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A European Saves Americans on Flight 253

The 9/11 attacks and the failed Christmas Day airplane bombing have two things in common: US agencies had enough information about the terrorists and could have intervened if they had properly analyzed and shared the information that they had, but instead another systemic failure - as President Obama called it - has occurred. Like with United 93 in 2001 it was again the passengers, in particular the Dutchman Jasper Schuringa, who subdued the Nigerian terrorist.

Yep, it was a European. And it is documented well. It is, however, not well documented what exactly happened on United 93. Nevertheless a movie was made that defames the German passenger Christian Adams as the "stereotypically weak-kneed Euro-pacifist," even though no information suggests that he acted that way. Hollywood should apologize by making a good movie about Flight 253 with a Dutch hero.

And while we are at it: The Dutch are also taller than Americans, probably because of better health care and more comprehensive welfare systems. So, perhaps Obama's health care reform will prevent further terrorist attacks ;-) Nah, I hope the systemic problems will be fixed. And to be fair: The system, including the much criticized No-Fly List, has probably prevented a few attacks, but such success can't be quantified and does not make headlines.

Endnote: Thanks to Robert Farley for the related post "But Bob Kaplan Said that Europeans Have Lost Their Will to Live!"

I used to be big fan of Kaplan, when he published The Coming Anarchy in the early 90s, but I got more and more disappointed by his writings since the turn of the millenium. I am not sure to which article Farley refers to. It could be this month column Let's Go, Europe about the "neopacifism" in a "debellicized Europe," which can only make a difference in the naval sphere. Or it is his November column The Fall of the Wall, where he argues that "We may have gained victory in the Cold War, but lost Europe to apathy and decadence in the process." Kaplan was so nice and took the 20th anniversary of the first ever peaceful revolution in Germany (our best contribution to the 20th century) as well as the revolutions in the countries of Central and Eastern Europe, which are now part of the EU, as an opportunity for Eurobashing:

What does the European Union truly stand for besides a cradle-to-grave social welfare system? For without something to struggle for, there can be no civil society—only decadence.  Thus, with their patriotism dissipated, European governments can no longer ask for sacrifices from their populations when it comes to questions of peace and war.

Of course, Jasper Schuringa's initiative on Flight 253 won't change Kaplan opinion about the decadent, neopacifist, debellized, unpatriotic Europeans.

The ECB Plays the Role of Scrooge

"What's Christmas time...but a time for paying bills without money?" - Ebeneezer Scrooge in A Christmas Carol by Charles Dickens

The European Central Bank has no plans to bail out Greece if it encounters difficulty in meeting its debt obligations. According to the Wall Street Journal Bank member Ewald Nowotny said,  "One has to be very clear: The ECB has no mandate or intention to take into account the situation of a specific country, especially not with regard to public finances." In other words, "if the poor would rather die, they had better do it, and decrease the surplus population."

The bank's reasoning is understandable: a blanket guarantee to underwrite sovereign debt throughout Europe would create an untenable moral hazard. And the bank likely does not have the legal foundation to "bail out" a sovereign country. But Greece has gone through a spate of bad news: First, Fitch and then S&P downgraded Greece's credit rating to BBB+. Moody remains the only rating agency to give the country an A1 grade, but it has the country on a negative watch. They would certainly have appreciated some good tidings.

Goldman Sachs analyst Erik Nielsen notes how this news creates a strange situation for the bank and for Europe (from Bloomberg News):
This is a bizarre and ultimately untenable situation for the ECB....The unthinkable -- that the ECB would not accept sovereign securities form a member as collateral -- has become a measurable risk, and one exclusively controlled by Moody's....Moody's is now the de facto decision maker on Greek eligibility.
A European institution (the ECB) refuses to entertain the idea of helping Greece, and so everything rests on an American company (Moody's). Merry Christmas Greece? Bah humbug!

