries and infrastructure, a developed service sector, and effective agricultural system. An economy founded on modern technology, Putin said.

Since the start of Putin’s political career as Prime Minister, there have been numerous economic reforms implemented including, establishing a flat income tax, creating a new bankruptcy laws, and reducing business taxes after introducing a Value-added tax.

Putin also transformed the private energy companies into state-owned enterprises in an effort to curtail foreign control of Russia’s natural resources.

In 2007, Russia signs of economic improvement. Trade and foreign Direct investment (FDI) both grew rapidly during Putin’s administration. From 2000 to 2007 Trade increased from $89 billion dollars to $300 billion and exports exceeded imports by $130 billion Likewise FDI increased in the same year from $5 billion to $52 billion.

Following the appointment of Putins successor, Dmitry Medvedev, there were some signs of the economy was stagnating. According to Putin, his successor has failed to improve the corrupt business environment.

A series of Wikileaks released in 2010 confirmed growing suspicions over Russia’s corrupt system. The report found that, the Mayor from Moscow, Yuriy Luzhkov, had connections with the criminal world and used bribes to help give the ruling party votes.

The corruption is manifested in different forms including, arms trafficking, money laundering and protection for criminals to extortion and kickbacks.  According to the Wikileaks report, governmental departments like the Federal Security Service, the Minister of Internal Affairs and the police department have taken part in this corruption by offering businesses a layer of protection for a fee. When the business refuses or can’t pay the fee regulatory agencies find some reason to close the business even on minor violations charges.

There have even been allegations by Spanish investigator Jose Gonzalez that Russia has actively supported Iran and Kurdish groups in Turkey.

During the Putin administration many world leaders were reluctant to criticize the then-prime minister Putin. In a past G-8 meeting then-French president Jacques Chirac said that other countries should mind their own business. German Chancellor Gerhard Scroeder went further and was awarded for his silence over Russian corruption by becoming the chairman of a company owned by Gazprom, Russia’s largest energy state-owned company.

Although neither Putin nor Medvedev have successfully transitioned the Russian economy from natural resources to knowledge based, (the number of patents to come out of Russia is less than one percent of total patents worldwide)  the influx of billions of dollars’ worth of remittance has improved the economy. Even with this fact taken into consideration Russia still earns less from exports than Belgium.  According to Nicholas Eherstadt, Hendry Wendt Chair in Political Economy at the American Enterprise Institute, Russia needs to create policies to increase global output.

It will be interesting to see if Russia’s political transformation will influence the political debates in America over foreign policy during the political season.

Lost in Translation--Getting the Facts on Immigration

I hear it all the time. "We should kick them out (illegal immigrants)," "they dont belong here they should come in legally."

As the political debates heat up one topic that is going to be crucial this election is season is immigration. The political contrast on this issue is stark. While Romney has taken up a hardliner approach to immigration, vowing to veto the DREAM Act, both Gingrich and Ron Paul made statements that were more moderate on the issue.

Given Romney's position on immigration I am still surprised he won Nevada although  identity politics may have something to do with it he is Mormon.

Nevada's Latinos make up 26.5 percent of the 2.7 million residents in the state. Perhaps more important is the fact that 78 percent of the Hispanic population  is from Mexico. Although, Latinos are mostly democrats it is going to be hard for Obama to secure a win in Nevada with an unemployment rate for latinos at 19 percent.

Neverteless, mass deportation of illegal immigrants is not a pragmatic solution to such a delicate issue. The mass deportation of illegal immigrants would have disastrous consequences for our economy. As cliche as it may sound  many of the jobs that illegal immigrants perform are jobs most Americans do not want such as picking fruit, and dismembering chickens.

Would Americans perform these jobs for higher pay? Perhaps but the inflaltionary impact that it will have on the economy will discourage consumer spending at a time were consumer spending is needed to stimulate the economy. For example,  According to Laura Hill, a research fellow at the nonopartisan Public Policy Institute of California found that food such as lettuce strawberrys and spinach would increase in price.

 Which would mean no more strawberries dipped in chocolate this valentine's day. It is not just Americans who are reluctant to perform the jobs of illegal Immigrants. A few summers ago, a Spanish employment agency found out that less than 1,700 unemployed people, mostly non-Spanish, out of 7,800 unemployed workers accepted the job.

