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INAUGURAL ISSUE | MAY 2009

C A N A D I A N I N T E R N AT I O N A L C O U N C I L

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GLOBALBRIEF World Affairs in the 21st Century CO N F L I C T I N T H E N E X T D ECADE J O H N E . M C LAUGHLIN B O U G A I N V I LLE DEAL A L EXA N D E R DOWNER

THE TOP

STAT E O F T H E T R O U B L ES

INTELLIGENCE

J O H N D E C H ASTELAIN

AGENCIES

N U C L E A R C ENTURY LO U I S E F R É CHETTE

W E S L E Y WA R K WAS P E A R S ON A N ACC I D E N T? A N D R E W CO HEN B A R AC K O B AMA V E RS U S T H E WORLD R O L A N D PA RIS BETWEEN WA R A N D P EACE M I C H A E L M O RGAN EPIGRAM D O U G L AS G LOVER

THE PARADOX OF INDIAN POWER SASHI THAROOR

Art Deal of the

NEZ À NEZ

Wheeling and Dealing for Peace, Security & Advantage

JOHN KAY FIRST PRINCIPLES FOR THE DEAL-MAKER SCANNING FOR ‘DOABLE’ DEALS ALVARO DE SOTO

STEVEN PINKER HUMAN NATURE AND SEALING THE DEAL

CANADA IN AFGHANISTAN GORDON SMITH

THE FUTURE OF GLOBAL M&A FRED LAZAR $7.00 in Canada US $7 | UK £4 | EU €4.50

VS SAEED RAHNEMA

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■ Canada’s International Development Research Centre supports research in the developing world that creates knowledge to beneﬁt the whole planet.

G L O B A L B R I E F • M AY 2 0 0 9

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Welcome to Global Brief

EDITOR’S BRIEF

Say hello to the newest dog in the fight

Photograph: jim allen

intelligence agencies, and Roland Paris of the University of Ottawa opines on prospects for Obama as the ‘forces’ of the world gather in potential opposition. Yale’s Michael Morgan argues that history suggests that more war can sometimes issue in a better peace, while an imperfect peace may issue in more bloody wars. Shashi Tharoor – fresh from the Indian elections – argues that India’s future strategic power will and should be ‘soft.’ Gordon Smith of the University of Victoria and York University’s Saeed Rahnema face off in Nez à Nez – a frank point-counterpoint debate on Canadian interests in Afghanistan. Finally, in The Definition, we ask some top minds to tell us about the pedagogy of future global leaders, while in Strategic Futures, we predict possible end-game scenarios in the emerging ‘great game’ in the Arctic. Barry Blitt, frequent cover contributor to The New Yorker, depicts a scene from The Cabinet Room of Vladimir Putin. Please visit us often at www.globalbrief.ca. Global Brief publishes bi-monthly to start (please subscribe online), but our web presence also includes regular web specials (in English and French), videos and podcasts, Facebook, as well as daily multilingual expert blogs to the world: in English, French, Mandarin, Russian, German and Spanish. We will very shortly add Farsi, Arabic and Hebrew expert blogs. I should like to sincerely thank Jim Balsillie, Chair of the Canadian International Council, Hugh Segal, Doug Goold (past president) and the entire CIC board and staff for the opportunity to lead this publication. I am indebted to my family (particularly my dear wife, Alla) and to Sasan Shoamanesh, an abiding friend who was instrumental in the conception of this magazine. For the record, Action Canada – Sam Belzberg, Jack Blaney and Cathy Beehan – provided the seed funding for the creation of the original business case for a very early prototype of such a publication. That prototype, named ‘Lester,’ was developed by a group of Action Canada fellows in 2007- 08. I was among their number. The others were Tim Coates, Shauna Mullally, Jane Macdonald, Taylor Owen and Gino Reeves – all working under Antonia Maioni of McGill University.

Irvin Studin Editor-in-Chief

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Strange fact: Canada has no top-tier international affairs magazine. No high-level platform for emerging and top thinkers to argue about the world. No authoritative ‘rag’ to spur decision-makers. No contribution – in written form, at least – to the global agora of debates about the world and its destiny. Britain has The Economist. The US has Foreign Affairs and Foreign Policy. France has Le Monde Diplomatique. And so on. Where, one asks, is Canada’s ‘dog in this fight’? Global Brief attempts to fill this void. It profits from none of the funding and incumbency advantages of the aforementioned great publications, but it seeks to be one of the first serious platforms of this new century – aimed at a global readership and populated by the works of top global writers – dealing with world affairs writ large – international politics, business, culture, movements and trends. It has no moral mandate. It is not Anglosopheric. It is not sensationalist. Nor is it fatalistic. Rather, it seeks to analyze and explain the world in all its bald complexities, to anticipate different ‘strategic futures,’ and to reflect – with policy relevance and nuance – on ways to address these complexities. The Art of the Deal – the small ‘t’ theme of our inaugural issue – speaks directly to the emerging identity of this new platform. A world-class inaugural roster tells us about how future ‘deal-makers’ must think about the world’s emerging geopolitical and economic puzzles, as well as a host of related issues . In the One Pager, John E. McLaughlin, former head of the CIA, starts us off by prognosticating on the conflicts of the next decade. John Kay of the Financial Times tells us how complex deals are to be struck, as does Alvaro de Soto, former UN top man, by way of kinetic interview in our Tête à Tête section. Louise Fréchette, former Deputy Secretary-General of the UN, talks bluntly about nuclear futures in our other Tête à Tête. Lawyer Ran Goel, former Australian foreign minister Alexander Downer and John de Chastelain, chairman of the Commission on Decommissioning in Northern Ireland, respectively give us In Situ reports from Colombia, Papua New Guinea and Belfast. In Query, Harvard professor Steven Pinker speaks to the quirks of human irrationality in international deal-making, while author Andrew Cohen tells us whether Lester B. Pearson, Canada’s most famous ever deal-maker, was the accidental progeny of a society that has been hard-pressed to produce international leaders. Fred Lazar of the Schulich School of Business discusses the resurgent future of global M&A. Wesley Wark of the University of Toronto ranks the world’s

INAUGURAL ISSUE

Editor-in-Chief Irvin Studin

M AY 2 0 0 9

D E PA R T M E N T S

Associate Editor Bob Johnstone Assistant Editor Laura Sunderland

EDITOR’S BRIEF . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Art Direction Louis Fishauf Design Special Events Jordan Dupuis Special Advisor Tamara Zur Research Thomas Adams COPY EDITOR Frances Cation Assistant Kathryn McBride Interns William Sapp, Alex Pawson Advisory Council Sasan Shoamanesh

André Beaulieu, Tim Coates, David Dewitt

ONE PAGER John E. McLaughlin | Conflict Over the Next Decade. . . . . . . . . . . . . 5 IN SITU Ran Goel | Colombia: Not Yet There. . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Alexander Downer | Case Study: The Bougainville Deal . . . . . . . . . 18 John de Chastelain | The State of The Troubles . . . . . . . . . . . . . . . . . 29

Paul Evans, Drew Fagan, Dan Fata, Margaret MacMillan, Maria Panezi, Tom Quiggin Web Design Dolce Publishing PriNting RJM Print Group Mailing Address Global Brief Magazine Canadian International Council 45 Willcocks Street, Box 210 Toronto, ON Canada M5S 1C7 Tel: 416.946.7209 Fax: 416.946.7319 www.globalbrief.ca istudin@canadianinternationalcouncil.org Global Brief is published six times a year by the Canadian International Council. The contents are copyrighted. Subscription rates Canada: $49 per year (plus GST) or $90 (plus GST) for two years US: $45 per year or $84 for two years UK: £45 per year or £84 for two years EU: ¤47 per year or ¤89 for two years PM Agreement No. 40062474

QUERY Steven Pinker | What of Human Nature in the Art of the Deal?. . . 15 Andrew Cohen | So Was Pearson’s Success an Accident?. . . . . . . . 35 tÊte À tÊte Alvaro de Soto | State of the Art: Scanning the Globe. . . . . . . . . . . 30 Louise Fréchette | The New Nuclear Century. . . . . . . . . . . . . . . . . . . 65 nez À nez Gordon Smith vs. Saeed Rahnema On Afghanistan and the Canadian Interest. . . . . . . . . . . . . . . . . . 60 in the cABInet room Putin on Obama’s First 100 Days . . . . . . . . . . . . . . . . . . . . . . . . . . . 51 THE DEFINITION On the Education of Future Business and Political Leaders. . . . . 68

