Wednesday, April 30, 2014

Trade is not a peacemaker

German economist Hans-Werner Sinn, apparently having given up on TARGET2 Trutherism, writes in the Wall Street Journal --

How can the cost of any further annexations be raised for Russia and the chances of finding a peaceful solution be strengthened, without doing any damage to Russia, Ukraine or the EU? The answer lies in the offer of a free trade agreement with Russia and the Ukraine as part of a new international agreement on Ukraine's future. In 2010, Russian President Vladimir Putin proposed a free trade area stretching to Vladivostok from Lisbon. What happened? The EU worked on a free-trade agreement with Georgia, Moldova, Ukraine and Armenia instead. This only increased Moscow's nervousness, because it implicitly posed the threat of customs barriers for Russia.

This comes after he blames the EU and NATO for the Ukraine crisis. Anyway, what of this potentially magical free trade deal with Russia. Here's the EU description of its status:

The new EU-Russia Agreement - currently under negotiation - should provide a comprehensive framework for bilateral relations with stable, predictable and balanced rules for bilateral trade and investment relations. It will focus on improving the regulatory environment by building upon the WTO rules and strengthen bilateral trade relations. The negotiation of this New Agreement with Russia started in 2008. The negotiations have been stopped in 2010 because no progress could be made in the Trade and Investment part. Today with the deepening of the Customs Union between Russia, Kazakhstan and Belarus and the difficulties for Russia to fulfill its WTO commitments, it is not clear how further progresses can be achieved in the Trade and Investment field and in general with the New Agreement.

In other words, it was Russia which confounded the progress in 2010. Does anyone think that Vladimir Putin is a better mood now than in 2010?

Monday, April 28, 2014

They were with those Iranian piligrims

A Wall Street Journal story based on a Moscow tabloid interview with Igor Strelkov, the apparent leader of one of the pro-Russian militias in eastern Ukraine --

Most of the men in the command possess war experience, including former service in the Russian or Ukrainian militaries and tours in Chechnya, Central Asia, the former Yugoslavia and Iraq, according to Mr. Strelkov. He said some "even managed to visit" Syria.

Now why would military operatives with shady links to Russian intelligence have been visiting Syria?

Sunday, April 27, 2014


Tony Blair on Meet The Press --

What I'm really saying is, look, if we analyze correctly what the nature of the problem is, in each of these individual countries, there are things that we're going to have to do that require commitment and engagement. It doesn't mean doing what we did in Iraq or Afghanistan. But it does mean being prepared to engage. And engage specifically, knowing and identifying, that the problem is around this Islamist ideology. And so whether it's, for example, in Egypt or whether it would be in Yemen or Syria ... Let's be very clear in Afghanistan and Iraq. You can agree or disagree with either decision. We removed brutal dictatorships. Allowed the people a chance to elect their government. They came out in both cases and voted, showing that they wanted such election. We gave them a massive amount of financial support. What was the disruptive effect? The disruptive effect was that very Islamist ideology I'm talking about, on the one side being pushed out of Iran from the Iranian theocracy, on the other side Al Qaeda and other groups. And they combined to try and destabilize the wishes of the majority of the country.

So his diagnosis of Iraq is that Iran and Al Qaeda ganged up to remove a majority government, but he also talks about how Egypt might have a problem with Islamist ideology -- having just had its elected Islamist government removed by a military coup.

Of course all blogging may be a waste of time and Blair-Bush-blogging even more so but the trouble with Blair's Islamism-is-the-real-problem  advocacy is that the complexity of Middle East politics and culture makes it impossible for such a theory to be coherent. If you want a single theory for all the country contexts, the more promising one is of a Shia-Sunni schism interacting with sclerotic, totalitarian, and failed states. One brute force intervention was never likely to make that situation better.

Friday, April 25, 2014

Moderation is for losers

You know it's bad when you're approvingly quoting the Wall Street Journal approvingly quoting The New Republic, but that's where we are:

From Leon Wieseltier's "The Inconvenience of History: Obama abandons another country to its fate" in the New Republic, April 23: ... In Syria, for example, the tyrant enjoys the significant support of Russia, Iran, and Hezbollah, the Islamist rebels enjoy the significant support of Saudi Arabia and Qatar, and the moderate secular rebels enjoy the significant support of nobody.

Thursday, April 24, 2014

Capitalism, French style

Reuters --

France's treasury chief, Ramon Fernandez, is expected to join state-backed telecom group Orange as chief financial officer, according to the Wall Street Journal. A person close to the matter earlier told Reuters that Fernandez, who has held the Treasury post since 2009, was likely to move to Orange but could not specify in what role. Such a move, to the second most senior job at Orange, would underline the continued influence of the French government at the group. The state owns 27 percent of Orange and holds 3 of 15 board seats, so effectively chooses its chief executive officer. 

