Burma takes a leap backward, anyone apart from Human Rights Watch listening?

After damning evidence from Human Rights Watch (following numerous reports), Burma admitted massive security failures in clashes in largely Muslim Rakhine. This event presents a massive leap backward for Burma. First, it indicates that violence in Burma continues. Second, it shows that the government will still suppress news and information when it is possible. There is a glimmer of hope in that the government did admit violence and its response; however, this admission only came after overwhelming evidence surfaced.

The United States and other Western countries that have extended an open hand to Burma should rightly ask the government whether it truly is moving forward, albeit without pushing the Burmese into China's grasp. Naturally, these questions and issues are extremely sensitive. The plight of this minority group should not be overshadowed by the potential opening up of Burma. Rewarding behavior that is just slightly less bad than it was previously has never previously led to good behavior. It only tests the waters of how one can maximize benefit while minimizing costs - something that cannot be afforded in Burma.

Counterterrorism: How to Gather Intel and Where to Send It

A couple of weeks ago, as detailed by Danger Room's Spencer Ackerman, a Senate report found that the post-9/11 "fusion centers" of the Department of Homeland Security are particularly inept when it comes to uncovering and thwarting terroristic threats.  It's telling, but unsurprising, that the FBI has been much more effective in uncovering and responding to such threats.

To understand why the FBI is often on the front lines of investigating and combating terrorism, one need look no further than Garrett Graff's The Threat Matrix: The FBI at War in the Age of Global Terror.  The Threat Matrix explores the FBI's long history of addressing terrorism, be it hijackings in the 1970s or the Islamic terrorism of the 1990s that ultimately culminated in 9/11.

So, if you want to effectively conduct counterterrorism investigations, and coordinate efforts across different geographical areas and different social strata, what do you do?  Well, the FBI and NYPD came up with a plan in 1980 that led to a long-standing model: the Joint Terrorism Task Force (JTTF).  There are now over 100 JTTF's throughout the country, but the original task force created in New York remains vital: just today, news came out that the New York JTTF, after a months-long investigation, arrested a man for attempting to bomb the New York Federal Reserve Bank.

Another shortcoming of fusion centers: global reach.  Sure, in theory, these fusion centers answer to the broader DHS hierarchy, which in turn could have the resources to properly analyze information.  On the other hand, DHS has tended to be a bureaucratic monolith, devouring resources without a clear concept of how it fits into the broader intelligence community structure.  If we intend to have a clear policy with respect to gathering and analyzing domestic intelligence, our options seem to be: fusion centers; FBI cooperation with local law enforcement; or a "throw everything against the wall to see what sticks" approach.  FBI cooperation with law enforcement seems to have advantages over the other options, not merely with respect to efficiency/reducing redundancies.  The FBI has global reach and global clout, the result of decades of forging strong professional relationships and personal friendships with police and military forces worldwide.  The FBI was already increasing its global presence before 9/11, and since then, has only increased its worldwide outposts and its efforts to have a presence in more countries.  That combination of domestic and international involvement is essential when you're addressing a threat as amorphous and elusive as international terrorism.  It's imperative that the United States decide how it wants to address intelligence-gathering and intelligence analysis - only by using the right tools will we be properly equipped to uncover terror plots and properly address them.

Today: Burn America, Tomorrow: Where are my Nikes?

One word: unemployment

Two words: youth bulge

Combined, these three words are a recipe for disaster the world over, and now being witnessed across the Middle East in riots and protests responding to an unnecessary film. It is ironic that many of those protesting (mainly men in the pictures) will turn tomorrow to look toward American products. Today protesters will attack an embassy or any other symbol of America. Tomorrow (or whichever day in the future one chooses to select) they will buy American products: Nike, Pepsi, etc. Why is it that a separation between an individual action and the collective will of society cannot be made? Is it that there's a connection between the freedoms that exist in the West and the hate that the West allows to be spewed? There is. Is there value in those freedoms that exists in excess of any negative side effects? There is.

Mass unemployment coupled with large youth populations are correlated with violence (a couple of studies are here, and here). Note that there are nuances and correlation does not imply causation. Nonetheless, it is these youth bulges and unemployment that has caused significant concern, and have been widely overlooked as a problem that will resolve itself with time. It won't. While governance is a significant issue, the type of governance that the West promotes resides with the people. If the people cannot be satisfied, governance will collapse. Therefore, the essence of aid and assistance should not be solely focused on forming governments and elections. Employment, including the institutions necessary for it, should also be at the focus. Once this crisis, like the ones that came before it, calm, it is important that the West, upon reflection, recognizes that providing populations with a means is just as important as providing them with heads of state.

The Grass Isn't Always Greener on the Other Side

Revolutions, in all their forms, rarely setup a country to be exactly what the revolutionaries wanted it to be. Take for example how Iran emerged out of its 1979 revolution (theocratic), or how Russia has developed following the "transfer of power" from Vladimir Putin to Dmitry Medvedev (dictatorial). Egypt is no outlier to the post-revolutionary balancing act wherein a country seeks to redefine itself on the international stage and appease the populace who clamored for revolution.

In the West, it is therefore troubling that one of the first trips by Egypt's new President, Mohammed Morsi, is to China and Iran. In China, Morsi will focus on business and development. These are important objectives: China is sought after as an alternative to Western influence throughout the world and Egypt is in dire need of an economic kindling in order to validate the revolution. In Iran, he will attend the meeting of the Non-Aligned Movement. Morsi will not visit the United States until the upcoming United Nations meeting.

This trip scheduling may be just logistics, but it will also be seen as a poor choice in the West (Thomas Friedman in particular doesn't like it). The United States is one of the largest aid donors to Egypt and no friend of Tehran's. At the same time, relations with China remain cool, and could head for a downturn if an incoming American president labels China a currency manipulator. Therefore it is troubling that Morsi chose to visit Tehran in person - which no Egyptian president has done since its 1979 treaty with Israel - rather than send a deputy or via alternative diplomatic means.

Morsi is clearly attempting to solidify a position as a moderate. The question everyone wants to know the answer to is: Is he one? At the same time as his trip abroad began, Morsi, albeit in somewhat vague terms, reaffirmed Egypt's position to the treaty with Israel as well as its terms regarding the Egyptian military's presence in the Sinai. One thing to remember is that eventually, everyone is aligned (even if you are aligned with the non-aligned) and the grass isn't always greener on that other side. It might behoove Mr. Morsi to consider not only where a significant amount of Egyptian aid comes from, but also which countries may most benefit the business, development, and political prospects of Egypt for years to come.

Coexistence & the Two-State Solution

It can be claimed that Israeli society is as polarized as it has ever been. Critical rifts run through: secular vs. religious, Jewish vs. Muslim, immigrant vs. native, and many others within those labels as well as across them.

