Democrats to control US Senate
Response: Northrop - Reflection, Prof
Nye - Soft Power Rebirth, Dr Malmgren - Deep Analysis; US Defense Secretary
Rumsfeld replaced; Emmott's Brief
London, UK - 9 November 2006, 7:18 GMT - We are grateful
to Michael Northrop from New York City for "US Elections: A Personal
Reflection," Prof Joseph Nye from Harvard for "The Rebirth of
Soft Power in the US?" and Dr Harald Malmgren from Washington DC
for "Deep Analysis: THE 2006 US ELECTIONS -- What is the action agenda
for the future?" by way of their welcome submissions to ATCA.
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Re: Democrats to control US Senate; Response: Northrop - Reflection,
Prof Nye - Soft Power Rebirth, Dr Malmgren - Deep Analysis; US Defense
Secretary Rumsfeld replaced; Emmott's Brief
We are grateful to Michael Northrop from New York City for "US
Elections: A Personal Reflection," Prof Joseph Nye from Harvard
for "The Rebirth of Soft Power in the US?" and Dr Harald Malmgren
from Washington DC for "Deep Analysis: THE 2006 US ELECTIONS --
What is the action agenda for the future?" by way of their welcome
submissions to ATCA.
Democrats to control US Senate
The leading US news agency has called the last undecided Senate seat
in Virginia for the Democrats, which should deliver control of the upper
legislative chamber to them as well. The Associated Press (AP) news
agency declared Democrat Jim Webb the winner, reflecting a growing view
that a vote recount cannot change that outcome. Official results have
yet to confirm victory for Mr Webb. The claim came after President George
W Bush announced that Defence Secretary Donald Rumsfeld was to stand
down. The election victory has been a stunning one for the Democrats
in that they appear to have won both houses of the US Congress for the
first time since 1994. Their aim was to take the Senate by holding onto
all their own seats and winning extra ones in traditional Republican
areas, which it now seems they have achieved.
In Virginia, Mr Webb is leading by more than 7,000 votes over Republican
incumbent George Allen. A Webb win would put the new Senate line-up
at 49 Democrats, 49 Republicans and two independents who have said they'll
caucus with the Democrats. The margin of victory had been seen so small
that a recount is possible though not likely. AP called the election
after contacting election officials in all the state's 134 localities
for updated voting figures. With 99% of votes now counted, it is thought
to be virtually impossible for Mr Allen to make up sufficient ground
to win. However, the race remains officially open while officials verify
preliminary counts at local polling stations before announcing the result.
Because of the narrow margin of Mr Webb's victory, Mr Allen may be entitled
to demand a recount, but it is unlikely that he will do so. The race
was crucial because a Republican victory would have led to a 50-50 split
in the Senate with Vice-President Dick Cheney having a casting vote.
Michael Northrop directs the Sustainable Development grant making program
at the Rockefeller Brothers Fund in New York City, where he focuses
on countering climate chaos, forest protection and marine conservation.
Northrop moonlights as a Lecturer at Yale University where he teaches
a graduate course at the Forest and Environmental Studies School. Previous
positions have included a stint as Executive Director of Ashoka, an
international development organization that seeks and supports "public
service entrepreneurs" working around the globe; at an investment
Bank, Credit Suisse (First Boston) in New York; and as a teacher at
Anatolia College in Greece and at Gadjah Mada University in Indonesia.
Northrop also serves on the Advisory Board of Climate Change Capital
in London, on the board of The Climate Group also based in London, and
on the Board of Directors of Oceana, a global marine conservation organization.
Mr Northrop holds a Master's degree in public policy with a specialization
in international affairs from the Woodrow Wilson School at Princeton
University, where he was an English major as an undergraduate. He writes:
Dear DK and Colleagues
Re: US Elections: A Personal Reflection
We are in a state of surprised relief here in the US tonight. We hear
that Senator Allen of Virginia will concede his race for Senate in Virginia
to his Democratic opponent and in so doing hand the Senate over to Democratic
control. Many here expected the Democrats would win the House of Representatives.
The Senate, though, did not seem as likely to flip.
The Democrats needed to hold all of their Senate seats and pick up four
others. Remarkably though, they did it. So suddenly the Democrats appear
poised to control both legislative chambers in Washington. This is big
change. In the process, the famous red-blue dichotomy seemed to crumble
just a little bit in the process. Democrats won House and Senate seats
all across the country last night, despite many obstacles, including
gerrymandered electoral districts, less financial resources, a sitting
wartime President, a decent economy, and the Republicans much vaunted
One can only read this as a broad call for change and a stinging indictment
of the Bush Administration. A failed war, corruption by party leaders
and rank and file members, incompetence, a failure to ask questions
in the legislative branch about repeated failed policies, little attention
to issues of concern for moderate Americans, and the general intransigence
of this President and his staff all seemed to pile on top of one another.
