THE REAL THREAT IN THE MIDDLE EAST – F. ZAKARIA

THE REAL THREAT IN THE MIDDLE EAST

By Fareed Zakaria

As 2011 was coming to a close, Israeli Prime Minister Benjamin Netanyahu made a remarkable speech to his parliament. Assessing the Arab Spring barely a year after it had begun, Netanyahu announced triumphantly that it had failed, that events had confirmed his extreme suspicion about the pro-democracy movements in the region. The Arab Spring was moving the Middle East “not forward, but backward.”

Netanyahu seems to endorse the Syrian regime’s approach to political protest. During the uprising in Egypt, he wanted the U.S. to stubbornly cling to Hosni Mubarak–who had cooperated with Israel on mutual security issues–as millions of Egyptians gathered in public squares across the country to demand democracy. But leaving that aside, the evidence for Netanyahu’s pessimism now is that parties advocating an Islamic approach to politics have won pluralities in Egypt’s first post-Mubarak elections. None of these parties have abrogated civil liberties or persecuted minorities or limited women’s rights. Each party has promised to abide by constitutional processes. This may all be a ruse, and they may prove less liberal over time–some surely will–but there is little current evidence from which to draw the sweeping conclusions that Netanyahu did.

In fact, the growth of democracy in the Middle East is under substantial threat, but not from Islamic democrats. The threat arises from the lingering authoritarian impulse of those in power–from ruling political parties and from the military. Obsessed with political Islam, we are ignoring the real danger on the ground.

Consider Egypt. While Netanyahu is fretting about Islamic parliamentarians, the Egyptian military has been busily consolidating its control. A few weeks ago, the government raided the offices of 10 civic organizations whose only mission is to promote democracy, the rule of law and civil rights. It accused a few of these groups, such as Freedom House and the International Republican Institute, of receiving funds from the U.S.

Egypt’s military has used the traditional tools of authoritarian regimes to retain power–arrests, torture, military trials and scaremongering. In Iraq, six years after the country’s first free elections, Prime Minister Nouri al-Maliki is using more unusual methods to cement his grip on the country. He has ordered the arrests of leading politicians–including his own Vice President (who comes from another sect and political party)–centralized the army and intelligence services and inserted his own party, the Dawa, into most of the major organs of government. Many Iraqis believe that Maliki refused to cut a deal with Washington so that American troops would have to leave Iraq and leave him unconstrained.

The most complex case is Turkey, where the former head of the military, General Ilker Basbug–one of 60 officers accused of a conspiracy to topple the democratically elected government of Recep Tayyip Erdogan–was arrested last week. These arrests are cited as one more piece of evidence that Turkey is turning away from its secular roots and toward Islamic fundamentalism.

Prime Minister Erdogan speaks in blunt ways and is a populist. But he has done nothing–no changes in laws or practices–to warrant the charge that he is dismantling secularism. In fact, Erdogan’s government has passed more economic and political reforms than any other Turkish government in history. It has made unprecedented concessions to Turkey’s Kurdish minority. In its quest to secure European Union membership for Turkey, Erdogan’s AK Party has passed hundreds of pieces of legislation over the past several decades to make Turkey’s political system conform to the guidelines set out by the Brussels bureaucrats. And by the way, the Turkish military has, over the years, planned and executed four coups against elected governments, so it is not inconceivable that it had been planning a fifth.

If there is a worry regarding Turkey, it is not about political Islam but about the autocratic tendencies of a wildly popular politician. Turkey has a highly authoritarian legal system, a legacy of its military era. (A human rights group notes that about half the nation’s prisoners have never been charged with crimes.) And Erdogan, having won his third thumping electoral victory, has used this system to harass opponents, including politicians, journalists and generals.

In other words, the danger in the Middle East is not that Islam corrupts but that power corrupts. A more open and democratic system is no panacea, but it will begin to create a more normal, modern politics for the region, one that will allow for populism and demagoguery but also provide greater accountability, transfers of power and media oversight. And that will move the Middle East forward, not back.

