AFP September

american foreign policy September 2009 Volume IX, Issue 1

A New Regional Powerhouse Strengthening Ties with Brazil

Staff

From the Editor

Editor-in-Chief

To the Class of 2013 and our returning readers,

Dan May ‘11

On behalf of the entire AFP staff, I’d like to welcome you to Princeton and introduce you to our magazine.

Publisher

Steve Lindsay ‘12

American Foreign Policy is the nation’s only foreign policy magazine that is run, written, and edited entirely by students. As such, we provide a unique forum for undergraduates to discuss and debate the pressing foreign policy issues of our time. We publish well-written, persuasive articles from anyone at Princeton regardless of their political ideology or their level of foreign policy experience.

AFP is fiercely non-partisan. Our staff contains Republicans, Democrats, realists, neo-cons, internationalists, constructivists, and many others. We firmly believe that no political ideology or international relations theory can be a perfect guide in the conduct of foreign policy. As such, we allow no political ideology to dominate our pages or monopolize the exposure we provide.

AFP is also fiercely meritocratic. We publish the best articles regardless of who wrote them, and we routinely place freshmen and sophomores in important leadership roles.

Our staff of writers, editors, and designers is among the most talented groups of students at Princeton. They value AFP because it provides them a tight-knit community of colleagues with whom to share their thoughts and ideas. Our strong network of alumni has also helped current members secure jobs, internships, and research positions in a wide variety of fields.

Managing Editors Vishal Chanani ‘11 Katherine Gaudyn ‘11 Eric Stern ‘11 Ben Cogan ‘12 Editors Ahson Azmat ‘10 Jon Bradshaw ‘10 Heejin Cho ‘10 Matthew Drecun ‘10 Jon Extein ‘10 Jonathan Giuffrida ‘10 Lucas Issacharoff ‘10 Catalina Valencia ‘10 Brendan Carroll ‘11 ‘11 Ellen Choi

Jamie LaMontagne Addie Lerner Tara Lewis Elias Sánchez-Eppler Eric Stern Kit Thayer Oliver Bloom Yun Chung Charlie Metzger Peter Wang

‘11 ‘11 ‘11 ‘11 ‘11 ‘11 ‘12 ‘12 ‘12 ‘12

Layout

Yanran Chen ‘12, Production Manager Jonathan Giuffrida ‘10 Kelly Lack ‘10 Ellen Choi ‘11 Emily Myerson ‘12

AFP has come a long way over the past year. We have updated our layout, expanded our staff, and improved our presence on the web. As we continue to grow the magazine and reach beyond Princeton, we invite all of you to join our staff. Whether you enjoy writing, editing, design, business, or event planning, AFP offers a unique forum for you to get involved and pursue your interests.

We hope you’ll join us.

Business Staff

Peter McCall ‘10

Ellen Chen ‘12

Editor-in-Chief Emeritus Rush Doshi ‘11

All best, Dan May ’11 Editor-in-Chief American Foreign Policy is a student-written, student-run publication based at Princeton University. It was founded in the wake of September 11th to provide Princeton students with a forum to discuss the difficult problems and choices facing the United States in the world. American Foreign Policy magazine is sponsored by the Woodrow Wilson School of Public and International Affairs, the Princeton Institute for International and Regional Studies, and the James Madison Program in American Ideals and Institutions.

No part of this publication should be construed to promote any pending legislation or to support any candidate for office. The opinions expressed herein are those of the authors and not necessarily those of the Woodrow Wilson School, the Princeton Institute for International and Regional Studies, the James Madison Program, Princeton University, or American Foreign Policy. AFP gladly accepts letters to the editor, article proposals, and donations, which are fully tax-deductible.

All correspondence may be directed to: American Foreign Policy, 5406 Frist Center, Princeton, NJ 08544 afp@princeton.edu www.princeton.edu/~afp

2

AFP Advisory Board

Christina Paxson: Dean, Woodrow Wilson School Katherine Newman: Director, Princeton Institute for International and Regional Studies Robert P. George: Director, James Madison Program G. John Ikenberry: Albert G. Milbank Professor of Politics and International Affairs Bernard A. Haykel: Director, Institute for Transregional Study of the Contemporary Middle East

American Foreign Policy

AFP Cover Story

US Foreign Policy

Economic Policy

A merican Foreign Policy September 2009 Volume IX, Issue 1 ta b l e o f co n t e n ts

4 5 6 8 10 12 13 14 16 17 18

A New Regional Powerhouse Strengthening Ties with Brazil Lucas Briger ‘11

AFP Quiz Dan May ‘11

Strategy Shift Approaching the Honduran Coup Brian Lipshutz ‘12 Closing Guantanamo Why Congress Should Support Obama Amara Nwannunu ‘11

Global Update Vishal Chanani ‘11

Containing Kim North Korean Reinsurance Fraud Zachary Slepian ‘11

In Context Tara Lewis ’11

Stronger Ties How China Is Powering Africa’s Growth Melekot Tsedeke Abate ‘11 A Culture of Innovation Why the U.S. Will Stay Globally Competitive Tara Lewis ‘11

Pakistan’s Frontier The Most Dangerous Place on Earth Sweta Haldar ‘12 Sanctioning Iran Now is the Time Addie Lerner ‘11

Photo Credits: Creative Commons images from Flickr and Wikimedia Commons

September 2009

Cover Design: Yanran Chen ’12

3

Cover Story

Pete Souza, The White House

President Barack Obama greets President Lula da Silva of Brazil on Saturday, March 14, 2009 in the Oval Office.

A New Regional Powerhouse Strengthening Ties with Brazil

A

lthough it is a rising economic powerhouse in a shifting global order, Brazil has been neglected in U.S. foreign policy in recent years. Given Brazil’s strategic significance, the U.S. must embrace closer relations with its Latin American neighbor, granting it some long-due political and economic compromises in order to consolidate a crucial inter-American relationship. By ending the Cuban embargo, pushing for Brazil to receive a permanent seat on the U.N. Security Council, and partially opening the American market to Brazilian biofuels, the U.S. can strengthen this crucial partnership.

By neglecting to cultivate America’s relationship with Brazil, the Obama Administration risks unsavory comparisons with the Bush Administration, which was heavily criticized for

4

Lucas Briger ‘11 all but ignoring South America. With memories of a (supposedly) U.S.-supported military coup d’etat that instituted a ruling military dictatorship for twenty years still fresh in the minds of many Brazilians, the U.S. must offer political gestures and concrete economic compromises that show that its relationship with Brazil is as valued as when the U.S. became the first nation to recognize Brazil’s independence in 1822. Latin American expert David Rothkopf implores the current presidency to pursue this special relationship which has been neglected until now. Despite Obama’s warm remarks about President Lula at the recent G20 London summit—Obama decalred, “He’s my man”—Rothkopf urges that Obama demonstrate commitment beyond just “lip service.” He writes, “[If the Obama Administration] only pays lip service to Brazil but slow

American Foreign Policy

walks the most important issues while seeking disproportionate payment in turn from the Brazilians… then tension and distrust are likely to manifest themselves.”

As noted by President Lula in his March 14th meeting with President Obama, reform of the American embargo on Cuba presents a golden opportunity to send a palpable signal not just to Brazil, but also to all of Latin America. The embargo on Cuba remains an antiquated and intolerant blemish on the U.S.’s relationship with the region—a relic from a war of ideas long since won. The U.S. must initiate a new campaign of ideas for a revitalized North-South relationship built on equality and respect in order to counter the efforts of populist leaders like Hugo Chávez, Evo Morales, and Rafael Correa to vilify the U.S. As Brazilian foreign minister Celso Amorim notes, “…It’s impossible not to talk about the Cuban embargo. It’s indicative of U.S. policy toward the region.” The repeal of the Cuban embargo would stand as a powerful symbol of goodwill and new beginnings, with all parties standing to gain, from the isolated Cuban public to the countless American multinationals chomping at the bit for a piece of the virgin Cuban market.

Moreover, enlisting the Brazilian President

as a mediator in Cuban-American negotiations would be a brilliant choice for the U.S., not only because Lula is skilled at reaching compromise, but also because the move gives Brazil what it seems to want so badly these days: prestige. Brazil’s recent generous renegotiations to pay more for natural gas contracts with Bolivia and hydroelectric agreements with Paraguay, along with its successful leadership of the U.N. peacekeeping mission in Haiti, indicate that Lula is maneuvering Brazil to be the torchbearer for Latin America. And as Brazil cements and expands this leadership role, it wants a say in international affairs commensurate with its growing economic power.