Often mid term elections are more about local issues. This election
became a national referendum on Mr Bush and his party.
So what does it mean? It remains to be seen, but at a minimum it means
some re-examination of the war in Iraq, tax cuts, the Bush style of
governance, and the need for more competent government. It may mean
that government in the US will move closer to the centre and further
away from the extreme ends of either party. Internationally it probably
means a new approach on Iraq (Secretary Rumsfeld's resignation was accepted
today by the President), a less bullying foreign policy and a greater
level of concern emanating from the US government, writ large, regarding
other critical international issues like climate chaos and energy policy.
Can anything really get done in this environment though? Mr Bush and
the Democratic Congress don't like each other and they will need to
behave like grown ups to accomplish anything. There is no recent trend
in this direction here in the US, but there were encouraging signs today
coming from the White House and Capitol Hill with the President and
Nancy Pelosi, the new Democratic majority leader, both calling for a
cooperative approach. Signals were sent that a minimum wage bill and
a new approach to immigration policy might be early movers in a more
cooperative environment. Neither were fated for success before the election.
Can anything else be accomplished? Lets wait and see. The 2008 presidential
race has now begun and both parties want desperately to win that battle.
Can either restrain themselves from trying to make the other look bad
in the interim? One cannot be over-confident about that. Democrats see
the Presidency as their chief goal now, much more so than they seem
to have over the past several electoral cycles. They've probably learned
quite a bit from Bush about the power of the Presidency. Lets hope they
see a way to put it to better purpose if they do win.
One last reflection. The Democrats won 6 Governorships from Republicans
last night. They now hold a 28-22 advantage in this category. In state
legislatures, Democrats picked up 145 seats and 12 legislative chambers
last night as well. They also now control both branches of government
in 15 states. This is significant for the simple fact that statehouses
control the redistricting process which the Republicans have used to
dramatic advantage in recent years. Democrats will have a chance to
change the boundaries of election districts to make them more fair for
their caucus. All of this supports the idea that this was a decisive
drubbing and a big shift toward the Democrats. The Republicans lost
power across all parts of the map and at every level of US Government.
The Republican revolution Karl Rove engineered seems to have faltered
a lot faster than anyone expected. In retrospect people will wonder
how a party so thoroughly in control could have lost control so rapidly.
Prof Joseph S Nye, Jr, is Dean Emeritus of the John F Kennedy School
of Government, Sultan of Oman Professor of International Relations,
and a member of the Belfer Centre for Science and International Affairs
(BCSIA) Board of Directors at Harvard. He joined the Harvard Faculty
in 1964 and has served as Director of the Center for International Affairs,
Dillon Professor of International Affairs, and Associate Dean of Arts
and Sciences at Harvard University. From 1977 to 1979 he served as Deputy
to the US Undersecretary of State for Security Assistance, Science and
Technology and chaired the US National Security Council Group on Non-proliferation
of Nuclear Weapons. In 1993 and 1994 he was chairman of the National
Intelligence Council, which coordinates intelligence estimates for the
US President. In 1994 and 1995 he served as Assistant Secretary of Defense
for International Security Affairs. In all three agencies, he received
distinguished service awards.
Prof Nye is a Fellow of the American Academy of Arts and Sciences and
the American Academy of Diplomacy and a member of the Executive Committee
on the Trilateral Commission. He has served as Director of the Aspen
Strategy Group, Director of the Institute for East-West Security Studies,
Director of the International Institute for Strategic Studies, the American
representative on the United Nations Advisory Committee on Disarmament
Affairs, and a member of the Advisory Committee of the Institute of
International Economics. Prof Nye received his bachelor's degree summa
cum laude from Princeton University in 1958. He was a Rhodes Scholar
at Oxford University and earned a PhD in political science from Harvard
University. In addition to teaching at Harvard, Prof Nye has also taught
for brief periods in Geneva, Ottawa, and London. He has lived for extended
periods in Europe, East Africa, and Central America. In 2004 he published
Soft Power: The Means to Success in World Politics, Understanding International
Conflict (5th ed), and The Power Game: A Washington Novel. He is an
honorary fellow of Exeter College, Oxford. He is the recipient of Princeton
University's Woodrow Wilson Award, and the Charles Merriam Award from
the American Political Science Association.
