JHU POLITIK
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FEBRUARY 2, 2015
VOLUME XVII, ISSUE II
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JHU POLITIK EDITOR-IN-CHIEF Eliza Schultz MANAGING EDITOR Christine Server
HEAD WRITER Julia Allen
ASSISTANT EDITORS Katie Botto Dylan Etzel Preston Ge Abigail Sia
POLICY DESK EDITOR Mira Haqqani
CREATIVE DIRECTOR Diana Lee
MARYLAND EDITOR David Hamburger
COPY EDITOR Florence Noorinejad WEBMASTER Ben Lu MARKETING & PUBLICITY Chiara Wright FACULTY ADVISOR Steven R. David
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CAMPUS EDITOR Juliana Vigorito
STAFF WRITERS Abigail Annear Olga Baranoff Arpan Ghosh Alexander Grable Rosellen Grant Rebecca Grenham Shrenik Jain Christine Kumar Shannon Libaw Robert Locke Sathvik Namburar Corey Payne
• February 2, 2015 • Volume XVII, Issue II
INSIDE THIS ISSUE
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Week In Review: Financial Shifts Rosellen Grant ’16 The Court, Marriage, and the Constitution Dylan Cowit ’16 Red Scare 2015:
How Greeks Learned to Love SYRIZA
George Gulino ’18
The Good Old Days?:
The Nostalgia-Fueled Communist Resurgence
Alexander Grable ’15
Ominous Omnibus:
What the Appropriations Bill Means for the New Congress
Corey Payne ’17
U.S.-Saudi Relations:
A Marriage of Convenience
Robert Locke ’15
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Week in Review: Financial Shifts by Rosellen Grant ’16, Staff Writer ECB Announces a Quantitative Easing Program On January 22, European Central Bank president Mario Draghi unveiled a €1.1 trillion “Expanded Asset Purchase Program”, marking a dramatic change in the ECB’s monetary policy. Under the program, also known as quantitative easing, the ECB will buy €1.1 trillion worth of euro-area government bonds for 18 months – in theory, increasing the supply of money, lowering interest rates, prompting lending and improving the Eurozone economy. The boost to the economy could hypothetically raise prices, pulling the Eurozone from the edge of its present deflationary spiral. Other central banks, including the U.S. Federal Reserve, have implemented similar programs; however, many worry that the program won’t be as effective in Europe due to risk-averse banks and smaller securities markets. The German government has also contested that QE contradicts founding EU treaties and incentivizes governments to keep overspending. Despite these criticisms, Draghi has forged ahead with his “whatever it takes” mentality, although it’s unclear whether QE will serve as the long-sought key to the Eurozone’s recovery.
Federal Reserve Stays Patient with Interest Rates In contrast to the ECB, America’s central bank kept to its course this week. Under Chairman Janet Yellen, the Fed signaled that it would not raise short-term interests rates before June at the earliest. Rates have hovered around zero for more than six years, but slowing inflation has muddled the waters regarding the Fed’s future policies; some analysts predict that they will hold off on raising rates until 2016. If the inflation rate continues to fall as the dollar strengthens and oil prices drop, increasing the interest rate could hamper borrowing and further hurt the economy. The Fed’s worries, however, seem to be self-fulfilling: following the announcement, the Dow Jones Industrial Average tumbled after oil prices slumped to their lowest level since 2009.