Though the United States has officially “recognized” Brazil’s candidacy for a permanent seat on the U.N. Security Council, it can shoot a safe shot across the bow of the international order by announcing strong support for the bid. As Lula rightly ascertained in a speech to the U.N. General Assembly, “Today’s structure has been frozen for six decades and does not relate to the challenges of today’s world. Its distorted form of representation stands between us and the multilateral world to which we aspire.” A firm American statement of approval for Brazil’s Security Council eligibility would help strengthen a crucial alliance in Latin America. In addition, the United States stands to lose little political capital by expressing public support for Brazil. Unlike the G4 Security Council candidacies of India and Japan whose bids are opposed by important American allies such as Pakistan and China, respectively, and Germany, whose bid could be considered disadvantageous for the U.S., support for Brazil risks very little. Mexico and Argentina, the two countries most vehemently opposed to Brazil’s U.N. aspiration, are sturdy American allies who could be placated with little effort.

A final gesture that the U.S. should make to Brazil is opening up the U.S. market to Brazilian ethanol. Brazilian biofuel companies look at the American market with unequaled lust, as an astounding 54-cent tariff on Brazilian sugarcane ethanol makes exporting to the American market economically uncompetitive and unviable.

Although repealing this tariff, which protects the comparably inefficient U.S. domestic corn-based ethanol industry, would be politically unpopular in the U.S., it is crucial to establishing a closer relationship with Brazil and would confer economic benefits on both countries. Given that the U.S. and Brazil account for almost 90 percent of the world’s biofuel production, developing a global ethanol market would be a mutually beneficial endeavor.

Also, such action is not without historical precedent. The Washington-based think tank

Cover Story

Council on Hemispheric Affairs notes that officials in the Obama Administration could look to the International Trade Commission’s 1986 ruling on imported Brazilian iron ore as a historical blueprint to pleasing the elected officials in America’s Corn belt, as well as their Brazilian counterparts. Just as the 1986 accord legally isolated the American Midwest market so as to insulate the Great Lakes’ vulnerable iron industry, a similar ethanol agreement could institute an analogous protected trade area for American

“Over the years, many countries have claimed to possess a ‘special’ relationship with the U.S. There has perhaps been no country more or longer deserving of that designation than Brazil.” corn ethanol in western and central U.S., opening the East Coast to Brazilian ethanol. Since American ethanol consumption is concentrated in the West, the economic impact of such a policy change would not be dramatic, but it would be a crucial gesture of support to Brazil.

Over the years, many countries have claimed to possess a “special” relationship with the U.S. There has perhaps been no country more or longer deserving of that designation than Brazil. One of the last countries to enter the world recession and poised to be one of the first to exit it, as Jonathan Wheatley wrote in the Financial Times, “this is the Brazil that finally, after years of unfulfilled promise, is catching the world’s attention.” The three-pronged mix of political and economic gestures described above would allow the current Administration to make some muchneeded overtures to its longtime rising star Latin American neighbor and possible long-lasting Latin American advocate. As for reciprocation, any Brazilian knows that once someone bestows an abraço on you, it is only good manners to return the favor. Afp Lucas may be reached at lbriger@princeton.edu

September 2009

AFP Quiz Multiple Choice Monthly Dan May ’11 1. The United States recently imposed a tariff on tires imported from which country?

A. Iran B. Sudan C. China D. Indonesia E. Mexico 2. Iran recently agreed to restart nuclear talks with the five permanent members of the UN Security Council and which other country?

A. Brazil B. Taiwan C. Iraq D. Germany E. Italy 3. Three citizens of which country received life sentences for plotting to blow up jet airliners with liquid explosives?

A. Germany B. Pakistan C. United Kingdom D. Saudi Arabia E. Yemen 4. How much money did a Saudi businessman offer to pay Iraq’s famous shoe-throwing dissident for one of the shoes he threw at George W. Bush?

A. 10 dollars B. 10,000 dollars C. 100,000 dollars D. 1,000,000 dollars E. 10,000,000 dollars 5. Which Ivy League University Press recently published a book about controversial Danish cartoons but refused to reprint the cartoons themselves in the book?

A. Princeton B. Yale C. Columbia D. Dartmouth E. Harvard

Answers on page 13

5

Central America

Strategy Shift How the U.S. Should Approach Honduras

U

ntil its final moments, the recent coup in Honduras was both constitutional and democratic. However, the final complication led the United States to condemn the removal of then-President Manuel Zelaya, and so lose sight of its longer-term strategic goals in Latin America. The U.S. needs to reconsider its stance on the matter and start pursuing a wiser policy.

The story started when former president Zelaya called a referendum, in March of this year, to alter the constitution and allow him to run for a second term. Article 239 of the Honduran Constitution limits presidents to one term, and this article is one of a very limited, important group that cannot be amended as per Article 374. Those who attempt an amendment are automatically and immediately prohibited from holding public office for ten years.

The Supreme Court dutifully declared the referendum unconstitutional, but Zelaya ignored the court and ordered the military to provide security for his referendum. When top military official General Romeo Vasquez refused, Zelaya fired him, prompting the resignations of the service chiefs of the army, marines, and air force. On June 25, the Supreme Court ordered Zelaya to reinstate Vasquez and the National Congress began to investigate Zelaya.

At last, the court issued an arrest warrant for President Zelaya. Again in accordance with the constitution, it ordered the military to enforce the order.

By this point, the Supreme Court, the top Honduran electoral body, the human rights ombudsman, and the National Congress had all opposed Zelaya’s referendum. The National Congress removed him from office and named Roberto Micheletti as the new president, in accordance with the rules of succession.

6

Brian Lipshutz ‘12 All this was, until the final stage, a perfect example of constitutional democracy stopping potential abuse of power.

The crucial misstep came when, instead of arresting Zelaya, the military deported him. The U.S. joined much of the world, including sudden friends of democracy like Venezuela and Cuba, in declaring the events a breach of de-

“Obama and Clinton have unwisely boxed themselves in by supporting the OAS and UN condemnation.” mocracy at the United Nations and the Organization of American States (OAS).

Zelaya should have been arrested and tried in the sunlight, not deported in a manner reminiscent of darker periods in Latin American history, but this misstep should not be allowed to spoil the entire process.

The U.S. seems fixated on that final wrench thrown in by the military, and in doing so, has ignored both liberal – in the international relations sense – and realist logic. President Barack Obama and Secretary of State Hillary Clinton are correct that the Honduran military did not follow the letter of the law. But as President Obama frequently remarks, the U.S. cannot let the perfect be the enemy of the good.

The constitution and the other branches of government stopped an abuse of power in a nation and a region all too familiar with such abuses. Zelaya’s removal, with the exception of the mili-

American Foreign Policy

tary’s decision to deport and not detain, was the proper functioning of a constitutional system of checks and balances.

Unlike previous generations of strongmen, Zelaya did not seek to abolish the constitution, but he did attempt to tinker with it in violation of the will of its democratic authors. Observers must resist being taken in by the democratic façade of this new authoritarianism that Zelaya was pursuing. The Honduran constitution is strict about term limits precisely to prevent power grabs like Zelaya’s. As such, his removal from office should be cause for the United States’ support.

Even democratically elected leaders can become threats to democracy by abusing their power. Hugo Chavez, the democratically elected president of Venezuela, has sought to dress up authoritarian rule in the guise of democracy by amending his own country’s constitution to expand the executive’s power and extend term limits. Zelaya received both the idea and the tools for his assault on democracy from Chavez; Venezuela provided the very ballots to be used in his referendum. In so doing, Zelaya joined Bolivia, Nicaragua, and Cuba as an ally of Chavez and his model of authoritarianism.

The U.S. goal of promoting democracy, whether for strategic or altruistic purposes, demands that Washington discourage Latin American politicians from this path. Imperfect but constitutionally minded processes like the coup in Honduras can defend democracy against attacks like Zelaya’s power grab.

It must be reaffirmed that the U.S. has disgracefully supported anti-democratic Latin American coups in years past, but the real threat to democracy today is from Latin American strongmen, not the United States. Obama deserves credit for taking pains to avoid behaving in a way that reinforces the specter of the imperialist yanqui. Unfortunately, President Obama seems to have worried too much about how he would look and not enough about how he should act. When governments like Honduras’ seek to stem abuses of power and when the U.S. can responsibly support them, Washington should firmly stand with its ideological allies. This does not mean the U.S. should offer full-throated approval of the flawed actions, but it does mean that we should provide assistance to a

Central America

Photo from Flickr

Honduran protestors chant slogans during the 2009 constitutional crisis.

government that chose democracy in a region where self-proclaimed enemies of the United States stifle representative government.