Prof Nye is credited with coining the term "Soft Power" in
a 1990 book, Bound to Lead: The Changing Nature of American Power. He
further developed the concept in his 2004 book, Soft Power: The Means
to Success in World Politics. Soft power is a term used in international
relations theory to describe the ability of a political body, such as
a state, to indirectly influence the behaviour or interests of other
political bodies through cultural or ideological means. While its usefulness
as a descriptive theory has not gone unchallenged, soft power has since
entered popular political discourse as a way of distinguishing the subtle
effects of culture, values and ideas on others' behaviour from more
direct coercive measures, such as military action or economic incentives.
In Prof Nye's words, the basic concept of power is the ability to influence
others to get them to do what you want. There are three major ways to
do that: one is to threaten them with sticks; the second is to pay them
with carrots; the third is to attract them or co-opt them, so that they
want what you want. If you can get others to be attracted, to want what
you want, it costs you much less in carrots and sticks.
Soft power, then, represents the third way of getting the desired outcomes.
Soft power is contrasted with hard power, which has historically been
the predominant realist measure of national power, through quantitative
metrics such as population size, concrete military assets, or a nation's
Gross Domestic Product. But having such resources does not always produce
the desired outcomes as the United States discovered in the Vietnam
War. The resources from which soft power behaviour is derived are culture
(when it is attractive to others), values (when there is no hypocrisy
in their application) and foreign polices (when they are seen as legitimate
in the eyes of others). Unless these conditions are present, culture
and ideas do not necessarily produce the attraction that is essential
for soft power behaviour. The extent of attraction can be measured by
public opinion polls, by elite interviews, and case studies. Prof Nye
argues that soft power is more than influence, since influence can also
rest on the hard power of threats or payments. And soft power is more
than just persuasion or the ability to move people by argument, though
that is an important part of it. It is also the ability to attract or
to entice, and attraction/enticement often leads to acquiescence. If
one is persuaded to go along with the other's purposes without any explicit
threat or exchange taking place -- in short, if one's behaviour is determined
by an observable but intangible attraction -- soft power is at work.
Soft power uses a different type of currency -- not force, not money
-- to engender cooperation. It uses an attraction to shared values,
and the justness and duty of contributing to the achievement of those
The success of soft power heavily depends on the actor's reputation
within the international community, as well as the flow of information
between actors. Thus, soft power is often associated with the rise of
globalisation and neo-liberal international relations theory. Popular
culture and media is regularly identified as a source of soft power,
as is the spread of a national language, or a particular set of normative
structures; a nation with a large amount of soft power and the good
will that engenders inspires others to acculturate, avoiding the need
for expensive hard power expenditures. He writes:
Dear DK and Colleagues
Re: The Rebirth of Soft Power in the US?
President Bush lost the 2006 elections for a variety of reasons including
corruption in his party. But it was Iraq that turned the midterm Congressional
elections into a "wave" election reflecting sentiment about
the President and national rather than local issues. Exit polls showed
six in ten voters opposing the Iraq war. Now the President has finally
fired Donald Rumsfeld, his disastrous Secretary of Defense and plans
to replace him with Robert Gates, a wise and moderate man who served
under Bush 41.
Bill Clinton captured the mindset of the American people when he said
that in a climate of fear, the electorate would choose "strong
and wrong" over "timid and right." The good news from
the recent election is that the pendulum may be swinging back to the
middle. One sign will be if the bipartisan Iraq Commission chaired by
James Baker and Lee Hamilton produces a consensus on a strategy for
gradual disengagement in Iraq.
After the election, we need Democrats to press hard power issues like
the failure of the US Administration to implement key recommendations
of the 9/11 Commission Report or the inadequate number of troops in
Afghanistan, and we need Republicans to press for a strategy that pays
more attention to attracting hearts and minds. For example, many official
instruments of soft power - public diplomacy, broadcasting, exchange
programmes, development assistance, disaster relief, military to military
contacts - are scattered around the government and there is no overarching
strategy or budget that even tries to integrate them with hard power
into an overarching national security strategy.
We spend about 500 times more on the military than we do on broadcasting
and exchanges, with little discussion of trade-offs. Nor do we have
a strategy for how the government should relate to the non-official
generators of soft power - everything from Hollywood to Harvard to the
Gates Foundation -- that emanate from our
If Republicans and Democrats continue to ignore soft power and the public
discussion is limited to a competition about who can sound tougher,
our truncated debate will remain like the sound of one hand clapping.
