May 2008

AmericAn Foreign PolicYmay 2008

The Battle for Southeast Asia

Freedom, Free markets, and democracy

Princeton Student Editorials on America and its Place in the World

2

StaffEditor-in-Chief

Rush Doshi ‘11

PublisherManav Lalwani ‘09

Managing EditorsZhenling Lai ‘09 Adam Harris ‘10

EditorsCole Bunzel Owen Fletcher Kent Kuran Carlos HancoEmily Norris Jessica SheehanZvi SmithAhson AzmatJon Bradshaw

‘08‘08‘08‘09‘09‘09‘09‘10‘10

Hee Jin Cho Jon ExteinJonathan Giuffrida Brandon McGinleyCatalina ValenciaBrendan CarrollEllen ChoiAddie LernerEric Stern

‘10‘10‘10‘10‘10‘11‘11‘11‘11

LayoutJonathan Giuffrida ‘10, Production Manager

Kelly Lack ‘10Ellen Choi ‘11Peck Yang ‘11

Business StaffRebecca KaufmanPatricia SeverPeck Yang

‘11‘11‘11

Peter McCallEllen ChoiShaina Li

‘10‘11‘11

Editor-in-Chief EmeritusZvi Smith ‘09

Publisher EmeritusJoel Alicea ‘10

AFP Advisory BoardAnne-Marie Slaughter: Dean, Woodrow Wilson SchoolNolan McCarty: Acting Dean, Woodrow Wilson SchoolKatherine Newman: Director, Princeton Institute for

International and Regional StudiesRobert P. George: Director, James Madison ProgramG. John Ikenberry: Albert G. Milbank Professor of

Politics and International AffairsBernard A. Haykel: Director, Institute for Transregional

Study of the Contemporary Middle East

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From the Editor

Perceptions can be dangerous, especially in East Asia. In a region that is increasingly heavily armed, tensions between China and Japan could yield

devastating consequences if allowed to spiral out of control. As East Asian trade now forms a sizeable portion of global trade, the U.S. has a clear interest in managing the potential conflict.

Competition is already under way, and our cover story explores the present Sino-Japanese diplomatic rivalry in Asia. This duel, however, has also polarized the populations of each nation, which now increasingly view each other with resentment. Only twenty-five years ago, Japan looked to be the region’s undisputed leader. An ascendant China, however, has dashed those hopes and generated a wave of anti-Chinese nationalism in Japan. Likewise, a similar wave has broken across China, with governing elites stoking anti-Japanese sentiments in an attempt to secure their political power. Statistical studies accurately capture this climate. Roughly seventy percent of Japanese view the Chinese as a threat while an equivalent number of Chinese harbor the same views towards the Japanese.

If these perceptions exert too much influence on each nation’s foreign policy, the current competition could easily escalate. According to power transfer theory, a rising power tends to come into conflict with a falling one when their capacities equalize—a point Japan and China may reach within the next decade. But even if violence is unlikely, each nation may nevertheless seek to construct its own opposing military alliances in East Asia. A divided East Asia is not only harmful for global trade, it also leaves the region dangerously unstable. The resulting zero-sum view of Asia would leave little room for cooperation on issues like North Korea, Taiwan, regionalism and non-traditional security issues. And of course, a region dominated by aggressive great power competition between China and Japan leaves less room for the U.S. to achieve its interests in the region.

Asia currently lacks a framework through which Sino-Japanese differences can be effectively addressed. In the absence of such a regional forum, U.S. mitigation of tensions is essential. Both China and Japan have better relations with the U.S. than they do with each other, creating a window for America to act as a pivot and steer both countries towards cooperation. It is therefore essential for the U.S. to prevent a threatened Japan from embarking on an independent security role in Asia which would aggravate China. Instrumental to this goal is increased U.S. participation in Asia’s regional forums to reduce Japan’s fear of a China-centric Asia. It is likewise essential for the U.S. to discourage China’s military build-up by assuring China that the U.S./Japan alliance is not part of a containment mechanism designed to constrain China diplomatically or hinder its economic growth.

Optimists note that trade between China and Japan has now risen well over $200 billion. On the assumption that economic interdependence raises the costs of war, they argue that the likelihood of military conflict will diminish. Although this theory may be true, if these antagonistic perceptions continue to strengthen, China and Japan may come to believe that their security can only be assured through war, no matter the costs. The U.S. should take measures now to help alter these perceptions and prevent a future conflict with potentially disastrous consequences. Rush Doshi ‘11, Editor-in-Chief

American Foreign Policy

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American Foreign Policy May 2008

VoluMe VII, ISSue 7

CONTENTS

May 2008Photo Sources: Oded Balilty, Misha Japaridze, Mikhail Metzel, Jerome Delay/AP Cover Photo: iStockPhoto

Cover Story The Battle for Southeast Asia 4 A Renewed Sino-Japanese Rivalry Owen Fletcher ‘08ASiA Eyed by the Tiger 6 The Necessity of Indo-American Partnership Lucas Issacharoff ‘10 In Context 8

Tara Lewis ‘11europe NATO’s Mixed Messages 9 Ambivalence Toward Eastward Expansion Dan May ‘11

Global Update 10 Vishal Chanani ‘11 Domestic Disaster 13 Russia’s Shaky Foundation Matthew Drecun ‘10 AFP Quiz 14

Franco Lopez ‘11Middle eASt Paradoxes and Peace 15 Dealing With Hamas Duncan Fritz ‘08

u.S. Foreign poliCy Rise of the Populists 17 Shifts in American Trade Policy Laura Kergosien ‘10

By the Numbers 19

Mohit Agrawal ‘11

Drinking Alone

Peace on My Terms

President Carter, Your Four O’clock

Sandwiched Between

the Powers

4 American Foreign Policy

There is no precedent for the competition occurring in East Asia. Until the onset of Euro-pean imperialism in the 19th

century, China was East Asia’s unchal-lenged hegemon. China considered itself the cultural center of the world, and re-quired its neighbors and trading partners to offer formal tribute.

During the 20th century, however, China’s weakness allowed Japan to be-come the dominant regional power. In the 1990s, Japanese bureaucrats spoke of establishing an East Asian hierarchy based on the “flying geese” model, in which Japan, East Asia’s largest economy, would naturally assume its rightful role as the “lead goose.” Other Asian countries would be willing followers, falling into position behind Japan.

Now, Japan is losing its lead as Chi-na’s monstrous economic growth rates

narrow the gap between the two nations’ economic capabilities. If this pattern of growth continues, Beijing will catch up to Japan—and possibly even the U.S.—within a few decades.

This prospect is fueling efforts in China and Japan to prevent the other from achieving regional domination, and their contest for leadership and influence is particularly heated in Southeast Asia. Though Sino-Japanese competition re-mains confined largely to the economic realm, it could intensify as China’s rise and Japan’s efforts to counterbalance it reinforce mutual threat perceptions.

Visions for regional cooperationThat China and Japan hold opposing

visions for East Asian regional coopera-tion is clear from their policies toward the two regional multilateral organizations created to facilitate regional “commu-

nity building”: the Chinese-supported ASEAN Plus Three and the Japanese-supported East Asia Summit.

At first glance, there seems to be little difference between the two group-ings. The ASEAN Plus Three comprises China, Japan, South Korea, and the ten members of the Association of Southeast Asian Nations—Brunei, Burma/Myan-mar, Cambodia, Indonesia, Laos, Malay-sia, the Philippines, Singapore, Thailand, and Vietnam. Meanwhile, the East Asia Summit consists of the 13 nations of the ASEAN Plus Three, as well as India, Australia, and New Zealand.