Russian Bonds Downgraded A third world economy experienced an embarrassing shift last week when Standard & Poor’s, a major credit rating agency, downgraded Russia’s sovereign bonds to junk for the first time in a decade. Citing weakening economic growth prospects, largely due to falling oil prices and U.S.-led sanctions, S&P indicated that it is no longer confident in Russia’s ability to repay its debt. Fitch and Moody’s, two other rating agencies, also downgraded Russia’s credit rating this month, but have maintained their sovereign debt status as investment-worthy. Following the downgrade, the Russian ruble fell by roughly 7 percent, but the government wasn’t fazed; formally, Russia doesn’t recognize Western credit ratings, and even if they did, Economic Minister Alexei Ulyukayev has claimed that the lower ratings are “unjustified.” Despite their apparent disregard, the Russian government is said to be preparing a stimulus plan of 1.4 trillion rubles to combat the weakening economy and their worsened ratings. ■
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• February 2, 2015 • Volume XVII, Issue II
The Court, Marriage, and the Constitution
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by Dylan Cowit ’16, Staff Writer
he Supreme Court recently granted review to four cases challenging state bans on same-sex marriage. Less than four months after declining to review lower court decisions overturning such bans, the Supreme Court has now officially entered the debate. At oral arguments, the justices will address a question long pondered by the American public: whether the Fourteenth Amendment requires a state to license a marriage between two people of the same sex. A final ruling will likely not be released until June. In the meantime, the American public has already begun to speculate how the Court could rule in these potentially landmark cases. Many constitutional scholars have looked for clues in another landmark case: United States v. Windsor (2013). In Windsor, the Court dealt not with state bans but with the federal Defense of Marriage Act (DOMA). At the time, DOMA defined “marriage” as excluding samesex couples, preventing them from enjoying many federal benefits available to opposite-sex couples. Justice Kennedy wrote the majority opinion in Windsor, ruling that the relevant section of DOMA violated the Fifth Amendment’s equal protection requirement. As a result, the federal government must recognize same-sex marriages lawfully licensed in states. Now, as the Court prepares to hear challenges to state bans, its ruling in Windsor has again become noteworthy. The constitutional arguments in Justice Kennedy’s opinion could have major implications for the outcome of the new cases. The nature of these arguments has been a subject of debate among scholars, who dispute whether the opinion was based primarily on federalism or on equal protection. Those who believe Windsor was a federalist decision claim the Court overturned DOMA solely because the right to define marriage belonged to the states and not the federal government. Others disagree, arguing that the Court overturned DOMA because the law treated same-sex couples unequally and violated the equal protection requirement of the Fifth Amendment. Despite sounding like a minor technical dispute, this debate could predict the Court’s future ruling on same-sex marriage. If Windsor were solely a federalist decision, it would signal that the Court will likely uphold state bans, proclaiming the right of states to define marriage as they wish. However,
if Windsor were decided on equal protection grounds, it would suggest a majority of the Court believes that the government cannot treat same-sex couples differently than their heterosexual counterparts. A close reading of Windsor suggests Justice Kennedy based his opinion primarily on equal protection. While federalism did play a role in the opinion, Justice Kennedy ruled the relevant section of DOMA unconstitutional ultimately because it treated same-sex couples unequally. He implied that DOMA had been motivated by “improper animus” against same-sex couples and that its “principal purpose is to impose inequality.” Thus, Justice Kennedy argued, “DOMA is unconstitutional as a deprivation of the liberty of the person protected by the Fifth Amendment,” not simply because a federal law aimed to invalidate state statutes in an area of state jurisdiction. By indicating he believes that the government cannot treat same-sex couples unequally, Justice Kennedy, often considered the Court’s “swing vote,” suggests he could consider state bans unconstitutional. Although his Windsor opinion concerned the federal government, the same reasoning could be applied to state bans. Rather than use the Fifth Amendment’s equal protection requirement, which applies to the federal government, Justice Kennedy could rely on the analogous equal protection clause of the Fourteenth Amendment, which applies to the states. Justice Kennedy already argued that a law imposing “a disadvantage, a separate status, and so a stigma” upon same-sex couples violated equal protection, and could easily characterize state bans as a similar violation. Justice Kennedy’s vote, when combined with the likely votes of Justices Ginsburg, Breyer, Sotomayor, and Kagan, could soon fully legalize same-sex marriage. Of course, Windsor does not guarantee that the Court will strike down state bans. Justice Kennedy wrote in Windsor that the specific ruling applied only to federal recognition of those marriages licensed in states where same-sex marriage is already legal. Yet Justice Kennedy’s previous reliance on equal protection suggests that the Court could act similarly when reviewing state bans. Whatever the justices decide, their ruling should finally provide clarity to the American public on the relationship between the Court, marriage and the Constitution. ■
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Red Scare 2015:
How Greeks Learned to Love SYRIZA
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by George Gulino ’18, Contributing Writer
bservers of finance, economics and politics watched intently as the Greek snap elections of January 25 yielded an expected victory for radical left coalition party SYRIZA. The 36.3 percent vote that SYRIZA secured in a fragmented field allowed it to form a government with the center-right Independent Greeks. The next day, party leader Alexis Tsipras was sworn into office. EU policymakers, Greek conservatives and all other defenders of Europe’s fiscal status quo struggled with how a NATO and EU member could elect an openly anti-capitalist party.
about more than the balancing of scales. This stubbornness places Europe on a collision course with the economic ruin of deflation. Greece’s debt has actually increased in spite of austerity because the damage done to its economy has caused tax revenues to plunge. The situation risks becoming an unsustainable norm of constant mediocrity for much of the Eurozone while a prosperous Germany tries to hold on despite shrinking export markets. However, Greek voters have decided to stop being the head that Germany stands on to keep its nose above the water.