In France it's considered normal for senior civil servants to move into senior corporate executive positions. In this case it's the former France Telecom but the same thing happens for banks. Whether that's a bad thing or a good thing is not clear but it probably means that France has its own class of American supermanagers à la Thomas Piketty, they just get to that category by a different route.

Wednesday, April 23, 2014

An election only Putin could love

Via Al Arabiya, one take on the list of candidates for the forthcoming Syrian presidential "election."

Monday, April 21, 2014

In defence of David Brooks

David Brooks: Obama Has A 'Manhood Problem' In Middle East screams the headline on Talking Points Memo. Hilarity ensues, at least in the comment section. But what was actually said? --

DAVID BROOKS: And, let's face it, Obama, whether deservedly or not, does have a (I'll say it crudely) but a manhood problem in the Middle East: Is he tough enough to stand up to somebody like Assad, somebody like Putin? I think a lot of the rap is unfair. But certainly in the Middle East, there's an assumption he's not tough-- (OVERTALK) 

CHUCK TODD: By the way, internally, they fear this. You know, it's not just Bob Corker saying it, okay, questioning whether the president is being alpha male. That's essentially what he's saying: He's not alpha dog enough. His rhetoric isn't tough enough. They agree with the policy decisions that they're making. Nobody is saying-- but it is sort of the rhetoric. Internally this is a question.

TPM only quoted the exchange up to the point of overtalk, knowing that they had their link bait right there. But the Chuck Todd quotes explain that the White House is using that same thought process -- who's got the manhood, the alpha male talk -- internally. And he further qualifies that it's mainly about the rhetoric.

It's when the White House starts talking about being the strong horse we should be worried.

Friday, April 18, 2014

Politics makes us selective

Paul Krugman --

Not long ago Ezra Klein cited research showing that both liberals and conservatives are subject to strong tribal bias — presented with evidence, they see what they want to see. I then wrote that this poses a puzzle, because in practice liberals don’t engage in the kind of mass rejections of evidence that conservatives do. The inevitable response was a torrent of angry responses and claims that liberals do too reject facts — but none of the claims measured up.

What Krugman doesn't mention is that among that "torrent of angry responses" was the Yale Law School professor, Dan Kahan, whose research Klein had cited, explaining how Krugman had completely misunderstood his work.

UPDATE: In fairness to Ezra Klein, he returns to his original point and makes a decent attempt to extricate Krugman from his McLuhan-esque predicament.

Scotland is over-represented in the electoral college

Right at the start of the video posted on Labour's website announcing the latest junketing gig for American campaign consultants in the UK, David Axelrod says he's proud to join the Labour team "on behalf of Ed Miliband and his campaign for Prime Minister." While you search your sample ballot for the box marked "Prime Minister," it might be worth someone reminding Axelrod that he's joining Labour's campaign to form a a majority in the House of Commons.

Thursday, April 17, 2014

They are not enablers

There's a sense of underwhelming justice in Ireland today as two senior executives of the failed Anglo Irish Bank (Patrick Whelan and "Fair Play" Willie McAteer) -- but not its chairman, Sean Fitzpatrick -- were found guilty of making illegal loans to a consortium to buy shares in the bank. A critical point in the trial is well described by RTE as follows --

Evidence of the legal advice was a major feature of the trial until early March when the prosecution won a major victory in having it excluded. In 2008 Anglo had recruited solicitors Matheson Ormsby Prentice to guide them on the legality of the Maple deal. From the trial's beginning it was a defence strategy to use evidence of this advice to show that the accused fulfilled their duties as directors in ensuring the deal was in line with the Companies Act. Several witnesses testified that the law firm had told Anglo the deal was on the level. When taken alongside the Financial Regulator's approval, the legal advice formed a convincing case that the men fulfilled their duties as directors. However the prosecution successfully contended that legal advice does not make an illegal act legal. Its argument was that if a solicitor tells you you are allowed shoot a man, that does not make it any less a crime. The defence teams responded that this logic placed an impossible burden on the men in their roles as directors. The 1963 Companies Act is 3-000 pages long and section 60 alone contains 40 sub-clauses.

Although we don't know the judge's exact rationale in excluding the legal advice, the principle is surely right and not just in the extreme example given by the prosecution. A common feature in the financial crisis in many countries was the transformation of corporate legal departments from answering the question "is this legal?" to "find a way to make this legal." The complexity of the laws -- which of course, they help write -- facilitated the latter role.