Questions of alliances should also concern realists looking at the situation. President Obama linked arms with Chavez, who has slowly but explicitly sought to marshal allies and resources against US policies in Latin America.

Chavez has amassed arms and nationalized natural resources like oil, directly challenging the U.S. and its allies. He allied Venezuela with the regime in Iran (the same one seeking a nuclear weapon) in a quest to counterbalance U.S. strength, and sought economic arrangements in Latin America to counter U.S. economic interests. President Obama should have no illusions about Chavez’s dreams. After all, he told the United States to “go to hell” in 2007.

If cold-blooded realism actually held sway in Washington, as some claim it does, then the State Department would not be seeking to reinstate an enemy who has allied himself with Chavez –

and, according to new reports, with the Colombian narco-terrorist group FARC – while Chavez seeks to counter U.S. power with allies, arms, and oil. The situation in Honduras offers an uncommon opportunity where liberal principles and realism agree and point to one policy – that very policy which America has eschewed.

In spite of these arguments, the Obama administration reacted to the “coup” by cutting aid to Honduras, revoking the visas of some of its officials, and joining hands with rogue regimes in repeatedly condemning Honduras for standing up to its president. It is not too late for the United States to reverse that course and follow good practice and great ideals to sound policy by increasing aid. Of course, given the self-assured position already taken by President Obama, such a reversal will not be easy.

First, in the short-term, the U.S. should make its goal pragmatic cooperation with the interim government. Obama and Clinton have unwisely boxed themselves in by supporting the OAS and

September 2009

UN condemnation. For self-identified realists, they left themselves with little strategic -- or even tactical -- flexibility.

What little leeway they still have should be used to switch to cooperation. This is not a self-serving, hypocritical change in tone, but an honest appraisal of a delicate situation that requires more than kneejerk condemnation.

Obama should also resume normal aid to Honduras, stop ignoring Honduran diplomats, and accelerate cooperation with the interim government. President Obama has offered engagement to true enemies of the United States, so a democracy like Honduras should be no problem. In fact, Obama should seek additional aid for Honduras. The interim government is the one recognized by the legislature, in line with the actions of the judicial branch. Zelaya is a man who has been removed from office, as the constitution requires. Neither a true realist, nor a true friend of democracies in the region, could ignore those facts.

In the longer term, Obama needs to steer the international community to diplomatic recognition of the Micheletti government. The U.S. and other governments cannot continue to ignore what is an imperfect but democratic state, which deserves a functioning government and redemption from its unfair pariah status on the world stage.

From both realist and liberal perspectives, it seems unwise to support a foe in the face of a growing threat to U.S. interests in the region and condemn a democracy in a very difficult situation – a democracy which managed to act with considerable poise and which provided an example to other democrats in the region. It is no wonder, then, if the people of Honduras question why President Mahmoud Ahmadinejad and Ayatollah Ali Khameini in Iran managed to get the benefit of the doubt from Obama this summer during their rigged elections, but the Micheletti government gets no patience. Afp

Brian may be reached at lipshutz@princeton.edu

7

U.S. Foreign Policy

Closing Guantanamo Why Congress Should Support Obama Amara Nwannunu ’11 Few subjects over the past eight years consistently occupied as much airtime and fueled as much political debate as the Guantanamo Bay conundrum. The topic’s salience originates from its association with a host of other hot-button issues. Deliberations over the boundaries of executive privilege, the suitability of harsh interrogation techniques, and the transformative nature of the War on Terror all converge on the Guantanamo narrative.

At the same time, the nuances of the story have dramatically changed since President George W. Bush first designated the naval base as a detention facility for terrorism suspects.

Since then, the United States has ordered the release or transfer of over 500 prisoners, with fewer than 250 inmates remaining in custody. And the Bush Administration decided all but a handful of these cases. Whereas the federal government once lauded the facility as a formidable icon for progress in the War on Terror, Guantanamo Bay now represents a political liability and ethical offense for the

growing contingent of government officials that have demanded its closure. This movement gained traction when President Barack Obama, freshly inaugurated, issued an executive order to close the facility by January 2010. Yet there remains much wrangling over where to relocate detainees and how to fulfill this mandate. Furthermore, many Congressional Republicans continue to oppose plans to close the prison camps in an effort strongly reminiscent of Bush-era drumbeating.

But there exists only one viable direction for deliberations over the Guantanamo issue. Lawmakers must put their full support behind the President’s decision to end this eight-year nightmare. If the United States is to have any hopes of demonstrating to the world that it has charted a new course, then closing this detention facility in a timely manner must remain a foreign policy priority. Guantanamo’s turbulent beginnings and sinister past offer only half of the incentive for taking action. While there is enough cause to close down the facility purely based on previous

Photo from Wikipedia

Protestors urge the closing of Guantanamo Bay during a July 2008 rally.

8

American Foreign Policy

wrongdoings, officials should also seize this opportunity to use the closure as a symbol of America’s new ideological direction. And despite what many opponents would suggest, this task is not so complicated.

At the heart of the historical controversy over Guantanamo is the original intent of the Bush Administration to establish a military prison unconstrained by domestic or international law—an objective that served as the catalyst for ensuing abuses. As classified terrorists, inmates were denied Geneva rights and basic Constitutional protections.

The Supreme Court and legal scholars alike have since debunked the legitimacy of that proposition.

Aside from the nuances of their legal status (which are beyond the purview of this paper), the more compelling argument for closing Guantanamo is that very few of the detainees should have ever been incarcerated. David Remes, a Harvard-educated lawyer who left an elite position at Covington & Burling to represent detainees, often speaks about the sobering experience of representing Gitmo detainees. In a special lecture at Princeton in April 2009, Mr. Remes emphasized the fact that the US military captured only 5% of the prisoners at Guantanamo Bay. Many of the remaining 95% were delivered by bounty hunters, who often subsequently received a few thousand dollars for each suspect.

Oftentimes, the basis of the accusation rested on the alleged sighting of the suspect in unsavory company. In slightly more substantive cases, soldiers were arrested on the battlefield for actually fighting alongside the Taliban. But even this justification for detention is not entirely logical. As Mr. Remes acknowledged, Afghanistan has been embroiled in a civil war for over a decade between the Northern Alliance and the Taliban. In short, the lines of this conflict had solidified before American involvement. For simply declaring allegiance to one side over another in a preexisting conflict, a soldier could be detained and sent to Guantanamo as a terrorist and enemy of the United States. Nevertheless, the Bush administration convinced the public that these men were at the helm of a global conspiracy, as Vice President Dick Cheney declared them “the worst of a very bad lot” and insisted that they “are devoted to killing millions of Americans.” A far cry from fulfilling the dangerous mastermind conception, the average Guantanamo prisoner is an underweight Yemenite who was delivered into US hands, by an enemy or rival, for a cash re-

ward. Typically, the detainee speaks no English and had never encountered an American prior to his arrival at the military base.

The testimonies and anecdotes of prisoner abuse have been constant. By what authority did the United States arrest, brutalize, and psychologically torment these men without substantive evidence of their wrongdoing? The most straightforward answer is that the federal government took this course of action because President Bush needed to create the semblance of accomplishment in the War on Terror and impoverished Middle Eastern countries were powerless to stand in the way of this goal. But the rest of the world has since denounced this injustice, and

“The closure of Guantanamo Bay stands out as one of President Obama’s most worthwhile foreign policy initiatives, yet only six Democrats voted in favor of the May 2009 bill to appropriate funds for this cause.”

Guantanamo has become a universal symbol of American tyranny.

Nevertheless, with a new administration comes the opportunity to revamp the national image. For his part, President Obama has wholeheartedly embraced this obligation. In a 50-minute address at the National Archives in May, Mr. Obama spoke about Guantanamo with a renewed energy. Beyond a simple pledge to close the detention facility, the speech represented a profound ideological departure from US doctrine over the past several years. The President spoke plainly about the corrosive effect of the Guantanamo legacy, and also of the dangers of stagnation: “I can tell you that the wrong answer is to pretend like this problem will go away if we maintain an unsustainable status quo. As president, I refuse to allow this problem to fester. Our security interests won’t permit it.

Our courts won’t allow it. And neither should

U.S. Foreign Policy

our conscience.” For the first time in a long time, an American president acknowledged that morality has a place in foreign policy and that our national security is not predicated on a disregard for civil liberties. Of course, President Bush made Wilsonian overtures of peace and democracy, but these gestures were frequently delivered at the end of a bayonet.