Canadian International Council The CIC is a non-partisan council established to strengthen Canada’s role in international affairs. It aims to advance research and dialogue on international affairs issues by supporting a Canadian foreign policy network that crosses academic disciplines, policy areas and economic sectors. In this sense, the CIC seeks to take its place on the international stage in a role analogous to that of the Council on Foreign Relations in the United States, Chatham House in the United Kingdom and the European Council on Foreign Relations.

strategic futures On the Arctic End-game . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70 epigram Douglas Glover | The Art of the Deal . . . . . . . . . . . . . . . . . . . . . . . . . 72

Chair Jim Balsillie Co-vice-Chairs

Bill Graham, John MacNaughton Executive Vice-Chair Hugh Segal

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Board of Directors

Scott Burk, André Desmarais John English, Brian Flemming Edward Goldenberg, Pierre-Marc Johnson Don Macnamara, Indira Samarasekera Janice Stein, Jodi White Canadian International Council 45 Willcocks Street, Box 210 Toronto, ON Canada M5S 1C7 Tel: 416.946.7209 Fax: 416.946.7319 www.canadianinternationalcouncil.org

CONTENTS

10 F E AT U R E S

The art of the deal lies in spotting mutual advantage, and avoiding deals based on misunderstanding and misinformation. by john kay

india’S STRATEGIC POWER: ‘SOFT’ IS THE WORD India’s power in this new century lies in the softer seductions. BY SASHI THAROOR

RANKING THE WORLD’S SPIES Which intelligence services are the best in the business? BY WESLEY WARK

BETWEEN WAR & PEACE Why future wars may well lead to peace, while an imperfect peace may well issue in bloodier wars. BY Michael Cotey Morgan

WHITHER GLOBAL M&A? The current economic crisis fast begets the next wave of global mergers and acquisitions. What’s to be done? BY FRED LAZAR

REVENGE OF THE WORLD Can Barack Obama’s ‘new’ foreign policy make a difference? BY ROLAND PARIS

cover illustration: keith negley

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Conflict Over the Next Decade On future war and peace and many things in between

ONE PAGER

BY John E. McLaughlin

icons: marc brown / istockphoto

of another OPEC to satisfy; China’s demand alone is likely to rise by at least 150% in the next decade. Water may also become an object of competition, as somewhere between one and three billion people come to lack access to a clean, safe supply, and as water tables continue to fall in key grain-growing regions of countries such as India and China. Among the uncertainties, there are at least three worth contemplating. The first has to do with how we organize ourselves to deal with some of the strains likely to emerge as the aforementioned trends accelerate, and as the emergence or re-emergence of certain powers brings an end to the ‘sole superpower moment’ that the US has enjoyed for the last two decades. Without significant refashioning, the UN could decline even further as an effective arena for conflict resolution. If NATO does not enjoy success in Afghanistan, its raison d’être could come into serious question. And if Russia, China and India are not drawn more effectively into a web of bilateral and regional ties, great power frictions could grow significantly. A second uncertainty centres on whether, internationally, we are able to coordinate development and assistance policies in a way that begins to erode some of the underlying causes of global terrorism. To succeed against terrorists, we must destroy the leadership, deny them safe haven and change the conditions that give rise to the phenomenon. The first two of these are tactical, and we have had at least limited success.The third requirement is strategic and more difficult, and we have had practically no success. A third major uncertainty has to do with nuclear policy writ large. The strategic effect of nuclear weapons in this new era is not clear. Perhaps they remain a force for stability, ensuring that we will never again revert to the global conflagration that I debated back in Sicily. Or are they our greatest potential worry, given the easy availability of nuclear technology and our failure thus far to ensure the security of nuclear materials globally? Regardless of what one may conclude, the future of conflict will turn to some large degree on whether we can restore momentum to nuclear arms reductions and reinvigorate a nuclear proliferation regime that has grown ragged from years of neglect (see the Fréchette Tête à Tête, p. 65). Dealing with conflict in the future will require an awareness of all these factors, along with statecraft informed more by foresight than has typically been the case in the past.

John E. McLaughlin, formerly Acting Director of the Central Intelligence Agency, is a Senior Research Fellow in the Merrill Center for Strategic Studies at the Paul H. Nitze School of Advanced International Studies (SAIS) of the Johns Hopkins University.

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On a mountaintop near the Sicilian town of Enna, site of a fierce WW2 battle, a colleague last year posed the question of whether we might ever again have interstate conflict approaching the scale of WW2 – so far the largest single conflict in world history. We debated the proposition for a few moments, acknowledging that most people might instinctively say “no,” but agreeing in the end that the future of conflict was today as close to imponderable as any question. Thinking about it since then, I have concluded that about all one can do is sort through the certainties and the uncertainties that surround the question. Among the many certainties we could discuss, three stand out. First, the world has experienced technological revolution in the past, but never at the pace we see today, and never with such rapid dissemination and ready availability for so many people. A nuclear physicist hinted at this several years ago when he said to me: “The 20th century was driven by physics and engineering – air power, nuclear weapons and such – but the 21st century will be driven by fast-paced revolutions in biology, IT, nanotechnology, materials technology and the integration of all of these.” His prediction has been borne out – and with obvious consequences for the future of conflict. The revolutions under way in all of these areas mean that terrorists may be only a microbiologist away from having biological weapons, that cyber-offence and defence will now be critical components of any future conflict, and that weaponry will continue acquiring precision that would have been unimaginable even a decade ago. A second certainty has to do with the growing likelihood of conflict within societies, as many governments experience strains resulting from burgeoning global population – 90% of the increase will be in the societies least able to cope with the increased demand for services – exacerbated by poverty, sub-par educational systems and financial crisis.These strains could become manifest in forms ranging from societal anarchy to ethnic cleansing. In turn, more stable and prosperous societies will increasingly be confronted with decisions about whether to intervene elsewhere. A third certainty has to do with what will be a growing competition for resources – not necessarily the spark for conflict, but clearly something that could help set the stage. In the absence of an alternative to fossil-based fuel, the demand for traditional energy could grow at a rate likely to require the equivalent

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Colombia: Not Yet There A violent underbelly belies significant improvements in Colombian stability

IN SITU

Ran goel reports from Uribia, Columbia

PHOTOGRAPH: RAN GOEL

50,000 Guajirans from their traditional lands. This unfolding tragedy underscores the fragility of the remarkable security improvements in Colombia over the last few years. On the one hand, the government has buttressed its military presence in Guajira. Along the road to Uribia from the regional capital, Riohacha, fresh-faced conscripts wielding Israeli Galil assault rifles brave the heat to inspect passing vehicles at the myriad military checkpoints every few kilometres. This army presence has drastically undercut guerrilla activity in the area. The twisted wreckage of a coal train visible from the road, the handiwork of a FARC operation, is a testament to different times. But the guerrillas are only part of the problem. The Colombian conflict has long been fuelled less by ideology than by narcotrafficking, kidnapping and extortion. The armed gangs tormenting Guajira are mostly comprised of former paramilitaries who were ostensibly disarmed from 2005 through President Uribe’s controversial demobilization process. The paramilitary groups had been formed by citizens in the 1980s to defend against guerrillas in rural Colombia. Before very long, many of the groups became complicit in extensive narco-trafficking, assassinations of journalists and union leaders, mass displacement and massacres. While many paramilitaries reintegrated into civilian life through the demobilization process, some splinter groups refused to disarm, while others have entered organized crime networks. With a slowing economy and cocaine production at peak levels, the allure of crime shines bright. Perhaps to an even greater extent than the guerrillas and paramilitaries that preceded them, these new armed groups have devastated the lives of ordinary Guajirans. Their emergence suggests that this almost half-century long conflict goes not like a goat to the slaughter.

Ran Goel is an attorney at an international law firm in New York City. He has published on energy issues, the Middle East and sustainable investment, and has worked and travelled extensively in Colombia.