What the nation needs is a discourse that recognizes the importance
of both hard and soft power and debates a smart strategy to integrate
them. Let us hope that the 2006 election has begun that process.
Dr Harald Malmgren is an internationally recognised expert on world
trade and investment flows who has worked for four US Presidents. His
extensive personal global network among governments, central banks,
financial institutions, and corporations provides a highly informed
basis for his assessments of global markets. At Yale University, he
was a Scholar of the House and Research Assistant to Nobel Laureate
Thomas Schelling, graduating BA summa cum laude in 1957. At Oxford University,
he studied under Nobel Laureate Sir John Hicks, and wrote several widely
referenced scholarly articles while earning a DPhil in Economics in
1961. His theoretical works on information theory and business organization
have continued to be cited by academics over the last 45 years. After
Oxford, he began his academic career in the Galen Stone Chair in Mathematical
Economics at Cornell University.
Dr Malmgren commenced his career in government service under President
John F Kennedy, working with the Pentagon in revamping the Defence Department's
military and procurement strategies. When President Lyndon B Johnson
took office, Dr Malmgren was asked to join the newly organised office
of the US Trade Representative in the President's staff, where he had
broad negotiating responsibility as the first Assistant US Trade Representative.
He left government service in 1969, to direct research at the Overseas
Development Council, and to act as trade adviser to the US Senate Finance
Committee. At that time, he authored International Economic Peacekeeping,
which many trade experts believe provided the blueprint for global trade
liberalisation in the Tokyo Round of the 1970s and the Uruguay Round
of the 1980s. In 1971-72 he also served as principal adviser to the
OECD Wise Men's Group on opening world markets, under the chairmanship
of Jean Rey, and he served as a senior adviser to President Richard
M Nixon on foreign economic policies. President Nixon then appointed
him to be the principal Deputy US Trade Representative, with the rank
of Ambassador. In this role he served Presidents Nixon and Ford as the
American government's chief trade negotiator in dealing with all nations.
While in USTR, he became known in Congress as the father of "fast
track" trade negotiating authority, which he first introduced into
the historically innovative Trade Act of 1974. He was the first official
of any government to call for global negotiations on liberalisation
of financial services, and he was the first US official to call for
the establishment of an Asian-Pacific Economic Cooperation arrangement,
known in more recent years as APEC.
In 1975 Malmgren left government service, and was appointed Woodrow
Wilson Fellow at the Smithsonian Institution. From the late 1970s he
managed an international consulting business, providing advice to many
corporations, banks, investment banks, and asset management institutions,
as well as to Finance Ministers and Prime Ministers of many governments
on financial markets, trade, and currencies. He has also been an adviser
to subsequent US Presidents, as well as to a number of prominent American
politicians of both parties. Over the years, he has continued writing
many publications both in economic theory and in public policy and markets.
He is also currently Chairman of the Cordell Hull Institute in Washington,
a private, not-for-profit "think tank" which he co-founded
with Lawrence Eagleburger, former Secretary of State. He writes:
Dear DK and Colleagues
Re: Deep Analysis: THE 2006 US ELECTIONS -- What is the action agenda
for the future?
This year's American elections revealed a widespread yearning for "change"
among voters across the political spectrum. This should not be surprising,
as the sixth year of a two-term President typically brings on what American
political analysts call the "six-year itch."
Historically, this election revealed little about what the two parties
want the US Government to do in the future. This election was not about
change towards something specific. Rather, it was an election about
sticking with the present political leadership, or rejecting it in favour
of an alternative group of political leaders. The Republicans essentially
argued the nation's well-being and security would be best served by
"staying the course." The Democrats decried the inability
of Republicans to "get things done" and focused their attacks
on Republican competence and corruption. Many Republican incumbents
suffered a "throw the rascals out" wave. Neither side presented
an action agenda for the future.
The rapidly growing number of scandals among a number of Congressional
Republicans in the weeks just before the election opened the opportunity
for Democrats to paint Republicans as having abused their privileged
position. As for competence, the "war in Iraq" became the
centerpiece: Whether or not voters supported the initial decision to
intervene militarily in Afghanistan and Iraq, it was evident to voters
in both parties that the management of the American military intervention
was poorly planned and poorly executed. This was not simply a matter
of poor execution of policy; many young Americans were dying, or suffering
Democrats succeeded in "nationalizing" the local constituency
elections across the country. Normally, Congressional elections are
primarily determined at the local level by local voter interests and
perceptions of candidates' qualities. Even when national polls show
widespread voter disaffection with "Congress," local polls
usually show that local voters still support "our guy" in
Washington. Usually, incumbents are very difficult to dislodge, given
the funding they can command and the personal identity they have built
within their own constituencies.