Optimists say these forums could lead to European Union-style integra-tion, but they have in fact produced little substantive cooperation, largely because Japan and China are split over which fo-rum to support.

One of the considerations driving this split is certainly Sino-Japanese economic rivalry. China argues that the ASEAN Plus Three forum, created in 1997 amidst a regional financial crisis, is the most ap-propriate vehicle for regional cooperation because it is exclusively East Asian. Ja-pan, however, has been reluctant to deep-

Cover Story

From left: Wen Jiabao, Yasuo Fukuda, and Singapore Prime Minister Lee Hsien Loong,

meeting at the 10th anniversary of ASEAN+3.

Wong Maye-E/AP

Wong Maye-E/APthe BAttle For SoutheASt ASiAA Renewed Sino-Japanese Rivalry

Owen Fletcher ‘08

5May 2008

en commitments to ASEAN Plus Three because it fears China’s economic as-cendancy will allow it to dominate the fo-rum. Indeed, the International Monetary Fund reports that China-ASEAN trade, which quadrupled from 2001 to 2006, has already surpassed Japan-ASEAN trade—in 2006, the totals were $160.9 billion and $156.6 billion, respectively. While Japan remains the forum’s largest economic power, it recognizes that China will even-tually usurp this position.

The other consideration is purely geopolitical, and reflects both parties’ conflicting views about U.S. involvement in the Asian region. This Sino-Japanese split was evident in the disagreement over the composition of the East Asia Summit in 2004. China initially expressed strong support for Malay-sia’s first proposal, which would limit the summit mem-bers to the ASEAN Plus Three nations, as it wished to es-tablish regional co-operation in an exclusively East Asian framework. This would allow China to emerge as the premier power in a unified East Asia while simultaneously weaken-ing U.S. influence in the region. A region oriented around China, Beijing calculates, would constitute a buffer against U.S. in-volvement in Chinese “internal affairs,” like the political status of Taiwan. In contrast, Japan’s preferred extra-regional framework is meant to reinforce U.S. dominance and dilute China’s regional influence. Hence, it proposed that the summit include democratic nations (and U.S. allies) such as India, Australia, and New Zealand, and supports the participa-tion of the United States itself in the long run. When Japan’s proposal won out, China stopped supporting a role for the East Asia Summit in regional community formation. Japan, meanwhile, has pro-posed to strengthen economic coopera-tion by creating a free trade area among all 16 of the forum’s member countries.

The economic toolsof competition

China and Japan are trying to expand their influence over regional cooperation through bilateral as well as multilateral channels. This often takes the form of a Sino-Japanese race to secure bilateral

free trade pacts with Southeast Asian countries. Beijing’s proposal in 2000 for a free trade area including China and all of ASEAN sounded the start of the race. Japan’s then-Prime Minister Junichiro Koizumi responded by visiting Indone-sia, Malaysia, the Philippines, Thailand, and Singapore in 2002, several months before the signing of the China-ASEAN free trade agreement. Japan has since completed negotiations on bilateral free trade arrangements with six individual ASEAN countries and with ASEAN as a whole.

China, however, remains the clear leader in efforts toward regional eco-nomic integration. Not only has China been quicker to initiate trade liberaliza-tion with ASEAN, but it has also done so

more comprehensively. For instance, it be-gan eliminating tariffs on 600 agricultural imports from ASEAN ahead of schedule in 2004, which was seen as a major uni-lateral concession benefiting ASEAN. In contrast, Japan’s powerful agricultural lobby prevents any similar concessions. Although Japan is a top destination for ASEAN’s agricultural exports, the liber-alization agenda of the Japan-ASEAN free trade agreement excludes beef, rice, and some dairy products. Japan’s inabil-ity to liberalize agriculture has seriously

impeded efforts to keep pace with China. Development aid is another bilateral

tool China and Japan are using competi-tively to increase their inroads to South-east Asia. Japan remains by far the largest aid donor to the region, but its aid budget has steadily declined since 2000 as a re-sult of its decade-long economic slump in the 1990s. China, meanwhile, is aggres-sively expanding its own aid distribution. In 2006, China offered the Philippines loans worth $2 billion each year for the next three years, doubling Japan’s offer of a $1 billion loan, which it promptly nixed in favor of China’s offer. By woo-ing the Philippines, a U.S. ally and the third-highest destination for Japanese aid in Southeast Asia, Beijing hopes to tilt the country’s strategic alignment toward

China.Japan and

China are also using develop-ment aid to fund oppos-ing infrastruc-ture projects

in continental Southeast Asia. China is funding construction of the “north-south corridor” highway running from south-western China to Bangkok, which will enhance China’s overland access to the western coasts of Thailand and Burma. Japan chose to subsidize two “east-west corridor” roads starting in Vietnam, which will increase its access to the Bur-mese coast. Both China and Japan hope to diversify their access routes to energy imports from the Middle East and re-duce their reliance on energy shipments

Cover Story

“China’s economic rise, if it continues, could push Japan toward military assertiveness to defend its shrinking regional role relative to that of China.”

0

40

80

120

160

200

Bill

ions

of U

SD

China-ASEAN and Japan-ASEAN Trade

Japan-ASEAN trade China-ASEAN trade

1994 1997 2000 2003 2006


In 1943, India suffered one of the worst famines in modern history, with at least two million people dy-ing of starvation. At that time, In-

dia was thought to be trapped in a classic Malthusian cycle in which its population outgrew its food supply, leading to endem-ic poverty and starvation. By 1984, how-ever, India’s food production had more than tripled from its 1950 levels; India could not only feed itself, but also lay the foundations for its current breakneck eco-nomic growth, which has exceeded 7% in the last decade. India’s economic rise has

ASiAsecurity in the shadow of a rising China, keeping competition between China and Japan confined to economics, diplomacy, and leadership in “non-traditional securi-ty” areas like combating maritime piracy and preventing the spread of regional epi-demics. The United States should actively encourage Japan to seek a role in such non-traditional security areas, where a growing role could satisfy Japanese ambi-tions for regional leadership without ap-pearing overly threatening to China.

There is little risk in the near future of a Sino-Japanese conflict or arms race, as the real security competition is oc-curring between China and the United States. Still, rivalry between China and Japan may intensify as China rises. As the most militarily powerful country in-volved in East Asia, the United States has an interest and a responsibility in ensur-ing regional stability by helping contain this rivalry. Afp

also been matched by the growth of its military power, as demonstrated by its nu-clear weapons tests in 1998. Though the West has been preoccupied with China’s meteoric ascent, India is now command-ing considerable interest of its own. While India’s history engenders a lingering mis-trust of Western powers, such concerns will ultimately be overcome by the abun-dance of issues on which American and Indian interests coincide. A realist foreign outlook on oil security, Afghanistan, ter-rorism, and China, combined with India’s drive to expand its naval power and influ-

ence, will push India into a close partner-ship with the United States.

Historically speaking, India has been burned before. The long British rule over India left deep scars on the national psyche and a lingering fear of foreign domina-tion. This led its first Prime Minister, Jawaharlal Nehru, to found the ill-fated Non-Aligned Movement (NAM), which sought to establish a neutral space for de-veloping nations, free from interference or domination by either of the Cold War powers. The NAM failed rather spectacu-larly when its largest member, China, in-vaded India in 1962, consequently driving India into the arms of the Soviet Union. The sudden collapse of the Soviet Union and India’s resulting isolation have left it wary of becoming dependent on any one ally.