SYRIZA won this election on an anti-austerity platform that seeks to reverse Greece’s economic catastrophe. Some proposals include asking for partial debt forgiveness, like the deal granted to Germany in 1952 and renegotiating the rest of the debt. This financial flexibility would offer some relief to the Greek public by raising the minimum wage, providing free electricity to the long term unemployed, and slowing or reversing cuts. Austerity was officially intended to improve Greece’s credit standing, increasing investor confidence and, consequently, investment. However, this policy has been totally ineffective in the Eurozone over the last five years.
If SYRIZA acts on its mandate to demand a debt renegotiation, Europe will have to either defy the spirit of the Eurozone to actively punish Greece into submission or submit to sanity. If a compromise can be reached, the Greek government can focus less on running ridiculous surpluses in order to pay back foreign banks and hedge funds, and instead use the revenue to fulfill campaign promises such as limited rehiring of government employees, a 10 percent increase in the minimum wage, reduction of healthcare fees, and a reversal of pension cuts to the elderly. This investment in the vulnerable, unemployed and underemployed will be quickly recirculated into the economy.
Austerity has been at best misguided and, at worst, a disingenuous attempt to protect the nations making the policy, rather than those being forced to implement it. History will likely remember the policy as it remembers the public spat between John Maynard Keynes and Winston Churchill in the 1920s: Churchill wanted to set the gold standard value to deflation-inducing levels to stabilize the money supply, but Keynes correctly predicted that the immediate spike in unemployment caused by deflation would cause intolerable or even structural damage. Today the EU, driven by Germany’s strict anti-inflationary philosophy, is making a blunder similar to Churchill’s. The day after the Greek election, Nobel Prize-winning economist Paul Krugman described the EU’s insistence on forcing budget deficits in a depressed economy as violating textbook macroeconomic principles. Some may cheer the punishment of fiscal irresponsibility, but this situation is
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It’s rather spectacular that, in this case, Marxist sympathizers are better at capitalism than the supposedly fiscallyresponsible. Unwilling to share more of the sacrifice to ensure long-term success for Greece and the entire Eurozone, Brussels has been feeding Greece what Joseph Stiglitz calls “poisonous medicine.” After five years of resulting destitution, humiliation and despair, Greek voters have opted for a second opinion. The result is perhaps best represented by Tsipras’s decision recent decision to remove the metal barricades from the front of the Greek Parliament. Erected in 2010 as a precaution against constant massive anti-austerity protests, their removal corresponds with a realignment of government interest with domestic interest. SYRIZA’s victory is the salvation the Greek people needed and, whether the continent comes to realize it or not, the potential shock back to sanity that Europe needed as well. ■
• February 2, 2015 • Volume XVII, Issue II
The Good Old Days?:
The Nostalgia-Fueled Communist Resurgence
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by Alexander Grable ’15, Staff Writer
n Christmas Day 2014, the Internet was temporarily flooded with news stories about the twenty-fifth anniversary of the death of Nicolae Ceausescu. The once-dictator of Communist Romania, Ceausescu was executed on December 25, 1989 after a show trial. Though Ceausescu was extremely unpopular at the time of his death, events in Romania since his downfall provide a strong indication that the post-1989 conservative/libertarian economic regime has failed. Throughout the 1980s, Romanian living standards declined as Ceausescu’s leadership, like many Communist countries, enacted an austerity regime (the sternest in the Eastern Bloc) to pay off foreign debts that had become unmanageable after the U.S. Federal Reserve sharply raised its interest rates in 1981. Ceausescu built a vulgar personality cult around himself and his wife, and his reign was enforced by the brutal Secret Police, the Securitate. Both isolated him from the reality that Romania was a powder keg. After an increasingly intense series of protests in December 1989, Ceausescu was forced to return from a state visit and staged a rally to condemn the protests – but a riot broke out soon after he began to speak His expression when he realized the depth of his unpopularity has come to symbolize the fall of Communist tyrants in Eastern Europe. After days of bloody street-fighting in Bucharest