Sunday, March 31, 2013

Immigration Reforms

Here is Ezra Klein praising advances on Immigration Reforms. He is right to mildly praise this progress though I am all guarded in this affair considering some other dissonant noises.

In any case, few thoughts came to my mind when I read:

"But bipartisanship is, unusually, a precious political resource that the minority party has exclusive control over. It is entirely in their power to make even an accommodating president look like a polarizing figure who’s unable to work constructively with the minority party. And more to the point, it’s entirely in their interest."

Question is has President Obama made 'this' clear to Americans that how actively Republicans are shunning 'split the differences' kind of options available? Sometimes he mentions that 'anything he proposes, GOP reactively rejects'. From time to time President  exhorts Republicans that 'at some point Republicans need to take away President out of the equation' in considering larger interests of the country. But the question is whether he has made a 'political argument' of hostile and nihilistic politics of GOP? It seems he has not and he has left lot on table in this regard. There could be negative ways as well as positive ways of going about these things. When President says publicly that 'immigration reform is going to benefit Republicans lot' that is about going positive in these matters.

The negative ways would be - do exactly what GOP does about Budget Deals when it keeps moving to Right anytime President Obama prescribes a middle path. So President will have to keep going to Left anytime Republicans warm up for a compromise on Immigration. Of course, like a swarm Republicans will come on President criticizing him that 'he does not want a deal on immigration and he simply wants to paint Republicans negative'. Sure, why would then President not blame Republicans exactly the same way for their budget approach (which is what the reality is)? President needs to do that.

Agreed, I might not have explored exact consequences of joining 'Immigration Reforms to Budget Wars' at the heap. Probably, beyond a point it cannot be done. But I am just saying what if....

Wednesday, March 27, 2013

BRICS - India's Quandary

As Dr. Singh wraps up his Durban Trip in South Africa from the jamboree called BRICS, he needs to seriously think where all that 'tamasha' (farce in Marathi or Hindi) is going. Fight over 'bank capitalization' where China wants to throw its weight is just the starting point. And by the way, Dr. Singh needs to ask himself: what is easier - to deal with USA and Western bullying about due share in IMF or China overpowering in yet to materialize IMF rival? 

To start with, we need to understand the arbitrariness of BRICS. Next, India needs to understand how lopsided the grouping is considering overweight China. On top of if Durban invokes memories of gallant fights by Mahatma Gandhi against British Imperialism and Racism, precisely those same charges of 'imperialism' are hurled against BRICS and China with some validity. Does India want to be party to all that?

Of course, Indians will argue pointing a finger at USA and say "but where does USA establish its foreign relations based on Morality? Has USA not formed relations with dictator regimes and non-democratic countries for pure selfish reasons? American History is littered with marriages of convenience.  Then why India should be singled out?" There is a merit in that rebuttal.

But if the whole purpose of BRICS, an arbitrary grouping with not much basis, is to create an alternative power structure to USA and West and to challenge the relative hegemony of Dollar in international finance; the right course is to fight within IMF and UN. The right course is to work with many more authentic democracies of the world, starting from Chile, Mexico, Canada, Scandinavian countries which are not part of EU, Poland, even Germany, Israel,  Turkey, Indonesia, South Korea, Japan and Australia. Why does India have to side with the 'thug regime of Putin'? Or Xi's China which can only claim superiority to India because of more money whereas India has a respectable record of democratic governance for decades? 

In other words, India needs to be guarded about which 'company' it keeps. Except Brazil and to some extend South Africa, you have got dubious regimes of China and Russian in this artificial club of BRICS; the grouping invented by an investment banker 'for profit' of Wall Street! Indians need to be aware that 'India and her foreign policy' is much more than 'pleasures of discredited Wall Street'. 

Tuesday, March 26, 2013

Obama and Middle East

"Obama's no fool. He's a busy guy with a full domestic agenda. He didn't make up with Bibi only to go to war with him again over the peace process -- unless there's a real chance to get something big done. For now, the president's trip to Israel still has the ring of a "been there, done that" exercise. 
Give Kerry the mandate. It's perfect. Let him shuttle.
If it works, the president will be viewed as a managerial genius. And if it doesn't, well ... it's John Kerry's peace process, right?
Borders first, so to speak -- and then negotiation of a more general character on the identity issues, Jerusalem, and refugees. I'm not critical of this approach, because frankly there doesn't seem to be a much better one right now. But we're deluding ourselves if we think it can work quickly, or perhaps at all.
Hopefully he won't be fooled into thinking that successful telephone diplomacy between Bibi and Erdogan means he's got a career as a Middle East negotiator.
So, Israelis and Palestinians, take notice. You want the president to help produce a two- state solution? Give him a reason to believe you have a real stake in one too. Otherwise, stop whining: Barack Obama has more important things to do."