While the historical inheritance of colonialism and past Soviet ties has cre-ated an anti-Western bent in Indian poli-tics, as evidenced by the Maoist’s success-ful opposition to a nuclear deal with the

eyed By the tigerThe Necessity of Indo-American Partnership

Lucas Issacharoff ‘10

Greg Baker/AP

through the Malacca Strait. Currently, ninety percent of Japan’s annual energy imports and 80 percent of China’s oil imports pass through this strait, which is highly vulnerable to maritime piracy.

Rivalry meets interdependenceCompetition between China and Ja-

pan in Southeast Asia is a manifestation of their deep strategic rivalry. But para-doxically, it is fueling the growth of re-gional interdependence, a force that has increased the two rivals’ shared interests in maintaining a stable and peaceful re-gion. It would harm both Chinese and Japanese business interests in Southeast Asia if rivalry between countries were to escalate into a scramble for deeper stra-tegic partnerships or military cooperation with regional countries.

Interdependence acts as a brake on Sino-Japanese rivalry, but cannot bring it entirely to a halt. This rivalry is deeply rooted in issues such as territorial dis-putes, nationalist sentiments, and differ-ent conceptions of America’s long-term military role in East Asia. It will probably be decades before shared economic inter-

ests become strong enough to engender strategic reconciliation between China and Japan.

In the meantime, competition be-tween China and Japan in Southeast Asia does have the potential to spiral out of control if either country seeks an explicit security role in the region. China is al-ready suspicious that the slowly expand-ing capabilities of Japan’s Self-Defense Forces portend greater Japanese military assertiveness. Japan harbors similar sus-picions about China’s opaque military buildup. Both counties may be driven to seek military cooperation with Southeast Asian countries for fear the other will do so as well. China’s economic rise, if it continues, could also push Japan to-ward military assertiveness to defend its shrinking regional role relative to that of China.

The United States can help reduce the likelihood of a spiral in Sino-Japanese competition in Southeast Asia. It should discourage Japan from seeking an inde-pendent security role in the region by continuing to maintain and strengthen its own alliances with the Philippines and Thailand, and its alliance-like ties with Singapore. This will reassure Japan of its

Owen may be reached at [email protected]

7May 2008

India’s blue-water navy provides the U.S. with an ally capable of securing the Strait of Melaka.

ascendant Democrats, that the tacit sup-port for Pakistan over India since the par-tition (and particularly the cozy relations since the 1980s) has been a mistake. Paki-stan’s recent political turmoil and contin-ued failure to take effective action against insurgents operating from its tribal regions have already begun to push the United States toward India, which promises to be a far more effective ally in establishing a moderate government in Afghanistan.

Although historical issues may some-

times push India away from the United States, the greatest determinant of Indian foreign policy will be a realist assessment of its strategic position—and this assess-ment should drive the two nations closer together. Indian and American interests dovetail on a number of international issues. In Afghanistan and the broader struggle against radical Islamic terrorism, India cannot help but support the United States; it was, after all, Mujahideen from Afghanistan who, fresh off victory over the USSR, first brought insurgency to Kashmir with Pakistani support.

Furthermore, India and the United States share a dependency on three Indian Ocean waterways that are extremely vul-

U.S., India’s democratic inheritance, now deeply ingrained in its culture, should not be lightly cast aside. Though India does deal with some unsavory regimes, most notably Iran and Burma, one of the fea-tures of Indian foreign policy has been its discernable commitment to human rights and consistent contributions to UN peace-keeping missions around the world. India was a global leader in condemning South Africa’s apartheid regime, and has taken the lead in attempting to resolve inter-nal conflict in nearby Sri Lanka and Nepal. While India’s foreign policy remains under-developed, it seems clear that its ideological focus has more in com-mon with America’s (admittedly inconsistent) commitment to democracy than with China’s breathlessly amoral courting of the world’s dictators.

On the other hand, America’s histori-cal support for Pakistan has hindered its efforts to build a relationship with India. America’s ties with Pakistan were built during the Cold War, when the U.S. chan-neled aid to Pakistan’s intelligence service in support of the anti-Soviet insurgency in Afghanistan. This aid has picked up again since September 11th, though much of it has been misdirected toward improving Pakistan’s military vis-à-vis India rather than the Taliban. There does, however, seem to be a growing recognition among American policymakers, particularly the

Asia

nerable to piracy and terrorism. India re-lies heavily on oil imports via the pipeline through Pakistan or via oil tankers travel-ing through the Strait of Hormuz and the Mandab Strait (Red Sea-Indian Ocean). The United States also cares deeply about the security of the global oil supply, and the two also share an interest in the se-curity of the Strait of Malacca, through which a massive share of the world’s trade flows.

India has made no secret of its desire to develop a blue-water navy. This interest stems partly from a desire to protect the vul-nerable trade routes mentioned above, but also from self-aggrandizing motives. India naturally sees itself as the regional center of gravity in the Indian Ocean due to its size and prominent position and seeks a navy that confirms and enhances this sta-tus. This navy will give India the ability to protect trade, particularly oil imports, and protect its physical security, giving it both diplomatic and potential military influ-ence over the nations on the periphery of the Indian Ocean. While India does not require U.S. aid to expand its naval capa-bilities, it will need certainly require U.S. assistance to avoid lagging dangerously behind China. In turn, American support for India’s naval objectives would not un-dermine its goal of maintaining global na-val superiority, but instead provide it with an ally to balance against China’s growing

regional strength.Indeed, this

particular necessi-ty will strengthen ties between the U.S. and India in the coming de-cades. As India

looks at the world, it faces two major op-tions for alignment: China or the United States. Though India would avoid com-plete subservience in either relationship, it would nevertheless be unable to become more than a junior partner for the foresee-able future. China’s economy is roughly three times the size of India’s, and thought by many to have greater short-term growth potential. The Chinese military is also vastly superior, and its burgeoning defense budget seems to indicate that this Sino-Indian disparity will only increase. While the United States also enjoys both economic and military superiority over India, America is only a remote threat, wielding regional influence more as a de-

Kyodo/AP

“American support for India’s naval objectives would provide it with an ally to balance against

China’s growing regional strength.”

Gautam Singh/AP

Biswaranjan Rout/AP

8

alliance with the U.S., or risk being frozen out of the surrounding regions altogeth-er. Ultimately, the common cultural and strategic interests of India and the United States will lead both countries to increase their military and political ties in the com-ing years, no matter the fate of the nuclear fuel deal. Afp

Asia

American Foreign Policy

fensive tool than as a precursor to direct or indirect domination. China’s strategic hinterland, on the other hand, is precisely the same as India’s: Southeast Asia and Central Asia. Competing economic in-terests aside, the United States and India can look forward to increasingly harmo-nized interests while China and India in-stead remain locked in a zero-sum game over the same prize. Furthermore, unlike areas such as oil security or terrorism, in

Lucas may be reached at [email protected]

which the U.S. supports specific Indian objectives, the Chinese threat demands a basic enhancement of Indian power: eco-nomic, diplomatic, and most importantly military.