A 2006 study by the Pew Hispanic Center said that they found no evidence to support the claim that there was a link between immigration and higher unemployment for native Americans. The study looked at the immigration patterns all states and compared the data to the unemployment rate.

One complaint that many have about illegal immigrants is that they take and more than they contribute to the growth of the economy.

There is some truth to this. According to the Center for Immigration Studies,  Immigrants in general use at least one welfare program at 50 percent higher rate than their American-born counterparts. In addition, the cost for providing health care to illegal immigrants in Los Angelos County  in 2002 was $340 million.

It would be intellectual dishonest for me to suggest that the existences of illegal immigrants in the United States does not create any economic problems, but the truth is that the benefits outweigh the losses.
Take for example Social Security. Many analysis and pundits have said that the social security system will go bankrupt unless appropriate reforms are put in place.

What gets lost and ignored in the social security debate is the fact that illegal immigrants still pay federal taxes because regardless of immigrant status, employers deduct payroll taxes from their paychecks.
 In 2002, one study at the Center for Urban Economic Development at the University Illinois in Chicago, found that 70 percent of undocumented immigrants paid payroll taxes. If you think Social Security is bad now just wait and see what will happen if every illegal immigrant is deported.

That is not the only economic benefit. The same study discovered that the spending by illegal immigrants generated more than 31,000 jobs and contributed more than $5.34 billion annually to Chicago's economy.
The economic benefits of illegal immigrants is not limited to Chicago. In North Carolina there are simiar results. While illegal immigrants may cost the state $61 million they also stimulated the economy by $9 billion.

One important distinction to make is that while the country as a whole benefits from illegal immigration, it is individual states that absorb the cost.

Some commentators have suggested that both illegal and legal immigration is causing wages to fall for native born Americans. in 2006 former CNN anchor Lou Dobbs said that immigrants were causing wages to fall for native born Americans by $200 billion a year. The truth is that there is no positive correlation between the loss of wages for Americans as a result of an increase in immigrants. The one group that is effected are other immigrants who work in similar sectors of the economy.

One study conducted from 1990-2004 discovered that immigration in California caused wages to increase by four percent. This is because immigrants  tend to work in jobs that compliment american jobs rather than replace them.

It is not just the economic impact of both immigrants and illegal immigrants that has caused controversy. Another easily disprovable myth about illegal immigrants is that they have a propensity for violence and criminal behavior. A U.S. Representative from Iowa claimed that illegal immigrants kill 25 Americans a day. In 2006, a conservative radio host claimed that illegal murder 45,000 American citizens since 9-11. This would mean that four percent of the population is responsible for 53 percent of all murders.

Furthermore the assumption that terrorist might use mexico to get to America is not based on fact. The millienium bomber was apprehended from Canada not Mexico. Also none of the hijackers that caused september 11 came through Mexico.

Perhaps I am too soft on immigration but this statement is a little hyperbolic. just a little.
 In an article from the Southern Poverty Law Center's, intelligence Report, one study found that the "rate of violence among Mexican Americans was significantly lower than among non-Latino Americans."
If anything illegal immigrants are coming to America because of the rise in Crime in Mexico and Central America.   According to an article in the Economists, a significant number of citizens said that Crime is far greater concern than unemployment.

Again, this shows that the reasons illegal immigrants come to america are more complex then some would like to believe.

There are various reasons why people decide to leave their homeland. Some leave for economic opportunities others are refugees and leave for political reasons. In 2008 many migrants entering through the Mediterranean came to Italy for Political Asylum. During that year the majority of the 36,000 migrants who came to Italy seeking humanitarian relief.

Of course economics cannot be ignored. Given recent events, the rate of immigration is declining. For instance the number of Latino immigrants in Spain has decreased by 100,000. This is causing a labor shortage for many countries.  Germany has 36,000 unfilled engineering positions and 43,000 openings in the information field.

A Sensible immigration policy needs to take into consideration labor demands. There is other evidence that show immigration is declining. According to Frontex, the European Union's border-security agency, only 150 people migrated to Italy and Lata in the first quarter of 2010 which is remarkably lower than in 2009 . (5,200) even though it was not the whole year.

There have been attempts by governments to offer various incentives for immigrants to come and stay but most of the policies have discourage immigrants from coming. For example, Spain has convinced north-west African countries to put the ports of departure further south to make the trip to the Canaries more dangerous and expensive.