Democratic strategy also aimed at making this election a referendum
on the Bush Administration, and to a substantial extent this strategy
was successful. The task was made easier by the seemingly endless violence
in Iraq. But the President's sinking job approval ratings positioned
him as a soft target. Members of his own Republican Party were evidently
putting a distance between themselves and President Bush, leaving him
isolated and vulnerable to attack. Moreover, Bush's continued resistance
to acknowledging his mistakes, and continued resistance to changing
personnel when political pragmatism cried out for change, presented
an image of stubborn rigidity. Bush also continued to pursue an ideological
agenda that appealed to his conservative "base," but which
alienated more voters than the entirety of his "base." Most
of all, American voters are pragmatic. They admire pragmatism. They
do admire politicians who stand on principle -- but they most of all
admire the ability of leaders to make compromises and get on with the
job of managing the country, so that voters can sleep quietly at night.
While voters on the far right or the far left are ideological, the vital
swing voters at the centre dislike ideological extremism and want conciliation
and consensus building.
Under President Bush, and recent Republican leadership, it was evident
that the Congress had become stalemated. Partisan bickering had replaced
the more traditional process of back-room bargaining in the generation
of budgets, legislation and regulatory policies. Republicans could be
blamed for allowing ideological positions to block compromise. But Democrats
could also be blamed for relying exclusively on obstructive tactics
in order to demonstrate the ineffectiveness of Republicans.
The decline in President Bush's political influence was accelerated
as members of his own party distanced themselves from his own agenda.
The deterioration in his Republican support began long before the Iraq
conflict became the dominant issue. The slide really began with the
failure of Bush's public effort to put "privatisation" of
part of Social Security at the centre of his proposals to reform the
US public retirement system. Congressional Republicans sensed that the
President's ideas were simply unacceptable to most of the elderly and
generated little or no interest among America's young. Bush was repeatedly
advised by fellow Republicans to drop his ideas, but instead he embarked
on a nationwide, town by town personal campaign to promote his own proposals.
Everywhere he went, polls showed a decline in his approval ratings after
he left. Republican politicians became demonstrably aware of the President's
inability to hold sway over voters when he went out to meet them directly.
The distancing of Republicans from Bush began then and continues to
this day. This Republican detachment from the President became more
and more evident even before Bush's re-election in 2004, particularly
in the Republican rebellion against the President's resistance to intelligence
reforms, which led to a Congressionally-mandated creation of the National
As Congressional Republicans delinked themselves from the President,
they foundered on bitter disagreements among themselves on crucial issues,
most notably immigration reform and health care questions like stem
cell research. Efforts by a small number of Republican moderates, or
"main street Republicans," to cooperate with a small band
of moderate, or centrist, Democrats did succeed from time to time in
blocking extremist confrontations and moving forward selected, non-ideological
legislation. Having long suffered deep divisions of their own, the Democrats
gradually converged in a conviction that they could regain power in
the wake of public disaffection with the President and his Administration.
Now that the elections are over, and Democrats have assumed a far stronger
position in Congress, what can be expected in the future? First of all,
virtually every politician, regardless of party, will be thinking about
personal survival in the next election. In a sense, every incumbent
will informally become a member of what we like to characterize as "the
infamous Survival Party" -- keep office and keep official auto
at all costs. Beyond that immediate, dominant survival instinct, the
process of devising an agenda for the 2007-08 Congressional Session
Very early in the next session, deep divisions within each party will
become evident. The Democrats will be torn by differences between the
left wing and the centrists; likewise the Republicans will be torn by
differences between the conservative, right wing "base" and
their party's moderates. Interestingly, a significant number of incumbent
Republican moderates either retired or lost their seats in this year's
election, leaving the ranks of Republican centrists very thin. On the
other side of the aisle, several of the newly elected Democrats had
been selected and fielded as conservatives in an effort to defeat Republican
conservatives in their home territories. Their election success will
result in an increase in the number of Democratic moderates, or centrists,
in the new Congress. In other words, the composition of the small band
of Congressional moderates will be shifting, with an increase in Democrats
and a decrease in Republicans among the swing Congressional politicians.