 

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Think jobs, not debt – Global Public Square, Obama’s Job No. 1: Create jobs – Washington Post

Think jobs, not debt – Global Public Square – CNN.com Blogs.                   Published: August 20th

Obama’s Job No. 1: Create jobs Washington Post By Fareed Zakaria,        Published: August 17th 

Democrats are finally up for a fight — with President Obama. Having despaired that Obama gave in to the Tea Party on the debt deal, they now criticize him as too cautious in his proposals to boost American jobs. They’re right that Obama should present a sharp distinction to the public between his efforts and the Republican Party’s utter passivity in the face of a national employment crisis. But perhaps Obama realizes that the most important factor that will help his reelection — and Democratic prospects more generally — is a rise in employment. And to have any impact on the actual economy, Obama needs proposals that can get through Congress, not ones that sound good on TV.

The problem before the country is more acute than people realize. It goes beyond the indebtedness issues that are surely depressing the recovery. In June, the McKinsey Global Institute published an eye-opening report called “An economy that works: Job creation and America’s future.” It points out that for 20 years, America has had huge difficulties creating jobs. After every recession since the Second World War, once gross domestic product recovered to pre-recession levels, employment also returned to pre-recession levels within about six months.

Until 1990. In the recession that began in 1990, it took 15 months for jobs to come back after GDP had recovered. In the recession of 2001, it took 39 months for jobs to come back.

And now? Since the start of this year, American GDP has returned to its pre-crisis levels — but with 6.8 million fewer workers. At the current rate of job creation, it will take 60 months — five years! — before employment returns to pre-recession levels.

Even these numbers mask the problem. The Nobel Prize-winning economist Michael Spence has found that of the 27 million jobs created between 1990 and 2008, 40 percent were in government and health care — sectors that can’t keep growing at their previous pace. Meanwhile, employment in the tradable sector of the U.S. economy, the sector that produces goods and services that can be consumed anywhere, such as manufactured products, engineering and consulting services — which accounted for more than 34 million jobs in 1990 — grew by just 600,000 jobs over the same 18-year period.

Why is this happening? Nobody knows for sure, but it does seem as though the timing coincides with the two great tidal waves that have been powering the global economy since 1990. The first is information technology, which expanded from a narrow, data-processing function in the 1980s to streamline every aspect of every business. Today, computer programs that do conceptual searches are used at law firms to read and code documents, replacing the dozens of young associates who used to be hired and paid handsomely to do the same job.

The second big shift is, of course, globalization, which has created a worldwide supply that allows companies to make new investments in regions where labor is cheap and newly emerging middle classes are eager for their products. The results have been great for American companies, but these same forces place enormous pressures on the American worker. The decline in American education has left Americans less able to compete in a world in which skills are the only path to high-wage jobs. As Bill Gross, the founder of the world’s largest bond fund, Pimco, succinctly put it, “Our labor force is too expensive and poorly educated for today’s marketplace.”

If we’re going to solve this problem, it will take a determination to make jobs Job One. Everything we do as a country should be geared toward the central task of boosting employment. Some of this will involve government spending. An infrastructure bank that uses current low interest rates, includes the private sector and chooses projects based on merit rather than patronage is one of the best ideas to come out of Washington in years. Obama should take his proposals to the country and press for a project to rebuild America.

But there are many cost-free policies that could boost jobs. Tourism is one of the largest growth industries in America, and yet because of exaggerated fears of terrorism, bureaucracy and politics, we have lost market share in global tourism over the past decade. We should make it much easier for tourists to get visas and work hard to make them feel welcome. They are, in the words of Starwood Hotels CEO Frits van Paasschen, a walking stimulus program.

The key is to subordinate politics to a national goal of job creation. Right now, a smart program to rationalize the patent process, which could unleash thousands of start-ups, is languishing in Congress not because of some principled opposition but because of turf battles between congressional committees. We can’t keep doing this.

comments@fareedzakaria.com

TIME: FAREED ZAKARIA – THE DEBT DEAL’S FAILURE

TIME: Fareed Zakaria.