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A pile of unhappy goats lies at the entrance to Uribia. Bound at the limbs, stacked atop each other, their resigned bleats compete with the shrieks of their brethren being slaughtered a little further down the dusty road. Uribia is the largest settlement in upper Guajira, an arid peninsula that lunges into the Caribbean from Colombia to form the northernmost reaches of the green continent. With the Atlantic Ocean to its north, the Venezuelan border to its east and sparse central government presence, the region is a smuggler’s fantasy. The indigenous Wayúu clan, with their intimate knowledge of the inhospitable terrain and dual Colombian-Venezuelan citizenship, have held a monopoly on the movement of goods in Guajira since colonial times, when they fought off the Spanish with smuggled European horses and arms. But their grip on these lucrative transit routes is now being threatened, and along with them an ancestral way of life. Nothing appears amiss in Uribia at first glance. The dry heat enforces a laid-back atmosphere. A chatty tourism officer patrols the main square, the site of an annual Wayúu culture festival. Kiosks selling cellular phone minutes run a brisk trade. The tip of the smuggling iceberg only begins to emerge at one of the town’s makeshift gas stations comprised of shacks encircled by blue drums. The cheap gasoline – water is far more valuable here – nods at the Venezuelan border just beyond the mirages in the distance. The battle over the trade in such gasoline, other consumer goods and illicit drugs is now increasingly spilling over into the lives of innocents. In January, several dozen Wayúu from the Uribia area were forced to flee across the border to Venezuela. Their homes had been burned down and their leaders threatened with assassination after they had attempted to resist “Pablo,” the region’s reigning smuggling kingpin. “Pablo” appears to be consolidating his control over smuggling in the area. Late last year, a trafficker based out of Cabo de la Vela – a hammock-strewn, picturesque village on the coast several hours by four-wheel drive from Uribia – was gunned down. A bloody vendetta has been launched against his allies throughout Guajira. There has been a spate of disappearances and targeted killings, and legitimate businesses are being subject to extortion. The threat of violence has displaced an estimated

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The art of the deal lies in spotting mutual advantage, and avoiding deals based on misunderstanding and misinformation – an increasingly tall order in today’s complex world by john kay

THE ART OF

THE DEAL John Kay is one of Britain’s leading economists and a weekly columnist with the Financial Times. His latest book is The Long

G L O B A L B R I E F • M AY 2 0 0 9

and the Short of It.

he art of the deal lies in structuring a negotiation in which there is a surplus to divide, so that both sides win. There are three principal categories of economic exchange – mutually beneficial trade, trade by mistake, and trade with exploitation. The mutually beneficial exchange creates a surplus by adding value. I buy a picture from an artist. The artist gets a return on his or her effort. I have an item which gives me more pleasure than it costs. But sometimes trade is exchange by mistake: the parties are wrong to believe that the exchange generates a surplus, but the trade happens because one or both parties have made errors in valuation. I purchase a used car, thinking it is in better order than it is. Sooner or later, at least one of the parties regrets the transaction, which appeared to be a gain, but was in reality their loss. In exchange with exploitation, one party gains from trade, the other loses, but the exchange happens anyway because one of the parties is more powerful than the other – as in the Mafia’s offer that you cannot refuse. Our evolutionary history taught us to be constantly vigilant for exchange by mistake and exchange by exploitation, especially when dealing with strangers. Traders would want our goods because they knew something we did not: they would demand our goods because they commanded force that we did not. Pre-modern economic history translated these fears to international trade. Mercantilists saw global trade as a means by which a stronger political power could enrich itself at the expense of a weaker power. There were good reasons for the mercantilist position: for most of history, trade was indeed largely based on exploitation and trickery. A victorious army ILLUSTRATION: keith negley

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imposed its will on those it had conquered, and helped itself to their assets and their produce. Perhaps the most important contribution of classical economists, epitomized in Adam Smith’s Wealth of Nations, was to demonstrate the potential scope of mutually beneficial exchange relative to exchange by mistake and exchange by exploitation. Smith and his successors elucidated the potential added value from trade through an appreciation of comparative advantage and the division of labour. Mutually beneficial exchange is possible whenever the two parties have different preferences, resources or capabilities. The division of labour, nationally and internationally, enabled people to effect these gains through specialization. When the nineteenth-century economist David Ricardo elaborated the theory of competitive advantage, he expected that international trade would proceed from differences in resource endowments – and in his time this was true. But today’s international trade is based more on developed

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Sometimes trade is exchange by mistake: the parties are wrong to believe the exchange generates a surplus, but the trade happens because one or both parties have made errors in valuation.

capabilities: Germany exports its skills in precision engineering, the US its achievements in software, China its pool of low-cost labour. The political and intellectual triumph of the classical economists changed the world. It set the scene for rapid economic growth. Empires would fade away as the costs of maintaining them became prohibitive, when most of the benefits of international trade could be derived from voluntary exchange, rather than appropriation. But the history of humanity is a history of anarchy and violence, with little of the harmonious order that the classical economists imposed on economic life. So even today, this classical thinking does not come easily to most people. The mercantilist tradition is deeply engrained. The belief that, since the West is so much more powerful politically and militarily than the developing world, trade between North and South necessarily means that the North gains and the South loses, is widespread in both North and South. The fallacy in the argument that China is tricking us out of our money by sending us its goods is obvious, but the fear that the sentiment induces is real. Every recession revives these

fears, and the current one is no exception. A more sophisticated misunderstanding of the nature of international economic relations uses the notion of economic power: politicians routinely talk of the prospect of China ‘overtaking’ the US, or of the economic power of an expanded EU. Insofar as commentators mean anything specific at all when they talk in these terms, they seem to be talking about the relative gross domestic product of a country or group of countries. Aggregate GDP may be indirectly relevant to political power: it provides the basis for military and other state expenditures. But only the most cursory scrutiny of data reveals that if there is any correlation between the size of a state and its prosperity, then that correlation is negative rather than positive. In India, China or Nigeria, we see states with long experience of economic achievement far lower than their economic potential. By contrast, the homogeneous societies of Scandinavia and the loose confederation of Switzerland have, over the last century, attained some of the highest standards of living in the world. Economic power is fundamentally different from political power – and economic power is probably not even a helpful or meaningful concept. Failure to understand the depth of that difference explains the fact that, although expectations of what can be achieved through international economic summits or negotiations are often high, the outcomes are almost always disappointing. It matters to politicians who does or does not receive invitations to the G8 or G20 meetings, but it matters very little to the economies of the countries involved. Excluded small states do not suffer economic damage through their non-inclusion. Perhaps they benefit: they do not even have to pretend to commit to anything.

ew international economic meetings of the past merit more than a footnote in history books. Who now remembers the London Conference of 1933, designed to develop a coordinated response by the Great Powers to the Great Depression? If it is noted at all, it is for the petulance of Roosevelt (who did not bother to come) and for Keynes’ memorable headline in a contribution to the Daily Mail in support of floating, rather than fixed, exchange rates: ‘President Roosevelt is magnificently right.’ Perhaps the only economic conference of lasting import was the Bretton Woods meeting of 1944, which established new international institutions (and which both Roosevelt and Keynes did attend). Many subsequent meetings have had ‘the new Bretton Woods’ as their advance billing: none has come close to living up to

it. If the London (G20) Conference of 2009 has any enduring significance, it will also be for its effect on the status of institutions – institutions which have so far had little impact on the development, or resolution, of the crisis.

The winner’s curse helps explain why mergers and acquisitions are so often disappointing. Companies contemplating a bid will always make errors in assessing the value of the targets. more often true that common values are uncertain than that private values differ greatly. People deal because they make different assessments of the value of the same security. That difference will ultimately be resolved in favour of one party or the other. These are exchanges by mistake. The primary motive for such trade was divergence in the estimates of value attached to instruments that were complex and far from transparent. The inevitable consequence was that such assets were mostly held by people who were too sanguine about their valuation, and with results that they would come to regret. The debate was epitomized by Alan Greenspan – for whom the sophistication of modern financial instruments was just another elaboration of the benefits of Adam Smith’s division of labour – and Warren Buffett, who characterized such instruments as weapons of mass destruction. But now, as banks try to dispose of what they have come to call the toxic assets on their balance sheet, we know who was right. The art of the deal is knowing when to trade for mutual benefit – and when to refrain from trade which is based on misunderstanding and misinformation.