But the centrists of both parties will remain a distinct minority.
As for Democratic Party leadership, new Speaker of the House Pelosi
is a left-wing, confrontational, sometimes inflammatory populist politician.
She will need the help of a centrist or moderate Democrat to guide her
away from her innate tendency to seek combat where quiet bargaining
would be far more efficacious. Former Speaker Hastert was a conciliator
and a consensus builder, but he had the "hammer" of Tom DeLay
to threaten uncooperative Republican colleagues. The next Republican
leader in the House will have greater difficulty in maintaining any
semblance of party discipline. Senate Democratic Leader Reid would always
rather fight than talk, and that is unlikely to change. The Republicans
will choose a new leader, but the underlying ambitions of many Republican
Senators to assume their own role on the national stage prior to 2008
will make the new leader's task exceedingly difficult.
What the voters want is an end to partisanship. What they will likely
get as a substitute will be intra-party rivalries and rebellions, tying
up the Congress in endless competitions to establish who is the alpha
dog on any given issue.
Another irony is the victory of Senator Lieberman of New York. The NY
Democratic Party rejected him as being too closely aligned with Bush,
especially on the Iraq conflict, so he ran as an Independent. While
campaigning, he promised to act like a Democrat if re-elected to the
Senate. He was so popular in New York that he kept his Senate seat in
spite of his own party's effort to dislodge him. He can be expected
to behave more like a Democrat than an Independent in the next Congressional
Session. It should also be recalled that Senator Jeffords of Vermont,
once a Republican and now an Independent, will also tend to vote with,
and act like a member of, the Democratic Party. Among Republicans, President
Bush has also found that several members of his own party in the Senate
have frequently aligned themselves with the Democrats, most notably
Senators Chafee, Snowe, and Collins. Chafee lost his seat in this election.
In the next Session, as the Presidential aspirations of politicians
heat up, Republican Senators McCain and Hagel will make major efforts
to distinguish themselves from Bush, to the point that they could be
characterized in the public mind as the anti-Bush faction among national
politicians. In other words, President Bush will be facing a strong
political opposition in both House and Senate, regardless of the final
Senate vote count.
Voters in this year's elections did not seem particularly interested
in issues of taxation, or budget deficits, or trade policy. The "China
threat" was not a significant issue, even in the Midwest. The elderly
were angry with the Republican-led reforms of Medicare, which left them
with increased personal costs for a significant part of their annual
prescription medications, and this was often voiced as a motivation
for voting against the Republicans. There was little voter interest
in Social Security reform or environment. Because gasoline taxes and
the cost of home heating oil had fallen in recent weeks, there was much
less attention among voters to energy issues. Climate chaos simply did
not rise to the surface as something to be considered in voting.
The new Congress will be well aware of these sentiments among voters.
Democrats will know that they do not need to talk about the need for
raising taxes, because there is no immediate public interest in the
federal budget deficit. Democrats will also not want to cut federal
spending, at least not before the 2008 national elections, including
the choice of a new President. So no visible tax increases, and no significant
spending cuts -- and probably some increased federal spending to prop
up the economy and set up positions for the 2008 elections. With a subdued
outlook for economic growth, budget deficits may grow, and voters will
not care. As for tax policy, most of Bush's tax cuts expire in 2010,
unless Congress takes action to extend them. For Democrats, the easy
way to increase taxes is to do nothing, let the Bush tax cuts expire
in 2010, and take no direct responsibility, blaming the event on "failure
of the Republicans to work out acceptable compromises."
Trade policy is a big unknown in the next Congressional Session. The
industrial labour union influence in the Democratic Party is substantial,
and the industrial labour unions will try to use a more protectionist
stance on trade policy as a means of propping up their own membership
among machinists, autoworkers, steel workers, electrical workers, etc.
The Bush Administration may try to continue its effort to liberalize
world trade, and pursue a variety of bilateral and regional free trade
agreements, but the next Congress may not be easily persuaded to provide
the appropriate implementing legislation. As I have said before, the
political timing in Europe as well as the US is unpropitious for the
consummation of new trade agreements that would open markets. Until
the French national elections are over, the EU can do little to end
the impasse in world trade talks at the WTO. Now, given the new Congress
in Washington, there are many questions about what Congress will be
willing to do.
The new Congress will be challenged by the unfortunate timing of the
expiration of the present US agricultural support programs in 2007.
Wise leadership should try to combine reforms of American farm supports
with a world agreement on market liberalization, including major reforms
in Europe's Common Agricultural Policy, but that kind of pragmatic wisdom
on agriculture has yet to be seen among US and European political leaders
in the last several decades.