And although former President Clinton’s efforts in Bosnia and Somalia were guided by feelings of altruism, President Obama is the first commander-in-chief since Jimmy Carter to prioritize humility and restraint in his worldview. Such a philosophy is part of what New York Magazine refers to as Mr. Obama’s greater attempt to “change our conception of both ourselves and our country, as well as the way outsiders perceive us.” Swift rectification of the Guantanamo issue would offer the reprieve that President Obama seeks for this country’s moral standing.

Republicans and Democrats alike belabor the administrative difficulties of transferring and releasing detainees, but there are several viable options for lawmakers to choose from, should they ever become serious about supporting the President’s agenda. One concern with repatriating inmates to countries like Yemen—known to be somewhat lax on terrorism—is that they would become an attractive pool of recruits for organizations like al Qaeda. But US allies like Saudi Arabia have agreed to adopt part of the prison’s Yemenite population. The Obama Administration has also made arrangements to transfer detainees to a host of European countries including France, Portugal, and Italy. At the same time, the United States must also be willing to accept a sizeable share of Guantanamo’s inhabitants. As the principal architect of this quagmire, the US has an obligation to rehabilitate and provide for these inmates until further provisions can be established. For the handful of detainees that are truly dangerous, facilities similar to the Supermax prison in Florence, Colorado remain realistic options.

While many politicians vehemently protest the possibility of absorbing suspects connected to the ominous War on Terror, The Denver Post reports that Governor Bill Ritter “supports the idea” of bringing them to his state, declaring that “Supermax was built to handle exactly this type of inmate.”

However, this position stands in stark contrast to the arguments of a contingent of the Republican Party, which has hyperbolized the risks of housing detainees on American soil. The Washington Post has covered the efforts of Congressional Republicans to dis-

September 2009

suade residents of Standish, Michigan (a site that has made President Obama’s most recent shortlist) from advancing plans to transfer inmates to a local facility: At the time, [tavern owner] Munson said he saw the idea as an economic lifeline for the town and the prison, which provides more than 300 jobs. Then he met U.S. Rep. Peter Hoekstra (R-Mich.) at a cocktail party and quickly changed his mind. ‘He told me things that really scared the heck out of me,’ Munson said. ‘He told me about soft targets and safe zones, that if they came to this country they would have rights, visitors and friends would come who could be jihadists.’

Politicians that espouse the beliefs of Rep. Hoekstra, who serves as the ranking Republican on the House Intelligence Committee, assert a moot argument. Yes, some of the detainees at Guantanamo are dangerous. Yes, these particular men should not be released into society. Yes, they would pose a threat to ordinary Americans if permitted to roam freely. But, as Governor Ritter noted, federal penitentiaries are equipped to deal with such people. One would be hard pressed to explain why our prisons would be wholly unfit for Guantanamo inmates, considering that these very facilities have secured the public against drug traffickers, mafia bosses, and deadly terrorists like Timothy McVeigh.

The closure of Guantanamo Bay stands out as one of President Obama’s most worthwhile foreign policy initiatives, yet only six Democrats voted in favor of the May 2009 bill to appropriate funds for this cause. The President’s difficulty in garnering congressional support is reflective of a broader problem in the political landscape: as with healthcare, Democrats have failed to unify under a common ideology. The Wall Street Journal is one publication that has exposed this embarrassing deficiency, detailing how Senate Majority Leader Harry Reid and other well-positioned liberals have equivocated on the issue. Until Mr. Obama’s party is able to overcome internal squabbling, many significant problems will be left unresolved. And the change that Americans so eagerly sought in the aftermath of the Bush Administration will become an unfulfilled promise. Afp

Amara may be reached at nwannunu@princeton.edu

9

A:

B: President Manuel Zelaya of

C: Terrorists detonate bombs at

G:

H: Sen. Edward Kennedy of

I: In JAPAN, elections for the 480-

In IRAN, Mahmoud Amhadinejad defeats Mir-Hossein Mousavi, winning over 60% of the vote.

Amid widespread allegations of fraud, the Guardian Council orders a partial recount but ultimately finds no evidence of wrongdoing.

Denis Sassou Nguesso is reelected to the presidency of the REPUBLIC OF THE CONGO winning close to 80% of the vote, amidst allegations of fraud. Sassou Nguesso, who has now served 25 non-consecutive years as President, will serve another seven-year term.

10

HONDURAS is ousted in a military coup authorized by the Supreme Court, following his plans to initiate a referendum permitting his reelection. Fellow Liberal Party member Roberto Micheletti assumes interim control of the government.

Massachusetts dies at the age of 77. Widely regarded as a leader of American liberalism, at the time of his death, Sen. Kennedy was the third longest serving senator in the history of the UNITED STATES.

American Foreign Policy

two hotels, a Marriott and a RitzCarlton, in Jakarta, INDONESIA. Seven are killed and over 50 are injured in the worst such attack in Indonesia in almost 4 years.

seat House of Representatives take place. The ruling Liberal Democratic Party, which had ruled almost uninterruptedly since 1955, loses to the opposition Democratic Party of Japan, taking only 119 seats, down from the 296 seats previously.

D:

E: Baitullah Mehsud, the leader

F: The Justice Minister of SCOT-

J: Opposition candidate Ri-

K: The Delhi High Court over-

L: Riots break out in Urumqi,

NORTH KOREA conducts a second nuclear test, shortly followed by more missile tests, despite international pressure to do so. The UN responds with the passage of resolution 1874, denouncing the test and increasing economic sanctions.

cardo Martinelli of the Democratic Change party wins close to 60% of the vote in the election for the presidency of PANAMA. The multiparty Alliance for Change which backed him also takes control of parliament.

of the main Taliban organization in PAKISTAN and believed to be behind Benazir Bhutto’s assasination, is killed by a CIA drone in the Waziristan region. Following his death, Hakimullah Mehsud assumed command of Tehrik-i-Taliban Pakistan.

turns a nearly 150 year-old law in INDIA that criminalized homosexual intercourse, finding that the law violated various fundamental constitutional rights, and writing that it ran counter to the principle of inclusiveness.

September 2009

LAND, Kenny MacAskill, orders the release of the bomber of Pan Am Flight 103, Abdel Al Megrahi, on compassionate grounds given his terminally ill state.

Megrahi returns to LIBYA to much celebration, to the outrage of victims’ families and American politicians.

CHINA over rising ethnic tensions between the Uyghurs, a small Muslim minority, and the Han, the group comprising over a 90% majority domestically. Close to 200 people are left dead and over 1700 are injured in the violence.

11

A sia

Containing Kim North Korean Reinsurance Fraud as Strategic Vulnerability

R

ecent North Korean missile tests indicate that North Korea is actively pursuing the development of long-range nuclear weapons.

Given Kim Jong Il’s bellicosity and the ineffectiveness of UN measures such as Security Council Resolutions 1695, 1718, and 1874, the international community should identify and exploit any weaknesses that could bring North Korea to the negotiating table. In particular, the international community should take steps to police North Korean reinsurance fraud, which has become the regime’s second largest source of foreign currency. Damming this source of hard currency is a viable way of bringing the North Korean leadership to the table that has a number of advantages over the strategies previously employed.

Reinsurance is just what it sounds like—insurance companies such as Lloyd’s of London, Munich Re, and Swiss Re buy the risk held by other insurance companies. There are several aspects of reinsurance that allow North Korea to commit fraud so easily. First, unlike with the usual kind of insurance, with reinsurance the investigation of the original claim is not carried out by the company that ultimately pays. KNIC, for instance, insures a North Korean helicopter. When it crashes, KNIC investigates the claim, puts together the paperwork showing that the claim is legitimate, and then simply passes on the paperwork to its reinsurer, say Lloyd’s of London, and waits.

Lloyd’s itself cannot do any investigation unless North Korea allows it to do so, which it often does not. Further, if a claim is made on something that is reinsured, it is in KNIC’s best interest not to deny the claim, because they do not in fact have to pay it and can siphon money off the top when it is paid. A third key point is that KNIC is a state-owned insurance company, and reinsurers such as Lloyd’s generally agree to be bound by North Korean law in administering KNIC’s claims.

This is a clear conflict of interest. The same people who are making the laws under which North Korean reinsurance is administered are

12

Zachary Slepian ‘11

the people buying and using that reinsurance.