By Fareed Zakaria

In narrow economic terms, the debt deal is actually not a big deal, neither as good as its advocates claim nor as terrifying as its opponents fear. The actual cut to the 2012 budget, the only budget over which this Congress has control, is $21 billion out of total expenditures of $3.7 trillion—a pittance. Everything else can and will be changed by future Congresses. What the deal does is kick tough choices down the road, this time to a congressional super­commission that will have to come up with a larger plan to reduce debt. And it does nothing to spur growth, without which the debt will expand well above projections. That’s why the usually circumspect Mohamed El- Erian, head of Pimco, the world’s largest bond fund, grades the deal somewhere between an incomplete and a fail. “Other than eliminating default risk emanating from a self-manufactured crisis,” he writes, “there is nothing good about America’s debt ceiling debacle.”

The deal’s largest impact will be political, and there it has been a disaster. The manner in which it was produced added poison to an already toxic atmosphere in Washington, making compromise even more difficult. Democrats now feel they need to mirror the Tea Party’s tactics and are becoming unyielding on any cuts to entitlement programs like Medicare. Republicans, emboldened by the success of their bullying, have closed ranks more solidly around a no-tax agenda. But the only solution to America’s debt dilemma will need to involve both cuts to entitlement programs and higher tax revenues. Even if the besmirched ratings agencies don’t downgrade America, we’ve downgraded ourselves. The system did not work.

Evidence of a working system would have been the adoption of a grand bargain almost forged between President Obama and House Speaker John Boehner to reduce the budget deficit by almost $4 trillion over 10 years, a plan that might actually have been enforced, because both parties would have been invested in it, each having contributed to shaping it. The system would have worked if it had adopted some version of the Bowles-Simpson plan, which reduces the national debt by the same amount, with pain on both sides of the aisle, but in an even smarter way. This is how Congress used to work: grand bipartisan bargains to solve difficult problems with compromises by both sides. This is not nostalgia. It is how the system worked in the 1980s and ’90s to save Social Security, reform the tax code, rationalize immigration policy and close hundreds of military bases.

Instead, we have demonstrated to ourselves, the world and global markets that our political system is broken and that we are incapable of conceiving and implementing sensible public policy. What we have instead is the prospect of more late-night cliff-hangers, extreme tactics, budget guillotines, filibusters and presidential vetoes. It makes for good TV news specials, but it is a sorry picture of how the world’s leading country governs itself.

There is one silver lining. The sword of Damocles that hangs over Congress (steep reductions in defense and Medicare if the two sides can’t agree to a basket of other cuts) is supposed to make legislators act more sensibly. Actually, it might provoke something more important: a national debate on the role of government. This might well have been Obama’s calculation and his purpose in accepting the debt deal—that it would end the crisis, in which the Tea Partyers held the country’s creditworthiness hostage to their agenda, and force a broader national discussion, one he is comfortable leading. If so, such a debate is long overdue. For more than a generation, Americans have delayed it, at incalculable cost to the country.

The modern seesaw about the role of government began with Ronald Reagan, who rode to the White House in 1980 on a tide of frustration with high taxes and big government. He promised to cut both down to size. He succeeded with taxes, reducing rates across the board and closing loopholes. Although he raised taxes several times during his presidency, by the time he left office in 1989, taxes were at 18% of GDP, down from about 20%.

But what he did not do was cut spending consistently. Spending under Reagan averaged 22.4% of GDP, well above the 1971–2009 average of 20.6%. Yes, much of this was for defense, but almost everything went up during his Administration. Farm subsidies, for example, rose 140%. If you lower taxes and don’t trim expenses, there is only one way to make up the difference: by borrowing. The national debt tripled, from $712 billion in 1980 to $2 trillion in 1988.

Reagan reflected the American public’s basic preferences. We want big government but low taxes. The only way to make this work, short of magic, is debt. And government at every level—state, city and local—followed this pattern and took on ever increasing amounts of debt. In fact, because of weak accounting requirements, politicians at the state level have even resorted to a kind of budgetary magic to satisfy key constituencies. When public-sector employees want pay raises, politicians provide just modest step-ups in salary but huge increases in pension and retirement health care benefits. That way, the (fraudulent) budget numbers don’t look that bad until years later, when the politicians who did the damage have safely retired.