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nternational economic negotiations do not achieve much because there is little surplus in such deals for political leaders to divide. Mutually beneficial economic exchanges generally take place at the level of the individual business, not as a result of state action. Much the most important issue for political agreement between countries is agreement not to interfere with these individual decisions. This means supporting free trade and eschewing disruptive currency interventions. But if some people have not learned the lessons of classical economics, others have learned them too well. They claim not just that most private economic exchanges benefit everyone, but that all such exchanges do. This market fundamentalist claim has ruled policy over the last three decades. Perhaps its most important manifestation is in the assertion that global trade in financial markets is as universally benign as global trade in the markets for goods and services. That claim is now questioned – and with good reason. Voluntary economic exchange may be the result of the likelihood of mutual gain. It may, however, also be the consequence of mistake based on imperfect and typically asymmetric information. In negotiation theory, the distinction between trade for mutual benefit and trade by mistake is often expressed as the difference between private value and common value. In a private value exchange, the parties to the deal agree on what the object is, but disagree on the value to be attached to it. In a common value exchange, the parties to the deal disagree on the exact character of the object, and would, if they agreed on its character, agree on its value. The significance of this distinction was famously observed through analysis of what became known as the ‘winner’s curse.’ Oil companies were invited to bid for offshore oil blocks. On average, they overpaid. Their successful bids were necessarily those in which their bids were higher than those of their competitors. Generally, these were for the blocks in which the bidder’s geologists had made the most optimistic estimates – more optimistic than those of other companies. The usual reason for the high bids was that the reserve estimates were too high. The winner’s curse helps explain why mergers and acquisitions are so often disappointing. Companies contemplating a bid will always make errors in assessing the value of the targets. But you are more likely to succeed if you are paying or of-

fering too much than if you are paying or offering too little. Quite generally, people are more likely to buy things when they overestimate their value than when they underestimate that value. This is as true when shopping or hiring as in the context of large-scale commercial negotiations. Wherever there is uncertainty about quality or value, the winner’s curse comes into play: success is often failure. As the complexity of securitization and derivative products in modern financial markets steadily increased, the financial community rehearsed the argument that the process was one of mutually beneficial exchange; that is, the wider range of trading opportunities allowed for a more and more exact tailoring of risk to the particular preferences and attitudes of particular investors. Mutually beneficial trade, based on differences in preferences, resources and capabilities, explained risk trading in securities markets, just as it explained the trading of goods in conventional markets. But securities trading is a business in which it is

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What of Human Nature in the Art of the Deal?

QUERY

Recognizing the sacred in order to get to the rational By steven pinker

Though deal-makers in international conflicts are often unsung and occasionally reviled, they deserve credit for one of the most extraordinary developments of our era: interstate conflicts have plummeted since the end of WW2, and civil wars have declined precipitously since the early 1990s. No small credit for the decline must go to the upsurge – over these same periods – in negotiations that stop wars and prevent them from restarting. And understanding how international actors ‘get to yes’ is an engaging intellectual problem with enormous moral consequences. John Kay (in The Art of the Deal, p. 10) elegantly lays out the rational basis of negotiation: “The art of the deal lies in structuring a negotiation in which there is a surplus to divide, so that both sides win.” In the case of war, there is almost always a surplus: it is easier to destroy than to

create, such that both sides are better off if they agree to refrain from destruction. So why is it often so hard to drag belligerents (or adversaries) to the negotiating table? I suspect that the answer may emerge from an ongoing revolution in the social sciences. The idealization of human beings as rational actors is being replaced by more realistic models informed by cognitive psychology and evolutionary biology. Just as behavioural economics is showing that certain irrationalities in economic outcomes may be explained by our cognitive quirks, a new ‘behavioural political science’ may show that destructive outcomes may come from other bugs in our psychological makeup. An example: The evolutionary biologist Robert Trivers has noted that natural selection favours organisms that can deceive adversaries about their

Steven Pinker is Harvard College Professor of Psychology at Harvard University, and author of many books on language, mind, and human nature, including How the Mind Works, The Blank Slate, and The Stuff of Thought.

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illustration: keith negley

The Walter & Duncan Gordon Foundation is pleased to support the inaugural issue of Global Brief magazine. The Gordon Foundation is an independent, charitable foundation dedicated to the development of sound and innovative public policies. Our Global Citizenship programme focuses on youth and diaspora communities — two groups of Canadians who share a passionate interest in and an ability to contribute to Canada’s role in the world.

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negotiated two-state solution to the Israel-Palestine conflict. Not surprisingly, a significant proportion of the Palestinians adamantly rejected the possibility of a two-state solution in which they would ‘recognize the historic right of the Jewish people to Israel’ or give up all claims to sovereignty over East Jerusalem. However, a significant proportion reacted with even greater anger and disgust if the compromise was sweetened by Israel paying Palestine a billion dollars a year for ten years! The Israeli settlers – also not surprisingly – rejected a two-state solution that required Israel to give up ‘Judea and Samaria’ or ‘recognize the legitimacy of the right of Palestinian refugees to return’ (with the agreement not actually requiring Israel to absorb the refugees). But they were even more opposed if the deal included additional American aid of a billion dollars a year for a century, or a guarantee of living in peace and prosperity. Fortunately, humans are not just moralists, but also hypocrites, as in the joke about the woman who considered an indecent proposal to sleep with a man for a million dollars, but reacted to his offer of a hundred dollars with, “What kind of a woman do you think I am?” (Reply: “We’ve already established that; we’re just haggling over price.”) Tetlock finds that people retreat from their taboos when a tradeoff pits a sacred value against another sacred value, rather than against a secular one like money. For instance, people will soften their opposition to a voluntary market for transplant organs when they are told that it would save many lives. The Ginges team found that the Palestinian and Israeli absolutists toned down their fury over the possibility of compromising their sacred values in a two-state deal when it would require the other side to compromise on their sacred values. For the Palestinians, this meant that Israel would ‘recognize the historical and legitimate right of the Palestinians to their own state, and would apologize for all the wrongs done to the Palestinian people;’ for the settlers, the Palestinians would ‘recognize the historic and legitimate right of the Jewish people to Eretz Israel.’ The challenge for deal-makers, then, is not just to structure a negotiation in which two rational adversaries would win, but to develop work-arounds for features of human nature that prevent adversaries from being thoroughly rational.

Natural selection favours organisms that can deceive adversaries about their strength and fitness. But it also favours organisms that can see through this deception – setting up an evolutionary arms race between lying and lie-detection.

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strength and fitness. But it also favours organisms that can see through this deception – setting up an evolutionary arms race between lying and liedetection. Since the best liar is the one who believes his own lies (so that he cannot betray himself with involuntary ‘tells’), evolution will select for a degree of self-deception. Many demonstrations in social psychology have borne this out, such as the Lake Wobegon Effect, named after the mythical town in which all the children are above average. When it comes to any desirable trait you name, a majority of people judge themselves to be above the population mean. A lethal example of self-deception is overconfidence in war. Historians have long noted that many cataclysms have been ignited when two adversaries both believe that an impending conflict between them will be a cakewalk. (Remember “Mission Accomplished”?) The anthropologist Richard Wrangham has noted that deceiving oneself about one’s strength can make one’s threats more credible (since, in one’s mind, one is not bluffing), thereby increasing the chance that the other guy will back down. It can also mobilize one’s own forces with the promise that they will be glorious victors, rather than cannon fodder. The political scientist Dominic Johnson, working with Wrangham, has demonstrated this effect in the lab. Subjects in war games who role-played the leader of a fictitious country overestimated their chances of victory, and the greatest self-deceivers were the most likely to launch unprovoked attacks. Another bug in our rationality is the mentality of taboo. Often, structuring a negotiation to divide a surplus does not tempt the two sides to claim their winnings, but rather inflames them (and unaffected third parties) into moral outrage. Just think about how you might react to a proposal that markets be set up for kidneys, votes, military service, jury duty or babies given up for adoption. The psychologist Philip Tetlock has argued that people treat certain values as sacred. They do not just refuse to trade them off against other goods in life, but are offended at being given the opportunity – and revile other people who consider it. This mindset may have evolved to protect our personal relationships: no one would befriend us, marry us or invite us into a coalition if they had to worry that we were constantly weighing the value of the relationship against other temptations. But, of course, this can get in the way of rational political and economic arrangements in the modern world. A recent study by Jeremy Ginges, Scott Atran, Douglas Medin, and Khalil Shikaki shows how the psychology of taboo can confound the bestlaid plans of rational deal-makers. They asked Israeli West Bank settlers and members of Hamas whether they would accept various versions of a

IN SITU

Case Study: The Bougainville Deal How Australia and New Zealand helped solve a PNG pickle Alexander downer reflects on Papua New Guinea

Alexander Downer was Australia’s longest-serving foreign minister, and is now the UN special envoy

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to Cyprus.