I think Aaron David Miller wanted to say 'been there, done that' to himself. Miller along with Jeffrey Goldberg of The Atlantic and David Ignatius of Washington Post; are the 'hot hands' on Middle East Foreign Policy issues in Public Media. (Tom Friedman of NYT and his taxi driver anecdotes - bit worn down at this point with much less punch or insight.) And I can understand on their part why and how these experts would be wanting to 'manage expectations' and damp down gushing about President Obama's Israel visit

There is merit in all that. Aaron David Miller is right that:
- 'borders first' is the only game in the town,
- it will be warring parties which will have to take first steps;
- else President Obama is not going to waste any political capital there.

That is what Americans would be expecting from this President and he has got it right there. And what about John Kerry then? As Aaron David Miller said aptly - if he sets up things, let us share the glory; else - what are John Kerry's of this world are for: to always carry the 'cross of America's cause' in this world. Politics is brutal and John Kerry knows it very well. It is all written large on that glorious, but tragic lifelong service for this country.

Aaron David Miller talks Iranian Mullah's nukes and Israel-Palestinian as two issues. But the third issue which he mentions in passing - Syrian Civil War; is the most critical in immediate terms. If one looks at these 3 issues, they are going to play most prominently - based on natural, underlying raw political forces - in following chronological order:
- Syrian Civil War
- Mullah's of Iran getting their nukes and
- Resolution of Israel-Palestinian conflict.

It is no brainier, given this natural order of things; Obama Administration 'talks the game of Israel-Palestinian conflict resolution' but is only ready to pay concrete political price for the first two. 

I would even venture, for the next year or so the most important issue is getting Syrian situation under control - if anything is doable there for USA. Until Iranian elections are done sometime by this mid-year, it makes sense to 'wait'. Try getting something out of these two complex problems and by then the calendar opens for 2014 mid-term elections. After that Mr. Barack Hussain Obama will be spending more time in 'declaring national monuments, nature sanctuaries'  and victory laps across the world as well as scrambling to make most to stick 'ObamaCare' long past when he is gone. Those two years will be glorious two years of special American phenomenon - lame duck Presidency from 2014 to 2016.

I do not think Barack Obama can solve Israel-Palestinian conflict in his second term unless those folks 'seriously move themselves'. The writing on wall will start appearing pretty soon and then best this Administration, and actually for that matter any Administration, would manage is 'don't screw up' further USA-Israel relationship. If it becomes nasty albatross as like how few Western Governments got entangled with Apartheid Regime in South Africa (including Israel itself!); then that will be the problem for Hillary or whosoever next Administration is. That is what Palestinians and Hamas are waiting for. When 'accountability is cheap' with your own people; playing to the hilt - as like Hamas and Palestinian rulers prefer to do - is not a problem to worry. Unfortunately, that is not the luxury available to President Obama and hence the best course here is to go 'ultra cautious'. The good part is, during the period Israelis will be all happy for these 'sweet nothing pillow talks' while Obama Administration continues to spend seriously for the first two immediate problems on hand.

Update - Chastened by Iraq experience, Tom Friedman is out with a column questioning the wisdom of American intervention in Syrian Civil War. It is quite sober, highlighting the prudent course of: either do nothing and let Syria get divided or work with Turkey, Israel and other peripheral nations to contain the damage and wait.

Jeffrey Goldberg in Bloomberg wants to highlight expectations in influential quarters of Israel that Obama Administration does something 'concrete' to halt Iranian Nuke Program Progress and do it without any delay. Very possibly, all the exchange with Israeli establishment will invigorate President Obama to concentrate further on the issue of containment of Iranian nukes.

Monday, March 25, 2013

Cyprus - II

Looks like finally EU and Germany have got things right here by going with a textbook solution in such situations:
- separation of bank assets into good bank and bad bank category, closure of bad bank (Laiki); 
- honoring insured deposits in full; and
- uninsured getting the haircut, compensated by equity in remaining banks.

Basically Cyprus political class made the 'call' that after Moscow dispatched their original entreaties, there was no particular reason to protect those 'fat cat Russian depositors' (above 100,000 Euros); nor there was any possibility of avoiding a hit to 'treasure island' business model which the Cyprus President tried so hard to protect all along. I do not think, adopting 'treasure island' business model is a particular problem of Cyprus. If Global Economic structure allows avenues for smaller island nations to pursue 'financial and tax heaven' business model, why would a particular island not adopt that? So long as these big G2 or G8 or G20 - whatever Gx - group of economies do not bother to get their act together in 'closing loop holes' in global financial structure to regulate Cyprus or Cayman Islands of the world; such 'treasure islands' will continue to exist and wealthy all over world will continue to take hit from time to time as like how Russian Rich Folks are at the receiving end in this case. There are number of reasons why global financial powers (read USA, IMF, EU, ECB, etc.) do not make any headway in regulating such rogue financial centers:
- First of all, Global Banks are still extremely powerful even after causing 2008 recession and Frank-Dodd law.
- All these nations, given a chance, want to protect Global Banks originating from their nations whenever the issue of adopting common regulations, capital structure comes up. National governments naturally feel the pressure to preserve 'jobs' involved and hence would be cautious in adopting policies which would impact banks with larger presence in their own countries. (UK government has always been protective of London Financial Sector while EU-America are not on the same page when it comes to adopting Basel Bank Capital  Structure.)
- Countries within EU find it hard to co-ordinate tax policies despite being in a common market and  uniform regulatory framework. Ireland wants to have lower Corporate Taxes to keep its edge in luring global corporations. One can imagine Republicans in Congress wanting to reduce Corporate Tax dramatically (actually not a bad policy necessarily if paired with cleaner Individual Taxes to catch rich dollars) while Democrats worried about loss in federal revenue and how all that 'football' would be making it impossible to co-ordinate on corporate taxes on global scale. (It is not easy to single out Banking Industry for separate Corporate Taxation, though a case can be made strongly after how badly all these Global Banks caused the recession of 2008.)
- Finally, when these 'treasure islands' go kaput; those who loose are 'rich' - politically never an easy constituency to fight for as well as their votes are minuscule (all over the world 'rich' are far less in number, except when you are in Norway...). Besides, the model is 'offshore financial haven'; meaning necessarily we are talking non-native islanders who would not be involved in the local political system.