Over the past three decades, this pattern has persisted, with a few exceptions at the federal level. Tax hikes and spending restraint under George H.W. Bush and even more so under Bill Clinton brought the problem under control and in the late Clinton years even produced a budget surplus. Then came the George W. Bush tax cuts, expanded health care benefits and two wars—all unpaid for—without any tax increases. The result: the surplus disappeared, and by 2008, the debt had ballooned to $10 billion. The final blow was the financial crisis and recession, which meant that federal tax revenues collapsed, followed by more tax cuts and stimulus spending. The debt rose to its current $14.3 trillion.

We couldn’t be grappling with this at a worse time. Many economists believe that the economy is fragile and that it would be better not to cut spending or raise taxes at this point. It’s true. The sensible economic policy would be more stimulus now and major deficit reduction in a few years. But that kind of smart, sequenced public policy is simply beyond the reach of the American system today.

So far, the national debate has been built around the fantasy that we do not have to choose between big government and low taxes—that we can get both by cutting waste, fraud and abuse. But the money is in the big middle-class items, from Medicare to the mortgage- interest deduction. With federal taxes at 15% of GDP, a historic low, and spending at 24% of GDP, there is really no conceivable way to close the gap without increasing taxes—either raising rates or eliminating deductions and loopholes. And Republicans might find to their dismay that when forced to choose, Americans will decide that they like their government programs after all. Polls show that the public would rather raise taxes than, for example, cut Medicare. (In fact, we would have to do both.) The public may hate government in theory, but it has warm feelings about most individual government programs, from the space shuttle to Head Start to Pell Grants. This may be why Obama might be happy to have this debate in 2012 and urge a mix of cuts and increased revenues.

Whatever the outcome of the ideological debate, that outcome has to then be translated into public policy. For that to happen, we need a government that works. What the debt crisis has highlighted is that Congress—the heart of day-to-day government—is utterly and completely broken.

Can one measure this breakdown? Yes. Congress is more polarized than ever before. A National Journal study shows that, for the first time since the publication began tracking the divide 30 years ago, the most left-wing Republican is more conservative than the most right-wing Democrat. There is no overlapping set of moderates, who used to engineer congressional compromises. This polarization has resulted in paralysis. More than two years into the Obama Administration, hundreds of key positions in government remain vacant for lack of Senate confirmation. The Treasury Department had to handle the global financial crisis, recession, bank stress tests and automaker bailouts, as well as its usual duties, with about a dozen of its senior positions—almost its entire top management—vacant. Senate rules have been used, abused and twisted to allow constant delay and blockage. The filibuster, historically employed about once a decade, is now a routine procedure that allows the minority to thwart the will of the majority. In 2009, Senate Republicans filibustered a stunning 80% of major legislation. Given how the chamber is composed—two Senators per state, no matter how thinly populated—people representing just 10% of the country can block all legislation. Is that how a democracy should function?

American parties now function like European parliamentary ones, ideologically pure and with tight discipline. But we don’t have a European system. In parliamentary systems, power is united so that when, for example, the British Prime Minister’s coalition takes office, it controls the legislative branch as well as the executive. The Prime Minister is, in effect, chief legislator as well as chief executive. The ruling party gets a chance to implement its agenda, and then the public can either re-elect it or throw the bums out. The U.S. system is one of shared and overlapping powers. No one person or party is fully in control; everyone is checked and balanced. People have to cooperate for anything to get done. That is why the Tea Party’s insistence on holding the debt ceiling hostage in order to force its policies on the country—the first time the debt ceiling has been used this way—was so deeply un-American.

The strength of the Tea Party is part of a broader phenomenon: the rise of small, intensely motivated groups that have been able to capture American politics. The causes are by now familiar. The redistricting of Congress creates safe seats, so the incentive is to pander to the extremes to fend off primary challenges, rather than to work toward the center. Narrow cast media amplify strong voices at the ends of the spectrum and make politicians pay a price for any deviation from dogma. A more open and transparent Congress has meant a Congress more easily pressured by small interest groups and lobbyists. Ironically, during this period, more and more Americans identify as independents. Registered independents are at an all-time high. But that doesn’t matter. The system in Congress reflects not rule by the majority but rule by the minority— fanatical, organized minorities.