The island of Bougainville off the east coast of Papua New Guinea is known to few. It has no television station, is strategically remote and is constitutionally part of Papua New Guinea (PNG), a country which itself has very little international profile. At first approach, Bougainville is a South Pacific paradise; its generous cladding of jungle covers a mountainous terrain which flows down to the translucent waters of the South Pacific. Yet between 1988 and 1997 Bougainville was the home of a bloody conflict which, by some estimates, directly and indirectly killed four times as many people as died in the Northern Ireland conflict between 1969 and the Good Friday Agreement of 1998. The origins of the Bougainville conflict are complex. Put at its simplest, the ethnic differences between the majority of Papua New Guineans and the Bougainvilleans were accentuated by the existence of a large, profitable Australian-owned copper mine. Bougainvilleans identify ethnically more closely with their neighbours in Solomon Islands than the rest of PNG but, as is so often the case, the arbitrary drawing of colonial boundaries put them inside PNG. That in itself was problematic, but the opening of a hugely profitable copper mine in the 1960s gave the ethnic tension a new edge. The mine provided about 25% of the PNG government’s budget, a major share of the country’s export income and a substantial number of jobs for people from throughout PNG. For the Bougainvilleans, the mine certainly generated economic activity. But for many Bougainvilleans, the mine also changed their society, as workers from other parts of PNG and foreigners changed the social makeup and mores of the island. The ensuing conflict began with the traditional owners of the mine trying to extract substantial increases in rents, the mine owners and the PNG government refusing, and violence erupting around a growing Bougainvillean demand for independence and the closure of the mine. Various acts of violence successfully forced the mine to close, and several years of conflict ensued

between what became known as the Bougainville Revolutionary Army (BRA) and the PNG defence force and its allies, the Bougainville Resistance. The effect of the mine’s closure and a succession of attempts to solve the problem by military force were extraordinarily costly to PNG. As the neighbouring metropolitan power and the mine owner, Australia had to try to solve the problem. As a first step, Australia encouraged New Zealand to host peace talks between the Bougainvilleans. New Zealand was of a similar mind to Australia, but it was perceived by the Bougainvilleans to be more neutral; most Bougainvilleans thought the Australian government’s interest was in reopening the mine regardless of the consequences for Bougainville. The peace talks, which began in 1997 in New Zealand (with Australia providing the substantive financing), included representatives of all the major parties to the conflict – the Bougainville Revolutionary Army, the Bougainville Resistance and the government of PNG. The talks agreed to a truce which gave space for further talks about the basis for a long-term settlement. The challenge was to consolidate the truce. The Australian government established an unarmed Peace Monitoring Group (PMG) comprising police and civilians from Australia, New Zealand and several South Pacific nations. This PMG was an essential component of building community confidence in the peace process. Although the PMG was unarmed, its very presence on the ground and its capacity to observe and report on any breaches of the ceasefire proved highly successful. The subsequent agreement by all the parties to the conflict to disarm was also managed by the PMG and authorized by a UN observer. The agreement to a truce and ceasefire monitored by the international community gave space for the negotiations on a long-term political settlement. It was clear to all that the status quo ante was finished forever, and the Australian and PNG governments made it clear that the reopening of the mine was not a priority. This created a less tense and confrontational atmosphere for the talks, because the very existence of the mine had the potential to recreate the explosive debate about resource sharing. Instead, the talks focussed on whether the ethniPhotograph: George Steinmetz/Corbis

Photograph: Alex Smailes/Sygma/Corbis

break the deadlock over the referendum. This was perceived by Bougainvilleans, and Papua New Guineans more generally, as their peace, even though it would not have been possible without the assistance of Australia and New Zealand. A peace process will never work if foreigners try to use it for their own glorification; it must be owned by those who are parties to the conflict, not foreigners. Less than a decade after a final agreement was concluded, Bougainville lives in peace, the mine remains closed, PNG has thrived again, and Australia and New Zealand’s role in the peace process is all but forgotten. That is a very good outcome.

A rebel soldier of the Bougainville Revolutionary Army, 1997.

Opposite page: Mount Bagana, an active volcano on Bougainville Island.

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cally distinct Bougainville could achieve extensive autonomy without becoming independent. Both the PNG and Australian governments feared independence for Bougainville would cause the collapse of PNG, as other provinces sought the same release from Port Moresby. Despite the truce and ceasefire, the talks were difficult and protracted; support for independence in Bougainville was high. Ultimately, a deal was brokered by Australia, under which Bougainville would elect its own autonomous government, but still remain part of PNG. After between 10 and 15 years, the Bougainville Government could ask for a referendum on independence, and the national parliament would make the final decision on whether or not to hold such a referendum. The Bougainville peace process was successful for a number of reasons. First, after years of conflict, the people of Bougainville – particularly the women – were anxious for peace. Second, the PNG government eventually realized – with some aggressive prompting from Australia – that it could not settle the problem militarily. Third, Australia and New Zealand provided a catalyst and a venue for talks, but, in the main, allowed the locals to negotiate their own solution. Fourth, Australia structured a multinational peace monitoring group which was unarmed and therefore perceived by Bougainville to be benign, impartial and competent. Fifth, Australia, as the major power of the region, only intervened when it had to – for example, to

illustration: anita kunz

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The Indian elections are over. What is all this talk of Indian strategic power? Not so fast... BY Shashi Tharoor

Indian STRATEGIC Power:

‘Soft’ is the Word

destitute, amidst despair and disrepair. Or could it be a combination of all these, allied to something altogether more difficult to define – the ‘soft power’ of its culture? Much of the conventional analysis of India’s stature in the world relies on the all-too-familiar economic assumptions. But we are famously a land of paradoxes, and one of those paradoxes is that so many speak about India as a great power of the 21st century when we are not yet able to feed, educate and employ all our people. So it is not economic growth, military strength or population numbers that I would underscore when I think of India’s potential leadership role in the world of the 21st century. Rather, if there is one attribute of independent India to which I think increasing attention should now be paid around the globe, it is the quality which India is already displaying in ample measure today – its ‘soft power.’ The notion of soft power is relatively new in international discourse. The term was coined by Harvard’s Joseph Nye to describe the extraordinary strengths of the US that went well beyond American military dominance. Nye argued that “power is the ability to alter the behaviour of others to get what you want, and there are three ways to do that: coercion (sticks), payments (carrots) and attraction (soft power). If you are able to attract others, you can economize on the sticks and carrots.” Traditionally, power in world politics was seen in terms of military power: the side with the larger army was likely to win. But even in the past, this was not enough: after all, the US lost the Vietnam War, the Soviet Union was defeated in Afghanistan, and the US discovered in its first few years in Iraq the wisdom of Talleyrand’s adage that the one thing you cannot do with a bayonet is to sit on it. Enter soft power – both as an alternative to hard power, and as a complement to it. To quote Nye

Shashi Tharoor is an author, peacekeeper, refugee worker, human rights activist, chairman of Dubai-based Afras Ventures, and now a political candidate for the Indian Parliament.

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s an Indian, I have become a little conc e r n e d ab o u t t h e proliferation of those who speak of India as a future ‘world leader’ or even as ‘the next s u p e r p owe r.’ T h e American publishers of my most recent book, The Elephant, the Tiger and the Cellphone, even added a gratuitous subtitle suggesting that my volume was about “the emerging 21st century power.” Now, I appreciate that this is not entirely unreasonable. Many thinkers and writers I respect have spoken of India’s geostrategic advantages, its economic dynamism, political stability, proven military capabilities, its nuclear, space and missile programmes, the entrepreneurial energy of India’s people, and the country’s growing pool of young and skilled manpower as assuring India ‘great power’ status as a ‘world leader’ in the new century. And yet I have a problem with that term. The notion of ‘world leadership’ is a curiously archaic one. The very phrase is redolent of Kipling ballads and James Bondian adventures. What makes a country a world leader? Is it population, in which case India is on course to top the charts, overtaking China as the world’s most populous country by 2034? Is it military strength (India’s is already the world’s fourth-largest army) or nuclear capacity (India’s status having been made clear in 1998, and last year formally recognized in the Indo-US nuclear deal)? Is it economic development? There, India has made extraordinary strides in recent years; it is already the world’s fifth-largest economy in purchasing power parity (PPP) terms, and continues to climb, though too many of our people still live

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The notion of ‘world leadership’ is a curiously archaic one. The very phrase is redolent of Kipling ballads and James Bondian adventures.