As for energy and environmental policy, it is the Congress more than
the President which stands in the way of US participation in a meaningful
international accord on environmental management and energy conservation.
When former Vice President Gore personally agreed to the Kyoto Treaty,
he and President Clinton immediately found that the US Senate, including
both Democrats and Republicans, would not provide their support for
that treaty, or anything like it. The Bush Administration's reluctance
to do something about international energy and environmental cooperation
is not solely a Bush Administration belief that the science is not clear-cut,
or that such an agreement is only workable if the main emerging market
economies participate. The problem lies deep in the US Senate, which
means deep in the American voter heartland, which embodies fundamental
resistance to major changes that affect daily use of energy in all its
forms in the energy-intensive US economy. The Stern report had no influence
on the US elections. Moreover, it had minimal visibility in the US press
and media. It would be surprising if the next Congress gave these vital
issues any significant attention. The possibility remains, however,
that President Bush might embark on some new form of international dialogue
on energy use and climate chaos, if an entirely new format were to be
devised, perhaps by leaders of other nations.
President Bush may be stubborn and excessively rigid, but he is also
well aware of the steep decline in his personal political influence,
especially following the outcome of this election. He had already begun
to adjust the power structure around him when he brought in Josh Bolten
as his White House Chief of Staff and Hank Paulsen as his Treasury Secretary.
Bolten was told to shake up the decision system, including the cabinet.
Bush came to recognize that his own influence in economic affairs had
become minimal, and instead granted Paulsen autonomy in direction of
economic policy. Now, Bush can anticipate opposition from Democratic
Party leaders and resistance from many Republicans for any domestic
initiatives he might take.
To use the remaining two years of his Presidency productively, and to
establish some kind of historic legacy, he is likely to increase his
attention to world affairs. Constitutionally, the President has significant
autonomy and flexibility to carry out international diplomacy. Where
the Congress does play a role in foreign policy is as an adviser, keeper
of the purse strings, and when necessary, the grantor of legislation
or the approval of treaties necessitated by Presidential accords with
However, as Bush is learning on the job about world affairs, he is finding
that nothing is simple. Introducing "democracy" to Iraq and
other parts of the Middle East temporarily had the appeal of purity
of purpose to the President. But democracy looks like the opening of
gates for violence among disparate sects and geographic regions to those
who have experienced brutal or heavy-handed leadership for decades or
even centuries. Mr Bush is finding that talking to one's enemies is
necessary to explore the potential for threads of common interests within
the overall web of conflicting interests. Most likely the President
will demonstrate a new pragmatism, beginning with greater willingness
to conduct diplomacy with governments like that of Iran and Syria.
But the hard question is who will act as the strategist for the new
focus on foreign affairs, and who will conduct such new diplomacy? The
President has relied up to now upon a small cadre of hard-line conservatives
for advice on how to deal with other governments. The Department of
Defense, under the leadership of Secretary Rumsfeld, dominated diplomacy
with the Middle East, North Korea and even with China and Russia. Since
the time of President Kennedy, the International Security Affairs section
of the Pentagon functioned as the internal "think tank" of
each Administration in matters of international security. Under Rumsfeld,
this section deteriorated into a dysfunctional support system for the
personal leadership of Rumsfeld.
In the meantime, the more important roles of the Secretary of Defense
were not well managed. The Secretary of Defense, together with his top
aides, must provide civilian oversight of the nation's military, and
this requires intimate interaction with the entire military command
system. It became evident, especially in recent days, that Rumsfeld
had lost the confidence and trust of virtually all the US military forces,
especially their leadership. As for managing the defense industry supply
system, the Defense Department under Bush experienced a series of scandals
in acquisition and management of outsourcing of military support operations.
Executives of the major defense industrial corporations privately observed
that Rumsfeld's Pentagon had been the worst manager of the defense industrial
complex since the days of President Eisenhower.
Now that Rumsfeld has resigned, it is widely hoped that an entirely
new team will be brought into the Pentagon to manage the US intervention
in Iraq and work constructively towards some new political-security
framework which would minimize direct involvement of the US military
in that country in the not-too-distant future.