Though Indian history leads it to be wary of close entanglement with a su-perpower, it cannot remain aloof. The growth of China’s influence in Southeast Asia, Central Asia and increasingly South Asia will force India to seek a balancing

In Contextcompiled by Tara lewis ‘11

“The whole world has a headache from your hypocrisy.”Ibrahim Ahmen Mahmound Al Qosi, a Guantanamo Bay prisoner,

commenting on the U.S.’s push for international human rights

“I have always reacted negatively to those who with their snotty noses and erotic fantasies prowl into others’ lives.”

Putin denying allegations that he divorced his wife in order to marry Olympic gymnast Alina Kabayeva

“The solution to the problem of Zimbabwe lies in the hands of the people of Zimbabwe.”South African president Thabo Mbeki asserting that Zimbabwe is not suffering from a crisis

“Thank you, Your Holiness, awesome speech.”President Bush addressing Pope Benedict XVI

after the Vatican leader’s speech in Washington

“We haven’t turned any corners. We haven’t seen any lights at the end of the tunnel.”

American Commanding General David H. Petraeus commenting on the progress of the Iraq war

“There is no war between us and our Iraqi brothers — no matter what their nationality, race or sect. The blood of Iraqis are forbidden on you.”

Infamous Shiite cleric Muqtada al-Sadr threatening war against American troops

“When millions of people are going hungry, it’s a crime against humanity that food should be diverted to biofuels.”

Indian Finance Minister Palaniappan Chidambaram assessing the drastic increases in global food prices

“His actions reward terrorists, lend support, and provide legitimacy to their belief that violence will eventually get them what they want.”

Rep. Sue Myrick criticizing Jimmy Carter for meeting with Hamas leader Khaled Meshaal in Syria

“Iraq cannot be the new Somalia.”Iraqi Prime Minister Nouriki Al-Maliki, on Iraq’s violent militias

Gerald Herbert /AP

9May 2008

strategy of engagement toward Russia rather than this sort of shortsighted po-litical calculation.

Russia has very legitimate reasons to fear NATO expansion. From the Russian perspective, NATO is a hostile military alliance originally designed to contain the Soviet Union and now de-termined to encroach on Russia’s sphere of influence. NATO’s most recent round of expansion in 2004 included the Baltic states of Latvia, Lithuania, and Estonia, former Soviet territories, and traditional Russian buffer states. Such expansion plays into Russia’s ancient and deeply held fear of western encroachment. Russia’s traditional response has been a defense-in-depth strategy, using the sheer expanse of its Eastern European territories as a buffer against the west. While previous NATO expansions have chipped away at Russia’s western fron-tier, this would be more significant. Ukraine has already fallen out of favor with the Kremlin after the 2004 Orange Revolution that replaced Russian-en-dorsed leader Viktor Yanukovych with the more pro-Western Viktor Yushchen-ko, who still serves as president. Ukrai-nian membership in the NATO alliance

weakly worded communiqué, reaffirm-ing that these countries will be NATO members at some unspecified future date. This noncommittal announce-ment is the worst of all possible alterna-tives for the future of relations between NATO and Russia. In the short term, Russia will see the rejection of the Bush expansion plan as a victory, a reward for its bad behavior and increasingly belli-cose rhetoric. Yet the policy falls short of a true engagement strategy, offering no hope for a long-term thaw in relations with Russia because it includes support for eventual enlargement as well as Eu-ropean missile defense. The summit rep-resents the failure of politics by consen-sus. Its policies were written to please every NATO constituency rather than to achieve real progress on the problem of Russian relations. NATO needs a true

Last month, NATO leaders held their annual summit in Bucha-rest, Romania, in an affair char-acterized by grand rhetoric,

half-measures and indecision. In Afghan-istan, member nations offered only mar-ginally increased military commitments, far short of the troop presence necessary to defeat entrenched Taliban forces. On the issue of missile defense, the United States and the Czech Republic finally agreed to a deal that allows American tracking radar to be based on Czech soil despite fierce Russian opposition.

As for NATO expansion, on the other hand, the alliance bowed to Rus-sian pressure, rejecting an American proposal to extend Membership Action Plans (MAPs) to the strategically im-portant states of Georgia and Ukraine. Instead, NATO leaders offered only a

nAto’S Mixed MeSSAgeSAmbivalence Toward Eastward Expansion

Dan May ‘11

europe

At their annual summit in Bucharest, NATO allies agreed to postpone offering membership to Georgia and Ukraine.

Vadim Ghirda/AP


UNITED STATES Secretary of Housing and Urban Development Alphonso Jackson resigns. The announcement comes amid in-vestigations of favoritism in selecting contrac-tors for government projects in New Orleans and Philadelphia, among other cities.

The UNITED STATES Senate approves a hous-ing relief bill intended to prevent foreclosure by offering tax breaks to homebuyers as well as to home builders. Many Democrats say the bill does not go far enough in providing relief, while the White House proposes alternative measures dealing with mortgage refinancing.

The Olympic torch is greeted by human rights protestors in Paris, FRANCE as it progresses toward Beijing. The torch itself is extinguished many times for security reasons, and its route is signifi-cantly shortened.

CROATIA and ALBANIA are invited to join NATO following heated discussions among leaders of the organization. Mace-donia, Ukraine and Georgia have all been denied membership much to the dismay of American lobbyists pressing for the inclu-sion of Ukraine and Georgia. The revamped organization will contain 28 members.

GLOBAL UPDATE

Presidential elections in PARAGUAY come to a close with the election of Fer-nando Lugo, a former bishop. His win marks an end to Colorado Party’s 61-year rule and is indicative of South America’s political shift leftward.

Silvio Berlusconi’s center-right coalition regains power over both houses in ITALY following parliamentary elections. This is likely to result in Berlusconi’s return to the office of Prime Minister for a third time.

The Prime Minister of IRELAND, Bertie Ahern, resigns as controversy arises over corruption charges early in his political career. Ahern had maintained office for over ten years, and his career was noted for progress on peace agreements with North-ern Ireland, among other things.

11May 2008

Following an apparent parliamentary victory for the opposition Movement for Democratic Change in ZIMBABWE, partial recounts are ordered. The results of the recount remain un-released, and it is believed they will be used to delegitimize the opposition victory. Human rights groups suggest that Mugabe’s party has once again begun torturing opposition leaders.

Jose Ramos-Horta, Nobel Laureate and President of EAST TIMOR, returned to the country after two months of hospitalization in Australia. He had been ambushed and shot by rebels outside of his personal residence.

GLOBAL UPDATECollected by Vishal Chanani ‘11

The leader of the nationalist Kuomintang party, Ma Ying-Jeou, is elected president of TAIWAN by an overwhelming majority. Ma expressed hopes of improving relations with Mainland China, marking a break with the isolationist government policies of his predecessor, Chen Shui-bian.

In IRAQ, the death toll for Ameri-can soldiers surpasses the 4,000 mark, further fueling the Democrat-ic Party’s opposition to the war. In response, President Bush claims that “those lives were not lost in vain.”

Also in IRAQ, American forces launch an invasion on the forces of Moktada al-Sadr in Basra. The poorly executed operation only comes to a stop after U.S. forces agree to grant amnesty to al-Sadr’s supporters. 1,300 Iraqi soldiers who failed to fight in the oper-ation are dismissed from the army. Al-Sadr’s militia, however, refuses to disband.

Unexpectedly, elections in NEPAL show a clear victory for the Maoist party, consisting of former guerrilla rebels who only recently signed peace negotiations. Such results ag-grieve neighboring INDIA as well as the United States.