again: “the soft power of a country rests primarily on three resources: its culture (in places where it is attractive to others), its political values (when it lives up to them at home and abroad), and its foreign policies (when they are seen as legitimate and having moral authority).” I would go slightly beyond this: a country’s soft power, to me, emerges from the world’s perceptions of what that country is all about. The associations and attitudes conjured up in the global imagination by the mere mention of a country’s name is often a more accurate gauge of its soft power than a dispassionate analysis of its foreign policies. In my view, hard power is exercised; soft power is evoked. For Nye, the US is the archetypal exponent of soft power. The fact is that the US is the home of Boeing and Intel, Google and the I-Pod, Microsoft and MTV, Hollywood and Disneyland, McDonald’s and Starbucks – in short, of most of the major products that dominate daily life around our globe. The attractiveness of these assets, and of the American lifestyle of which they are emblematic, is that they permit the US to persuade others to adopt the agenda of the US, rather than it having to rely purely on the dissuasive or coercive ‘hard power’ of military force. Of course, this can cut both ways. In a world of instant mass communications enabled by the Internet, countries are increasingly judged by a global public fed on an incessant diet of web news, televised images, videos taken on the cellphones of passers-by, and email gossip. The steep decline in America’s image and standing after 9/11 is a direct reflection of global distaste for the instruments of American hard power: the Iraq invasion, Guantanamo, Abu Ghraib, torture, rendition, Blackwater’s killings of Iraqi civilians. But this essay is not about the US. In his book, The Paradox of American Power, Nye took the analysis of soft power beyond the US; other nations too, he suggested, could acquire it. In today’s information era, he wrote, three types of countries are likely to gain soft power and so succeed: “those whose dominant cultures and ideals are closer to prevailing global norms (which now emphasize liberalism, pluralism, autonomy); those with the most access to multiple channels of communication and thus more influence over how issues are framed; and those whose credibility is enhanced by their domestic and international performance.” At first glance, this seems to be a prescription for reaffirming the contemporary reality of US dominance, since it is clear that no country scores more highly on all three categories than the US. But Nye himself admits this is not so: soft power has been pursued with success by other countries over the years. When France lost the war of 1870 to Prussia, one of its most important steps to re-

build the nation’s shattered morale and enhance its prestige was to create the Alliance Française to promote French language and literature throughout the world. French culture has remained a major selling point for French diplomacy ever since. The UK has the British Council, the Swiss have Pro Helvetia, and Germany, Spain, Italy and Portugal have, respectively, Institutes named for Goethe, Cervantes, Dante Alighieri and Camoes. Today, China has started establishing ‘Confucius Institutes’ to promote Chinese culture internationally, and the Beijing Olympics have been a sustained exercise in the building up of soft power by an authoritarian state. The US itself has used officially sponsored initiatives, from the Voice of America to the Fulbright scholarships, to promote its soft power around the world. But soft power does not rely merely on governmental action: arguably, for the US, Hollywood and MTV have done more to promote the idea of America as a desirable and admirable society than any US governmental endeavour. Soft power, in other words, is created partly by governments, and partly despite governments; partly by deliberate action, partly by accident. What does this mean for India? It means acknowledging that India’s claims to a significant leadership role in the world of the 21st century lie in the aspects and products of Indian society and culture that the world finds attractive. These assets may not directly persuade others to support India, but they go a long way toward enhancing India’s intangible standing in the world’s eyes.

he roots of India’s soft power run deep. India’s is a civilization that, over millennia, has offered refuge and, more importantly, religious and cultural freedom, to Jews, Parsis, several varieties of Christians, and Muslims. Jews came to the southwestern Indian coast centuries before Christ, with the destruction by the Babylonians of their First Temple, and they knew no persecution on Indian soil until the Portuguese arrived in the 16th century to inflict it. Christianity arrived on Indian soil with St. Thomas the Apostle (‘Doubting Thomas’), who came to the Malabar coast some time before 52 A.D. and was welcomed on shore, or so oral legend has it, by a flute-playing Jewish girl. He made many converts, so there are Indians today whose ancestors were Christian well before any Europeans discovered Christianity. In Kerala, where Islam came through traders, travellers and missionaries, rather than by the sword, the Zamorin of Calicut was so impressed by the seafaring skills of this community that he issued a decree obliging each fisherman’s family to bring up one son as a Muslim to man his all-Muslim

Photograph: The Canadian Press / Damian Dovarganes

home to every faith known to mankind, with the possible exception of Shintoism, and Hinduism – a faith without a national organization, no established church or ecclesiastical hierarchy, no Hindu Pope, no Hindu Mecca, no single scared book, no uniform beliefs or modes of worship, not even a Hindu Sunday – exemplifies as much our diversity as it does our common cultural heritage). Indian nationalism is the nationalism of an idea, the idea

of an ever-ever land – emerging from an ancient civilization, united by a shared history, sustained by pluralist democracy. Pluralism is a reality that emerges from the very nature of the country; it is a choice made inevitable by India’s geography and reaffirmed by its history. We are a land of rich diversities: I have observed in the past that we are all minorities in India. This land imposes no narrow conformities on its citizens: you can be many things and one thing. You can be a good Muslim, a good Keralite and a good

“Bollywood Dreams,” a float in the annual Rose Parade, pays tribute to India’s film industry, Pasadena California, 2009.

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navy! The India where the wail of the Muslim muezzin routinely blends with the chant of mantras at the Hindu temple, and where the tinkling of church bells accompanies the Sikh gurudwara’s reading of verses from the Guru Granth Sahib, is an India that fully embraces the world. Indeed, the British historian E.P. Thompson wrote that this heritage of diversity is what makes India “perhaps the most important country for the future of the world. All the convergent influences of the world run through this society.... There is not a thought that is being thought in the West or East that is not active in some Indian mind.” That Indian mind has been shaped by remarkably diverse forces: ancient Hindu tradition, myth and scripture; the impact of Islam and Christianity; and two centuries of British colonial rule. The result is unique. Though there are some who think and speak of India as a Hindu country, Indian civilization today is an evolved hybrid. We cannot speak of Indian culture today without qawwali, the poetry of Ghalib, or for that matter the game of cricket, our de facto national sport. When an Indian dons ‘national dress’ for a formal event, he wears a variant of the sherwani, which did not exist before the Muslim invasions of India. When Indian Hindus voted recently in the cynical and contrived competition to select the ‘new seven wonders’ of the modern world, they voted for the Taj Mahal constructed by a Mughal king, not for Angkor Wat, the most magnificent architectural product of their religion. In the breadth (and not just the depth) of its cultural heritage lies some of India’s soft power. One of the few generalizations that can safely be made about India is that nothing can be taken for granted about the country. Not even its name: for the word India comes from the river Indus, which flows in Pakistan. (That anomaly is easily explained, of course, since what is today Pakistan was hacked off the stooped shoulders of India by the departing British in 1947). Indian nationalism is therefore a rare phenomenon indeed. It is not based on language (since our Constitution recognizes 23, and there are 35, according to the ethnolinguists, that are spoken by more than a million people each – not to mention 22,000 distinct dialects). It is not based on geography (the ‘natural’ geography of the subcontinent – framed by the mountains and the sea – was hacked by the partition of 1947). It is not based on ethnicity (the ‘Indian’ accommodates a diversity of racial types, and many Indians have more in common ethnically with foreigners than with other Indians: Indian Punjabis and Bengalis, for instance, are ethnically kin to Pakistanis and Bangladeshis, respectively, with whom they have more in common than with Poonawalas or Bangaloreans). And it is not based on religion (we are

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India’s claims to a significant leadership role in the world of the 21st century lie in the aspects and products of Indian society and culture that the world finds attractive.

Indian all at once. So the idea of India is of one land embracing many. It is the idea that a nation may endure differences of caste, creed, colour, culture, cuisine, conviction, costume and custom, and still rally around a democratic consensus. That consensus is around the simple principle that, in a democracy, you do not really need to agree – except on the ground rules of how you will disagree. Part of the reason for India being respected in the world is that it has survived all the stresses and strains that have beset it – and that led so many to predict its imminent disintegration – by maintaining consensus on how to manage without consensus. The world of the 21st century will increasingly be a world in which the use of hard power carries with it the odium of mass global public disapproval, whereas the blossoming of soft power, which lends itself more easily to the information era, will constitute a country’s principal asset. Soft power is not about conquering others, but about being yourself. Increasingly, countries are judged by the soft-power elements they project onto the global consciousness – either deliberately (through the export of cultural products, the cultivation of foreign publics or even international propaganda) or unwittingly (through the ways in which they are perceived as a result of news stories about them in the global mass media). India produces various kinds of culture, notably including the films of Bollywood, now reaching ever-wider international audiences. The triumph of Slumdog Millionaire at the 2009 Oscars both reflects and reinforces this trend. Bollywood is bringing its brand of glitzy entertainment not just to the Indian diaspora in the US, UK or Canada, but around the globe, to the screens of Syrians and Senegalese alike. A Senegalese friend told me of his illiterate mother who takes a bus to Dakar every month to watch a Bollywood film: she does not understand the Hindi dialogue, and cannot read the French subtitles, but these films are made to be understood despite such handicaps; she can still catch their spirit and understand the stories, and people like her look at India with stars in their eyes as a result. An Indian diplomat friend in Damascus a few years ago told me that the only publicly-displayed portraits in that city that were as big as those of then-President Hafez al-Assad were those of the Bollywood superstar Amitabh Bachchan. Indian art, classical music and dance have a similar effect. So does the work of Indian fashion designers, now striding across the world’s catwalks. Indian cuisine, spreading around the world, raises our culture higher in people’s reckoning; as the French have long known, the way to foreigners’ hearts is through their palates. The proliferation of Indian restaurants around the world has been little short of astonishing. In England today, Indian curry

houses employ more people than the iron and steel, coal and shipbuilding industries combined. (So the Empire can strike back.) Globalization has both sparked and allayed many Indians’ fears that economic liberalization will bring with it cultural imperialism of a particularly insidious kind – that Baywatch and burgers will supplant Bharatanatyam dances and bhelpuri snacks. Instead, India’s recent experience with Western consumer products demonstrates that we can drink Coca-Cola without becoming Cocacolonized. Indians will not become any less Indian if, in Mahatma Gandhi’s metaphor, we open the doors and windows of our country and let foreign winds blow through our house – because Indians are strong enough not to be blown off their feet by these winds. Our popular culture has proved resilient enough to compete successfully with MTV and McDonald’s. Besides, the strength of ‘Indianness’ lies in its ability to absorb foreign influences, and to transform them – by a peculiarly Indian alchemy – into something that belongs naturally on the soil of India.