If you're up to dodgy stuff and you consult a lawyer, he becomes your consigliere, a la Tom Hagen from the Godfather. But you can't then run into court and say, I had legal advice that it was OK.

Worth a rethink

For reasons best known to himself, Edward Snowden phoned Vladimir Putin's Direct Line call-in show today. Here's the host introducing the show --

Good afternoon, I could say that we are having today yet another conversation with Vladimir Putin, however the situation is different since the country we are talking to now has changed. After waiting for 23 years, since the breakup of the Soviet Union, Crimea and Sevastopol have joined Russia. For this reason, every question today will be directly or indirectly related to Crimea.

Snowden's question was actually about electronic surveillance policy in Russia, but if he'd watched the whole show, he should have seen that it was a propaganda effort for the Crimean annexation -- and implicitly for whatever other parts of eastern Europe Putin has his eye on.

Anyway, on Snowden's question, Putin's response concluded that the Russian surveillance agencies --

are under strict control of the state, society, and their activities are regulated by law.

And those are self-defence forces and local militias in eastern Ulkraine!

UPDATE: Snowden's convoluted defence in the Guardian never discusses why he used a Crimean annexation propaganda show to make his point.

Never trust a small island with a financial centre

Remember after the European financial crisis when we were assured that never again could a dodgy operator work out of one country and run up massive liabilities in another? --

[RTE] Up to 75,000 van and car drivers are being advised by the Central Bank to purchase a new motor insurance policy immediately following the collapse of Setanta Insurance. The insurance firm, which was licenced by the Malta Financial Services Authority and sold car and van insurance in Ireland, had been in the process of winding up its business here since January. However the company recently decided that a solvent run-off of the business was no longer viable and, at an Extraordinary General Meeting yesterday, decided to immediately dissolve and surrender its business licence.

The fact that the firm had adopted name from Irish mythology and yet chose to be based in Malta was perhaps a warning sign. There might be some in the EU who view it as rough justice that Ireland got caught out in this case, given the corporate tax issues.

Pedant's Corner

James Traub reviewing Shadi Hamid's book Temptations of Power in the Wall Street Journal --

I wish Mr. Hamid had addressed the strange spectacle of the secular government of the United Arab Emirates last year prosecuting dozens of Islamists as alleged members of a fifth column, while Saudi Arabia's Wahhabi government—far more theologically reactionary than the Brothers—declares the group a terrorist threat. The Brotherhood has become a pan-Arab "other" for regimes seeking to tighten their grip on restive citizens.

Article 7 of the UAE Constitution -

Islam is the official religion of the UAE. The Islamic Shari’a is a main source of legislation in the UAE.

Tuesday, April 15, 2014

Ructions in Riyadh

Saudi Press Agency --

A royal order announced here today that Prince Bandar bin Sultan bin Abdulaziz was relieved of his post as Chief of General Intelligence upon his request and that General Staff Yousif bin Ali Al-Idreesi was assigned to act as Chief of General Intelligence. The royal order will be carried out by the concerned authorities with immediate effect.

It's not clear how to interpret this. General Al-Idreesi was Bandar's deputy so it looks like an orderly succession but for a man carrying the nickname Bandar Bush, not to mention being in charge of the botched support to the Syrian rebels, nothing is likely to be orderly.

Shutting up about deflation: Priceless

Paul Krugman notes some bizarre statements from former ECB board member Jurgen Stark. But the line of thought: deflation is fine as long as people don't talk about it  -- is embedded in the Eurozone elite. Here's Dutch minister of finance and Eurogroup chief Jeroen Djesselboem last week, courtesy of the Wall Strret Journal  --

“What I’m worried about is that if all of us keep talking about and warning about the risk of deflation, it will become a self-fulfilling prophesy,” Mr. Dijsselbloem said. “Because if you keep telling people and investors and companies that there will be a long-term low inflation or even deflation, that could influence their behavior.”

Algiers isn't expanding

John Vinocur writing in the op-ed pages of the Wall Street Journal --

There's an area of French society bleak beyond any let's-pretend action-plan or incantatory chorus about brotherhood. The country's existential problem of coming to terms with more than five million Muslims in its midst—and how these immigrants and citizens accommodate (or flout) French law and custom—is deepening into a new phase of what is described as intolerance, seeming incompatibility, and political polarization.

Right now, there's a European country of mixed Catholic and Orthodox Christian composition (not to mention tens of thousands resilient Jewish citizens) being broken up by the fully Orthodox Christian country next door. That would be Ukraine and Russia. Let's have some priorities on where we think Europe's existential threats are.