According to Kim Kwang Jin, who left North Korea in 2003 after working as a manager at KNIC for six years, North Korea has made between $50 and $60 million a year from reinsurance fraud - 5% of the regime’s annual revenue. The money is used, says Kim, ‘to scout out potential disasters in North Korea, to buy more reinsurance on the global market, and to pay premiums.’ The money left over after this, about $20 million dollars, is delivered yearly near Kim Jong Il’s birthday as a “present.”

“...the international community should use tightened reinsurance laws as part of its broad strategy to pressure the North Korean regime.”

Next to weapon sales, reinsurance fraud is the regime’s second largest source of hard currency revenue. Since North Korea relies so heavily on this source of funding, measures taken to diminish this supply would be highly effective in encouraging the regime to toe the line. Such measures would not only threaten North Korea’s capacity to build weapons, but would also remove the possibility for North Korea to respond, as it has historically, with more bellicosity. The beauty of tightening insurance fraud laws is that North Korea cannot say anything in response—for to do so would be to admit to the fraud. At worst, North Korea might respond with some criticism of new insurance laws as unduly restrictive, or as opposed to a free-market economy. Given their 3000% inflation, their concern will be easy to ignore.

American Foreign Policy

Critics might argue that North Korea will simply switch to other types of financial fraud. But this is a negligible objection. First, nothing prevents North Korea from doing these unspecified other types of fraud in the first place (in fact, North Korea already counterfeits US currency on a noticeable scale).

Therefore, presumably if these other frauds were lucrative, North Korea would already be doing them, or doing them to a greater extent than it is. Even supposing North Korea could simply increase its other kinds of fraud and make the same money it now makes, this switch would take several years and a re-tooling of the regime’s expertise in fraud.

These several years could buy the US and likeminded countries valuable time in bringing North Korea’s nuclear program to heel.

A further advantage of stemming the flow of reinsurance fraud revenue is that doing so is unlikely to hurt the average North Korean.

Cutting off food aid might do so, but since the regime is using the money from fraud to buy itself big guns and fast cars anyway, the North Korean people have little to lose. Lastly, new approaches are needed because UN resolutions have simply not been effective in the past. Although SCR 1718 (2006), which froze assets relating to weapons programs, is often cited as a successful measure, it was not ultimately sufficient to stall North Korea’s nuclear weapons program, as a nuclear device was tested soon after. Overall, UN resolutions are cast in the form of rebukes after North Korea tests a weapon and seem to be more “crying over spilled milk” than impeding North Korea’s aggressive aims.

A measure which forced US banks to cut off all transactions with Banco Delta Asia, a bank which does substantial business with North Korea, illustrates how effective an approach aimed at cutting off North Korea’s supply of foreign currency can be. Kim Kwang Jin called the case “frightening” to the regime, and it was soon after this that North Korea returned to multilateral talks. But tightening reinsurance fraud laws is even better.

Whereas North Korea could plausibly argue that US actions in the BDA case were highly prejudicial to its interests, and that the US was demonstrating its typical bullying behavior as the “bad guy,” such arguments do not hold much water for reinsurance. Here, the US can easily claim it is just interested in making sure the reinsurance industry runs as efficiently as possible, and that these new laws are not directed at any one country. This would leave North Korea with little negotiating leverage.

How might this strategy be implemented?

First, reinsurance corporations need to learn to better detect fraud and avoid it. So far, insurance companies have been remarkably poor at detecting North Korean reinsurance fraud because the North Koreans split their reinsurance up into many small packages to diminish suspicion. For instance, in a 2005 judgment in London, Lloyd’s lost $58 million on a case that was likely fraudulent. North Korea also operates under front companies to conceal the country where the risk originates and moves from country to country, much like a con man moving from town to town before the populace of each town catches on.

Governments can play a role in disseminating the information. An international information clearinghouse on reinsurance fraud might be established, so that reinsurers could immediately find out which companies have had large and questionable claims on a regular basis in the past and avoid them. This clearinghouse might also have an arm to investigate currently operating companies and pin down how they are interconnected. This would remedy the fact that the North Koreans often operate using shell companies that appear to be based in other countries.

Second, governments should consider requiring reinsurance companies to administer claims only under the laws of the country where the reinsurance company is based. This would prevent claims being decided under North Korean law, which is a sure-loss situation for any reinsurance company. Another piece of legislation might demand that any reinsurance claim be considered void unless it could be investigated by the reinsurer, which would prevent North Korea from fudging paperwork and then barring investigation by those paying. Finally, reinsurance companies that do choose to work with North Korea should be legally compelled to pay North Korean claims in North Korea won rather than in a hard currency.

In closing, the international community should use tightened reinsurance laws as part of its broad strategy to pressure the North Korean regime. Its current tactics of UN condemnations and broad based sanctions are too clumsy and reactive to handle the dynamic and difficult challenge of containing North Korea’s nuclear program. Reinsurance reform is a more sensible and subtle economic alternative. Afp

In Context Compiled by Tara Lewis ’11

“I told them I am a movie star.”

-Shah Rukh Khan, Bollywood actor, explaining what he told Newark Liberty Airport security after being detained by security and questioned there for two hours.

“Today, [Liberia] is a model of successful transition from conflict to postconflict, from lawlessness to democracy, from despair to hope.”

-Hillary Clinton, US Secretary of state praising Liberia during her recent tour of Africa.

“[Muammar] Gaddafi is not welcome in New Jersey. I am angry, like every other New Jerseyan and every other American, about the release of Abdel Basset Ali al-Megrahi.”

-Jon Corzine, New Jersey’s governor responding to leader Gaddafi’s plans to stay in New Jersey during his upcoming visit to the UN. Gaddafi supposedly celebrated Megrahi’s homecoming; Megrahi was convicted of involvement of the 2001 Lockerbie plane bombing.

“It’s the second presidential and parliamentary election in Afghanistan and I’m sure that, inshallah, this will be for peace.”

- Hamid Karzai, Afghanistan’s President commenting on Afghanistan’s recent election.

“They have talked much but not done much.”

-Xie Zhenhua, head of China’s climate change negotiations arguing that developed countries are preventing an international agreement for climate change.

“It’s a nondescript, pretty-much-worthless stone.”

-Frank Beunk, a geologist commenting on the investigation into the fake moon rock given to a former Dutch leader by the American astronauts of Apollo 11.

“Shaking hands during an election campaign is key, so this is pretty troubling.”

-Denny Tamaki, a political candidate in Japan’s coming election on why he will not be shaking peoples’ hands while campaigning.

“The punishment has not been cancelled, it was postponed because of Ramadan.”

-Mohamed Sahfri Abdul Aziz, executive councilor for religion, missionary work and unity reagarding on the scheduled whipping of a Muslim model convicted for drinking alcohol.

Answers to quiz on page 9:

1) C 2) D 3) C

4) E 5) B

Zach may be reached at zslepian@princeton.edu

September 2009

13

Economic Policy

Stronger Ties How China Is Powering Africa’s Growth

T

he merciless African sun is slowly giving way to the cool breeze of the evening, and yet another long day comes to a blissful end in the dusty little town of Sekoru in a desolate corner of the Ethiopian Rift Valley. The handful of mishit betoch (nightclubs) interspersed along the length of Sekoru’s only paved road, only minutes ago glaring in its quite stillness, become abuzz with lively activity. A bartender in one establishment eagerly displays his dazzling assortment of imported spirits, while a scantily clad waitress suggestively flashes her wares in another.

Almost as if on cue, columns of foreign men come marching down from their hilltop encampments, invading every joint in sight in search of a good time. These, however, are not the colonizers of old (in fact, Ethiopia remained a singularly free country throughout the continent’s dark history of colonialism), but rather, a new breed of pioneers. The hardened, but eager, faces of these expatriates signify the rise of a new kid on the African block – the People’s Republic of China.

These men are vastly different from the conquerors who scrambled for Africa’s riches centuries earlier. Instead of the safari suits and velvet top hats that their European predecessors donned, the Chinese frontiermen of the 21st century come decked in loose overalls and somber hardhats. Unlike the infantrymen who arrived bearing rifles and muskets before them, the newcomers are contractors, technicians and engineers equipped with cranes and bulldozers. Nor do they live in exorbitantly fancy villas and seclude themselves in exclusive neighborhoods. When not toiling at their work sites or resting in their Spartan dormitories, most prefer the same (cheap) pleasures that their local counterparts enjoy.