and an attempted escape, Ceausescu was captured, tried and executed. Romanians celebrated the end of Communist rule and hoped that Ceausescu’s fall would usher in an age of democratic freedom, stability and rising living standards. Yet nearly 25 years later, 54 percent of Romanians surveyed in April 2014 said that life had been better under Ceausescu. Only 16 percent said that life had been worse. This is a clear indication that something has gone badly wrong. Immediately after Ceausescu’s fall, the IMF and World Bank pushed economic liberalization upon Romania. The 1990s were a lost decade during which Romanian wages declined, factories closed and even deeper cuts to social spending were made. The economic boom of the 2000s did little to alleviate the poverty that had only worsened since the fall of Communism. As with the rest of world, wealth and income inequality exploded in Romania, and the quality of life has
plummeted since 1989. Romania’s uneven recovery since the 2009 recession has not ameliorated the situation. This malaise with the post-1989 order is manifest in Romanian films and documentaries – and this is a country that is a member of the European Union. Among Romanians, there is a deepening disillusionment with the post-Communist order and an increasing nostalgia for many bygone Communist policies. In the current economic climate, people remember with envy how Communist regimes had been committed to full employment and guaranteed pensions – two things that the conservative/ libertarian economic order has not provided. Since 1989, Europe has undergone increasing privatization and economic liberalization, and conservative/libertarian economic tenets have been written into the EU Constitution. Under great pressure from Germany, the EU has pursued conservative/ libertarian policies of hard money and austerity, two policies which have failed to incite growth. They have inflicted suffering – particularly on countries like Greece – due to the radical shrinking of the state that they champion, regardless of the cost to others. Romania is an especially troubling example of nostalgia for Communist regimes because of the suffering that the Romanian people endured under Communism. The fact that the post-1989 order has produced poorer economic outcomes for the Romanian people is inexcusable. But Romania is not an isolated instance. East Germany, following the economic depression of the 1990s, has become a left-wing bastion and the center for a resurgent Communist Party. The recent victory of the firmly left-wing Syriza Party in Greece, which counts many Communists among its members, shows the depth of dislike for conservative/libertarian “starve the beast” policies, and a desire for firm left-wing economic policies (which include expanding public payrolls, increasing minimum wage, and halting privatization). The discontent in Romania and elsewhere in Eastern Europe illuminates the false promise behind conservative/libertarian trickle-down economics, and the claim that these policies will produce a rising tide that lifts all boats. Instead, what we have come to see is that most people drown. ■
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Ominous Omnibus:
What the Appropriations Bill Means for the New Congress by Corey Payne ’17, Staff Writer
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n December 16, President Obama signed the fiscal year 2015 omnibus appropriations bill, which funds the majority of the government through September. The bill, officially titled the “Consolidated and Further Continuing Appropriations Act, 2015,” totals $1.014 trillion in federal spending and includes a continuing resolution to fund the Department of Homeland Security through February. Emblematic of the politics of the 2014 election year, this budget foreshadows what we might see in the new Congress. And unfortunately, the way this budget came into existence has frightening implications for the upcoming legislative session. Complying with the Murray-Ryan 2013 budget agreement, the omnibus bill caps total spending increases at 0.1 percent, significantly less than the rate of inflation, which has recently hovered around 2 percent. As such, the real value of the new federal budget will be cut drastically, with some estimates predicting a $10 billion reduction in appropriations. The budget is incredibly partisan and gives major victories to the Republican Party just weeks after the GOP’s landslide midterm election victories. It includes large spending cuts for the Internal Revenue Service and Environmental Protection Agency – two agencies championed by the left and despised by the right. To give the appearance of bipartisanship, the deal also contains a marginal increase in funding for major financial regulators such as the Securities and Exchange Commission and the Commodity Futures Trading Commission. However, this is mostly an empty gesture, as the budget contains a policy-rider that strips the Dodd-Frank Wall Street reform of some of its clout by repealing the provision that restricts trading of derivatives, which were largely responsible for the 2008 crash. Even worse, the rider was simply copied and pasted from language provided by Citigroup, which stands to gain from this repeal. But perhaps most infuriating is the blatant disregard for the democratic process that this law has in its campaign finance rider. It drastically increases the amount of money an individual can give to national party committees – a rise