Monday, April 14, 2014

Outside the narrative

Wall Street Journal news report on Middle East Respiratory Syndrome (MERS) in Saudi Arabia --

On Friday, in place of the cleric giving the weekly sermon, a medical official spoke at one of Jeddah's main mosques to brief listeners about how to avoid transmitting MERS.

Public health trumping religious practice, at least for a day. Not the standard expectation for Saudi Arabia.

Sunday, April 13, 2014

I left my trolling in San Francisco

Andrew Sullivan, 2001 --

EASTER IN SAN FRANCISCO: Attended mass at Old Saint Mary’s yesterday .. I went with one of my oldest and dearest friends, Doug Robson, a journalist whose father, John, has been nominated to head up the Ex-Im Bank in Washington. The Robsons, like the Cheneys, are Republicans with gay children, and, as such, are surely a deep reason for that party’s slow progress toward treating homosexuals with respect. Later, Doug dropped me off in the Castro, a neighborhood that never fails to amuse. It being Easter, the streets were dotted with the usual hairy-backed homos – this time in large, floral Easter bonnets. I saw one hirsute fellow dressed from head to toe in flamingo motifs. And they say it’s not a culture. The afternoon beer-bust at the Eagle, a San Francisco ritual, was, however, a bust. Rarely have I seen such a scary crowd – and in the full glare of the afternoon sun. At times, it seems that San Francisco is almost frozen in time – roughly 1977. Gay life in the rest of the U.S. is increasingly suburban, mainstream, assimilable. Here in the belly of the beast, Village People look-alikes predominate; and sex is still central to the culture. This can be fun for a tourist, but I’d go nuts if I had to live here full-time.

Andrew Sullivan, 2014 --

The reason [why more gay men aren't on Truvada], it appears, is that being free from the fear of HIV infection could lead gay men to have lots of sex again with lots of partners. (One study we have examining this did not bear this out.) But here’s some breaking news: for vast numbers of gay men, lots of sex is already the case. Now that HIV is not a death sentence but a chronic disease like diabetes, the terror is long gone. But the virus isn’t. And rates of infection remain stubbornly high, especially in this demographic. Because, well, men are men. Betting against their testosterone in a sub-population without women is a mug’s game.

UPDATE: Bonus points for comparing Sully's logic in explaining gay promiscuity above (testosterone!) with his take on the Chait-Coates debate --

But it seems to me that in this debate, TNC (Coates) is almost willfully blind to the truth that historical legacies can create self-sustaining cultures of poverty that have a life of their own. And I think Chait is equally too pessimistic about the ability of people to transcend the circumstances into which they were born. There comes a point at which any community, which has been historically suppressed and vilified, simply has to believe that the future has potential. That’s certainly how I see the gay community in my lifetime. You can acknowledge the psychic toll of homophobia and heterosexual supremacy all you want, but it won’t help people overcome it. In fact, you run the risk of so emphasizing the crushing burden of the past you entrench the very sense of helplessness that perpetuates the problem. 

So for blacks, it's culture and a failure to transcend it. For behaviour among gay men that also features in stylized typologies of black men, it's just biology!

Musical Interlude

It was 1992. The Clintons hadn't yet murdered anyone* and the music truly rocked. Soundgarden, Birth Ritual, not an actual video but from the Singles soundtrack.

*in vast right-wing conspiracy land.

Saturday, April 12, 2014

Dartboard geography

With American journalism now under the rule of the wonks, the above map is getting a lot of attention. It was featured on a post on The Monkey Cage blog at the Washington Post and later written up on the Klein-Yglesias supergroup vehicle Vox. The dots represent the responses of each of around 2000 survey participants to a graphical challenge to pick out Ukraine on a map, and the roars of laughter come from wonks everywhere with the accompanying finding that the people worse at picking out Ukraine on the map were more likely to favour US military intervention in it.

Fine. Leave aside the fact that there's little evidence that the people who can't pick out foreign countries on maps are the ones who are influential. Billy Kristol could pick Iraq out on a map in 2003. What's remarkable about the map responses is how widely distributed they are once you take out the eastern Europe and Central Asia clusters. Just about every African country got a guess, most of Latin America, a few US states, lots of Canada including its Arctic territories, quite a few who thought it was in Greenland, a fascinating straight line of dots down the middle of Russia.

In short, there's circumstantial evidence that many survey respondents did not meaningfully participate in this survey at all. So the conclusion is not that people less likely to know where Ukraine is more likely to favour military intervention. It's that people who didn't put much thought into this survey were more likely to favor such intervention. This sounds like a ripe scenario  for presentational anomalies. 