It is men like these who have breathed life into the economies of little towns like Sekoru and surrounding areas, not only in their patronage of local hangouts, but in the big things they are accomplishing all around them. In this remote corner of the Great Rift

14

Melekot Abate ‘11 Valley, several dozen Chinese engineers and construction workers are busy constructing East Africa’s biggest hydroelectric dam, Gilgel Gibe IV. Upon completion, it is expected to supply the urban centers and rural peripheries of southern Ethiopia and even neighboring Kenya, Djibouti and Sudan. This dam will not only bring electric power to hundreds of villages for the first time, but it will also be an indispensable catalyst for rapid industrial growth in the region.

This mammoth project, jointly financed by the Ethiopian and Chinese governments and the World Bank, is merely one of many similar undertakings that have sprung up all across Africa in the past decade. In its unfet-

“Moreover, China has striven to demonstrate its deep commitment not only to the economic well-being of the continent, but also to its peace and security.” tered ambition to join the highest ranks of world powers, China has set its sights on Africa, aiming to establish deep, friendly relations with the continent. In countries like Angola, Nigeria, Ethiopia and Sudan, the Chinese government has been hard at work providing much-needed developmental assistance, not only embarking on comprehensive projects to build schools, hospitals, roads, bridges and dams, but also training the robust human resources needed to maintain them. Nor is China’s largesse limited to the mobilization of

American Foreign Policy

fleets of engineers, architects and construction workers.

The People’s Republic has had to reach deep into its pockets to finance its expensive relationship with Africa. According to the terms of a robust assistance package announced by Chinese President Hu Jintao at a summit of African Heads of State and Government in Beijing in 2006, China pledged to double aid to Africa by the year 2009 and provide $3 billion in preferential loans for development ventures, further establishing an Africa development fund expected to reach $5 billion. At this watershed event, Chinese Premier Wen Jiabao also proposed that China and Africa take steps to strengthen their commercial ties, bringing trade volumes up to $100 billion dollars by the year 2010. (http:// english.focacsummit.org) Indeed, since 2006 trade has grown even faster than the premier expected, reaching the $100 billion mark in 2008, a whooping 45 percent increase from a year earlier. According to figures released by China’s General Administration of Customs for the 2008 fiscal year, China imported $56 billion worth of goods and services from Africa, while exports to the continent reached a staggering $50.8 billion. (http://www.chinadaily.com.cn/bizchina/2009-02/11/content_7466973.htm) This makes China Africa’s second biggest trade partner, behind only the United States and ahead of both Britain and France. (http://www.cfr.org/publication/9557/) The benefits of closer ties with China for Africa are clear. China’s financial and technical resources allow for the construction of much-needed infrastructure, the gleaning of valuable expertise and the growth of trade and industry, among other things, all at a much lower cost than arrangements with Western countries would entail. Furthermore, the “no-conditionality” nature of Chinese assistance allows aid to be used to meet the priorities identified by African governments, as opposed to the dictates of Western governments and monetary institutions.

Moreover, China has striven to demonstrate its deep commitment not only to the economic well-being of the continent, but also to its peace and security. In the last two decades, the Chinese government has mobilized thousands of its armed forces and civilian observers to conflict zones in Southern Sudan, Liberia and the Democratic Republic of Congo. More recently, China has deployed a formidable naval contingent to the East African coast, where piracy has threatened to cripple international shipping.

Economic Policy

Photo by the World Economic Forum

Jiang Jianqing, Klaus Schwab, Jacob Zuma, Kofi Anann, Ngozi Okonjo-Iweala and Soud Ba’alawy at the Opening Plenary on Africa and the New Global Economy held During the World Economic Forum on Africa 2009 in Cape Town, South Africa, June 10, 2009

All these generous overtures, however, have raised western eyebrows, perhaps because China’s newfound zeal may be reminiscent of a bygone era in which Africa was overrun by the imperial and commercial ambitions of different foreign powers. Because of a rapidly booming economy insatiable in its appetite for raw materials and markets for finished goods, Chinese multinationals have demonstrated their capacity and willingness to go to great lengths to secure both. In particular, they have demonstrated a strong desire to gain sustainable access to the sources of crude oil and natural gas in places like Angola, Nigeria and Equatorial Guinea, where the culture of good governance and strength of civil institutions are still lacking in maturity.

Consequently, the unrivalled spending power and political clout of Chinese businesses has occasionally bypassed the needs of local populations and served to exacerbate their already impoverished conditions. Unrestrained drilling and loose safety practices by Chinese energy companies in the oil-rich Niger Delta and elsewhere have led to the pollution of drinking water sources, dislocation of inhabitants and rife corruption.

China’s willingness to overlook gross violations of democratic practices and human

rights by its African trade partners has also made it the target of much criticism. China has played an obstructionist role in the UN Security Council in implementing resolutions targeting the Sudanese government for gross violations of human rights committed by government-backed rebels in Darfur, including the dislocation, rape and mass murder of hundreds of thousands of civilians. Moreover, the high prevalence of Chinese small arms and light weapons in several conflicts zones abets the further deterioration of peace and security in Africa. Either through the medium of international arms dealers or corrupt African governments, these arms fall into the possession of rebel groups in places like the DRC, where they are used to inflict serious harm upon civilians.

In spite of all this, however, there is no denying China’s invaluable contribution to the economic development of African states and its increasing assistance in bringing about peace and security. Nonetheless, the government of the PRC needs to re-evaluate the precise nature of its objectives on the continent and the extent to which its own interests are served by maintaining the policy of near complete “non-interference” in the domestic affairs of the nations it deals with. China could

September 2009

play an immensely constructive role by joining the international community of nations in demanding that African governments live up to the principles of transparency, accountability and respect for human life that they supposedly espouse. Pulling the weight of its enormous economic leverage and its permanent status on the UN’s Security Council, China could exert decisive pressure to facilitate the end of some of the most tragic human catastrophes of this decade. Not only would such a strategy pay dividends in creating political stability in the states that are increasingly vital to China’s economic interests, but it would also shine positively on the image of an emerging superpower that aims to be taken more seriously on the global stage. China has the unprecedented opportunity to be the catalyst of much-needed change on a continent that has been starving for it. It is an opportunity that the Chinese government and businesses need to seize for their own interests and for those of their African friends. Afp Melekot may be reached at mabate@princeton.edu

15

Economic Policy

A Culture of Innovation Why the U.S. Will Stay Globally Competitive

C

hina’s economy is strong despite the global recession. “Make Way For The Rise Of Asia” says Kishore Mahbuban, author of “The New Asian Hemisphere: The Irresistible Shift of Global Power to the East.” Many academics, journalists and bU.S.inesspeople share Mahbuban’s opinion that America is declining economically and that China is the next superpower. Their predictions are premature, as it will take decades before it can be called the world’s economic superpower.

Fortunately for the U.S., it is far from losing its international edge in business and innovation.

China’s prosperity should be welcomed. It benefits the Chinese people through better living standards, social mobility, economic freedom and improved government safety nets. China’s growth will also increase demand for foreign products and spur trade.

Despite its strengths, China still lags far behind the U.S.—especially in economic freedom and its capacity for innovation. Its GDP per capita is relatively low and its government inhibits innovation. While China should be recognized for its progress and strong economy, it is ridiculous to discount the U.S.’ economic potential or prematurely pontificate about American decline. The U.S.’ diverse population and capacity for innovation will keep it economically competitive and geopolitically strong for years to come.

Proponents of America’s decline make it appear as if China outperforms the U.S. both economically and educationally. In China, however, more than 20 million college students have few job prospects and half of its engineering graduates only have associate degrees. Naturally, given China’s massive population, it will eventually overtake the U.S. in its population of scientists. The U.S. though, educates more engineers per capita than does China and in its 2008-2009 report, the World Economic Forum ranked the U.S. as the most competitive economy. Minxin Pei, senior associate at the Carnegie Endowment for International Peace, says that de-

16

Tara Lewis ‘11 spite China’s rapid growth, it will take nearly 50 years for the average income in China to equal the average income in America.

A recent article in the New York Times suggests that job opportunities for American graduates in China are plentiful and that so are the Americans seeking these positions as evidence of American economic decline. It recounts stories of Americans and their successful jobs in China; yet, it cites no research and provides no concrete figures. Some Americans may easily find work in China

“The U.S.’ diverse population and capacity for innovation will keep it economically competitive and geopolitically strong for years to come.” like the Americans in the article. Shaun Rein, founder and managing director of the China Market Research Group thinks not. Jobs for recent college grads are scarce in China. And Rien says that Chinese companies would rather hire Chinese employees who understand both American and Chinese cultures than American applicants. Rein says that Americans have to convince employers that they are more valuable than the Chinese applicants—hundreds of thousands of whom have the same western education as the Americans.