So long story short, Cyprus may have avoided its sudden financial death for now. Meanwhile as it is hard for French Ministers to avoid taking potshots against Cyprus by calling it as 'casino economy'; it is not right to forget that Cyprus is not Macau nor Cyprus banks invested anything outrageously - those banks bought Greek bonds; all blessed by Europe. In other words, one cannot escape the basic observation that it is the European Mess and Greek bonds, which pulled down Cyprus. It is natural then that EU needs to offer the helping hand here apart from the obvious self-interest of avoiding 'bank run' in weaker economies of EU. (While Greece has been drowning for years, how come Cyprus banks did not adopt a cautionary policy of investing into other safe instruments? That is something Cyprus Government and Cyprus People will have to investigate separately. I mean 'Greek ruination drama' has been unfolding over years; giving sufficient 'early warning signs'.)

In the earlier proposal, EU and Germany in particular, were not politically attentive to details about what kind of 'deal' Cyprus Government was about to sale to their own people. EU let go Cyprus with a lousy and down right politically tone deaf proposal. This time it seems like Germany got it's act together to ensure that politically it is all 'palatable' - German Minister even says that Cyprus Politicians would not have to take any 'tough' vote here at all! That is excellent, finally German Chancellery is learning something.

The only worry in all this is, the losing party (apart from thousands of bank job losses) - Russian Rich People - has some reputation to adopt Godfather style Mafai techniques to settle disputes (murders and intrigues). With a previous KGB guy firmly in saddle in Kremlin, some of these rich Russians with connections and favor with Russian rulers; may be tempted to opt for some unconventional ways to hand 'pay back' to some of these Cyprus Politicians. So vigilance is required; else Cyprus Crisis would not remain just 'financial' but 'criminal' with far more sinister consequences.

Sunday, March 24, 2013

Iraq War and Success of Democrats

Ross Douthat is out with the theory that these Bigwig Young Darlings of Left - messers Ezra Klien, Jonathan Chait and others - opted for saying 'sorry' rather than being intellectually honest to acknowledge inherent help Bush's failed Iraq War gave to the success of Democrats in recent years. Better to be humble than expose true reasons of your success - someone else's foolishness and incompetence. 

The problem with this theory is to assume otherwise is basically to assume that American Democratic System fails to work. Imagine that after all this bungling of Iraq War, people still vote Republican Party. That would mean we would not have any other political party viable to conduit People's Will and make a run for change. If you have an argument that there should be more than 2 political parties in USA and then Americans would have had an opportunity to vote someone different than Democrats; then say so.

For good or bad, we have duopoly in our system. With Daily Kos, Huffington Post, FireDogLake, Talkingpointsmemo and all those brethren on Left thriving on anti-war sentiments essentially transformed Democratic Party culminating in foisting of Nancy Pelosi as the speaker in Dem House victory of 2006; exactly the same way Tea Party propelled "Shellacking of Barack Obama in 2010" has been a genuine attempt to change GOP (whether I agree with Tea Party policies and politics, that is a different issue). 

What Ross is offering is history and plain vanilla 'description' of how events unfolded in the last decade. It is useful and very insightful reading of contemporary American History, but that cannot be lessons of Iraq War. If not Iraq War, then something else (2008 recession? no mention of that? McCain's theatricals of halting 2008 campaign as a response to 2008 financial crisis?) would have given an equally potent reason to all these emerging 'political forces in America' to express themselves on behalf of changing demographics of America. 

Friday, March 22, 2013

Democratic Dream Ticket for 2016?

Hillary Clinton for President, former Sec. of State
Antonio Villaraigosa for Vice President, soon to be former mayor of LA

Well, I have no idea if that is what going to be. Generally, things do not happen on predicted lines in this business. But look, both are unemployed or soon to be unemployed career politicians, capable ones with substantial following in a party on ascend with growing 'vote bank' of Women and Latinos. The ticket will have ferocious abilities in raising money - dude, that is what happens when two past presidents would be carrying waters for you: Bill Clinton followed by Barack Obama.