President Mahmoud Ahmadinejad of IRAN announces plans to expand its uranium enrich-ment facilities by adding 6,000 centrifuges to the pre-existing stock. Meanwhile, the UN Security Council continues to demand complete disarma-ment and cessation of nuclear programs.

ETHIOPIA breaks off diplomatic relations with QATAR, accusing the country of pro-moting instability in the region by supporting violent armed oppositions. Ethiopia is also an-gered by Qatar’s close ties to ERITREA.


ers must recognize America’s limited capability to influence a nuclear armed, oil rich superpower an ocean and a con-tinent away. Rather than resist Russian aggression with military force or raw power, the Atlantic coalition should pur-sue a policy of compromise and engage-ment, acknowledging Russian suprem-acy in parts of Eastern Europe while doing its best to insulate the Ukraine and Georgia from outside pressure.

This strategy will require painful concessions. On missile defense, for example, the United States should bow to Russian demands and allow military observers into its new Polish and Czech radar sites. Given their history with the Soviet Union, these countries will not willingly accept Russian military per-sonnel onto their soil, but the United States must pressure its allies to allow the observers, as they are crucial to as-suaging Russian fears about American hostility. Moreover, NATO must per-manently shelve Georgia and Ukraine’s bid for alliance membership. While the

United States and its re-gional partners would like to protect these nascent de-mocracies from outside in-fluence, they will only pro-voke Russia by integrating them into the western mili-tary alliance. America need not abandon the two coun-

tries, but should seek to support them through more subtle economic means. Combining these two policy conces-sions with constructive negotiations, the United States and NATO can engage Russia on important regional issues like energy security and ethnic nationalism without continuing the current trend to-ward hostility. These soft line proposals will not please conservatives within the administration, but they reflect a realis-tic assessment of American capabilities. Certainly, they would represent an im-provement over the incoherent patch-work put together at Bucharest. Afp

line with the Eastern-European perspec-tive, the Bush Administration aggressive-ly championed a MAP for Georgia and Ukraine. The United States sees NATO membership as the best way to protect and consolidate recent pro-Western rev-olutions in the two countries, advancing the cause of democracy in a historically chaotic region of the world. The Bush administration has also been the leading advocate for European missile defense, couching the system as a defensive mea-sure against an increasingly dangerous Iran.

On the other side of the continent, Western European members of NATO have a strong economic incentive not to antagonize the Russian government. Western Europe relies on Russia for more than 25% of its natural gas, which will only increase as Russia opens new gas fields in the Arctic and completes its $15 billion South Stream pipeline proj-ect to bring gas through the Balkans to southern Europe. At Bucharest, this dis-unity within the NATO alliance led to

truly incoherent policy positions. West-ern Europe led by Germany and France managed to stymie the proposed MAP extension, but they acceded to Wash-ington’s more aggressive stance on the issue of missile defense. Furthermore, the parties affirmed in the alliance’s communiqué that Ukraine and Geor-gia would at some point become NATO members. Thus, the alliance managed neither to ease Russian concerns about Western aggression nor to send a strong short-term signal that NATO would stand firm against further meddling in Eastern Europe. Instead, it followed an awkward and inconsistent middle road that antagonized Russia while leaving Georgia and the Ukraine vulnerable to continued pressure.

How should NATO pursue its re-lations with Russia going forward? As much as the United States would like to resist Russia’s anti-democratic interfer-ence, even the most aggressive hardlin-

would cement Ukraine’s turn toward the west, replacing a friendly buffer state with another western military base.

NATO expansion and missile de-fense are particularly problematic given former Russian President Vladimir Pu-tin’s recent attempt to reestablish his na-tion as a world power and a regional he-gemon in Eastern Europe. Over the past couple of years Russia has aggressively intervened in Georgian and Ukrainian internal affairs to pull the countries back into the Kremlin’s sphere of influence. In Georgia, the Russian government continues to fund secessionist move-ments in South Ossetia and Abkhazia. In Ukraine, the Kremlin used its massive natural gas reserves as a weapon, shut-ting off gas supplies completely in early 2006 because the Yushchenko govern-ment refused to accept massive price in-creases for domestic consumers. NATO expansion would weaken the Kremlin’s bid for regional hegemony, while an ef-fective missile defense system might un-dermine its nuclear deterrent. Despite Western claims that the proposed missile defense system would be worthless against Russia’s enormous nu-clear arsenal, Putin has declared that missile defense is a “red line” issue, a strategic con-cession that his government simply can-not accept. Particularly given Russia’s long history of insecurity and invasion, the Kremlin’s opposition to this further NATO expansion as well as Eastern Eu-ropean missile defense is quite natural.

Clearly, NATO faces a complicated problem. The alliance must display re-solve in the face of Russia’s increasingly aggressive behavior without provoking the emerging power to greater hostil-ity. NATO responded to this difficult policy dilemma neither with a concilia-tory attempt to assuage the Kremlin’s concerns nor with a firm condemnation of Russian meddling in Eastern Eu-rope. Instead, NATO’s negotiations at Bucharest sent weak and mixed signals to Russia, which only highlighted the competing interests among members of the alliance. Eastern European NATO members, wary of the Kremlin’s aggres-sive posture, generally support NATO expansion as a firm signal of resolve. In

Europe

Dan may be reached at [email protected]

“NATO’s negotiations at Bucharest sent mixed signals to Russia, which only highlighted the competing interests among members of the alliance.”

13May 2008

exploration. Though it has had new ven-tures in Bolivia and Egypt, the company has limited its domestic efforts to revisit-ing mature fields in Russia. Gazprom’s only domestic growth has come at the expense of its competitors, through the acquisition of smaller companies and the government-assisted elimination of major rivals such as Yukos. Though individual corporations like Gazprom might benefit greatly from such a rear-rangement of Russia’s resources and through the development of other coun-tries’ reserves, the Russian economy as a whole will not. The energy sector re-mains the foundation of Russian pros-perity, comprising between 20 percent and 30 percent of the GDP, and a failure to sustain domestic energy production will threaten the stability of the entire economy.

The other significant challenge the new government faces is Russia’s stag-gering population decline. The United Nations has warned that the current population of 141 million people could decrease by as much as one-third by 2050. The causes of Russia’s popula-tion woes are myriad. Some are histori-cal, like the aftershocks of the gigantic death toll from World War I to World War II. Most, however, are current: an unusually high murder rate that aver-ages around 30,000 a year, driven up by crime and corruption; endemic al-

doMeStiC diSASterRussia’s Shaky Foundation

Matthew Drecun ‘10

The new Putin-Medvedev administration must find a way to sustain Russia’s energy industry while addressing its population decline.

ment and of the country as a whole.The oil and gas industry has fueled

both Russia’s recent economic develop-ment and the rise in Putin’s personal popularity. Maintaining the current growth of the energy sector is crucial to the continued health of both. Russia’s corporations must continue to explore and develop new domestic oil and gas fields in order to secure the future of its energy sector, as the oil or gas con-tained in any one field is finite. Most energy companies around the world are naturally driven by the desire to improve profit margins by exploring and devel-oping new fields.

But Russian energy companies have remained curiously passive. Take for ex-ample Gazprom, the company that con-trols nearly all the natural gas produc-tion in Russia, which in turn produces the most natural gas in the world. Gaz-prom’s reserves have apparently grown over the last few years, but this has not happened as a result of new domestic

On March 2, Dmitri Medvedev was elected to the presidency of the Russian Federation, succeeding incumbent Presi-

dent Vladimir Putin, who has held the seat for the past eight years. Considering Medvedev has never held an elected posi-tion prior to his endorsement by Putin in 2008, Western analysts have speculated that the new President will be only a fig-urehead, while Putin continues to domi-nate the government as Prime Minister. Such predictions, however, are problem-atic.