Recently, a group of Jewish teenagers beat an Arab teenager to within inches of his life (he has since been released). Unsurprising to many observers, a general lack of enmity toward Arabs by religious Jewish populations may have been an underlying cause. Many Israelis recognize the inevitability of coexistence and the two-state solution - the alternative is all-out war and annihilation. However, some continue to believe that they are participating in a zero-sum game. In reality, the situation is one where both sides can benefit. It is therefore positive to see that Israel ordered its schools to discuss the beating, as well as the feelings that may have fueled it. What would be even more positive would be to see would be for this incident to be labeled, officially speaking, racist and the charges being level with the hate crime category in the United States. The government should take the stance that this kind of activity will not be tolerated in the society that Israel seeks to build.

Support Arab Spring by Selling Arms to Existing Regimes?

The United States, supposed proponent of the Arab Spring (unless it is not entirely convenient), sold $66.3 billion in arms abroad last year. Russia was second - at $4.8 billion. $33.4 billion of those arms were sold to Saudi Arabia. That figure alone broke the previous record sales of US arms - $31 billion in 2009. Other notables included Oman and the United Arab Emirates. On the bright side, no major sales to Syria?

Australian Tiger?

Australia is so far away, its business hour window with the United States is only a couple of hours wide. Yet, the country often portrayed as backward (see Crocodile Dundee if you must) has been on a roll, starting with the 2000 Sydney Olympics, and after experiencing a slight dip in the mid-2000s, is once again resurgent.

Australia's banks, rising out of a country of 20-odd million people, have a market value more than all those in the Eurozone. Australia has just a smidge more people than Romania, to put things in perspective. Australia's economy, led by resource exports, has grown steadily, leading to worries of a resource curse taking hold in this developed economy. So far, Australia is weathering all storms. Is Australia the next tiger?

Egypt: The Presidential Shake, Rattle, and Roll

New Egyptian President Mohammed Morsi moved to solidify his power yesterday, dismissing two of the top military leaders and rescinding a June military declaration that had given the military final authority on declaring war and naming generals.

The move was, it seems, coordinated with members of the military, as the two senior military officials who were dismissed will remain on as senior military advisers to Morsi.  The move suggests that Morsi has built sufficiently strong ties with at least parts of the Egyptian military apparatus that he felt confident to make such a move.  What this all means for the direction of Egyptian military and foreign policy, however, remains to be seen.

When do we start helping Israel with the Middle East's dirty work?

In 1981, Israeli planes bombed and destroyed the Osirak nuclear reactor just south of Baghdad. The operation was vehemently lambasted by the United Nations. At the same time, many believe that the attack set back a developing nuclear weapons program by at least a decade. This not to say that work on weapons of mass destruction halted entirely after the attack, but that efforts to meet those ends were harmed. Even the expansion of those efforts and their hidden nature did not, it seems, bring Iraq back to where it would have been had the reactor remained.

More than 20 years later, in 2007, Israeli commandos and planes destroyed a nuclear reactor in Syria. Reaction, this time around, was softer with largely silence throughout the Middle East. Reports quickly confirmed that the destroyed facility was an undeclared nuclear reactor with possible military implications.

Come to 2012, and the question of Iranian reactors lingers. Israel has been repeatedly asked to back off and avoid repeating the 1981 and 2007 incidents. It seems though, that patience is wearing thin. For Israel, the question is not of politics, or even military ability; the question is existential. Will the Israelis carry out a third strike on a nuclear reactor in the Middle East in (just about) 30 years?

This time around, the environment is different. Calculations are more complex. The Israeli public is arguably more comfortable with the international environment and more wary of a war with a (relative) neighbor, or at least one with the missile capacity to rock Israeli cities and towns.

The US, the West, and the UN, have tiptoed around the issue of Iranian nuclear development for years. Perhaps it is time we draw a hard line and help our supposed ally, thereby possibly also avoiding an all-out conflict that could drag in other neighbors, including those with fledgling democratic reforms.

Civilian Deaths Down In Afghanistan; U.N. Unhappy

Even in a short U.N. press release such as this, there are numerous questions about how to gauge success in Afghanistan or success of counter-terrorism in general.  Civilian casualties caused by international and pro-government forces were down 25%, and those forces were responsible for only 10% of all civilian casualties.  Anti-government forces, meanwhile, were responsible for 80% of civilian casualties, and their assassinations of pro-government officials, use of IEDs, and attacks on schools, were all on the rise.  Overall, civilian casualties were down 15%.

From that data, one could point to numerous successes, including the improved efforts of pro-government forces to minimize civilian casualties.  On the other hand, protecting civilians from Taliban and other insurgent attacks -- though extremely difficult -- is a necessary component of any successful counter-terrorist effort.  If a government cannot keep its citizens safe, then those citizens will continue to lack faith in that government.  The Taliban is likely too embedded into Afghan society to ever be eradicated by military means alone; rather, any lasting peace in the region will almost undoubtedly involve bringing the Taliban to the table.  Until then, the war will continue to wind down to a bloody end, if indeed an end is in sight.

Shadow Wars: Yemen Edition

From the mid-2000s onward, the U.S. has fought a shadow war in Pakistan.  U.S. relations with Pakistan have ebbed and flowed in that time, with Pakistan often providing intelligence on targets and airstrip space while publicly decrying the drone attacks.

Fast forward to the past two years, where the U.S. has ramped up its involvement in Yemen.  While U.S. officials hem and haw, never officially acknowledging the extent of our actions and involvement there, analysts say that we're at war.  This sounds familiar: for years, the U.S. conducted the massive, covert drone (and special ops) war in Pakistan without publicly acknowledging it.  Officials have become more open about operations in Pakistan in recent years, in part in order to provide legal justification for the continued, aggressive drone campaign.

While the similarities between Pakistan and Yemen are clearly evident, there are some important differences that America must keep in mind as it tailors its response to the growing threat of al Qaeda in the Arabian Peninsula (AQAP).  First, AQAP is considered by some analysts, with good reason, to be the most active and lethal al Qaeda affiliate.  The underwear bomber, the cargo plane bomb plot (the one with the printer ink cartridges), and the failed NYC bomber were all organized or inspired by AQAP.  Even the perpetrator of the Fort Hood massacre, Maj. Hasan, conversed online extensively with now-deceased AQAP leader (and propaganda leader of al Qaeda) Anwar al-Awlaki.  Thus, the U.S. must not underestimate the threat posed by this al Qaeda affiliate, and the extent of our recent involvement there suggests that the government is well-aware of the threat and has ramped up operations accordingly.

Furthermore, military operations between U.S. and Yemeni forces is much more cooperative than that of U.S. and Pakistan military personnel.  Indeed, the level of mistrust between U.S. and Pakistani military forces (stemming from repeated Pakistani military leaks to Taliban forces) existed for years but was on display for the entire world to see during the bin Laden raid.  U.S. military, meanwhile, cooperate with Yemeni counterterrorist operations in much more direct ways:

In an escalation of America’s clandestine war in Yemen, a small contingent of U.S. troops is providing targeting data for Yemeni airstrikes as government forces battle to dislodge Al Qaeda militants and other insurgents in the country’s restive south, U.S. and Yemeni officials said.

Operating from a Yemeni base, at least 20 U.S. special operations troops have used satellite imagery, drone video, eavesdropping systems and other technical means to help pinpoint targets for an offensive that intensified this week, said U.S. and Yemeni officials who asked not to be identified talking about the sensitive operation.