Fine, fine; this is all Friday night political gossip worth nothing. May be because our government is functioning (President is having a successful foreign trip and helping douse international tensions while Senate passing a budget without government shutdown at least for next few months); a blogger is left only with speculative topics.

Tuesday, March 19, 2013

Iraq War - My Memories and Analysis

My basic call on Bush's Iraq War was right - I opposed the Bush-Cheney-Rumsfeld-Wolfowitz arguments to topple Saddam by force. Why did I oppose? Fundamentally, having recently migrated from India then - around 6 years before the start of Iraq War - I had my sensitivities of a Third World Person intact. In that worldview you do not put 'your soldiers feet on foreign ground' unless you are attacked. Toppling Talibans in Afghanistan was justifiable in a sense (though looking back I feel there were other smarter ways too) since Talibans protected OBL. But there was no such case against Saddam Hussain. I felt Bush Administration had time to pursue UN backed efforts to force Saddam come clean about WMD. I also felt that initiating Iraq Ground War did not justify when one did cost-benefit analysis. Saddam was dangerous, but then there were, and there are, so many other regimes which are always a threat to USA and West; but you do not go in all such cases to invade those regimes. Few more things influenced me in opposing the Iraq war - a scathing editorial in the print edition of San Jose Mercury News and Paul Kgruman's arguments in New York Times.

But then overall Bay Area was opposing the war. San Francisco had 2 huge rallies in opposing the war as a part of world wide demonstrations. I attended one of them. We were around 100,000 folks on that bright day. To date, participating in that public rally is my most cherished political moment in this country. I distinctly remember that rally because then 'West Wing' popular Martin Sheen recited Ravindranath Tagore's famous poem 'Where The Mind Is Without Fear'. Tagore's that particular poem has a special place in my life. My father has been a private English Language Tutor back in India, a famed tutor in his own right. We had this poem in our text-book and I remember when my father movingly taught that poem to my class. So hearing that poem recited by a famous Hollywood Liberal from SF podium - one can imagine how thrilling that would have been to a newly migrant from India who was not even citizen then.

When I look back, I am glad that I was on the right side of the History. Where I missed, and at times I regret about that, is the later part - about the Surge which Bush ordered immediately after 2006 election despite the Pelosi Victory and when Rumsfled was kicked out. At that time I was deeply moved by Joe Klein's account of James Fallows 'seminal' work about Iraq War. I believe that is the time when Senator Harry Reid declared on the Senate floor that 'America lost the Iraq War'. That is the time Joe Biden proposed 'division of Iraq into 3 separate regions' and I fell for that. Biden and his liberal supporters proposed Kurdish Iraq, Sunni Iraq of Anbar and Shiite Iraq of Basra and Southern regions with Baghdad divided or shared.

Why do I regret that? I think that was the moment which manifested the 'worst defeatist' tendencies of Liberals in this country and I would have wanted to avoid that. My position is, it was absolutely wrong for Bush and America to start the ground war to topple Saddam; but once you start a war you do not want the 'only indispensable power of this world' to re-live another Vietnam. Howsoever discredited George Bush is; Americans and History owe to him that he did not make Iraq war another Vietnam for America and surge helped in that. I would have loved to distance away from defeatist tendencies of Democrats. But I got enraged, like most other Liberals, that just after the thumping defeat of Bush at hands of Pelosi Democrats; the commander-in-chief dared to pour more American blood and treasury in that bottomless pit of dragging Iraq War. I think Bush was very much aware how unpopular he was and how disliked the surge decision would be. But he doubled down, in his famous fashion, and made his all out, honest efforts to retain remaining Credibility of America.

The thing is, you need to have lived many years outside of this country to understand significance of America keeping its commitment and keeping unity of Iraq despite colossal cost. At times I doubt whether Liberals, and lately even few Republicans (the flavor of the month Senator Paul Rand); understand the two most significant strategic achievements of America in the first decade of this century with lasting effects:
- that once started, America does everything possible to take its foreign intervention to a logical end (transition of Iraq to post-Saddam world as a single country is much better outcome than Biden's partition of Iraq in 3 separate regions), and
- it does not matter how many years have passed or political leanings of American Leaders in between, America will not stop in bringing justice to those who harm their own people (killing of OBL).

As President Obama takes this much saner turn in America's Foreign Policy - being tough when needed and 'leading from behind when applicable' - gradually America's credibility will continue to improve based on  above mentioned foundations. (Too bad that America however would not get any such manageable success in Afghanistan, clearly Obama Administration undermined what harm overlooking of 'corruption does' in an occupied country. But that is a topic for another blog post.)

Update - Don't get me wrong, I love VP Biden and especially his recent leadership in dealing with Congress. It is just that his 'Iraq call around the surge time' was wrong.