One must remember that Putin oc-cupied a strikingly similar situation in 2000. A virtual unknown to the Rus-sian public, he had been endorsed by President Yeltsin only months before the coming election, and most analysts dismissed Putin as a tool of Yeltsin and his inner circle. Contrary to those ex-pectations, he worked quickly to push out Yeltsin and his associates, corral-ling Russia’s oligarchs who had stiffly resisted government influence and as-serting himself as the dominant force in Russian politics. It certainly remains possible that Medvedev will only be a placeholder and figurehead. Given the example of Putin’s unexpected rise to power and the historic inaccuracy of Western predictions in general—recall how many experts were caught un-awares by the collapse of the Soviet Union—such forecasts cannot be ac-cepted on faith.

In any event, predictions about whether Putin will overshadow Medve-dev or vice versa will become irrelevant if the government as a whole fails to maintain its hold on power. Numerous problems loom ominously ahead for the new Russian government. Two among them are particularly significant: first, the uncertain future of Russia’s energy industry, and second, a significant popu-lation decline. Left unsolved, these prob-lems threaten the success of the govern-

Europe

Pool/AP


general improvement in quality of life are still fresh in the memories of most citizens. Putin’s perceived competence grants him performance-based legiti-macy, which has allowed him to secure both the election of his chosen succes-sor, Medvedev, and his own position as the new Prime Minister.

This performance legitimacy, how-ever, hinges on the ability of the Putin-Medvedev administration to continue de-livering economic success, quality of life improvements, and standard government services to the Russian people. Economic success is what Russians believe in, and if the government fails to deliver on Putin’s broad promises of improved well-being, widespread disillusionment will result.

Over the next few years, Medve-dev may manage to assert his indepen-dence as Putin did eight years ago. On the other hand, Putin may maintain his control over the government. At this point, we are unable to meaning-fully predict what will happen. We do know, however, that the prosperity of Russia’s energy sector, the health of its population, and the stability of its pub-lic infrastructure are relatively fragile. It is precisely this fragility which makes Moscow’s current diplomatic plays un-tenable in the long-term. The resurgence of Russian power has allowed Putin to adopt an increasingly assertive, anti-Western foreign policy, creating diffi-culties for the United States on dealing with Iran and establishing a European Missile Defense shield. Nevertheless, it is conceivable that population woes or a drop in the price of oil will force Rus-sia to adopt a less belligerent tone to-wards the U.S. After all, it was Russia’s economic frailty in the 1990s which led Boris Yeltsin to open it up to influence and investment from the West.

While the economic prosperity cre-ated by the energy sector has enabled Putin’s administration to stay in power; if it wishes to remain, finding solutions to these problems ought to be at the top of its list. Afp

Europe

coholism among the male population, such that the life expectancy of males is over a decade shorter than that of females; a staggering rate of 13 abor-tions for every ten births; and a failing healthcare system, crumbling from in-adequate and uneven funding. Worse still, many of these problems interact and build on each other. Poor health-care, for example, has led to poor qual-ity abortions which rendered millions of Russian women infertile.

This population decline has signifi-cant economic consequences. As each generation becomes smaller than the preceding one, there are fewer workers available to bear the older generation’s pension burden. A smaller domestic la-bor force also necessitates an increased reliance on immigrant workers, caus-ing jobs to be filled by often illiterate and undocumented Central Asian im-migrants.

Many of the problems contribut-ing to the population decline are fix-able. The healthcare infrastructure, for instance, suffers from a lack of fund-ing, which should not be a problem for the currently cash-flush Moscow gov-ernment. The government is also in a much stronger position to crack down on crime and corruption than it was a decade ago.

The Russian government has not only failed to address these societal problems, but it has also hurt, rather than helped, the energy sector. Free-market competition once helped to in-vigorate the Russian economy, but over the last few years, the government has been asserting increased state control over many companies, most notably Gazprom, and then proceeded to help its corporations establish dominant mar-ket positions. The growing convergence of business and government interests has thus shifted the focus of Russia’s highest officials away from national concerns. Not only has the government failed to prioritize the distribution of its resources, it has also neglected a number of other responsibilities, like maintaining the country’s social and transportation infrastructure, or devel-oping its banking sector and reforming its legal system. Public complacency has largely allowed Putin’s government to get away with its failure to address these ills, as the economic boom and

Matthew may be reached at [email protected]

AFP Quizmultiple choice monthly

1. Which country recently elected a former Roman Catholic bishop as President, ending 61 years of one-party rule? a) Panama b) Portugal c) Paraguay d) Poland e) Pakistan

2. Which country’s troops are fighting Islamic militants in Mogadishu, resulting in the highest level of violence in Mogadishu’s capital since 1991? a) Ethiopia b) Somaliland c) Kenya d) United States e) Kosovo

3. Which nation is rife with violence in the wake of disputed elections that allegedly led to the defeat of its only leader since independence? a) Georgia b) East Timor c) Belarus d) Zimbabwe e) North Korea

4. Which former American statesperson recently held several controversial meetings with Hamas officials despite opposition from the Bush administration? a) Madeline Albright b) Bill Clinton c) Colin Powell d) Jimmy Carter e) George H. W. Bush

5. Which country recently accused Russia of illegally shooting down its unmanned spy plane over the region of Abkhazia? a) China b) Georgia c) Ukraine d) Monaco e) Armenia

Answers on p. 18

Franco Lopez ‘10

15May 2008

Yousef Allan/AP

AP

pArAdoxeS And peACeDealing with Hamas

Duncan Fitz ‘08

For progess to be made in resolving the Israeli-Palestinean conflict, these Hamas

leaders must be brought to the negotiating table.

Middle eASt

As part of the Bush adminis-tration’s push to democratize the Middle East, the January 2006 Palestinian legislative

elections were intended to be a shining example of free, transparent, and demo-cratic elections to the Arab world. In-stead, the unexpected victory of Hamas stunned international observers and sent shockwaves reverberating throughout the region. By ending Fatah’s decades-long dominance of Palestinian politics, Hamas’s victory ushered into power an Islamist group whose raison d’être is the destruction of Israel and its replacement with an Islamic state. The Israelis and Palestinians seemed to be as far away from a negotiated two-state settlement as ever before.

The international community has struggled with how to respond to Hamas’s ascension to power, as the lat-

ter’s continued refusal to adhere to past Palestinian Authority-brokered agree-ments, recognize Israel’s right to exist, or renounce violence has placed Israeli and Fatah leaders in a difficult bind. The An-napolis Conference, which the U.S. host-ed in November 2007, was one such at-tempt to achieve an expedited final-status agreement between Israel and Palestine. Although the conference successfully managed to obtain broad Arab support for a two-state solution, the implementa-tion of the agreement has been fraught with difficulties. Continued rocket fire by Hamas and Islamic Jihad militants into southern Israel, combined with ineffec-tual American monitoring mechanisms and the weakness of Israeli and Fatah leaders, has prevented both sides from making further progress towards a final settlement.