The U.S. forces also advised Yemeni military commanders on where and when to deploy their troops, two senior Obama administration officials said. The U.S. contingent is expected to grow, a senior military official said.

 Clearly, we are heavily engaged in Yemen right now, but to what end?  The always-prescient writers at Danger Room raise this question, and suggest that President Obama admit we're at war and articulate the strategic.  Just as there was a time lag regarding operations in Pakistan, however, I think keeping mum about Yemen might make sense for the near future.  First, while operations are ramping up, they are nowhere near the level of activity that took place in Pakistan for years without official acknowledgement.  While this is not in and of itself a justification to keep quiet about operations, keeping quiet about Yemen allows the U.S. government to be adaptable to the quickly-changing conditions in Yemen.  Perhaps the U.S. will not decide whether its goal is "defeat" or merely containment of AQAP until more is known about the feasibility of each option.

The U.S. has already articulated reasons for providing aid to Yemen for infrastructure and civil society-building.  Meanwhile, when providing billions in aid to Pakistan for years, the U.S. openly admitted that the funds were geared toward helping our partner in the war on terror combat the threat of the Taliban and al Qaeda.  The U.S. should, at the very least, articulate a broad policy of providing counter-terrorism assistance to Yemen.  I don't know think this would necessarily involve articulating our end-game in that country, especially when the combination of the Arab Spring and the rise of AQAP make the country one of the most unstable in a very unstable region of the world.  Ultimately, while our current activities appear to be a proactive effort to tamp down the rise of AQAP, our ultimate long game in Yemen might have to be a reactionary one reflective of the realities of our ability to control the direction and fate of the country.

Gaza: An Opportunity for Israeli-Egyptian Cooperation?

The truth is that neither Egypt nor Israel is particularly pleased with the long-term development of Gaza since Israeli disengagement and less so since Hamas took control. Hamas' access to third-party support, financial and otherwise, outside of its neighbors, largely from Iran, gives it significant leverage to develop activities aimed at destabilizing both. With little to no aboveboard economic activity, Gaza's legitimate ties to its neighbors are nothing more than lines in the sand.

Last week, a brazen attack by militants left 16 Egyptian soldiers dead near the border crossing with Rafah. The goal, seemingly to create security problems for both neighbors, is worrisome. While the attack was into Egypt, one vehicle was reportedly driven into Israel for nearly a mile before being destroyed. Egypt has since arrested several suspects, but it's not clear whether this will truly mitigate a growing problem of lawlessness in Sinai, promoted by Hamas and its supporters (even regional news outlets largely share this view). Nonetheless, the Rafah crossing is under constant attack, putting Egypt on the defensive. The border is not the only issue - the problem stems far into Sinai, as evidenced most recently by the attack on peacekeeping forces at its heart. Since Hamas controls the arms, as well as the smuggling tunnels, in Gaza, is there anyone else to blame for the "militant" attacks?

While it is easy to look at the glass half-empty - another security problem in the Middle East threatening to destabilize the region - it can also be seen half-full - an opportunity for two "new" partners (considering Egypt's recent political transition) to cooperate to secure their shared interests. Egypt and Israel have, in the past, cooperated on improving the Rafah crossing in order to benefit legitimate crossing and to mitigate militant operations. Perhaps it will be clearer now that increased cooperation is needed, to secure the border above the sand, destroy the tunnels beneath it, and even to reassert Egypt's presence in Sinai outside of its periphery.

Globalization is Keeping You on Hold

If you notice longer than average wait times, blame Mother Nature. Massive flooding has swept the Philippines, particularly around Manila, the capital, home of many call centers, both for US and foreign companies. Perhaps outsourcing should adopt some of the energy industry practices, with reserves on hold in case of emergency or demand.

Terrorism in America: All About Definitions

In examining terrorism, it is always interesting to see who defines what and how they define it. After all, definitions make all the difference. The 1995 Oklahoma City bombing is widely accepted as a case of domestic terrorism. Similarly, the 2009 Fort Hood shooting is generally considered domestic terrorism. Sunday's shooting at a Sikh temple in Wisconsin is stirring debate - the dividing lines between crime, hate crime, and terrorism.

From a foreign policy end, America is always worried about the leaders of minority and majority ethnic groups stirring hatred and inciting possible violence that could lead to war, or what we call these days low-level civil conflict. Meanwhile at home, we value our freedom of speech, even if that means that one group is allowed to express their hatred of another group. Perhaps America should look inward and examine itself within a foreign policy lens.

The potential for home-grown terrorism has existed for a long time. The Turner Diaries is one example of literature around for years (the specious Protocols of the Elders of Zion being another) that illustrates that the concerns America has when a Sunni-Shia clashes in the oil-rich eastern provinces of Saudi Arabia are reflective of concerns regarding violence and terrorism at home. America is no different in its subtexts; the impressive part being its ability to consistently move on, perhaps with the victims of terrorism and hate crimes being so subsumed by its high murder rate (both gun related and otherwise).

A scary thought within all this is perhaps the failure of basic cultural education - that it may be possible for a man with blind hatred and ambition to commit an act of terrorism against one group cannot distinguish it from an entirely different population. This incident speaks volumes about how globalization may be bringing the world closer in many facets, but perhaps not in the most important: understanding of one another.

Regardless of the definition one chooses to apply for terrorism, there has always been one overarching standard: you know it when you see it. In Wisconsin, we saw terrorism.

NCIS Outtakes: The Silly Season

If you watch the always-entertaining show NCIS, you know that just about everything they investigate involves murder (cue Gibbs saying "we got a body") and much also involves serious national security threats.

Occassionally, however, NCIS apparently delves into the silly, harrassing news organizations over unclassified information simply because it is marked "FOUO" (For Official Use Only).  Now I know military personnel aren't supposed to release FOUO information, but still -- with all the presumably pressing things to investigate, this one seems extremely low on the totem pole.  Basically, the military put out a pie-in-the-sky request for companies to create a laser-mounted drone that could shoot individuals (and maybe burn their clothes off or something like that).  This sounds very similar to the public announcements made by DARPA and other DOD agencies all the time.

Meanwhile, I hope this documentary on next-generation laser technology is on someone's radar at NCIS.

The Opening of Libya: Cinnabon

A short article earlier today notes that Cinnabon is the first US franchise in Libya. So following months of air support during civil war and then assistance getting the oil flowing, the US sends in...Cinnabon. Apparently, this move is successful and sales are booming - of course no one can resist the chemically induced indulgences created by American manufacturing genius. This does beg the question of which other franchises or, more critically, international businesses are looking at opening up in Libya, which is no longer the pariah state it once was, or the wild west that followed it. It can only be hoped that Cinnabon in Tripoli does not turn out to be the KFC in Fallujah.

Annan Resigns, Endgame Approaches?

Kofi Annan resigned today as the UN-Arab League envoy to Syria.

To start, this decision was neither courageous nor timely. Moreover, Annan did not all-out resign, but rather chose to accept the inevitable and request that his position not be renewed when it expires, in nearly a month (August 31).