Monday, March 18, 2013


"Under a promise which still appears on the website of the Central Bank of Cyprus, deposits in its banks are insured up to 100,000 euros. Cyprus has about 30 billion euros in insured deposits, a large amount for a country of just 1 million people.

But because of its status as an offshore financial hub for foreigners - including large numbers of rich Russians - it also has 38 billion euros in uninsured deposits in bigger accounts.

Cyprus could have offered full protection to those with insured deposits up to 100,000 euros and still reached the 5.8 billion euro target by taxing uninsured deposits at a rate above 15 percent."

Apparently, based on this report, Trioka (ECB, EU and IMF) offered exactly that - no deposit cuts for below 100,000 Euro while un-insured taking all the hit. For any politician attuned to public sentiment, that would have been easy to accept. But that is not what the conservative President of Cyprus did. Considering his fresh election just last month, he being so out-of-tune with his common people is jaw dropping.

Few reasons one can imagine are:

- Conservatives in many cases think that 'protecting rich' is their primary job in governance, under the false view of rich are the job creators (Mitt Romney line of thinking) or rich are simply more able component of the society which need to be nurtured further (discredited Randian philosophy of Paul Ryan). Such conservatives insist on 'shared sacrifices' so as poor contribute more from their low income.

- Or Cyprus President realizes that - what Krugman calls RMML - money of rich Russians is very crucial for the business and economy of Cyprus and hence there is no point in 'troubling' your biggest 'customer'.

- Or he thought even among 'insured' deposits; most of the money is of Russians and hence there is no point in leaving them free. (But then this President could have said, deposits of Cyprus nationals under 100,000 are safe and then rest pay the price; one can devise many ways to protect your own people who have voted you.)

I do not know which of these is true. All that one sees here is, politically deaf responses of this politician resemble lot with the state of affairs with GOP in USA. But by now, we need to accept that Politicians regularly 'screw' their own weaker section people for some perceived benefit in future or as 'profile in courage'. That is what 'wrongly applied austerity' is bringing all this misery in Europe.

Update - Unwritten rule of good blogging is, you offer a 'solution' to the problem. When you do not have expertise to do that, next best thing is highlight some other qualified solution which is sold around on Web. Here is my favorite blogger -  Felix Salmon - advocating Buchheit and Gulati solution to the Cyprus Problem. Seems credible, especially considering that Cyprus Parliament does not have enough votes to pass the misguided plan of its President. If I were to bet, 'no, politicians' do not pick wiser solutions and hence I would not be surprised to see that Cyprus Parliament does not pick up Buchheit and Gulati Plan. That is the wont of politicians. What all this shows, how casually politicians at times inflict lasting damage to their own people - case in point is President of Cyprus in this crisis.

Saturday, March 16, 2013

Foreign Relations - India's Headache

You get impressed by Indian Supreme Court when it takes Delhi Darbar to task in demanding 'why Indian Politicians are flouting designations like VIP and VVIP and how can those designations be retained in a democratic society'? Supreme Court is right on.

Alas, that same Court we find flat footed when one wonders why did Indian Supreme Court allow those Italian Guards to leave India when they were accused in murdering Indian Fishermen and the trial was about to start? How did Indian Supreme Court believe all those affidavits and assurances from Italian Embassy and Italian Officials? Why would anyone go back to a foreign country for the trial when Italians dispute whether that trial is legal or not? Italian Government argues that the incident happened in international waters and hence India does not have any jurisdiction in these matters.

How come Indian Supreme Court turned out to be so gullible? It is understandable that Supreme Court would believe legal assurances of a foreign government and generally would not get into the business of understanding political ramifications. That was the job for Indian Central Government which is even more lousy than Supreme Court. Indian Government is not on record asking Court to be prudent in these matters and not let go those accused guards. The guards claimed they wanted to participate in Italian Elections, Indian Supreme Court believed that and ever eager to promote Democracy all over the world, the Supreme Court allowed those folks to leave India! While these accused murders were running out of the gate Indian Government did nothing! Wow!

(The guards were earlier allowed to leave India to celebrate Christmas with their families and they came back after the new year. I guess that precedent might have made Indian officials to be lenient and relaxed.) 

Indian government is back into the familiar territory - horse has left the barn and now you try to close the gate and run after the horse...PM Dr. Singh is ordering review of the entire gamut of Indo-Italian relations as if there is something profound happening between these two countries or there is some kind of Trillion dollar trade flourishing between them! Except for the export of Sonia Gandhi way back when our Indian prince Rajeev Gandhi fell for her in England; for most Indians 'Italy' does not ring a bell and there is nothing much happening between these two countries. What leverage are you talking Dr. Singh to force Italy to return back those accused? To start with, Italy is infamous for her barely functioning government and politics. Italy can barely prosecute under-age sex adventures of a septuagenarian politician Berlusconi and still trying to mop up the mess left by him. How on earth such a country would have any respect for a judicial process in some far away place? The election where these accused guard voted, produced inconclusive verdict. I guess at this rate these accused would stay for the next election which is going to take place soon and then another one there after and so on. When entire Italian political system is in some kind of vortex to produce a minimum government, who cares for noises from Indian PM in Rome?