ndeed, from the export of Bollywood to bhangra dances, India has demonstrated that it is a player in globalization, not merely a subject of it. India benefits from the future and the past – from the international appeal of its traditional practices (from ayurveda to yoga, both accelerating in popularity across the globe) and the transformed image of the country created by its thriving diaspora. Information technology has made its own contribution to India’s soft power. When Americans in Silicon Valley speak of the IITs (the Indian Institutes of Technology) with the same reverence that they used to accord to MIT, and the Indianness of engineers and software developers is taken as synonymous with mathematical and scientific excellence, it is India that gains in respect. Sometimes this has unintended consequences. I met an Indian the other day – a history major like me – who told me of transiting through Schiphol airport in Amsterdam and being accosted by an anxious European crying out: “You’re Indian! You’re Indian! Can you help me fix my laptop?” The old stereotype of Indians was that of snake-charmers and fakirs lying on beds of nails; now it is that every Indian must be a software guru or a computer geek. In the information age, Joseph Nye has argued, it is often the side which has the better story that wins. India must remain the ‘land of the better story.’ As a society with a free press and a thriving mass media, with a people whose creative energies are daily encouraged to express themselves in a variety of appealing ways, India has an extraordinary ability to tell stories that are more persuasive

Photograph: The Canadian Press / Manish Swarup

not we are trying to show it to the world. To take a totally different example: Politically, the sight in May 2004 – after the world’s largest exercise in democratic franchise (but then every Indian election is the world’s largest exercise in democratic franchise!) – of a leader of Roman Catholic background (Sonia Gandhi) making way for a Sikh (Manmohan Singh) to be sworn in as Prime Minister by a Muslim (President Abdul Kalam), in a country 81% Hindu, caught the world’s imagination and

won its admiration. (I was travelling in the Gulf on behalf of the UN at the time, and the reactions of my Arab interlocutors to what had happened in India could not have been more gratifying). So it is not just material accomplishments that enhance India’s soft power. Even more important are the values and principles for which India stands. After all, Mahatma Gandhi won India its independence through the use of soft power – because non-violence and satyagraha were indeed classic uses of soft power before the term was

An election official puts indelible ink on the index finger of a voter before she proceeds to cast her vote at a polling station, in Jamuva Bazar, near Varanasi, India, April, 2009.

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and attractive than those of its rivals. This is not about propaganda; indeed, it will not work if it is directed from above, least of all by government. But its impact, though intangible, can be huge. To take one example: Afghanistan is clearly a crucial country for India’s national security, as it is for the US’s. President Obama has spoken of reinforcing American and NATO military capacity there. But the most interesting asset for India in Afghanistan does not come out of a military mission: it does not have one. It comes, instead, from one simple fact: Do not try to telephone an Afghan at 8:30 in the evening. That is when the Indian TV soap opera Kyunki Saas Bhi Kabhi Bahu Thi, dubbed into Dari, is telecast on Tolo TV, and no one wishes to miss it. It is reportedly the most popular television show in Afghan history (at least until the onset of Afghan Idol last year), considered directly responsible for a spike in the sale of generator sets, and even for absences from religious functions which clash with its broadcast times. (This has provoked visceral opposition to the show from the mullahs, who wish to shut it down). Saas has so thoroughly captured the public imagination in Afghanistan that, in this deeply conservative Islamic country where family problems are usually hidden behind the veil, it is an Indian TV show that has come to dominate society’s discussion of family issues. I have read reports of wedding banquets being interrupted so that the guests could huddle around the television for half an hour, and even of an increase in crime at 8:30 pm because watchmen are sneaking a look at the TV, rather than minding the store. One Reuters dispatch recounted how robbers in Mazar-i-Sharif stripped a vehicle of its wheels and mirrors recently during the telecast time and wrote on the car, in an allusion to the show’s heroine, “Tulsi Zindabad” (long live Tulsi). That is soft power, and India does not have to thank the government or charge the taxpayer for its exercise. Instead, Indians too can simply say, “Tulsi Zindabad.” Of course, official government policy can also play a role. Pavan Varma, the current head of the Indian Council on Cultural Relations, has argued that “culturally, India is a superpower,” and that cultural diplomacy must be pursued for political ends. So India is highly visible at cultural shows around the world, and the ICCR is rather good at organizing Festivals of India in assorted foreign cities. That is good, but I am not a fan of propaganda, which most people tend to see for what it is. I believe that the message that really gets through is that of who we are, not what we want to show. For soft power is not just what we can deliberately and consciously exhibit or put on display; it is rather how others see what we are, whether or

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These assets may not directly persuade others to support India, but they go a long way toward enhancing India’s intangible standing in the world’s eyes.

even coined. India’s first Prime Minister, Jawaharlal Nehru, was also a skilled exponent of soft power: he developed a role for India in the world based entirely on its civilizational history and its moral standing, making India the voice of the oppressed and the marginalized against the big power hegemons of the day. This gave the country enormous standing and prestige across the world for some years, and strengthened our own self-respect as we stood – proud and independent – on the world stage. But the great flaw in Nehru’s approach was that his soft power was unrelated to any acquisition of hard power: as the humiliation of the military defeat by China in 1962 demonstrated, soft power has crippling limitations in national security terms. Instead of Theodore Roosevelt’s maxim, “speak softly and carry a big stick,” Nehru’s India spoke loudly, but had no stick at all. But in a tough neighbourhood, the rhetoric of peace can only take you so far. Soft power becomes credible when there is hard power behind it; that is why the US has been able to make so much of its soft power. Recent Indian history offers a somewhat mixed picture when it comes to the effective use of hard power. The 1971 war with Pakistan, leading to the emergence of Bangladesh, remains the preeminent example, but there are few others – the repelling of Pakistani intruders from the Kargil heights in 1999, and a swift paratroop intervention in the Maldives to reverse a coup against President Gayoom in 1996, providing rare instances of hard power success. Against these examples are the said 1962 China war, the spectacular failures of the Indian Peacekeeping Force in Sri Lanka in 1987 (the Force withdrew after incurring heavy casualties in an unplanned war with the Tamil insurgents), the hijacking of an Indian Airlines aircraft to Kandahar in 1999, resulting in the craven release of detained terrorists from Indian jails, the repeated ‘bleeding’ of the country through terrorist incidents planned and directed from Pakistan, and innumerable unprovoked incidents on the Bangladesh border involving Indian loss of life. India is often caught in a cleft stick on such matters: it typically treads softly in its anxiety not to come across as a regional bully and, in so doing, it emboldens those who are prepared to test it. As a result, India has been noticeably reluctant to evolve a strategic doctrine based on hard power. Indeed, there is a sense in which most Indians still think that would be unseemly. This helps explain India’s growing consciousness of its soft power – though, of course, New Delhi knows that its soft power cannot solve its security challenges. After all, an Islamist terrorist who enjoys a Bollywood movie will still have no compunction about setting off a bomb in a Delhi market, and the US has already learned that the

