The Mound of Sound

Retired 4-star general, former Republican Secretary of State Colin Powell has endorsed Barack Obama as president of the United States.

From The New York Times:

Powell, “endorsed Senator Barack Obama for president on Sunday morning as a candidate who was reaching out in a “more diverse and inclusive way across our society” and offering a “calm, patient, intellectual, steady approach” to the nation’s problems.”

While Powell has been a friend and advisor to McCain for decades, he criticized the McCain campaign’s attempts to smear Obama for his passing acquaintance with William Ayers. “I thought that was over the top,” Mr. Powell told reporters. “It was beyond just good political fighting back and forth.”

Powell added that McCain would simply be a new face pasted on the “orthodoxy of the Republican agenda.”

I suspect we’re beginning to see the Republican Party undergo a healthy re-alignment with the moderates – Powell, Chuck Hagel, even the Chicago Tribune, rejecting the neo-conservative movement of Bush/Cheney now embraced by John McCain. Sounds like they want their party back. They’re drawing a line in the sand, telling the neo-cons that they would prefer to back a Dem than allow their party to languish in the far right of extremism. I wonder when progressive Conservatives will catch on.

In this era of uncertainty it’s refreshing to hear a voice of reasoned optimism. From Newsweek’s Fareed Zakaria:

Since the 1980s, Americans have consumed more than they produced—and they have made up the difference by borrowing.

Two decades of easy money and innovative financial products meant that virtually anyone could borrow any amount of money for any purpose. If we wanted a bigger house, a better TV or a faster car, and we didn’t actually have the money to pay for it, no problem. We put it on a credit card, took out a massive mortgage and financed our fantasies. As the fantasies grew, so did household debt, from $680 billion in 1974 to $14 trillion today. The total has doubled in just the past seven years. The average household owns 13 credit cards, and 40 percent of them carry a balance, up from 6 percent in 1970.

But the average American’s behavior was virtue itself compared with the government’s. Every city, every county and every state has wanted to preserve its many and proliferating operations and yet not raise taxes. How to square this circle? By borrowing, using ever more elaborate financial instruments. Revenue bonds were backed up by the prospect of future income from taxes or lotteries. “A growing trend is to securitize future federal funding for highways, housing and other items,” says Chris Edwards of the Cato Institute. The effect on the projects, he points out, is to make them more expensive, since they incur interest payments. Because they “insulate the taxpayer from the cost”—all that needs to be paid now is the interest—they also tend to produce cost overruns.

The whole country has been complicit in a great fraud. As economist Jeffrey Sachs points out, “We’ve wanted lots of government, but we haven’t wanted to pay for it.” So we’ve borrowed our way out of the problem. In 1990, the national debt stood at $3 trillion. (That sounds high, but keep reading.) By 2000, it had almost doubled, to $5.75 trillion. It is currently $10.2 trillion. The number moved into 11 digits last month, which meant that the National Debt Clock in New York City ran out of space to display the figures. Its owners plan to get a new clock next year.

…At some point the magical accounting had to stop. At some point, consumers had to stop using their homes as banks and spending money that they didn’t have. At some point, the government had to confront its indebtedness. The United States—and other overleveraged societies—have now gotten the wake-up call from hell. If we can respond and change our behavior markedly, this might actually be a blessing in disguise.

In the short term, all the solutions to the current crisis require that governments take on more debts and larger obligations. This is inevitable and necessary. But that doesn’t mean we should, as some noted economists advocate, stimulate the economy with more tax cuts. That would be only one more way to keep the party going artificially—like asking a drunk to go to AA next year, but in the meantime to have even more whisky. A far better stimulus would be to announce and expedite major infrastructure and energy projects, which are investments, not consumption, and therefore have a much different effect on the country’s fiscal fortunes.

…we have to get back to basics. Households, for instance, should save more. Governments should put incentives in place that make such savings more likely. The U.S. government offers enormous incentives to consume (the deduction of mortgage interest being the best example), and it works. We have the biggest houses in the world, the thinnest flat-screen TVs and the most cars. If we were to tax consumption and encourage savings, that would also work.