Europe's Strategic Irrelevance

Richard Gowan of New York University and the Global Dashboard blog, has some wise remarks on Afghanistan in The Indian National Interest Review:

The quality of strategic debate on Afghan affairs in EU capitals is far lower than that in Washington. "We ask what pulling out of Afghanistan would mean for the transatlantic alliance," one respected French strategist admits, "but not what it'd do to Afghanistan."

He could go further. Although European commentators are typically well-informed about Pakistan's instability, they rarely put "AfPak" in a wider strategic regional context. How would a NATO failure in Afghanistan affect relations between China and India? What impact would it have on Russia's Central Asian ambitions, or Iran's defiance of the West? These are not questions you are likely to hear seriously discussed in Europe. (.)

European analysts who see Afghanistan in transatlantic terms ("What does this do to NATO?") are in denial on this point. The future of Afghanistan is clearly of far greater significance to the triangular strategic relationship between China, India and the United States than it is to European affairs. But no-one likes to admit they are a second-order issue.
I agree. I think it is a big problem, that Europeans view so many foreign policy issues in regard to its effects on Europe's relationship with the big brother/uncle/cousins on the other side of the Atlantic.

Endnote: Check out on this topic: Towards a post-American Europe: A Power Audit of EU-US Relations. No more special relationships: Europe is wasting its "Obama Moment"

Obama's Afghan Strategy: Regional Perspectives

The Atlantic Review is pleased to present this guest article by Dr. Shanthie Mariet D'Souza of the Institute for Defence Studies and Analyses, New Delhi, India.

Dr. D'Souza (image file)President Barack Obama’s ‘new strategy on Afghanistan’, unveiled on December 1 at the U.S. Military Academy at West Point, linking additional troop deployment to a timetable of drawdown of forces and narrowly defined goals, misses out on the core essentials of counter-insurgency (COIN) campaigns which hinges on time, long-term commitment, institution building and larger political strategy. Ultimately, COIN campaigns are won in the political domain, where military is only one of the many essential elements to achieve the long-term solution.

As the debate on the troop surge raged in the United States following the controversial Afghan presidential elections and waning domestic support for the Afghan war, President Obama announced his decision to send 30,000 troops within the first half of 2010, nearly acceding to his top military commander General McChrystal’s request for an additional 40,000. President Obama banking on his approach of ‘multilateralism and diplomacy’ has requested NATO allies to pitch in another 10,000 troops. So far NATO appears to have managed to garner support for another 7,000. Combined with NATO troops, the top US Gen. McChrystal would eventually get the required number of 40,000. The amount spent on Afghan war will increase from an estimated $130 billion in fiscal 2010 to $160 billion.

With increased troop levels, Gen. McChrystal had promised to turn the tide of the Taliban momentum in 12 months. By adopting a ‘population-centric’ COIN strategy of ‘clear, hold, build and transfer’, the additional troop could help in ‘clearing and holding’ insurgency afflicted areas in the south and east. However, with focus of troop deployment being the South and the East, concerns abound regarding the stability of Afghanistan’s North and the West. The Taliban insurgency which works through various networks has the capacity to cause instability in these regions, as witnessed recently in Kapisa, Kanduz and Baglan. More importantly, the COIN strategy does not look at new measures of cutting the symbiotic nexus and sources of funding of the various strands of Taliban insurgency which is a huge motley of various anti government groups, followers of Afghan warlord Gulbuddin Hekmatyar’s radical group Hizb-i-Islami, the Haqqani network, Al Qaeda and its affiliates, religious clerics, narcotic traffickers, bandits and tribal fighters in the Pakistan-Afghanistan border region. For instance, the Haqqani network, operating in Khost, Paktia, Paktika, and North Waziristan has now extended its activities to Ghazni, Logar and Wardak provinces.
Continue reading "Obama's Afghan Strategy: Regional Perspectives"

Rocking the Banking Boat

Changes are afoot in the tight-knit world of transatlantic central banking. The problem is, central bankers and the markets that follow their every word hate change.