This peace plan and partnership with the Arab League never had any bite. Both sides undermined the agreement as well as its principles. The end result: more death and destruction.

The only hope is, Annan's resignation turns the tide, displays that peaceful coexistence with Syria's current leadership is untenable, and ends the silent partnership between certain nations and Syria's neptocracy. Acceptance of the status quo, or its waverings, may finally open up to a new Syria.

Silence: The World's Reaction to Islamism in Mali

This could be a fun exercise: point out Mali on the world map. Much like Iraq, many adults likely do not know where Mali is, or even possibly what continent it is on. Somewhat ironically, many have likely heard of Timbuktu, the ancient center of learning, which is found in present-day Mali. Although the general population is much unaware of Mali, it is deplorable that statesmen around the world, unceremoniously including those here in the US, are ignoring the situation in Mali.

To give a quick rundown. In March, soldiers staged a coup and ousted the government. Tuareg rebels, more or less tied to Al-Qaeda in the Islamic Maghreb (AQIM), quickly expanded their insurgency and now all-but control the country's north. Meanwhile, a military government, propped up by the coup, continues to control the quickly deteriorating government, or what's left of it. The ingredients for a failed state are quickly manifesting themselves and mixing into a violent concoction.

International reaction? Condemnation. US reaction? None, though a quick Google search does show that the US has now allotted $10 million for Malian refugees. The F-22 Raptor fighter plane costs $150 million a pop. By the time that money reaches Mali, it will be all-but spent.

In summary, the international reaction has resembled a couple of crickets having a conversation. While the West seemingly focuses its attention to its own crises, it ignores the problems brewing on its borders. Mali is ever close to the countries clinging to delicate democratic ideals and processes borne out of the Arab Spring. More critically, Mali's lawless north presents an opportunity for Muslim extremists to carve out space for independent action. It's happened in Africa before, with Sudan and Libya entertaining some relationships with international terrorists. But Mali is a new case - there is no strongman keeping it together. Mali is closer to Afghanistan - remote and on the verge of collapse. So while Syria is a trendy topic, Mali is ignored.

It seems that, with every moment, the world leans closer to collapse. The West is so enamored with saving its own economies that it fails to ignore the problems that may affect those economies in the not-too-distant future. Perhaps, and this is just a thought, condemnation isn't enough. Action is needed if Mali is to regain its internal sovereignty. While Mali may no longer be critical to the international system as in its heyday, it would be wise for the international community to think critically and support, either directly or indirectly, the capacity Mali requires to avoid it becoming a hotbed for international terrorism.

A Grip on Egypt

An interesting dynamic is unfolding in Egypt between the armed forces and the newly-minted president. Following the conclusion of the presidential election on June 17th, it took the Supreme Council of the Armed Forces (SCAF) about a week to declare Mohamed Morsi the winner, even though the Muslim Brotherhood declared their candidate the winner as early as the morning of June 18th and it was fairly clear to most observers who had won. Internationally, rumors swirled that SCAF was not willing to cede power to an Islamist candidate. Meanwhile, SCAF dissolved parliament and reverted its powers back to SCAF.


Clearly, a careful game of chess is being played that will determine who truly controls the new Egypt. The world is watching to see whether Egypt will regress to military-style authoritarianism, progress to some middle-ground of democracy, or shift toward religious autocracy. But doesn't Turkey already represent a regional model where the armed forces continue to wield great power even with relative democracy? Turkey surely has had a different history, but has, in recent years, worked to include religious parties into government. The issue may truly be then the stability of those armed forces, perhaps not in terms of political stability, as both Turkey and Egypt have strong militaries, but in terms of funding.

Both Turkey and Egypt have been recipients of significant U.S. military aid. Direct grants to Turkey largely stopped in the late 1990s, though Turkey does continue to receive aid in other forms. Egypt continues to receive direct military aid to this day. Taking an example, Turkey received received several hundred million dollars in 1998, out of a military budget of $7.2 billion USD. Meanwhile, in 2010, Egypt was the third largest recipient of military assistance, outpaced by only Afghanistan and Israel. Egypt received $1.3 billion in military aid that year. Egypt's military budget meanwhile, has seemingly dropped from around $4.6 billion in 2010 to closer to $4 billion in 2011, likely more than partly due to the Arab Spring. All this means an increasing reliance on US military aid, which makes up more than a quarter of the military's source of funds now.

US military aid to Egypt is largely based on its ability to maintain stability in the region. From a US perspective, that stability is directly tied to the Egypt-Israel Peace Treaty of 1979, a treaty that has always rested on shaky ground in Egypt, but has maintained its status under authoritarian leadership. This is the same treaty that Mr. Morsi has said he would "reconsider." No peace treaty. No military aid. No military. Therefore, it is clearly in the military's best interests to maintain the peace treaty. It ensures continued aid from the US, which helps secure SCAF's power within Egypt.


So who then has the grip on power in Egypt? Is it the military, who need the US? Is it Mr. Morsi, who risks being vulnerable without the military? Or is it the US, who keeps the aid flowing? Clearly, the US role in Egypt's future is more prominent than either Egypt or the US would like to admit. Perhaps a better balancing of aid, between military and other forms, would give the parties jostling over Egypt's future the right incentives to full, long-term democracy.

Amnesty: The Price of Peace?

In my last post, I briefly hinted at the idea of fringe or terrorist groups being brought into the political fold.  Now I'd like to talk about a related topic: amnesty for those groups.

Colombia is the latest example of amnesty issues plaguing a war-torn country seeking peace.  Just yesterday, its senate passed -- by a razor-thin 65-3 margin -- a constitutional amendment (dubbed the "Legal Framework for Peace") that gives Colombia's Congress more authority to legislate the conditions under which rebels are prosecuted.  This means, for example, that the Congress could pass legislation directing prosecutors to only go after rebel leaders or making sentences for rebel crimes more lenient.  Former president Uribe has criticized the amendment, deeming any potential amnesty an inappropriate tool with which to handle FARC and other terrorist or rebel groups.

Also interesting: opposition to this law, and many other amnesty laws, comes from human rights organizations.  Human Rights Watch, for example, opposes the amendment because of its potential for amnesty.  A chief source of contention is amnesty for war crimes, crimes against humanity, and similar crimes that are the focus of international criminal law prosecutions.  Indeed, this is a problem in the international law field: international criminal law relies upon the idea that violators of certain egregious crimes are brought to justice, but countries may have to forego some prosecution (or provide lighter sentences) in order to achieve lasting peace.  Some international legal scholars go so far as to claim that countries cannot provide amnesty to those who violate international criminal law.  This, I believe, is a mistake.  While one does not want to diminish the import of crimes committed in the past, it would be a disservice to the people of a country, not to mention the global community at large, if chances for peace were thwarted in favor of an unyielding prosecutorial principle.