…A new discipline would benefit America in a more general sense, too. Ever since the collapse of the Soviet Union, the United States has operated in the world with no constraints or checks on its power. This has not been good for its foreign policy. It has made Washington arrogant, lazy and careless. Its decision making has resembled General Motors’ business strategy in the 1970s and 1980s, a process driven largely by a vast array of internal factors but little sense of urgency or awareness of outside pressures. We didn’t have to make strategic choices; we could have it all. We could make blunders, anger the world, rupture alliances, waste resources, wage war incompetently—it didn’t matter. We had more than enough room for error—lots of error.

…Checks and balances are James Madison’s crucial mechanisms, exposing and countering abuse and arrogance and forcing discipline on people. This discipline will be painful for a country that has gotten used to having it all. But it will make us much stronger in the long run. If we can learn the right lessons from this crisis, the United States will once more be playing by its own rules. And that cannot be bad for us.

The real measure of Iraq’s stability is about to be tested.

Forget the surge. That was never more than American political theatre. Yes, violence in Iraqi centres did decline. That actually began before the surge was implemented and that traces back to a number of developments in Iraq at that time.

The tinderbox issue of the moment is the Status of Forces Agreement between the Maliki government and Washington. It supposedly provides for the withdrawal of America forces from Iraq by 2011 but, in reality, it’s riddled with so many conditions and escape clauses that withdrawal becomes iffy at best, out of the question at worst.

Everyone has been curious about Muqtada al Sadr and his Mahdi Army and where they’ve gone lately. Today, Reuters reports that thousands of Sadr supporters took to the streets of Baghdad to protest the agreement and demand that American forces quit Iraq.

What’s entirely uncertain is whether the agreement will be passed by the Iraqi parliament. Asia Times Online reports that the Maliki government, even as it has signed the deal and submitted it to parliament for approval, privately hopes it is defeated:

The Americans announced, against [Maliki’s] wishes, the arrest of a senior officer in the Iraqi army on charges of channeling funds from Tehran to radical groups inside Iraq.

The funds were to be used to buy the loyalty of certain Iraqi parliamentarians in order to sink the proposed treaty with the US. Maliki never wanted the much-loathed treaty with Washington, and neither did Tehran. To keep his post, however, he had to go on with American requests to ratify the pact before the end of 2008.

Meanwhile, he turned a blind eye to all those opposing it. In fact, he encouraged them at times because this echoed his own personal beliefs and what he felt best served the interests of both Iraq and Iran. Among other things, the treaty calls for the withdrawal of all US troops from Iraqi cities by June 2009, and from all of Iraq by 2011, “unless requested otherwise by the Iraqi government”.

…Within the political system, Maliki remains at odds with the Sadrists, although the tension is low nowadays because of mutual distrust of the American treaty. Maliki is mildly trying – again – to win the favors of Iraqi Sunnis as his relationship remains strained with the two Kurdish heavyweight parties. He wants the Sunnis to oppose the treaty as well, and then cite their opposition with US decision-makers.”

If this account is accurate it means that Maliki signed the Status of Forces Agreement because he had to and now is looking to his parliament, including the opposition parties, to take him off the hook by voting it down.

The Americans are putting Maliki under a full court press to deliver a deal before the end of the year. That’s when the UN mandate lapses. Without a done deal on January 1, 2009, America becomes an “illegal occupier” and subject to sanctions.

If the deal is signed, sealed and delivered, Iraq would be bound to accept the American occupation for at least two years, the agreement requiring that much notice of revocation.

What happens when a megastate collapses under the weight of its own excesses and bad judgment?

The director of the liberty and national security project of the Brennan Centre for Justice at New York University, Aziz Huq, offers this incredibly insightful look at what America has made of its unipolar superpower days and what lies ahead for the United States.

http://www.atimes.com/atimes/Middle_East/JJ18Ak03.html

Sometimes, very rarely, a photograph can change our lives, open our eyes, make us notice. This is one of those rarest of rare photographs. It shows a vulture patiently watching over a starving Sudanese girl.