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from $32,400 per year to $324,000. Added to the amount that individuals are already permitted to give to congressional campaign committees, this means a single donor can give as much as $777,600 to the official arms of a national party, which is an enormous increase from the current $97,200 limit. In one regard, this budget is the natural fluctuation of political tendencies. Public opinion is a pendulum, vacillating from left to right. The midterm elections seemed clear: Republican ideology has returned to favor. However, this may not be the case. Despite significant margins on Election Day, the GOP’s victories did not come with as large of a mandate as many believe (if at all). Less than 36 percent of voters voted on November 4, and many voted Republican purely out of disdain for President Obama, as opposed to genuine support for Republican policies. The omnibus bill was a reaction to the November elections, but the pendulum might not have swung completely away from the Democrats yet – they gave up their clout too early. In fact, the Democratic agenda seems favorable to the public. According to the exit polls, 52 percent of voters were prochoice, 57 percent support legal status for undocumented immigrants, and 63 percent said that the present system unfairly favors the wealthy. Similarly, Gallup reported that there has been no significant change in the satisfaction with one’s individual healthcare plan since the implementation of the Affordable Care Act – people are generally content with their individual healthcare situations. Moreover, despite a 5 percent third-quarter expansion rate, gas prices falling below $2.50 a gallon, the Dow Jones above 18,000, and official unemployment at the lowest in years, exit polls showed 70 percent of voters viewed the state of the economy negatively. With the economy and healthcare listed as the number one and two priorities among voters this past election, one cannot help but wonder why the American people came out in droves to vote against the Democrats, whose policies have carefully cultivated the economic growth they desire, and whose ideological positions they seem to agree with.
• February 2, 2015 • Volume XVII, Issue II
This means, very simply, that the Democrats screwed up. Their message in this campaign was reactionary and defensive. Instead of standing by their popular policies and honing in on messages that illuminate the true state of the nation, the Democrats allowed themselves to be caught up in a game of “How Many Times Were You Photographed With Obama” and “I Never Really Liked Him Anyway.” Then, when the time came to govern again, they were too busy licking their wounds to fight for the new budget. Democrats deserved to be beaten last November and they deserved to be beaten on this spending bill. Instead of standing firm and debating the issues – a debate they could have won – they allowed themselves to be unceremoniously dragged to the middle of the aisle, stooping down to a mediocre, pandering level of politics, then allowing their opponents to beat them with experience. President Obama’s increasing approval ratings after the elections, with action on popular issues such as immigration, Cuba, and community college, only further proves that debating these issues would have served the Democrats well in November – and better still in the fight over the funding of the government. Republicans wanted to avoid a shutdown showdown as much as Democrats did as both parties geared up for a brutal presidential election season. But when the faceoff began, Democrats blinked. This sent a clear message to the new GOP majority: “When the going gets tough, we will back down gracefully.” This was their attitude in the campaign, and they allowed it to be dragged into the halls of the Capitol. The new leadership has begun its push for conservative policies: in the new session, the GOP has already passed the Keystone XL pipeline authorization, pushed for a CBO change to make tax cuts easier, and moved forward on anti-choice legislation that leaves even women in the majority caucus cringing.