In the US, Fed Chairman Ben Bernanke underwent his renomination hearings in Congress last week. The public grilling and aggressive questioning surprised some and spooked investors who feared they signaled the beginning of Congressional meddling with monetary policy.

Meanwhile, EurActiv reports that Italy is refusing to support the renomination of Jean-Claude Juncker, the ever-present Luxembourg Prime Minister, as president of the Eurogroup. The position coordinates the central bank activities of countries using the Euro, and Italian resistance may cause further problems when countries decide on a new president for the European Central Bank. In the complex wrangling of EU politics, each country seeks to have its fair share of prestigious posts. Italy feels left out from the recent appointments in the European Parliament and European Council and seems to see the Eurogroup or even ECB as a consolation prize. Though such a compromise may appease EU players, it would likely upset financial markets unaccustomed to politicized central banking.

All of this uncertainty in central bank leadership in Europe and the US is not helpful. The extraordinary intervention by central bankers during the past two years was only the first half of the plan. Arguably, the trickier part will be for central banks to divest their positions and resume their normal responsibility as interest rates nudgers. Wrangling about leadership, particularly while countries like Italy and Greece struggle with enormous burdens of debt, will only be a dangerous distraction.

Rasmussen's 7,000

NATO Secretary General Anders Fogh Rasmussen is promising that there will be 7,000 additional troops from 25 countries to support Obama's extended surge. Interestingly, one of the reasons he gave was the multilateralism of the US:
If we are to make Afghanistan more stable, and ourselves more secure, we must all do more. The US has pursued a multilateral approach to this operation. We must now demonstrate that multilateralism delivers concrete results.
Several commentators have recently hinted that Obama should act more unilaterally, as George W. Bush did (in his first term and a half). Calling for abandoning the multilateral approach is premature. The way multilateralism is described by its fans and opponents alike is also too romantic. The fact is that the US is still getting things done by excercising pressure on individual countries -- but it's doing so behind the scenes rather than through grandstanding. If Rasmussen is able to deliver his 7,000, it should show that the Obama administration's approach to diplomacy has worked.

Whether it really is as multilateral as it is said to be or not...

Debt Debaters

This post is from Andrew Zvirzdin, who used to be a guest blogger, but now joins Atlantic Review as part of the team. Andrew is originally from upstate New York and is currently finishing his second year of grad school at the Maxwell School in Syracuse

After the implosion of the Dubai miracle in the desert, investors are nervously looking elsewhere for the next debt debacle. No small wonder that the focus has turned to European countries with high debt loads such as Greece and Italy. Top European monetary gurus have been quick to assure investors that no European default is likely. But these days, anyone with a big credit card bill looks suspect in international finance.

The remarkable thing is that the EU has taken a significant lead in charting the course towards global economic recovery, despite its heavy debt burden. Consider for example that Germany and France were among the first countries to escape the present recession late this summer. Their robust growth was due in part to automatic stabilizers already in place when the financial crisis hit. And the notorious-and by some estimates, beneficial-cash-for-clunkers program in the US was inspired by Germany and other European countries who already had similar but more successful programs.

Now, as Europe is fading as the American health care punching bag, the continent's ability to live with government debt is under close scrutiny. Paul Krugman has recently warned (here and here) against an excessive focus on fiscal deficits in the US, pointing to Europe as an example: "If these countries can run up debts of more than 100 percent of GDP without being destroyed by bond vigilantes, so can we." CNBC is less positive in its assessment but acknowledges that Italy's resilience despite high debt levels means there is still a "lot of debt tolerance out there."

Still, debt will remain a worry on everyone's mind for some time to come, though the Eurozone has the tools needed to weather this storm (as I have written about here and here), and the US still has its financial strength. With the US and European countries consistently ranked as among the most indebted countries in the world, both sides of the Atlantic will likely need to work together on debt-related matters. Indeed, as the eurozone has already shown, teaming up with other indebted nations makes it that much harder to be bullied around by international markets.