Let us see to what an extent EU fulfills this void of active foreign relations management on behalf of Italy when Italy is totally inward looking politically. It will be a test for the effectiveness of EU and we will see how much merit is there in all this talk of squabbling European nations subsuming their sovereignty to EU. 

It is good that Switzerland is not part of EU, else EU would have asked India to punish rapist of a Swiss national before accused Italian guards reach Delhi. But in any case, India should quickly find these rapists and prosecute them. May be the same alert Supreme Court attends to these matters and forces wheels of infamous Indian Justice System. And it will be also good, if Supreme Court reminds Indian Government that letting these accused rapist die while in jail without full sentence is not an exact conception of 'justice' India wants to promote.

Wednesday, March 13, 2013

Hope and New Pope

As most observers have said, this represents a clear shift from Europe Centric Catholic Church to Americas driven Church where full growth of Catholicism has taken place in the last century. This selection is positive for the church as well as the quick election of the Pope. To a large extent, contemporary Papacy is driven by Global Media and to that extent quick election has not dragged people's attention beyond a limit. It brought the excitement and cliamx while the world remained attentive.

I am not sure whether the new Pope would realize or willing to exploit the Global Media 'mega phone' he has. May be he will take his own time to settle and probably advocate a quiet papacy to advance the cause of poor and down trodden. His background and his life time's work for sure point in that direction - that he will urge his clergy to help 'have-nots of this world'. That should be the real welcome possibility and the potential for a significant contribution to humanity. Such a humanitarian approach grounded in Latin American socialistic moorings would possible hide his otherwise Conservative leanings. In that sense, it seems new papacy will continue his predecessor's policy of complete anti-abortionist view and opposition to gay marriage. What is to be watched is whether such orthodoxy on social issues would deter Catholic Flock and continue the decline of Catholic Church or the possibly humble, humanitarian and non-controversial papacy helps restore the glory of the church.

Sunday, March 10, 2013

Ryan Political Art

“We don’t want to refight the fiscal cliff. That’s current law. That’s not going to change,”

"Are you saying, as part of your budget you assume the repeal of ObamaCare?,"  host Chris Wallace asked.

"Yes," said Ryan.

"Well, that's not going to happen," Wallace said.

“We believe it should,” Ryan shot back. “That’s the point. This is what budgeting is all about. It’s about making tough choices to fix our country’s problems. We believe ‘ObamaCare’ is a program that will not work.

“We believe ObamaCare will actually lead to hospitals and doctors and healthcare providers turning people away,” he said.

So here is the Ryan logic:
- it is perfectly right to assume additional $620 Billion revenue which Obama made available by passing the law of Biden-McConnell Agreement;
- but the same legal status does not extent to dully passed ObamaCare which is upheld by the highest court of this land!

What a hypocrisy!

I know that is Politics. The reason Ryan is going so brazenly against ObamaCare is because of Freedom Works and open challenge thrown by Tea Party Members to Republican House Leadership. That challenge is no good and Ryan is trying to cover the 'rear' here.

However all this means for all the talk of President out-reach to GOP; it is unlikely to work. President himself needs to somehow manage the 'good cop bad cop' routine here - ripping Ryan budget on one hand for his totally contradictory interpretations of laws on one hand while continue to talk to more and more GOP members. It is a true assessment that without Ryan President is not going to get anything in the House and no settlement in the Fiscal Wars. After Bush Cut Tax elapse political victory (netting additional revenue) for President Obama; acceptance of sequester by nation has given GOP their victory. It is 1-1 in some sense. But instead of this helping GOP to come to senses, chances of emboldened GOP seem high and Ryan 'non-sense' is the first such sign.

Next week, a concrete Ryan budget and a weaker Senate Dem version will be released. Ryan and GOP will try to turn the debate by showing how they are addressing the deficit by just repealing ObamaCare and few other gimmicks while downplaying how improving Economy helps to reduce the deficit. One attempt will be to present a choice to America - either reduced Deficit or ObamaCare. That will be good Politics with the Tea Party Base which refuses to learn anything new. The way to answer it will be to expose all these 'contradictions' in the Ryan budget - assuming one law while not assuming another one. Though not easy, these contradictions and internal fissures within GOP should be enough for President and Democrats to defeat 'political games' Ryan wants to start. 

America's endless Fiscal Wars refuse to go away.

Friday, March 08, 2013

Obama Economy?

Dow Jones hovering over 14K for days while propelling global equities further. February created 236K new jobs. For the first time unemployment going below the rate when President Obama started his first term. No wonder folks are toying phrases like 'Obama Economy' and coming vehemently after why Paul Krugman is wrong.