Monday, April 07, 2014

It's always an undisclosed location with that family

Liz Cheney on Fox News Sunday --

But I just come back myself from the Middle East about ten days ago. And across the region you have got real unanimity, frankly, among the Israelis and the Arab governments in terms of saying where is America? Why aren't you helping us in the battle against the extremists? Against the al Qaeda? Why are you choosing now to push on this particular issue when in fact the Iranians are on the verge of obtaining a nuclear weapon? And when al Qaeda's resurging across the region?

Liz Cheney was just back on Fox News Sunday after an enforced sabbatical due to her failed campaign running for the US Senate from Wyoming, a state in which she hasn't lived for years. That's another Cheney thing. But anyway, the point here is there's no public account of any Liz Cheney trip to the Middle East recently. This is most definitely not a Tom Friedman trip to the Middle East where he finds taxi drivers and Kings that agree with him, and writes it all up. She was there and back again without a trace.

So why does she get to go on Sunday TV without naming countries, let alone sources, where she heard criticism of Barack Obama's foreign policy?

Sunday, April 06, 2014

Get the ref a jersey

International Business Times --

Kuwait's justice and Islamic affairs minister Nayef al-Ajmi, accused of fundraising for terrorist groups in Syria, has resigned citing health reasons. Al-Ajmi strongly denies having any links to jihadi groups fighting in Syria and rejected the claims against him as "baseless and groundless". .. The US Treasury Undersecretary for terrorism and financial intelligence David Cohen had previously said that al-Ajmi has "a history for promoting jihad in Syria", and that images of his face had been used on fundraising material for the al-Qaida-linked Jabhat al-Nusra militia. Cohen described al-Ajmi's appointment to the Kuwaiti cabinet as a "step in the wrong direction".

So who has the US put pressure on to resign over support to Assad regime?

Friday, April 04, 2014

Inflation has died, risen, and will come again

European Central Bank President Mario Draghi explains why the recent fall in Eurozone inflation is hard to interpret --

Draghi: On the first point: there are a couple of factors that somehow clouded the analysis of whether this latest inflation data would actually be a material change in our medium-term outlook or not. One has to do with the volatility of services prices and the fact that Easter time this year comes remarkably later than last year. The explanation is that, around Easter time, services expenditure usually goes up – demand for services goes up – especially travel, and this affected last year’s prices and it’s going to affect this year’s prices. So you have a base effect which produced much lower inflation data in March and may well produce higher inflation data next month.

The solution is not to be so fixated on the 12 month change in headline prices, but consider the implication: if the ECB turns out to have reacted too late to deflation because of when Easter happened, we're back to blaming the Moon for things we didn't understand. Silly ancient people did that!

Wednesday, April 02, 2014

Bogeyman or men

BBC -- Prime Minister David Cameron has commissioned a review of the Muslim Brotherhood's UK activity, No 10 says. The Muslim Brotherhood is an Islamist movement which has been declared a terrorist group by Egypt's government. Recent press reports have suggested members have moved to London to escape a crackdown in Cairo, where the group backs ousted president Mohammed Morsi. Number 10 said the review would examine the group's philosophy and activities, and the government's policy towards it.

They must be splitting their sides laughing in Cairo and Riyadh at how they've gotten the British Prime Minister -- too busy to phone the Turkish PM after a big election win -- to crack down on the movement that less than a year ago formed the democratically elected government of Egypt.

Anyway, that investigation into political Islam's presence in the UK may want to look into that noted radical sheikh, Prince Andrew, seen above presenting the 2012 Chatham House award to Rashid Ghannouchi (on his right), the intellectual force behind Tunisia's Muslim Brotherhood equivalent, Ennahda. Ghannouchi spent his exile in London.

Patrick Stewart would have joined the call

Downing Street press briefing, 31 March --

When asked whether the Prime Minister had had a chance to congratulate Turkish Prime Minister Recep Tayyip Erdogan on local election results the PMS [spokesman] responded that the Turkish election was a local election and it was not usual precedent to congratulate national leaders except following victories in national elections.

Kremlin website, 31 March --

At Russia’s initiative, Vladimir Putin had a telephone conversation with Prime Minister of Turkey Recep Tayyip Erdogan. The President congratulated Mr Erdogan on the convincing victory of his Justice and Development Party in the municipal elections held in Turkey on March 30.

Vladimir Putin looks at a map and notices that Turkey is a critical player on Black Sea issues, e.g. Crimea, and Syria. So even though he and Turkey are in disagreement on both, he picks up the phone and congratulates Mr Erdogan, on what everyone -- especially his opponents -- had billed on a referendum on his rule.

But David Cameron had something more important than coalition-sustaining on Crimea and Syria to attend to.