months due to the reactionary attitudes of the campaign and tired inaction on the spending bill. But this promotion did nothing to silence Warren. Instead of conforming to the center-left positions of the leadership, she continued her crusade against the omnibus budget and has worked with Senators Boxer and Sanders in pushing against the Keystone XL bill already this year. With these leaders at the front, we can recover from this budget before it turns the Democrats of 114th Congress into simple opposition with no agency. Taking steps like adding measures to the Keystone XL authorization that confirm the existence of climate change is only one of many ways Democrats can make their mark while in the minority. Indeed, the Republicans are already having trouble governing. From chaos in the select committees to divisions in the House caucus, the GOP has its work cut out for it, and they can bet that Democrats are going to be standing by, eager and willing, to push their own policies. If Democrats continue the spineless attitudes they adopted during the campaign, then the rest of the session will be a repeat of the spending bill fight. But if other Democrats follow the example of Sanders and Warren and push the limits of the GOP majority – if they can stand up for their supposed values and if they can surpass the expectations of a weary base – then perhaps the omnibus bill isn’t so ominous. Perhaps there is hope that, in the coming months, the ideals of progressive Americans won’t be so easily ignored, and the policies of the people so hastily pushed aside. ■
But there is still a chance that the Democratic party can recover from its mistakes. Many members of Congress voted against the spending bill, and several leaders emerged. Senators such as Elizabeth Warren and Bernie Sanders became clear crusaders against the bill, trying with all of their authority to stop it from passing. In the new legislative session, they have already begun to lead the charge against the harmful policies of the new conservative majority. Recently, Warren received a huge promotion to Democratic leadership in the Senate for the new session. Minority Leader Harry Reid created a new policy position just for her, a move many criticize as pandering to the left – a group within the party that has felt increasingly disenfranchised in recent
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U.S.-Saudi Relations: A Marriage of Convenience
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by Robert Locke ’15, Staff Writer
s the world remembers King Abdullah, who died in late January at the age of 90, Saudi Arabia finds itself at the center of international headlines once again. The king’s death has prompted a reflection period of sorts on Saudi Arabia’s role in the region, the world, and on their partnership with the United States. With power now in the hands of King Salman, early indications are that U.S.-Saudi relations will continue to flourish. Although the relationship between the United States and Saudi Arabia is as strategically necessary as ever, it continues to overlook sharp ideological differences between the two states on the human rights front. Even at a time when popular movements stemming from the Arab Spring and globalization have begun to challenge the iron grip the Al Saud regime has held over the country for centuries, the direction of Saudi domestic policy shows little sign of change. However, Saudi policy in the Gulf region and its global foreign policy are less certain. King Salman is surrounded by an increasing number of foreign policy “hawks” who continue to advocate an increasingly aggressive Saudi foreign policy. The regime is being urged to move toward direct involvement in driving away regional threats and working towards stability in surrounding countries like Yemen. As a state deeply rooted in the regime’s interpretation of Islam, Saudi Arabia is likely to guide its policy choices with significant religious considerations. Considering Saudi Arabia’s oil wealth and the location of Mecca, a spiritual hub of the region and Muslim world, the country inherently holds significant sway in the region. Will the continuous rivalry between Sunni Saudi Arabia and Shia Iran further escalate, especially if Saudi Arabia becomes more aggressive in promoting its beliefs and policies? Time will tell.
women. The United States is much further along the road to protecting human and women’s rights than Saudi Arabia, where women cannot drive and need male chaperones. In fact, 2015 will be the first time in the country’s history that women will be able to vote and run for local office positions. Saudi Arabia’s human rights record is widely considered to be concerning, but is often swept under the rug in the marriage of convenience that the U.S. and Saudi Arabia share. How concerning are Saudi human rights standards really? Let’s compare them with the punishment standards of ISIS, sworn enemy number one of the U.S. – and not without reason. Saudi Arabia and the Islamic State carry out comparable, if not the same, punishments for the following crimes: theft (amputation of hand), adultery (death by stoning), and acts of homosexuality (death). Yet we are fighting one and befriending the other. Why do we depend on Saudi Arabia to provide us energy when we have essentially little in common with the regime and its regrettable behavior? Perhaps it is more reasonable to expect a change within U.S. energy policy instead – not only to pursue more sustainable energy sources, but also to allow ourselves to maintain a higher standard for our business dealings around the world. While this may not be the most politically convenient choice currently, self-sufficiency in energy production would enable us to maintain a more consistent standard for countries around the world, and to avoid regrettable discrepancies in our foreign policy. As the world moves through the natural reflection that a notable death brings about, many of these questions are ones to consider as we reevaluate our relationship with Saudi Arabia and our foreign policy in the Middle East. ■
Saudi Arabia has long been a staunch ally for the United States in the region. The Saudis possess the world’s largest oil reserves, a precious commodity that the U.S. has been in great need of for some time. The alliance between the two countries is as strong as ever, even though both have vastly diverging policies on human rights, especially regarding
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