This is not to say, of course, that any peace is good peace.  History will always find ways to remind us of the potential for folly -- Chamberlain's peace with Hitler being the most commonplace example.  Still, countries must have the flexibility to develop unique solutions to their unique situations.  Colombia's constitutional amendment is the latest iteration of this concept.  If its execution turns out to be poor, then Colombia will deserve the criticism it will undoubtedly receive.  The law in its current form, however, is more designed to give the Colombian government greater flexibility in dealing with rebel groups -- something with which I believe most reasonable people could agree.

In a bid to stay relevant, Al Shabaab Places Bounty on Obama, Clinton

One curious item picked up by the major news outlets over the last 24 hours is the bounty placed on President Obama and Secretary of State Clinton (Click here if you haven't read it yet, though it's made yahoo's headlines since this post has been written). Clearly, the bounties are a play in a pretend tit-for-tat game with the United States. A few days prior, US officials leaked information on up to $33 million in bounties for Al Shabaab leadership (here). In return, Al Shabaab offered 10 camels for Obama and 2 camels for Clinton. The CNN article linked above mentions that the average price of a camel is $700 in Somalia, though a number of websites selling camels (likely not in Somalia) indicate that prices can be a few thousand per camel. So a guy with a $5 million dollar bounty on his head puts one of a up to a few ten thousands on his opponent.

Is the bounty price meant as an insult, or is it truly a sign of weakness? The information available so far does not indicate any insult. In fact, military strategy often notes to respect the strength of your opponent, until you can secure victory. The one exception is where an insult can lead to your opponent's position becoming unwound, none of which seems to apply here.

Let's also compare this bounty to others. There has been a $100,000 bounty on a rapper who insulted Islam and a $2.2 million bounty on the pastor who burnt the Koran, just to name a few. On the other side, a British parliamentarian supposedly offered (though later denied offering) a bounty of £10 million on President Obama. So this helps put the no more than $10,000 camel bounty placed by Al Shabaab in perspective.

At the same time, it is widely believed that Al Shabaab's power has diminished over the past year or so. Its tactics and strategies seem to be less and less effective. So much so that it has been forced to partner with Al Qaeda, which reflects on the diminishing power of both groups. It is rapidly losing territory and influence (ex: here and here). On a related note, despite there existing a lack of government, it has been argued that the Somali economy is no where near as absent as its government. This means that there should be more "money" for such a bounty. Perhaps. But many signs point to less capacity within Al Shabaab.

So what is the end goal? Al Shabaab is not capable of a tit for tat with the US, unless it is an imaginary one from the Islamist perspective wherein the small group from Somalia is fighting with the hegemon on the world stage. It's important to remember that terrorism is meant to spread an effect and any opportunity for publicity is critical. Islamist compete, much like nonprofits and politicians, for donations and funding. This is Al Shabaab's grab at a larger slice of the media pie and thereby, the funding critical for them to retain their previous power.

The Arab Spring: Ideals, Stability, and Security Issues

With the first free and fair(ish) democratic elections taking place in Egypt, the United States must once again evaluate its strategic interests with this and other states in the region.  As has been the case for decades now, we find ourselves struggling to balance our democracy-promoting idealism with the take-it-as-we-find-it realpolitik of working with dictators and other dubious allies.

Barring unforeseen circumstances, the runoff in the Egyptian presidential elections will feature Mubarak’s former prime minister, Ahmed Shafiq, and the Muslim Brotherhood’s champion, Mohammed Mursi.  People argue that Shafiq is no fan of the revolution; indeed, he refers to Mubarak as his idol and promises to clamp down on dissent with an “iron fist.”  Mursi, meanwhile, hails from a party that promises greater influence of Islam in Egyptian law and affairs.  Many Egyptians see no good choice at all and, indeed, analysts expect voter turnout to be low.

Just glancing at another Arab Spring country, one can see continued turmoil in Yemen.  Yemen held elections a few months ago, though the fact that there was one candidate (Vice President Abdurabu Mansur Hadi, who had been acting president after Saleh stepped down) made the use of the word “election” questionable.  Still, the situation in Yemen makes one question what U.S. priorities should be: do we push for Hadi to keep his promises and move toward free and fair elections, or do we focus on the burgeoning problem of Yemen becoming a major breeding ground for terrorism and the fact that al Qaeda in the Arabian Peninsula is now considered by many the “most active and lethal Qaeda affiliate”?  One might argue that the two options are not mutually exclusive, and hopefully they can co-exist.  However, our prior support for dictators like Mubarak and Saleh (and Qaddafi) makes the U.S. uniquely ill-positioned to be a champion of the Arab Spring – an irony when one takes into account our unique status as the largest democracy in the world with the oldest written constitution.

People sometimes call democracies “natural allies” and argue that democracies don’t go to war with each other.  If so, it follows that the U.S. should promote free elections and democracy everywhere.  On the other hand, one consequence of democracy is that we might not always like how elections turn out (see Palestinian elections in 2006).  For many reasons, Hamas winning elections was not something the U.S. had hoped for.  Still, the very fact that Hamas was able to win elections should have sent some signals to the world community – Palestinians were unhappy with the PA, with their lot in life, and with a multitude of other things that Hamas was able to exploit.  Hamas is a terrorist organization that needs to fundamentally change before it can be an acceptable partner in negotiations on a two-state solution.  While one part of me wants to argue that Hamas is too rotten to its core to ever be a legitimate political partner in negotiations, history reminds us that the Palestinian Authority itself was once a terrorist organization.  This isn’t to say that “terrorism works.”  To the contrary, I think that history has shown that terrorist organizations can sometimes evolve into political organizations (Sinn Fein and the Palestinian Authority immediately come to mind, though I know there are others).

This brings us back to the Muslim Brotherhood and Egypt.  Although the Muslim Brotherhood is not a terrorist organization, it is an Islamist political party.  This in and of itself has made many Westerners uncomfortable.  Western countries are unsure whether the Muslim Brotherhood would, for example, continue to let Egypt be the state in the Middle East that helps maintain the regional peace with Israel.  Would the Muslim Brotherhood take a more anti-Israeli stance that could threaten the always-tenuous regional stability?  For that matter, is the alternative – which may well include a violent crackdown on peaceful demonstrations – a better option?

While laudable, democracy can often be messy.  Right now, many people look at Egypt’s upcoming elections and see two bad choices.  Many people look at U.S. presidential elections, however, and often see the same thing.  We in America are often told that we are “throwing away” our vote if we don’t vote for one of the two major political party candidates, even if we don’t truly support either of them (one of the problems with not having a runoff system).  Egypt’s experiment with democracy will undoubtedly face many obstacles, but the very fact that it’s having these elections is something to celebrate.

The hope, ultimately, is that the U.S. can have good relations with democratic states in the Middle East, and that those states can be allies in the war on terror.  We tried our hand with dictatorial allies – from Musharraf to Mubarak to Saleh to Qaddafi – because we needed allies to fight terrorism.  We’ve been making the same compromises for decades, however, supporting several dictatorships in the Cold War when they professed to be anti-Communist.  I’m not saying the choices we made were wrong.  I’m just pointing out that supporting dictatorships comes with a cost – aside from exposing ourselves to claims of hypocrisy, we run the risk of losing a potential alliance with a democratic government in the future.  Building a good relationship with a Muslim Brotherhood government, for example, would be complicated by both our prior support for Mubarak and the fact that many in the U.S. are skeptical of any Islamist government, democratic or not.  Would those same people prefer an Egyptian dictatorship?  Perhaps it will require the continued sale of billions of dollars’ worth of arms to Egypt to smooth over any rough edges in such a relationship.  My personal hope is that, in Egypt and other countries where democratic elections might lead to results we might not find ideal, we can still develop positive relations and find common ground where our democratic principles align.