Current American and Israeli policy

is to conduct direct negotiations for a two-state settlement with Fatah leaders, deliberately excluding Hamas from any agreement. The U.S. and Israel hope that by isolating Hamas, they will encourage the Palestinian people to reject radical Is-lam and instead support moderates like Prime Minister Mahmoud Abbas in his quest for peace.

This strategy, however, is unlikely to succeed. As long as there is fighting in Gaza, it will be virtually impossible for Israel to successfully conduct peace nego-tiations with Fatah. Hamas may choose to escalate the level of violence, thereby breaking any agreement that would ex-clude them from government, or delib-erately stir up a wave of popular anger against Israel which would force Abbas to suspend negotiations—as he did in March 2008 after an Israeli offensive. Hamas, in other words, still retains the ability and the willingness to disrupt the talks before Israel and Fatah can reach a final settlement.

Numerous Israeli experts, includ-ing former Foreign Minister Shlomo


Ben-Ami and Efraim Halevy, the former Mossad Chief and Head of the Israeli National Security Council, have made the case that only engagement can di-lute the power and extremism of Hamas. Halevy, for instance, argues that Fatah is far too weak militarily, politically, and socially to make the necessary sacrifices on behalf of peace. “I have no sympathy whatsoever for Hamas,” he clarifies. “I think they are a ghastly crowd . . . but I have not seen anybody who says the Abbas-Fayad tandem is going to do the job.”

As the hopes raised by the Annapo-lis Conference dwindle in the face of the continued violence in Gaza, it is becom-ing apparent that no serious peace deal can be successfully implemented without Hamas’s consent. For peace to succeed, Hamas must be given a stake in the negotiations. Otherwise, rockets will continue terrorizing inno-cent Israeli civilians in the western Negev and peace agreements with Abbas will inevitably falter. On Israel’s part, it must reject is the use of military force, as buffer zones and small- or large-scale in-vasions are but temporary solutions, and are unlikely to put a permanent stop to the violence on the ground.

Once the military option is ruled out, the critical question then becomes whether or not Hamas can play a con-structive role and live up to its obliga-tions in a new type of negotiated peace settlement. Although it has remained steadfast in its opposition to Israel’s right to exist, many of Hamas’s leaders have in fact been gradually—if grudgingly—moving toward consensual international positions regarding a two-state solution. Most recently, Khalid Mishal told the Palestinian newspaper Al-Ayam in April 2008 that Hamas supported an indepen-dent state based in the 1967 boundar-ies and promised to coexist peacefully alongside Israel. He declared that “all organizations [including Hamas] say they agree to a state in the 1967 borders” and repeated Hamas’s support for a mu-tual cessation of violence throughout the Occupied Territories. This is a landmark occasion, as he is the first senior Hamas leader to express a willingness to coexist peacefully with the Israeli state as part of a Palestinian Authority which recognizes

Middle East

Israel’s legitimacy. This rhetorical hedg-ing from one of Hamas’s more radical leaders is reminiscent of steps taken by the ANC, IRA, and PLO leadership on their paths to peace, and suggests the po-tential for a continued evolution towards a negotiated compromise.

The best course of action for Ameri-ca is to implement a short-term ceasefire, reform the Palestinian National Unity government, and establish a two-state solution between Israel and this new Na-tional Unity government which explicitly recognizes Israel’s right to exist without requiring Hamas to do so independently of the Palestinian Authority. Such an agreement, sold as a binding but renew-able hudna (cease-fire) to the Hamas rank-and-file, gives Hamas a stake in the new Palestinian National Unity govern-

ment—as opposed to continued isola-tion—and offers the best chance to give hope to the Palestinian people, improve Israeli security, and bring peace to the re-gion. Though Hamas’s inclusion does not guarantee an Israeli-Palestinian peace, it at least makes such an outcome possible, as it will now have a vested interest in cooperating with Israel to achieve a two-state solution.

Our first priority must be working to-wards the establishment of a Palestinian state, as it would ease the way to Palestin-ian recognition of Israel and give the Pal-estinian Authority an incentive to clamp down on violent extremists and encour-age integration into the international community. Moreover, Palestinian state-hood would empower moderates within both Hamas and Fatah, and reduce or-dinary Palestinian’s resentment of Israel. Indeed, once they perceive that an agree-ment between Israel and a Palestinian National Unity government is possible, the appeal of radical Islam will quickly decline, as people now have an alternative to violence and hatred. This would take the form of a negotiated two-state solu-tion, albeit one sold by Hamas leaders as “temporary” to their rank-and-file, but which forces them to implicitly recognize Israel as part of the newly-formed Unity

government. Both Ben-Ami and Halevy argue that if Hamas can clamp down on all militants operating in the Gaza Strip and support an Israeli-Palestinian Authority agreement which recognizes the Israel’s right to exist, insisting upon Hamas’s formal recognition of Israel as a precursor to dialogue is detrimental to Is-raeli security interests. In support of this claim, they point to the armistice agree-ments signed between Israel and four of its neighbors in 1949, which did not provide for formal recognition but still dramatically enhanced Israeli security by encouraging moderation from its ene-mies. Similarly, Hamas leaders may very well find themselves trapped between upholding an agreement which steadily erodes their power or violating their own proposal and exposing themselves as in-

herently hostile to peace. Such a settlement, there-fore, is likely to neutralize radical elements within Hamas over time.

The current attempts at peace have taken on a

renewed importance for the future of the Israeli-Palestinian conflict. The policies advocated here seek to build on Hamas’s gradual evolution and empower Palestin-ian moderates of all parties in an effort to reverse the radicalization of Palestin-ian society. It is imperative that the Unit-ed States help bring about a negotiated settlement that has the ability to usher in a lasting peace for all Israelis and Pales-tinians alike. Otherwise, in the words of former National Security Advisors Zbig-niew Brzezinski and Brent Scowcroft, “failure risks devastating consequences” for the United States, Israel, and the en-tire Middle East. The stakes have never been higher. As former Israeli Prime Minister Yitzhak Rabin once observed, “we must think differently, look at things in a different way . . . peace requires a world of new concepts, new definitions.” Taken together, these policy recommen-dations will enable the United States and Israel to rise to the occasion. Afp

Duncan may be reached at [email protected]

“Though Hamas’s inclusion does not guarantee an Israeli-Palestinian peace, it at least makes such an outcome possible.”

17May 2008

maximize their comparative advantage by specializing in the goods and services they make best, and improves produc-tion efficiency of all industries. This cre-ates cheaper goods and therefore higher living standards, thus benefiting all par-ties involved. According to a 2004 report from the Cato Institute, the per capita GDP in the quintile of countries with the most restrictive trading policies was only $1,883 in 2002, while the per capita GDP for the same year in the quintile of countries with the most liberal trad-ing policies was $23,938. Moreover, free trade is also one of the strongest factors in promoting development. As Colombia University economist Arvind Panagariya observes, “on the poverty front, there is

overwhelming evidence that trade openness is a more trustworthy friend of the poor than protection-ism. Few countries have grown rapidly without a simultaneous rapid expan-sion of trade. In turn, rapid

growth has almost always led to reduc-tion in poverty.”

Though economists present persua-sive data that free trade creates jobs, ben-efits consumers with lower prices, and boosts overall economic growth, today’s public is still unconvinced. Opinion polls

Political support for free trade has been on the rise since the Reagan era, most notably under President Clinton, who argued

that the economy could only achieve sus-tained growth if global markets were al-lowed to operate without restraint. This free market approach coincided with a period of economic prosper-ity, low unemployment, and falling trade deficits. As these conditions have begun to re-verse, however, the populist approach is now gaining in-fluence.