Agreed, Obama Administration did not follow dictates of Paul Krugman. Krugman wanted larger stimulus whereas President opted for a political compromise (apart from Solenydra not much of a controversy, big political achievement?). When Krugman wanted Bank Nationalization, Geithner-Summers-Bernanke trio opted for stress tests which finally have resulted in healthy Banking Sector laying foundation for a good recovery. But still, people do not stop equating Obama Administration with Paul Krugman and then after taking Krugman as the 'straw man' keep criticizing Obama Administration policies.

I am not denying that Obama Administration policies have been more near to what Krugman has been prescribing than many other pundits on the Right side. I am glad that Administration considers Krugman prescriptions more seriously than others because:
- despite cherished illusion on Right about ObamaCare as further expansion of entitlements, it was done to help constrain health care costs and expand the coverage to folks who are left out today; and
- despite in hindsight folks want to criticize President for Afghan surge, he did end the Iraq war as promised and Right was clamoring for more 'doubling down' on Afghanistan when President Obama started his term.

Overall chances of History judging 'Obama's hand' much more stable compared to misguided austerity of David Cameroon in UK or People's revolt in Italy or 'lost in woods ways of Hollande in France'; are much higher. 

No one is denying that 'debt' is not an issue for America. To be specific Medical Cost is the real issue for America. But when Economic Growth is the immediate task on hand, Krugman has a point. Difference is Kgruaman effectively sees Medicare as some kind of stimulus spending in absence of an actual stimulus; whereas President Obama should have adopted a policy to 'pile on debt for future of America' rather than spending all that borrowed money on 'past of America' (i.e. Medicare). 

But then President Obama might have reached a point, where he can 'afford to call the truce' on these endless fiscal wars with GOP - deficit is decreasing and it is not a bad deal: to give up around half a Trillion Dollars of tax revenues in return for protecting all entitlements while simply accepting 'sequester' as the collateral damage. May be Hillary or the next president then will have a  room to undertake entitlement reforms from a cleaner slate while Economy would have rendered the need of raising further revenues less urgent.

Monday, March 04, 2013

State of the play

For every Bill Keller admonishing President Obama, we have Jonathan Chait ripping apart claims which blame Obama for not offering enough spending cuts. Truth is President Obama has achieved over $2.5 Trillion cuts during his years in White House (excluding sequester) while gaining little less than $0.7 Trillion in new revenues. (We have to keep aside Speaker Boehner's bogus claim about tax increase for ObamaCare since neither that was passed by Republicans nor it is expected to increase deficit if implemented properly.)

No matter how much 'very serious people' (Woodward, Simpson, Bowles, Brooks and now Keller joins that party) want to 'carry waters' for intransigent elements of Republican Party; 'low revenue high cuts' is not a trajectory for a sustained budget. On top of it, what all these so called Centrist and Republicans are offering as a solution - it is below even Speaker Boehner's earlier offer of $1.2 Trillion revenue! 

The real question to be asked is was it wrong then for President Obama to accept the year end deal of Biden-McConnell agreement? Was it right to forgo additional sure shot revenue of over $1.0 Trillion due to expiring Bush Tax Cuts? To be fair, that is what Bill Keller's grouse is. But he is not helping President Obama by not understanding reasons why President accepted the deal. Jonathan Chait at least has a sense to know 'who are the real culprits here - Republicans' and he is not turning on a president fighting for some sanity. Keller does not seem to have that discipline and that is the larger problem with all these 'very serious folks' - while they enjoy in pin pointing tactical mistakes of President Obama here and there; they let go the real evildoer free - Republicans and Tea Party who only see 'cuts' as the solution to our problems (as if travails of Conservative Cameroon pursuing austerity in UK are nothing!).

President Obama, knowing well Biden-McConnell Agreement short on revenue, still accepted the deal  because:
- first of all it establishes yet another time that when there is a 'reason', this White House would come forward for an agreement;
- while sacrificing some revenue (with the belief that the remaining revenue would eventually come through tax loophole closures), President got extended unemployment, scrapping of AMT permanently and avoiding a shock to the economy; and
- avoiding 'poisoning of the political well to a saturation point' on the eve of historic inauguration of second term of the first black president

It is a sane argumentation among supporters of President Obama - whether accepting Biden-McConnell agreement was a right call rather than simply letting elapse Bush Tax Cuts or again President left too much on the table. But from there to jump to blame all on Obama; that is a jump too far.

What should then President expect in coming days? For a starter, full readiness for Government Shutdown. True, Speaker Boehner is assuring that he would not shut down the government. But sane and experienced hands in this matter are well cautioning and heeding that caution is a prudent course. Even if House relents some and somehow President avoids government shutdown by not insisting on revenue increase; there comes 'debt ceiling increase' next, followed by next year's budget fights. What it means, there are enormous opportunities for Republican Party to screw Federal Fiscal situation and sabotage American Economy.