Opposing Soft Diplomacy

The Economist makes the case this week (Nul points: http://www.economist.com/node/21555919) against overlooking domestic oppression in the selection of international contests. While Eurovision is at the heart of the argument, the article also touches on the upcoming EURO 2012 championship, which a number of European leaders have pledged to not attend in light of Ukraine's treatment of its former Prime Minister Yulia Tymoshenko, who is jailed under dubious charges.

It seems funny that this, albeit short, article fails to mention international contests that cross European borders. For instance, the 2018 FIFA World Cup was awarded to Russia, a bastion of regression towards authoritarianism and international malaise over the past decade. 2022 was awarded to Qatar, which recognizes neither gay rights nor Israel. Brazil, home of the 2014 Cup, is little better, having improved democratically in recent years, but continues to undermine human rights by forcibly removing settled populations for construction and aesthetics. Another event subject to controversy is the Formula One Grand Prix, most recently in Bahrain, where human rights concerns have been raised regarding the government response to protesters. Even the biggest international contest of them all is no stranger. The 2008 Summer Games were held in China. 2016 - Brazil. 2014 Winter Games - Russia.

One aspect nearly all of these contests have in common is the fact that they are awarded by committee. The sole exception is Eurovision, which automatically transfers from country to country based on the victor. Perhaps that unique aspect of Eurovision gives it some semblance of fairness that other international contest selections lack. Instead, countries should not only pledge to politically boycott awarded games, but sometimes a more thorough boycott is needed. For example, how would Ukraine have responded under threat to move the games out of Ukraine (Poland's neighbor Germany seems to have some recently-built soccer stadiums). Despite claims, politics and sports are not separate. Sport is often used to divert attention, build loyalty, and promote populism. Does it do more to make international contests seem inclusive, so long as one has the ability to fund them, whether that funding comes from economic success or economic subjugation, or does it do more to make international contests exclusive, reserved for only those nations who agree on certain basic principles, such as human rights and representative government?

Europe's Greek Tragedy?

As Greece heads towards elections on June 17, the drama is unfolding not unlike one of its ancient tragedies. While Europe is enveloped in the melodrama of successively failing Greek governments and the potential for Greece's exit from the Eurozone (even becoming termed the "Grexit" as I've learned from The Economist), the rest of the world is watching cautiously.

The question on every European politican's mind is whether an exit by Greece, a seriously indebted outlier, could trigger the collapse of the Eurozone altogether and the death knell of an integrated Europe. Greece is followed, in no short order, by Portugal and Ireland, with Italy and Spain not lagging far behind. Further concern over France and the Netherlands continues to grow daily. It is perhaps Germany who seems the strongest, but 40% of its exports are to the Eurozone. If a domino effect were to occur, Europe would be shorn apart.

At least until mid-June, it seems that the threat is grave, but overstated. The "contagion" problem, and the ramifications of the collapse of the Euro are so great, that it is unlikely that Europe's stronger economies, namely Germany, would allow a weak economy to so significantly affect them. Protection against the sovereign risk of a Greek default or a Greek exit is minimal, with the default being more likely and easier to work through (though not easy in any means). In essence, Europe's strong would need to convince investors, the people, and other nations that a Greek exit would have little to no effect on the Euro. All in all, that is highly unlikely to occur, and even less so in the course of a single month.

Therefore, if Greece were to stay, it would need to be controlled. In order for it to be controlled, a more unified Eurozone fiscal and budgetary policy would need to be implemented. So although we see a Europe today in crisis, is it really in any more crisis than when Ireland rejected the Lisbon Treaty in 2008 or when the European Union enlarged in 2004 and 2007? Recall that the Lisbon Treaty was ratified in time and European expansion has slowed, but never fully stopped (Croatia looks to be next to join). This is the dichotomous story of Europe since World War II - always either about to collapse into itself or integrate further. The value of integration has been well illustrated over the decades, and the value of collapse well understood by two major wars and some smaller, but still noteworthy conflicts. The question really remains: do today's politicians, and today's citizens for that matter, remember what happened when Europe collapses? If they don't, or if they choose to ignore it, the tragedy they're watching may simply be a story within a story, with the themselves as the main characters failing to see the relationship to their own situation.

Do We Really Need an Arms Trade Treaty?

In a word: no.

Most people don't know that the next big treaty on the United Nations' horizon is an Arms Trade Treaty.  This summer, diplomats, scholars, NGO representatives, and other interested parties, will descend upon the Big Apple to hammer out a multilateral treaty that will (in theory) regulate the international trade of conventional weapons.  While it is always good to promote ideals and advance the rule of law, the most likely outcome of this treaty will be millions of dollars wasted and an ineffective human rights-promoting institution.

So, what exactly are we talking about when we say "arms trade"?  The arms trade includes conventional weaponry -- mostly consisting of firearms, assault rifles, rocket and grenade launchers, artillery, surface-to-air missiles (SAM), anti-ship missiles, tanks, helicopters, and aircraft.  Meanwhile, the term excludes WMD -- nuclear, biological, and chemical weapons.  Conventional weapons arms trade is massive.  Because a great amount is unreported, underreported, and/or illicit, the exact amount is unknown.  The best estimate, though a few years old, puts conventional arms trade at approximately $55 billion per year.

In addition to providing states with finished weaponry, arms exports may assist states that are in the process of developing their own weapons systems.  China, for example, imported parts from Canadian, British, Italian, French, and German companies while developing a new attack helicopter.  Furthermore, China could export those finished attack helicopters to a state like Sudan that has a record of human rights violations.

So, at first glance, the notion of an arms trade treaty seems like a great idea.  However, when looking at the practices of the biggest arms-exporting countries, one might find reason to pause.

The United States, for example, sells billions of dollars of weapons per year and is the single biggest exporter of conventional weapons.  At the same time, the U.S. has an extremely robust arms control regime.  In considering arms exports, the U.S. considers its own national security interests, potential effects on the recipient state and region, and the possibility of re-transfer to third-party states (22 U.S.C. § 2751).  As far as process is concerned, the State Department reviews most sales and Congress has the power to express disapproval for export sales over $1 million; preferential treatment and streamlined approval is given to NATO members and other close allies (22 U.S.C. § 2776).  For various reasons, including state sponsorship of terrorism, U.S. regulations restrict sales to certain state and sub-state actors (including, for example, Burma, China, Cuba, Iran, and Syria).  The U.S. export regime also closely analyzes sales of dual-use items (commercial items that might have military purposes).