These dysfunctions have reached crisis levels at the very time the U.S. faces intense pressures from an aging population, technological change and globalization. We need smart policies in every field. We need to pare spending in areas like health care and pensions but invest in others like research and development, infrastructure and education in order to grow. In an age of budgetary limits, money needs to be spent wisely and only on projects that are effective. But in area after area—energy, immigration, infrastructure—government policy is sub optimal, a sad mixture of political payoffs and ideological positioning. Countries from Canada to Australia to Singapore implement smart policies and copy best practices from around the world. We bicker and remain paralyzed.

Some of those best practices used to be American. The world once looked at America with awe as we built the interstate highway system, created the best public education in the world, put a man on the moon and invested in the frontiers of knowledge. That is not how the world sees America today. People watched what happened over the past month and could not comprehend it. We have taken something that the world never doubted—the credibility of the U.S.—and put it into question. From now on, every time the debt ceiling has to be debated, the world will wonder, Will America honor its commitments? Will it keep its word? Will the system break down? We have taken our most precious resource, the trust of the world, and gambled with it. If, as a result of these congressional antics, interest rates on America’s debt rise by 1% —in other words, if the world asks for just a little bit more interest to lend us money—the budget deficit will rise by $1.3 trillion over 10 years. That would more than wipe out the entire 10 years of cuts proposed in the debt deal. That’s the American system at work these days.


A way out of our dysfunctional politics – Global Public Square – CNN.com Blogs

A way out of our dysfunctional politics – Global Public Square – CNN.com Blogs.

U.S. Capital Building

In the standoff over the debt crisis, it’s easy to point the finger at the Tea Party. Even conservative commentators have argued that its uncompromising ideology is at the heart of the problem. But there have often been strong ideological movements in American politics, represented by politicians such as William Jennings Bryan, Barry Goldwater and George McGovern.

Yet between elections, people still found ways to compromise and govern. What has steadily changed over the past three or four decades is not so much the ideological intensity (though it has grown) but the structure of politics, making it more beholden to narrow, specialized interests — including ideological ones — rather than broader national ones.There was no golden age in Washington when people were more high-minded than they are today. But 40 years ago, the rules and organizing framework of politics made it easier for the two parties to work together. Since then, a series of changes has led to the narrowcasting of American politics. Redistricting has created safe seats so that, for most House members, their only concern is a challenge from the right (for Republicans) and the left (for Democrats).

U.S. Constitution: A flexible document

U.S. Constitution: A flexible document   

Yesterday night, Fareed Zakaria talked with Eliot Spitzer and Simon Schama about the U.S. Constitution, a topic that has stirred much discussion on the Global Public Square. Their key point was that our founding document is not monolithic — it requires constant interpretation and re-interpretation. Here’s an edited transcript of their conversation: Eliot Spitzer: Rarely has Constitution been at the heart of our politics as much as it is today — … Read More

U.S. Constitution

via Global Public Square

Why the 21st Century will not belong to China (via Global Public Square)

Why the 21st Century will not belong to China

Editor’s Note: The following is an edited transcript of Fareed Zakaria’s opening and closing statements at the Munk Debate where he joined Henry Kissinger in arguing against the proposition: “The 21st Century will belong to China.” You can watch the debate here. By Fareed Zakaria, CNN China is not going to be the dominant power of the 21st century for three reasons: economic, political and geo-political. Economic One thing we’ve realized over rec … Read More

BEIJING, CHINA - JUNE 28 *CNN*

via Global Public Square

America risks losing its immigration advantage (via Global Public Square)

America risks losing its immigration advantage

By Fareed Zakaria, CNN Lately, I’ve been thinking about how the United States is different from Greece. One of the biggest differences that sets the United States apart from every other rich country in the world is that America is demographically vibrant. Almost every rich country in the world faces problems of the welfare state which are technically fixable by reducing entitlements, raising retirement ages and working healthcare costs.  But … Read More

Kevin Nunoz, 5, marches during a May Day protest May 1, 2011 in Los Angeles, California. Thousands of people marched for immigration reform, among other issues.

via Global Public Square