If for the reasons of sequester or not so well contained situation in Europe (Italy back to her form), American Economy falters; all these so called exaggerations from Obama White House about sequester would be regarded as 'smart advance warning'. If luckily Economy holds, sure GOP would pat itself for 'we told you - sequester did not matter'; but no one would bother much of a commander-in-chief who is very cautious. But Public accepts the 'balanced approach' (read revenue increase) now and it will accept so in future too. Meanwhile possibly the price of the sequester many not be so easy for GOP as well. All that means, President Obama needs to continue to insist for certain revenue increase. What can be done to facilitate a movement on that account is President Obama coming out and laying down his vision of additional cuts which GOP is clamoring for. Presentation of next budget is one such excellent opportunity. Whether GOP accepts that deal or not, Americans will know yet another time that Obama White House is not shy when it comes to entitlement reforms; it is GOP which would be reluctant for any additional revenue. Whether Media brings out that well or not, that Media's problem. As this White House can 'jump over the traditional Media' to reach Americans, it is less of a problem for President Obama.  And not all is lost, there are voices in GOP which are ready for revenue so long as these additional cuts are 'locked' in. Some budgetary mechanism to build the confidence for GOP to enter into an agreement with White House should not be that hard to smart minds of new Treasury Secretary Jack Lew and new OMB Chief.

After all if nothing else succeeds, strident advocacy to wreck the GOP coalition on Immigration and Minimum Wage Increase; those are for sure reserved political hands for Obama White House to play the ultimate ploy of winning the House and retaining the Senate to stream roll a 'balanced approach' in the last quarter of Obama Presidency, starting November 2014. 

Saturday, March 02, 2013

Another American Solution?

Days after Newtown massacre, in a year end party I was discussing with my friends what would stop 'gun violence' in this country. I remember talking about how we would need a campaign like 'pink ribbon' started by Susan Komen to make the shift. A friend instantly responded, did I mean "we need marketing and branding" for the 'gun control' campaign? Yes, that is what I was thinking.

Joe Nocera compares 'Mothers Against Drunk Driving' in his article; but the basis is same - we need national marketing and branding campaign to make the 'cultural shift' in this country. Now, that is something I can 'believe in and most Americans' can believe in. This is because the talent and proven competence for Marketing and Branding in this country is second to none in the world. Americans have been always good at marketing and branding; if American Society brings that strength to cure its own ills (in addition to another of its strength - lawsuits); nothing better like that. Coupled with 'political muscle flexing by Bloomberg' on the Gun Control issue; we can indeed see some movement on this problem. And this does not come too late, given where we are heading:

"Politics in Washington has become far worse than the traditional partisan to-and-fro inherent in any democracy. It now presents a danger to orderly day-to-day governance of the country. Politics is no longer the art of the possible; it is bad theater. We are lurching perilously close to becoming Italy, where citizens appear to have given up on being self-governing citizens and instead have cynically chosen reality TV. Criminally implicated tycoons and comedians vie for the presidency; these candidates appeal to many Italians because they provide a diversion from a government in perpetual crisis.

We laugh at the Italians, but give us another four years of fiscal cliffs, government shutdowns and debt limits, and the famously optimistic and forward-looking American people may surprise us with their cynical response to Washington’s refusal to govern rationally."

Are we experiencing the end of 'primacy of Congress and American Political System' in making change in lives of Americans? (The only change it makes is it makes our life harder.) If that is the case, real forces of change in American Society will opt for more and more 'cultural changes' and then Congress will be only formality, turning itself into some kind of decorative and celebration place. Definitely, that it is what Bloomberg backed Kelley win looks like. 

Update - Moises Naim elaborates in his Op-Ed what I wanted to elude in the above post: sense of power loss for traditional political institutions. Here are few money quotes:

"Nor is the decay of power related to the supposed decline of America and rise of China — one of the most useless and distracting debates of our time. When the Taliban is able to deny the world’s mightiest military a victory, when Somali pirates with rickety boats and AK-47s thumb their noses at the most modern multinational fleet ever assembled, when European leaders fail to stem the economic crisis that started in Greece’s minuscule economy and when the world is incapable of agreeing on how to curb carbon emissions, it becomes clear that something is happening to global power that transcends any zero-sum, Sino-American rivalry.
But the decay of power also poses dangers to our wallets, families and lives. It explains why the U.S. economy is at the mercy of self-inflicted crises in Washington. It explains why European nations struggle to act together in the face of crippling economic problems, despite spending decades developing institutions geared toward collective action. It explains why fragile states that have difficulty delivering basic services are proliferating. It explains why the world is paralyzed in the effort to curb greenhouse gas emissions.
Given the end of power as we know it, our traditional checks and balances — originally meant to constrain excessive power — are now threatening to choke what little power is left."

All this means successful politicians are able to realize these limits and the context of power loss. Part of it is what might have prompted Barack Obama to say he cannot force Republicans in Congress to change their minds. But such realization is only the first step. What needs to follow after that is a specific plan to involve Public in unprecedented ways to force obstructing elements to move aside. Though Obama's Organization For Action may invite critical evaluation and Romney may berate Obama for 'permanent campaign style politics'; but who knows precisely these may be the responses we would need to combat the erosion in traditional political power structure? Those ways may be the only ways possible to augment weakening political power by People's Force to achieve something tangible here and now.