Populist arguments con-trast the interests of the masses and the elites, noting how economic benefits have flowed disproportionately into the hands of corporate leaders and Ameri-ca’s wealthiest families. This imbalance has only worsened in recent years. Pro-ponents of populism want to reevaluate

America’s role in the global economy and regulate markets. For example, they would refuse any trade agreements with-out protectionist clauses that would try to limit layoffs and shield incomes. The rise of populist economics among politi-cal leaders threatens to reverse the trend towards free trade that has characterized

American policy for the past three de-cades.

These politicians seem to have forgot-ten the vast benefits that trade liberaliza-tion has brought to America and its trad-ing partners. Free trade improves global resource allocation, allows countries to

riSe oF the populiStSShifts in American Trade Policy

Laura Kergosien ‘10

u.S. Foreign poliCy

Courting the little guy?

Charlie Neibergall/AP J. Scott Applewhite/AP

“Politicians would do well to reverse the trend toward populism by

ameliorating American concerns with free trade.”


income gains are redistributed and that lower and middle class Americans will have the resources necessary to succeed in a liberalized trade system. The Ameri-can public can demand social security networks that protect people who can-not earn a living wage, as well as policies that work to ensure that the poor do not remained trapped in a cycle of poverty. These were goals that America pursued when competition was limited to Ameri-can businesses, and they are goals that we can pursue in the modern world of global competition. Indeed, they are goals we must pursue to ensure that free trade, which has brought unsurpassed wealth to our country, is sustainable in the long run. Furthermore, such pursuit is essential for reassuring our trading partners that our markets are desirable and reliable.

Issues surrounding free trade, pro-tectionism, and economic populism are likely to remain important in the upcom-ing elections. The whole debate may best be summed up in a report released in No-vember 2007 by the centrist Democratic group Third Way. “Fair traders fight with values; free traders fight with data. This is like bringing a knife to a gunfight. As a consequence, our arguments are elit-ist, our numbers are unconvincing, and Americans don’t think the economic ben-efits of trade are worth the moral and so-cial costs.” As Hilary Clinton and Barack Obama continually try to outdo each oth-er in blaming the troubles of the Ameri-can middle class on NAFTA, free traders have no choice but to expand their argu-ments to show America both that free trade works and that social justice can be a part of the resulting economic prosper-ity. Unless that happens, free trade, along with America’s economic preeminence, may soon become extinct. Afp

show most Americans believe free trade destroys American jobs and its benefits largely accrue to large corporations. This skepticism is based upon legitimate con-cerns, as income inequality has contin-ued to increase despite the past few years of relatively strong GDP growth, man-ageable inflation, and a healthy stock market. Adjusted for inflation, the aver-age income of the bottom 90% of Ameri-cans decreased by 12% between 1973 and 2005, despite the fact that real per-capita income increased by 68% between 1980 and 2006. After several decades of pro-moting free trade, we’ve seen its largest gains realized by the rich, and its job loss-es through outsourced industries concen-trated in the lower and middle classes. Many Americans resent this unfair allo-cation and want to see capitalism regu-lated with a social conscience in order to minimize inequality, provide a safety net to victims of outsourcing and protect the environment. Populism addresses these moral concerns and promises to protect workers from the dangers of global trade, albeit at the cost of some economic pros-perity.

This, however, is not a small cost. Protectionist subsidies, as well as labor and environmental clauses, infuriate our trading partners and damage our reputa-tion throughout the world. For instance, countries with lower living standards and cheaper labor have a comparative ad-vantage in low skill manufacturing, and consider it unfair that wealthy nations, which had their chance to develop with-out environmental and labor restrictions, are now placing such limitations upon

today’s developing economies. These countries will turn from the U.S. towards China and other countries which provide market opportunities without such im-positions. Many will take their business elsewhere.

Evidence suggests that changes in in-ternational opinion towards the U.S. as a trading partner are already occurring. As Democratic presidential candidates vow to repeal or seriously rework NAFTA, Colombian and Canadian foreign min-isters have complained that America is not a reliable trading partner. Deals with South Korea meant to solidify our al-liance are falling through in both coun-tries; the recent Doha Round of trade talks failed largely because the rest of the world has had enough of exorbitant American and European agricultural protectionism. A Mexican trade minis-ter, working in Washington for the past two decades, noted that he found on his recent visit to Congress “an almost xeno-phobic mood of a kind that he had never before encountered.” As populism gains traction in America, the U.S.’s reputation as a worthwhile trading partner will con-tinue to wither.

Politicians with an interest in im-proving or even in maintaining Amer-ica’s economy would do well to try to reverse the trend towards populism by ameliorating American concerns with free trade. Wage insurance and educa-tion programs for laid off workers could alleviate much of the harm caused by trade liberalization in some of America’s increasingly obsolete industries. Progres-sive income tax will help ensure that

U.S. Foreign Policy

Answers for the quiz on page 14: 1) c 4) d 2) a 5) b 3) d

Laura may be reached at [email protected]

This may be a long lunch break, guys.

David Kohl/AP

19May 2008

BRIC-A-BRACThe Perils in Store for These Rising Stars

Mohit Agrawal ‘11

The last few years have ushered in the rise of the BRIC states:

Brazil, Russia, India, and China. To-gether, these behemoth have a popu-lation of 2.803 BILLION, or fully 42% of the world population. The economic growth of these nations has increased their political clout: Brazil serves to counter Venezuela, Russia is successfully blocking American policies in Eastern Europe and Cen-

tral Asia, India is bidding for a seat on the Security Council, and China is poised to host the 2008 Olympics. In spite of these successes, however, each country faces critical issues. From the environment to popula-tion growth to infrastructure needs and education, these are only some of the problems which could bring down the rising stars. Will these ris-ing stars overcome or flame out?

3 DAYS time it takes to unload and reload a cargo ship in the port of Mumbai. In Shanghai, the statistic is 8 hours. The lack of efficient transportation in India is a bot-tleneck on its economic growth.

300 THOUSAND

people who suffer acute pesticide poisoning in Brazil each year. Due to the rise of export-based agribusiness, pesticide use is skyrocketing, hurting both people and the environment.

45 THOUSAND

people who were injured daily on roads in China (2004). On average, 600 people were killed daily, or about 220,000 annually. That’s roughly the population of Orlando, Florida.

#143

rank of Russia in the Corruption Preception Index (Transparency International), out of 179 coun-tries. Brazil, India, and China are all tied at #72, while the United States is at #20.

5 CENTS for each rat killed in the Indian state of Mizoram this year. Due to a once-in-49-years flowering of bamboo in the state, the population of rats has rapidly multi-plied, decimating the local rice crop.

5.5 PEOPLE

per square meter in a jail in Rio state. The rate of incar-ceration in Brazil rapidly doubled from 1995 to 2003, causing mass prison overcrowding. Riots and mass breakouts have become common in Brazil.

-14 MILLION

expected population change in Russia over the next 20 years. The Russia population is quickly aging, indicating that economic growth could quickly come to a standstill.

2.82%of GDP spent on education in Chi-na. India spends nearly 4% while the U.S. 6%. From 2000-05, illit-eracy grew in China by over 30 mil-lion people. Illiteracy is hampering China’s economic growth.

By the nuMBerS

Excited?

Get more AFP atwww.princeton.edu/~afp

Tsvangirayi Mukwazhi /AP

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May 2008