While the U.S. arms export regime is considered by many to be the "gold standard," other states and organizations are not always so careful.  The EU's arms export program has some similarities to that of the U.S., but less strict in certain areas -- for example, EU states export hundreds of millions of dollars' worth of weapons per year to China.  Germany also exports arms to Iran, Libya, and Syria.  Russia, meanwhile, has sold billions of dollars' worth of weapons to Iran.  China sells weapons to Sudan, Nepal, Burma, Chad, and Tanzania.  China claims that its arms sales are "cautious and responsible," but it does not participate in any multilateral arms export treaties seeking to prevent the use of exported arms to human rights-violating states.

For those states already desiring to restrict arms sales to certain states, there are several international bodies attempting to address the serious issues.  For example, the U.N. Security Council maintains embargoes against Cote d'Ivoire, Liberia, North Korea, Somalia, al Qaeda and the Taliban, nongovernmental forces in the Democratic Republic of the Congo, nongovernmental forces in Iraq, nongovernmental forces in Lebanon, nongovernmental forces in Rwanda, nongovernmental forces in Sierra Leone, and the Darfur region of Sudan.  These arms embargoes are regularly violated, however.  While widespread violations of Security Council embargoes could well serve as an indicator of an arms trade treaty's ineffectiveness, NGOs actually (and disingenuously) use the embargoes' ineffectiveness to argue for an arms trade treaty.

There are also voluntary multilateral institutions like the Wassenar Arrangement, which promote best practices in arms export control among member states.  Such arrangements are voluntary and non-binding, and thus contain no system for determining or punishing violations of the Arrangement's principles.  At the same time, the Arrangement has the flexibility to allow member states to participate how they see fit; such flexibility and voluntary participation are perhaps the best indicia of states' desire to engage in responsible arms export practices.

Meanwhile, over the last five years, support for an arms trade treaty has increased amongst NGOs, the U.N., and states.  The common theme is that a binding, multilateral treaty would codify the "highest possible common international standards for the import, export and transfer of conventional arms" (this language appears in multiple U.N. General Assembly resolutions).

While the final makeup of an arms trade treaty is unclear, draft resolutions acknowledge "the right of all States to manufacture, import, export, transfer and retain conventional arms for self-defence and security needs and in order to participate in peace support operation."  The treaty will also probably set a base level of standards with which states should comply before exporting arms.  The U.S. insists that states should be able to unilaterally set higher arms control standards, but it remains unclear how this principle would be reconciled with the right of states to import conventional weapons.

Furthermore, setting aside the politically questionable issue of state ratification, one must question the extent to which an arms trade treaty would affect state behavior.  Without U.S. support, the treaty would not include the vast majority of arms export sales.  Meanwhile, Russia and China abstained on the vote for the latest U.N. General Assembly resolution calling for an arms trade treaty.  This is particularly important, as these two states are major arms exporters as well as permanent members of the U.N. Security Council.  This leaves both states well-positioned to block Security Council arms embargoes, block any Security Council action against Russia or China for violating already-existing arms embargoes, and circumvent the provisions of an arms trade treaty without consequence.

What should one think, meanwhile, of the numerous states that support an arms trade treaty but currently do not employ rigorous export controls?  There is already ample evidence of states (even developed European states) permitting arms exports to states with dubious human rights and/or retransfer practices.  Will an arms trade treaty affect their behavior?  Scholars and NGOs supporting an arms trade treaty appear to think so.  They point to violations of an EU embargo on sales to China as evidence of the need for a multilateral treaty.  If a 27-member institution of developed states cannot control its own export practices, however, what is the expected efficacy of a much broader treaty with a much more diverse polity?

Take China, for example.  Faced with China’s dubious export practices, Amnesty International pushes hard for an arms trade treaty and calls upon China to participate in that treaty process.  The countervailing strategy that Amnesty implicitly rejects is strengthened political pressure from other states.  Of course, this might reflect the simple reality that other states are ill-positioned to coerce a state with the world’s largest population, third-largest economy, and a permanent seat on the U.N. Security Council.  Regardless of how one views China's arms export practices, the very dubious likelihood of China and other states changing their arms control practices calls into question the great need for an arms trade treaty.

While we do not know what the arms trade treaty will look like in its final form, it will not likely solve many of the problems its proponents cite as justification for the treaty.  Regional and international structures exist – notably the Wassenaar Arrangement, on the international scale – for those states interested in developing better arms export practices.  Those states currently not interested in setting high arms export standards would not likely care to develop them after an arms trade treaty.  Rather, like human rights treaties, states would likely comply when there are low costs of compliance or when faced with non-treaty coercive pressure.

The United States, in particular, should view the development toward an arms trade treaty with caution.  It should make sure that, regardless of whether it ratifies the treaty, such a treaty embraces high standards of export control and permits states to surpass those standards.  A failure to do so could allow the treaty process to be hijacked by states seeking to set low standards or simply embarrass the United States by forcing it to accept low standards or not sign the treaty at all.  Because the arms trade treaty would not likely solve the problems it identifies, greater attention should be paid to already-existing agreements amongst those states truly seeking to set high standards for export control.  If states earnestly tried to address arms trade problems through those agreements and still found those agreements unavailing, then it might be time to seriously consider an arms trade treaty.


Further reading:
http://www.un.org/disarmament/convarms/ArmsTradeTreaty/
http://www.state.gov/t/us/136849.htm
http://armstradetreaty.blogspot.com/
http://en.wikipedia.org/wiki/Arms_Trade_Treaty
http://www.oxfam.org/en/category/freetags/arms-trade-treaty
http://www.heritage.org/research/reports/2009/08/the-uns-arms-trade-treaty-a-dangerous-multilateral-mistake-in-the-making

Don't cry for Argentina...

It seems that the Argentinian President Cristina Fernandez needs a summer crash course in history and economics, particularly as they relate to capital-intensive energy sectors. It is still to a large extent beyond me how Ms Fernandez was the deemed the most qualified individual in a country of approximately 40 million (at the time), but, then again, we haven't made the wisest decisions here at home either over the past decade or so. But enough of past history. The other week, Ms Fernandez decided that the best way to keep Argentina financially afloat would be to nationalize the 51% stake of Yacimientos Petrolíferos Fiscales (YPF), the country's largest energy company. YPF was formerly Argentina's national oil firm, having been privatized just in the past decade. It seems that popular support in the country's senate makes this move likely to actually occur. (EDIT: Approved by the senate!)

Many outside observers consider this an unwise decision, and rightly so. To start, the entire 51% share being nationalized is owned by Respol, a Spanish company (minority owners, largely Argentine, would be less affected). Spain is one of Argentina's largest trading partners, so that doesn't seem like a good way to spur economic development or any growth. Part of Ms Fernandez's claims include the lack of reinvestment by YPF/Respol. Problematically, nationalization scares away investment. This is particularly noticeable in the energy sector where significant amounts of capital are needed just to take chances of finding and producing energy at a profitable rate. Examples just over the past twelve or so years include Russia and Venezuela, while going further back one can look at Libya. All in all, a country such as Argentina needs the expertise, capital, and sheer willpower of large energy firms just to explore, take chances, and invest in developing new energy opportunities. Nationalization is not going to make the multinational companies who lead the international energy sector eager to invest; the risks of energy investment are high enough without the political risk of expropriation.