According to immigration scholar, Tamar Jacoby, one deterrent for immigration in Germany is the byzantine and burdensome visa process. Likewise in 2006 Canada put more restrictions on immigration by making the citizenship test harder and making it more costly  for an investor to get access.

Many immigrants experience extreme conditions to get to their new destinations.  attempting to travel to the Canary islands face a host of issues such as paying between $1,200-$2,000 to be transported by Senegalese merchants. Many end up getting arrested and detain some are thrown over board by their captains to ease the weight of the ships.

Likewise it is nearly impossible for Mexicans and other immigrants from Hispanic countries to enter America especially if they are poor. Many Mexicans decide to swim the Grand Rio to gain entrance in the United States. Just as there are middlemen in Africa who profit enormously from taking immigrants to another country so do men known as coyotes profit from the same thing in the southern border of the United States.

As much as I hate to admit it some immigration policy were motivated by racism and ethnic-centrism such as the Chinese Exclusion Act of 1882  and the National Origin System in 1921. Some believe that the immigration policies in much of Europe discourages immigration from Africa because it is a threat to its racial homogeneity.

A good example of this is the treatment of the Roma population in Europe. Last year a gunman in Eastern Europe killed seven people and injured 14 before committing suicide. Six of the victims were a Roma Family killed inside their apartment. Many Roma have traveled westward for more opportunity urtunity. One time Hungarian police collaborated with the FBI because of a number of attacks on Roma Setllements, which left a five-year-old boy dead.

Also five Roma boys were arrested for theft and forced to strip naked, kiss and hit each other as police filmed it.

 The treatment of the Roma population is extremely abohorrent. One member of a far-right Hungarian party, called for the internment of the Roma.

it is not just the Roma who are victims of xenophobia one politician in Germany blatantly said that immigrants from Arabia and Turkey are no longer welcomed.

Not surprisingly, the United States is home to numerous irrational manifestations of xenophobia  such as billionaire Rust Childress who sent radical groups to harass day labors in Phoenix. Ironically, the auto dealer has illegal immigrants working at some of his dealerships. The same group known as Freedom Riders, went to a parking lot to place a citizen's arrest on a mother who was hiding in a church.

Not convinced? What about Jason JT Ready, a Nativist who would like  to place land mines near the Texas Mexican border and said that

"The truth is that negroids screw monkeys and rape babies in Afreaka...stop negroid immigration and intergration now!

Another brilliant example is 25-year-old Vito Vaccaro who formed a group based on trying to expel all Muslims from America. Vaccao conveniently ignores the fact that Muslims have been coming to America since the 19th century and that the first mosque was built around the 1920s. Vaccao created a party called the Loyalist Party Against Islamic Hate to promote this agenda.

If Vaccaro had his way were would he send all the Muslim converts who have no ancestral connection to another country?

In 2007 the Southern Poverty Law Center's Intelligence Project identified 144 nativist extremists groups. There behavior and language is saturated with Irony. According to a leader in the Emigration party the "invasion" of illegal immigrants is akin to the invasion of Ghengis Khan.

Yet it is the American Freedom riders, a group of nativists, who entered a church parking lot and surrounded a group of immigrants with their motorcycles.  The same person who made the Genghis Khan comparison said that Latino women apprehended should be forced to undergo sterilization so that America does not become a "third World sewer."

More recently, a police Chief in New York decided to resign after news surfaced that his officers were acting abusively toward Latinos.

To be fair there are legitimate concerns when it comes to immigration. One study estimated that between 10-12 percent of Muslims in Germany are prone to radical Islamic thinking, and  25 percent of Muslim teenagers are hostile to Christians and Jews. Surprisingly, this is not the only European country that has had been a popular destination for adherents of a radical interpretation of Islam. More recently, there has been a group of Muslims in Belgium calling for Sharia law. The hatred for non-Muslims is as despicable as any other group based on hate.

There are other problems with immigration that arent as inflammatory such as the lack of renting space available in Canada in large cities because of immigration.

Regardless immigration is going to be crucial in 2012 election just as it was for Barack Obama. Harry Reid credit his successful defeat of Sharon Angle to the support he garnered from Latino voters.

Unless the GOP candidates approach immigration reform with support from the Latino community, then they can say hasta luego to defeating president Obama come this fall.