Jobs are scarce in China. Unemployment in cities is officially 4.3 percent, but unemployment among last year’s Chinese graduates is about 12 percent. And the number of Chinese college students is growing. The bottom line is that Americans will struggle to find jobs in China just as they will in the U.S. Both countries suffer slow growth and high unemployment rates in this tough

American Foreign Policy

economy. The difference between the U.S. and China is that American culture and its government fosters innovation. The U.S. is home to a majority of the world’s most innovative companies and people. In 2003 IBM, an American company garnered five times as many patents as China and India gained combined. In 2008 the U.S. still greatly outpaced China in the number of patents generated.

Former Woodrow Wilson School dean and current Director of Policy Planning for the U.S. State Department, Anne Marie Slaughter talks about America’s creativity in “America’s Edge,” published in Foreign Affairs this year. She says that the U.S.’ capacity for networking will “renew its power and restore its global purpose.” Slaughter says that China’s economic and political policies will prevent it from becoming an international leader in economics.

American companies and even American universities are experts at networking and marketing themselves and their products.

Slaughter explains how American multinationals use networking to create well-selling products in markets around the world. A recent article in The Economist points to America’s history to show how important marketing has been for American innovation: “Edison did not invent the light bulb and Ford did not think up the motor car, but both came up with the business-model innovations required to profit from those marvels.”

American universities also market themselves to draw foreign students who contribute greatly to innovation in America. Fareed Zakaria, author of “The Rise of the Rest,” says that nearly half of all science researchers in the U.S. are either foreign students or immigrants. Foreign nationals made up 62% of all PhDs in the 2006 in the U.S., but they only comprised 7% of all B.S. degrees. Although the stay rate—percentage of foreign students who stay in the U.S. upon graduation—decreased slightly over the past few years, it remains high. A little over two-thirds of foreign PhD students stayed in the U.S. for at least 2 years after graduation. The stay rate will depend on America’s economy and immigration policies and whether foreign students and researchers have job prospects there in the future. As of 2009, the U.S. State Department is reworking its policies to reduce the time it takes to process Visas to two weeks.

For now though, as a 2008 RAND corporation report says, “America accounts for 40 percent of the total world’s spending on

scientific research and development, employs 70 percent of the world’s Nobel Prize winners and is home to three-quarters of the world’s top 40 universities.” Diversity helps America discover new markets. Like Henry Chesbrough of the Berekeley Haas School of Business says, Americans are so successful at marketing because of their “ability to listen to, and learn from, customers in new markets.”

The Chinese government is trying to increase its capacity for innovation through state-created communities that consist of University campU.S.es and research centers of International and Asian firms. These state-planned centers of innovation will not recreate the dynamic environment that encourages innovation in the U.S. because innovation comes from what Slaughter describes as “positive conflict”—the ability to challenge the status quo. China wants to produce more innovative citizens yet it controls the simplest aspects of their lives.

During the 2008 Beijing Olympics, China exposed how strictly its censors media.

Foreign journalists were appalled by how much the government censored the internet.

Chinese journalists also face tough restrictions—China leads the world in number of Journalists imprisoned. The Chinese government controls foreign trade just as strictly. On August 12th, 2009 the WTO ruled that China has been violating trade rules by restricting imports of media—movies, music etc. The state film distribution organization, China Film Corp., can decide for example that this summer the Chinese people will watch Harry Potter and not Star Trek. Unless China allows its people more freedom, both personal and economic, its private sector will remain stifled and small.

China has a strong and growing economy that is helping many people escape poverty and improve their lives. The U.S. and the world though, should not lose confidence in America. Eric Schmidt, CEO of Google’s reminds U.S. that, “innovation is how America works…creative destruction, this constant process of layoffs and new jobs and new companies and so forth is key to America’s competitiveness.” That mentality will make America the world’s most competitive economy for decades to come. Afp

Tara may be reached at taral@princeton.edu

Asia

Pakistan’s Frontier “The Most Dangerous Place on Earth”

T

ermed “the most dangerous place on Earth” by CIA officials in 2007, Pakistan is among the most crucial fronts in the war against Islamic terrorism. The nation’s mountainous Waziristan region is a Taliban stronghold, and the presumed hideout of many high-level al-Qaeda operatives. Unfortunately, the nation’s vested interest in U.S. anti-terror efforts has not translated into successful cooperation. Despite pledges of support, Pakistan’s attempts to supplement U.S. efforts in the region have been largely unsuccessful. As recently as April of this year, Taliban forces were able to capture Pakistan’s Swat Valley, a region within 100 kilometers of Islamabad. Though Swat has since been reclaimed, the episode was yet another example of Pakistan’s historic reluctance to turn fully against Islamic radicalism, and its preference for negotiation and compromise. This year, in a particularly dismaying example, the government attempted to defuse the conflict in Swat by simply meeting the militants’ demands and allowing the establishment of Islamic sharia law within the district. To no one’s surprise, this emboldened, rather than pacified, the militants, who soon occupied the entire Northwestern Frontier Province.

Pakistan has not given the Waziristan conflict the resources or the resolve it requires. A Defense Department official described the situation in these terms: “The government is too worried about its own political survival to take on the militants.”

Still, if the U.S. is to salvage its anti-terror partnership with Pakistan, it must emphasize that strategies designed to appease the Taliban are unacceptable. Furthermore, the U.S. must understand that the crisis in Pakistan is not entirely a military endeavor. Current President Asif Ali Zardari heads a fragile, insecure government, the country’s disenfranchised and uneducated youth remain vulnerable to radical strains of Islam, and sympathy for Islamist groups lingers within Pakistan’s intelligence and security institutions. America must use its

September 2009

Sweta Haldar ‘12 funds, resources and international clout to promote, first and foremost, a more robust secular educational system, one designed to inculcate democratic virtues and national pride among young Pakistanis.

That education is the only surefire cure for extremism has become a cliché, but in Pakistan it is highly applicable. Pakistan’s public education system has suffered enormous neglect over the past thirty years, and Islamic schools, madrassas, have filled the void. In 2002, approximately 10,000 Paki-

10,000 number of madrassas in Pakistan

1,700,000 number of students in madrassas

172,800,048 population of Pakistan (2008 est.)

stani madrassas educated a total of 1.7 million students.Though only a small minority of these schools promote violent, anti-Western ideologies, almost all encourage prioritizing allegiance to the pan-Islamic ummah (community of believers) over national duty. The development of a competent secular educational system, dedicated to teaching not only reading and writing but also the value of democratic participation would help to cultivate a more vibrant and accessible political environment, getting into the non-military roots of the problem.

In 2007, a representative sample of 1,044

17

Pakistanis found that Osama bin Laden had an approval rating of 46%. Approval ratings of the Taliban and al-Qaeda were similarly high. Perhaps even more jarring, only 4% of respondents believed that the United States had good intentions in its War on Terror. Winning the hearts, minds and loyalties of the Pakistani people is as central to U.S. interests as anything happening in Waziristan; the U.S. must understand that donations to the Pakistani military, however generous, are unlikely to alter public opinion, especially given the historic tendency of the military to carve itself a role in civilian politics.

Thus, while the Pakistani military certainly does deserve continued American support, so too do the Pakistani people and their government. A strong, effective educational system, and more particularly the economic opportunities and civic virtues it would cultivate, would go a long way to fostering the growth of moderation, tolerance, and democracy in Pakistan. America can best improve its regional reputation by demonstrating tangible support for the social, and especially educational, needs of the Pakistani people. Future aid should be directed more towards public programs than military enhancement. Additionally, financial assistance should be targeted not merely at projects of local development, but also towards the Pakistani government’s own attempts at systemic reform.

In June 2009, as Pakistani troops were retaking Swat, Osama bin Laden released an audio recording to Al Jazeera, the Arabiclanguage television network. He claimed that the Waziristan war was “an American, Jewish and Indian plot”, whose ultimate aim was to weaken Pakistan in the face of Indian aggression and American imperialism. Appealing to historic Pakistani insecurities, bin Laden attempted to deflect attention from the thousands of Pakistanis killed and the millions displaced by the current conflict. Against such an enemy, America must recognize that education is its strongest defense; only with a holistic appreciation of the conflict will Pakistanis be able to recognize that their deadliest foe is extremism itself. Afp

Sweta may be reached at shaldar@princeton.edu

18

U.S. Foreign Policy

Sanctioning Iran Now Is The Time

H

eading into fall 2009, the United States has unambiguously recognized the threat of Iranian nuclear proliferation. President Obama, Secretary of State Clinton, and other high-level U.S. officials have stated that Iran’s development of a nuclear weapon is unacceptable and have deemed Iranian non-proliferation to be a high priority. For the past few years, however, much of the international community has been less critical than the U.S., and the United States’ near unilateral approach to diplomacy and economic sanctions has been futile. Now, with the true nature of Iran’s regime—an authoritarian regime—on view for the world to see after Iran’s disastrous and violent June 12th elections, more and more international players are realizing the dangers of a nuclear Iran, whose missile range already includes much of southern Europe.