The National Security Council staff in the White House had for many
years dominated the shaping as well as the execution of American foreign
policy. Under Mr Bush, the NSC has been little more than a Presidential
briefer and a door keeper for the comings and goings of rivals among
the State Department, Defense Department, the military, the Treasury,
the various intelligence agencies, and the various other departments
and agencies charged with international responsibilities such as world
Secretary of State Rice has a strong academic intellect, but it is no
secret that she dislikes the close contact interaction with domestic
and foreign politicians and decision-makers that is required to function
effectively in her post. It is no secret in Washington that Defense
Secretary Rumsfeld and Vice President Cheney never held her in high
esteem, precisely because she did not like to involve herself in the
necessary, brutal, seemingly endless bureaucratic and political manoeuvres
to establish power and execute policy in Washington. She is also not
viewed among her Administration colleagues as a strategist. When she
was head of the NSC, the NSC was considered unusually ineffectual in
managing interagency rivalries, but she was more criticized by her colleagues
for absence of overall strategy. So who can the new strategist be? Former
Secretary of Treasury and of State James Baker, together with former
Democratic Foreign Relations Committee Chairman Lee Hamilton will soon
propose new strategies for Iraq and the Middle East more broadly. But
they are outsiders with new ideas. Who will implement a new Presidential
foreign policy, including both its formulation and its execution? If
the present Secretary of State remains, she will need heavyweight help
-- most likely National Intelligence Director will become her Deputy
-- but that raises the question whether someone like Negroponte would
be satisfied to be second in command in a role which requires extensive
personal involvement in domestic and foreign politics? Will Bush choose
a new NSC Director to direct his own foreign policy initiatives, and
could it be someone who would have the weight of a Kissinger or a Brzezinski
relative to Defense and State?
So the emerging politics after this year's election will be a nation
split more or less 50-50 on most issues, with an incoherent Congress
likely to experience deep divisions within each party as well as between
the two parties. The President can wield his veto powers, but the Congress
is unlikely to do much by itself. Issues of climate chaos, or world
economic imbalances, or reforms of domestic taxation and health care
will be duly considered and debated. However, politicians focused on
the 2008 elections will not want to be recorded as voting one way or
the other on issues which are contentious among the nation's voters.
Controversies will be the subject of Congressional hearings, because
controversies make news. But resolution of controversies will be left
for the Administration of the next President.
Thus, the world should not expect a profound transformation of the workings
of the US Government at home or abroad. The President may try to use
his remaining term to build better relations with other nations, but
his ability to implement commitments he might make with leaders of other
nations will be limited by the members of the Congressional Survival
Party, all of whom seem to be eager to distance themselves from the
President in positioning themselves for the next election and the choice
of a new American leader.
In the background, I expect the US economy to continue to slow down.
Since the US economy is the primary engine pulling the train of national
economies throughout the world, I expect a global economic slowdown
in the next couple of years. This might bring some temporary relief
in energy demand, but it will certainly undermine the hopes of the Euro
zone, the emerging markets, and countries like China for continued and
even stronger economic expansion. Rather, the next couple of years will
more likely suffer the pains of weakened global growth, putting political
strains on governments in Europe and many other parts of the world.
A global slowdown is not necessarily harmful to the US -- and in fact,
a weakening of the outlook elsewhere is likely to increase capital flight
from all over the world to the safest parking place -- which is the
US market, the biggest, most liquid, and most legally protected parking
area for capital in a time of trouble.
In other words, the US economy can cool down, but the world will likely
provide shock absorbers for the US. The Bush Administration and Congress
will not much care about "global imbalances" and other global
dangers like climate chaos. But President Bush will be looking to build
a legacy. Thus, a challenge has been put into the hands of other world
leaders, to suggest new initiatives in new frameworks that Bush might
be able to join, freed from concerns about his own re-election.
We look forward to your further thoughts, observations and views. Thank
For and on behalf of DK Matai, Chairman, Asymmetric Threats Contingency
ATCA: The Asymmetric Threats Contingency Alliance
is a philanthropic expert initiative founded in 2001 to resolve complex global
challenges through collective Socratic dialogue and joint executive action
to build a wisdom based global economy. Adhering to the doctrine of non-violence,
ATCA addresses opportunities and threats arising from climate chaos, radical
poverty, organised crime & extremism, advanced technologies -- bio, info,
nano, robo & AI, demographic skews, pandemics and financial systems. Present
membership of ATCA is by invitation only and has over 5,000 distinguished
members from over 100 countries: including several from the House of Lords,
House of Commons, EU Parliament, US Congress & Senate, G10's Senior Government
officials and over 1,500 CEOs from financial institutions, scientific corporates
and voluntary organisations as well as over 750 Professors from academic centres
of excellence worldwide.
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