Respol is asking for upwards of $10 billion for its stake, a sizable chunk for a country that has repeatedly found creative ways to manage its economy over the past few years, including raiding central bank coffers and pension funds. Compounding this situation is that Argentina still has not fully agreed to pay out for its default a decade ago. Respol may not get any compensation (or may get it decades down the line). In turn, this will lead other industries, beyond energy, to toe carefully before entering Argentina. After all, who wants to risk developing products, markets, and infrastructure in a country that may take it all away without any real compensation?

The repercussions of this move, following a number of other, similarly concerning government decisions (noted briefly above), can have ramifications for Argentina's economy for years to come. Perhaps it is time to move beyond populism and revisit economics and history in Argentina, or is it too late? Regardless of the terminal station this road leads Argentina to, don't cry for Argentina; it chose the road itself.

LIBORrowing, LIBORedom, and the financial LIBORdello

Does anyone know what the LIBOR is? Bueller?

Not being in banking or finance, I can't say that I knew until recently. The LIBOR is the London Interbank Offered Rate. Basically, it is a statistical average of the interest rates that banks loan to money to other banks at. It is published daily and utilized by pretty much every banking and financial institution to set their benchmark interest rates.

Before I delve in, I need to make a correction to the statement above. The LIBOR is the average of the interest rates that banks claim they would get were they to borrow money from other banks. That's right, this rate, which underlies nearly all other interest rates, is computed by self-report. It is meant to be computed by staff at each bank independent of staff that manage exchanges.

Self-report is an ideal alternative to regulation, but it does not always work out when that self-report is tied to more than basic data collection. In this case, a self-report system has grown tied to some of the very foundations of modern banking and finance. Reports from a variety of outlets (a few examples are here, here, and here), including some academic work noting that self-reported interest rates were overly similar across different levels of risk at different banks, suggest LIBOR manipulation. More clearly, they suggest that self-reported interest rates were artificially depressed, implying to consumers that the banks were safer bets than the truly were. As the articles note, regulators are investigating.

Apart from all the noise over who manipulated, how they manipulated, who has standing to sue and how much they can get (being from Baltimore, I really doubt that the city will make use of the funds the Economist article suggests it may win), the biggest question should really be: how can the LIBOR be fixed? It does not seem fair to let the banking sector have yet another mulligan. There needs to be a system in place, and a system that operates efficiently enough to continue daily postings of the LIBOR. One option would be to introduce some sort of computational analysis that would combine with the self-report, a la a BCS-style system in NCAA college football; however, if such a system has so little support in football, could it really benefit in finance? Another option would be to develop a regulatory scheme that would compare submitted figures with independent analysis; however, cost and timeliness could be issues. A third option may be to regulate by reviewing submitted data after the fact and adding accountability for accuracy back into reporting. This option is better, but the possibility of backlog and the potential costs may be issues.

It is unclear what the best option really is. It may benefit to explore having banks report the rate they claim they could borrow at alongside the rate they would lend at. Also, since banks lend continuously, it may be helpful to group banks by operations and size and have them cross-report lending and borrowing within their cohort. Regardless, accountability needs to be instilled into LIBOR reporting, as well as a penalty scheme for the organization, not just the individual.

Clearly, no option currently on the table is perfect. However, most of the options are better than financial manipulation. Maybe this financial crisis and its after effects will teach us lessons not only about our economic models and their premises, but also about human decision-making.

Ozzie Guillen, Castro, and Free Speech

Although plenty of other news sources have covered the Guillen situation, I feel compelled to add my two cents.  For those of you who avoid sports news, the short of it is this: Ozzie Guillen, manager of the Florida Miami Marlins, uttered the phrase, "I love Fidel Castro."  Everyone went berserk, and the Marlins suspended him for 5 games.  Large numbers of Cubans and Cuban-Americans have understandably expressed outrage and promised to boycott the team while Guillen remains at the helm.  I have no problem with them using the power of the purse-string to make a strong statement of disapproval.  What I do have a problem with, however, is the reaction of both the Marlins organization and Hypocrite-in-Charge MLB Commissioner Bud Selig.

Let's put aside for a moment the fact that, when looked at in its full context, Guillen was clearly expressing admiration for Castro's ability to remain in power and never expressed support for Castro's politics or practices.  The bigger issue is that executives chose to suspend Guillen for what was perceived (rightly or wrongly is irrelevant) as a political statement.  This isn't the case of Ben Roethlisberger, suspended for allegedly committing immoral practices.  I had a problem with that suspension, as it was not based on a conviction or any sort of formal hearing of any sort, just King Goodell holding court and deciding on a whim that a person not even charged with a crime should be suspended for six games.

Rather, this is a suspension designed solely to appease (or try to appease) the Cuban-American population that Miami hopes will form a loyal fanbase (also of note: the sparkling new Miami stadium, financed with taxpayer dollars, sits in the middle of Little Havana).  Now, as I said, that population has every right to express anger over Guillen's statements.  I think that anger is misguided, but again, I support their right to exercise free speech and use their money as they see fit.  There is nothing noble or even justifiable, however, in the reactions of the Marlins and Bud Selig.  The Marlins organization could respond by reiterating the fact that Guillen does not speak for the organization, that people in the organization feel differently, etc.  It could even fire Guillen, should it be of the opinion that its business was sufficiently in jeopardy and that a new direction was needed to maintain/expand its fan base.  A suspension in this case, however, is worse than firing.  Firing could potentially be done as a business/PR justification.  A suspension, on the other hand, signifies improper behavior.  And when it comes to suspending people because of their political speech, the risk of a slippery slope is not just academic.  Honestly: would a player be suspended for wearing one of those hipster Che t-shirts?  Maybe, in Miami, he would be.

Bud Selig, meanwhile -- I have nothing to say about him other than the fact that he's a huge hypocrite (picture of him, on the right, hobnobbing with Castro).

Despite the fact that Guillen is often a moron and says the wrong thing, let's just lay to rest the notion that this suspension and the MLB Commissioner's support of it is anything more than mere grandstanding.

Nine years on, Saddam's fall is overlooked

Granted, there are bigger issues on the political landscape - Libya, Syria, and, of course, our favorite, the looming American election. However, it was noticeable to a select few today that the anniversary of an event that defined a decade and changed the tide of international politics was largely ignored. April 9 represents the nine-year anniversary of the fall of Saddam Hussein.

Though likely next year, at the decade mark, there will be some retrospection, it remains an anniversary that we choose to ignore. It reminds us that nine years later, we have not only not found any direct evidence of weapons of mass destruction, we have not found much direct evidence to suggest that there was much to find in the first place. It reminds us that we put our reputation on the line in front of the world at the United Nations. And most importantly, it reminds us that we've largely left the country in no better shape than it was 9, or even 21 years ago.

It is hopeful that a retrospective on Iraq follows over the next year, one that gives us greater insight into the war within the context not only of our own standard, but also within the changes that follow. Iraq has a future. The only question is how did we contribute or detract from it.