Sunni Arab states in the Middle East, too, have become fearful of the potential for Shia regional hegemony; though they have not publicly condemned Iran’s actions, some, like Saudi Arabia, have begun exploring nuclear programs of their own, which will likely spark a Middle Eastern arms race.

The Obama Administration must capitalize on Iran’s diminished international legitimacy by signing the economic sanctions bill to be passed by Congress, if and when upcoming Iranian negotiations fail. Economic sanctions would have a strong effect on the Iranian regime because of its current internal unrest and meaningful economic weaknesses. The administration should pursue multilateral sanctions even without the support of Russia and China, who have been reluctant to cooperate with the U.S. on the issue. Incomplete international cooperation on sanctions would still be sufficient to put significant pressure on the Iranian regime.

Internationally, the Iranian government has been delegitimized because of the seemingly fraudulent reelection of President Ahmadinejad and its bloody aftermath. The numerous accounts of unwarranted arrests, tortured prisoners, and coerced confessions have exposed Iran’s regime for what it truly is: author-

American Foreign Policy

Addie Lerner ‘11 itarian. Western countries, including many in Europe, who engaged eagerly with Iran previously have started sending lower-level officials to meet with Iranian leaders in place of typical high-level members of government, a tangible sign of Iran’s decreased standing in the international community. Also, for weeks after the fraudulent election, large groups of protesters decrying Iran’s government could be seen in cities around the world.

“The Obama Administration must capitalize on Iran’s diminished international legitimacy by signing the economic sanctions bill to be passed by Congress...”

Although some nations may have previously been willing to accept a nuclear Iran, or at least concluded that thwarting Iran’s nuclear ambitions would come with too high of a cost, they have concluded differently after the June 12th elections. Britain especially has reason to fear Iran, as it has become the regime’s latest target of aggressive rhetoric. Canada, which is home to 120,000 Iranian-Canadians, has publicly condemned Iran’s violent postelection crackdowns and now sees Iran as an adversary. The post-election fallout over the summer has led nations such as France and Germany, who previously disagreed with the US over how to approach Iran, to jump on the multilateral sanctions bandwagon. As Iran condemns these and other nations that previously supported a soft-line strategy against Iranian nuclear ambitions, it will find itself

with increasingly little international support.

Domestically, Iran is divided. Much of the Iranian public is upset over the corrupt elections and the subsequent violent crackdown.

There is even disagreement within President Ahmadinejad’s conservative government over cabinet firings and appointments, suggesting that Ahmadinejad and Grand Ayatollah Khameni (who has ultimate sovereignty in the country) are becoming even weaker. For Iran, the combination of the loss of international legitimacy and internal weakness make new sanctions quite promising.

Fortunately, the US Congress will likely pass these proposed sanctions in the form of the Refined Petroleum Sanctions Act sometime this year. These sanctions prevent any company that exports refined petroleum to Iran from doing business with the United States.

Although Iran is a well-known oil producer, it does not have sufficient capacity to refine all of its oil and thus imports 40% of the refined petroleum it consumes. The goal of the sanctions would be to prevent Iran from attaining much of its refined petroleum, which could substantially increase fuel and transportation prices in Iran, all of which would put severe pressure on the Iranian government to make concessions concerning its nuclear program.

First, however, it is important to address the critics who say that economic sanctions will not work because they harm the country’s civilians, not its government, and that civilians’ plight usually has no effect on an authoritarian regime. In Iran, dissatisfaction and anger would have a tremendous effect on the government. Iranian civilians already have shown a willingness to protest and put pressure on the regime when they feel harmed, as exhibited in the post-election protests.

Although the government managed to crack down on the election unrest, cripplingly high fuel prices may serve as the proverbial “final straw” and cause an uproar in an even larger segment of the population.

For sanctions to work, it is important that the Iranian people be willing to give up their nuclear weapons program. Though a World Public Opinion poll from August 2008 found that around 90% of Iranians supported their country’s development of nuclear energy technology, only 51% wanted their country to obtain nuclear weapons. And about 70% of Iranian would favor giving up nuclear weapons ambitions in exchange for trade and/ or technological development assistance.

Though there is not recent polling data on the issue, the number of Iranians favoring weapons development has likely decreased fol-

U.S. Foreign Policy

lowing the election as Iranians have become dissatisfied with their government and come to see the nuclear program as a source of isolation, both diplomatic and economic.

Previous U.S. sanctions have had varying degrees of success. Some, such as the 1996 Iran Sanctions Act, forced refined petroleum companies to choose between doing business with Iran and doing business with the United States. Although some companies terminated business with Iran, others preferred to sacrifice their business with the US. For example, the French petroleum company Total chose, in ’96, to divest its US holdings and pursue its business with Iran. Strong multilateral sanctions, however, could force companies

90%

percentage of Iranians who support their country’s development of nuclear energy

51%

percentage of Iranians who support their country obtaining nuclear weapons

to make the opposite choice. Iran’s largest petroleum importers are Vitol, a Swiss firm, Trafigura (Swiss/Dutch), Total (French), Glencore (Swiss), British Petroleum, and Reliance (Indian). These firms all do a lot of business in Western Europe, so that multilateral sanctions including France, Germany, and the U.K. would put pressure on them to cut ties with Iran. Already, German companies are feeling the pressure of existing sanctions against Iran, and new, pan-European sanctions could cause them to sever business ties with Iran completely. And Total, who now does business with both the US and Iran (after President Clinton waved the ’96 sanctions), may choose to sever its ties with Iran this time around.

There is some hope that Russia and China may sign onto such sanctions, or, if not enforcing sanctions themselves, at least not undermine US and European sanctions. Russia’s defiant move last summer in vetoing a fourth set of United Nations sanctions was a result of tense US-Russian relations after the Georgian-Russian war. Now, however, as President Obama has labored to improve relations with Russia, the country seems more willing to

September 2009

cooperate with the US on Iran. Russia has already put an arms deal with Iran on hold, and analysts suggest that this might signal willingness to get on board with new multilateral sanctions. China, aiming to attain trade concessions from the U.S., may support sanctions if properly enticed.

But even if Russia and China do not sign onto sanctions, the decrease in refined petroleum providers will still put pressure on Iran.

China and Russia may be markets for crude oil and a source of manufactured goods, but neither country has the technology or knowledge that Iran so desperately needs to expand its petroleum refining capabilities and natural gas production. Neither nation has the refining capacities to supply Iran with refined petroleum if it loses supply from multinational firms. Also, although Iran has the second largest natural gas reserves in the world, it is a net importer of natural gas, partially because the flow of technologies from the West to tap this gas has largely been shut off. Thus, sanctions that further cripple Iran’s access to refined petroleum and natural gas technologies will have significant effects regardless of China and Russia’s cooperation.

Perhaps the threat of these sanctions might force Iran to seriously engage in talks. The Iranian government, wary of a revolutionary unrest caused by a very high oil shortage, might be pressured to make concessions due to fears of being overthrown. Such an outcome is surely hoped for, but Iran’s track record suggests that is not likely. The Obama Administration’s best option going forward is to get members of the international community on board for sweeping economic sanctions, enter negotiations with Iran threatening these sanctions as the outcome for stalled and fruitless negotiations, and vigorously enact the sanctions—all the while implicitly courting the Iranian population as an ally. These steps have the potential to lead Iran to forgo its nuclear ambitions. In fact, that is just the outcome that NYU Professor Bruce Bueno de Mesquita forecasts in his game theory computer analysis, which has been known to successfully predict the outcome of international negotiations. Bueno de Mesquita’s program describes a scenario in which, due to pressure on the Iranian regime, it stops its development of a nuclear bomb in early 2010, when it is just “at the brink” of realizing a nuclear weapon. Afp Addie may be reached at alerner@princeton.edu

19

Can’t Get Enough Foreign Policy?

Check out the new AFP website at www.afpprinceton.com