perpetrators of 9/11 ate their last dinner at a McDonald’s. To counter the terrorist threat, there is no substitute for hard power. Hard power without soft power stirs up resentments and enmities; soft power without hard power is a confession of weakness. Where soft power works is in attracting enough goodwill from ordinary people to reduce the sources of support and succour that the terrorists enjoy, and without which they cannot function. But this means that India also needs to solve its internal problems before it can play any role of leadership in the world. We must ensure that we do enough to keep our people healthy, well-fed, and secure – not just from jihadi terrorism, but from the daily terror of poverty, hunger and ill health. Progress is being made: India can take satisfaction from its success in carrying out three kinds of revolutions in feeding its people – the ‘green revolution’ in food grains, the ‘white revolution’ in milk production and, at least to some degree, a ‘blue revolution’ in the development of our fisheries. But the benefits of these revolutions have not yet reached the third of our population still living below the poverty line. We must ensure that they do, or our soft power will ring hollow – at home and abroad. At the same time, if India wants to be a source of attraction to others, it is not enough to attend to these basic needs. It must preserve the precious pluralism that is such a civilizational asset in our globalizing world. Our democracy, our thriving free media, our contentious civil society fora, our energetic human rights groups, and the repeated spectacle of our remarkable general elections, have all made of India a rare example of the successful management of diversity in the developing world. It adds to India’s soft power when its non-governmental organizations actively defend human rights, promote environmentalism, fight injustice. It is a vital asset that the Indian press is free, lively, irreverent, disdainful of sacred cows. But every time there are reports of sectarian violence or a pogrom, like the savagery in Gujarat in 2002, or a nativist attack like those by a fringe group in February on women drinking at a pub in Mangalore, India suffers a huge setback to our soft power. Soft power will not come from a narrow or restricted version of Indianness, confined to the sectarian prejudices of some of the self-appointed guardians of Indian culture (‘Bharatiya Sanskriti’). It must instead proudly reflect the multi-religious identities of our people, our linguistic diversity and the myriad manifestations of our creative energies. India must maintain its true heritage in the eyes of the world. And that will mean acknowledging that the central battle in contemporary Indian culture is that between those who, to borrow Walt Whitman’s

phrase, acknowledge that we are vast – we contain multitudes – and those who have presumptuously taken it upon themselves to define (in increasingly narrow terms) what is ‘truly’ Indian. Pluralist India must, by definition, tolerate plural expressions of its many identities. To allow any self-appointed arbiters of Indian culture to impose their hypocrisy and double standards on the rest of us is to permit them to define Indianness down until it ceases to be Indian. To wield soft power, India must defend, assert and promote its culture of openness against the forces of intolerance and bigotry inside and outside the country.

of the normal emanations of Indian culture. Such goodwill has not been systematically harnessed as a strategic asset by New Delhi. It is ironic that, in and around the 2008 Olympics, authoritarian China showed a greater determination to use its hard-power strengths to cultivate a soft-power strategy for itself on the world stage. India will not need to try as hard, but it will need to do more than it currently does to lever its natural soft power into

Photograph: The Canadian Press / Rajesh Kumar Singh

a valuable instrument of its global strategy. I believe that the India that has entered its seventh decade as an independent country is one open to the contention of ideas and interests within it, unafraid of the prowess or the products of the outside world, wedded to the democratic pluralism that is India’s greatest strength, and determined to liberate and fulfill the creative energies of its people. Such an India truly enjoys soft power, and that may well be the most valuable way in which it can offer leadership to the 21st century world.

Bollywood actor Hema Malini, right, performs the Hindu myth of Radha and God Krishna at the Indian Institute of Information Technology, December, 2008.

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t helps that India is anything but the unchanging land of timeless cliché. There is an extraordinary degree of change and ferment in our democracy. Dramatic transformations are taking place that amount to little short of an ongoing revolution – in politics, economics, society and culture. Both politics and caste relations have witnessed convulsive changes: who could have imagined – for 3,000 years – that a woman from the ‘untouchable’ community of outcastes (now called ‘Dalits’) would rule India’s largest state, Uttar Pradesh, as Kumari Mayawati now does with a secure majority? It is still true that in many parts of India, when you cast your vote, you vote your caste. But that too has brought about profound alterations in the country, as the lower castes have taken advantage of the ballot to seize electoral power. These changes are little short of revolutionary. But the Indian revolution is a democratic one, sustained by a larger idea of India: an India that safeguards the common space available to each identity – an India that celebrates diversity. If America is a melting pot, then to me India is a thali – a selection of sumptuous dishes in different bowls. Each tastes different, and does not necessarily mix with the next, but they belong together on the same plate, and they complement each other in making the meal a satisfying repast. India’s civilizational ethos has been an immeasurable asset for our country. It is essential that India not allow the spectre of religious intolerance and political opportunism to undermine the soft power which is its greatest asset in the world of the 21st century. Maintain that, and true leadership in our globalizing world – the kind that has to do with principles, values and standards – will follow. This will require the more systematic development of a soft power strategy than India currently has. So far, such strategic advantages as have accrued from India’s soft power – goodwill for the country amongst African, Arab and Afghan publics, for instance – has been a largely unplanned byproduct

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The State of The Troubles Northern Ireland is again in the news. What gives?

IN SITU

John de Chastelain from Northern Ireland

The recent war in Gaza and other conflicts in the news, coupled with recent murderous attacks in Northern Ireland, have drawn attention once again to that province, raising the question of whether the peace process deemed to be effective there can be a template for conflict resolution elsewhere. Some believe that it can be. George Mitchell’s recent appointment as President Obama’s special envoy to the Middle East, and Tony Blair’s 2006 appointment as the Quartet’s man there, bring together two statesmen who played key roles in Northern Ireland. In January, Blair’s former chief of staff,

Photograph: associated press / Julien Behal

Since retiring from the Canadian Forces in 1995, John de Chastelain has been involved in the Northern Ireland peace process – since 1997, as Chairman of the Independent International Commission on Decommissioning.

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Jonathan Powell, and former IRA member and now Northern Ireland Assembly member Gerry Kelly, went to Manila and Mindanao to brief the Philippine government and the opposing Moro Islamic Liberation Front on the lessons of the Northern Ireland experience. But some contend that the situation in Northern Ireland is unique, and that lessons from that conflict are not necessarily transferable. They point out that today some aspects of the Belfast Agreement have still not been fully implemented, and that problems remain. Powers of policing and justice have not been devolved, dissident republican paramilitary groups are still active, and very recently murdered three members of the security forces. Loyalist paramilitary groups have also yet to decommission their arms. They note that some communities are still separated by so-called ‘peace barriers,’ sectarianism still exists and the reorganized Police Service of Northern

Ireland is still regarded with suspicion in some areas. These factors notwithstanding, most would agree that the situation in Northern Ireland today is very much improved, and that the way forward proposed in the 1998 Belfast Agreement and the 2006 St. Andrew’s Agreement provides the most hopeful path to a lasting peace there. Since its re-establishment nearly two years ago, the Northern Ireland Assembly has been governing the province effectively, even if with inter-party disagreements common to all democratic parliamentary systems. Differences over education, the spending of public funds for the establishment of a sports stadium on the site of a former prison, the issue of truth and reconciliation, and concern over the effect of the current world fiscal situation on the interrelated economies of Ireland, both north and south, are problems that face Members daily during sessions of the Stormont Assembly. Issues left unresolved from the Belfast Agreement are due for particular attention in the coming months. Debates on the devolution of policing and justice are intended to decide that issue before the end of the year. Loyalist paramilitary groups The funeral of a have been given twelve months police officer to decommission their arms with killed by dissident the International Commission, Republicans in and both nationalist and unionMarch 2009. ist political parties have urged the people of Northern Ireland to support the police in their work to bring to justice those members of the dissident republican paramilitary groups responsible for the murders of the two soldiers and the policeman. In the referendum held on the 1998 Agreement, and in the election following the 2006 Agreement, the people of Northern Ireland voted in favour of the peace process as it was reflected in both those Acts. The focus of Assembly Members now is to see the process fully implemented, and to address the day-to-day needs and concerns of the citizens. If elements of the process are exportable, so be it. For the people of Northern Ireland, the process is still ongoing.

TÊTE À TÊTE

Alvaro de Soto is a senior fellow at the Ralph Bunche Institute for International Studies, an associate fellow at the Geneva Centre for Security Studies, and a member of the Global Leadership Foundation. During a 25-year

State of the Art: Scanning the Globe Global Brief scans the globe with former United Nations top man to distill best practices and low-hanging fruit in international conflict deal-making. Conversation with alvaro de soto

career in senior positions at the UN, including as G L O B A L B R I E F • M AY 2 0 0 9

Under-Secretary-

General, he led, among other things, the 19901991 negotiations that ended the El Salvador war.

Q Alvaro, you were a key player in the 1990-1991 negotiations (or ‘deal-making,’ as it were) that brought an end to the civil war in El Salvador. What do you make of the most recent presidential election results in El Salvador? What does the the rise to power of a candidate from the old Marxist resistance coalition – the Farabundo Marti para la Liberación Nacional (FMLN) – say about about your deal-making a couple of decades ago?

A Early in the war, President Reagan’s first Secretary of State famously said that El Salvador was where the US would draw the line against communism. As it turned out, when the parties in conflict concluded that the war could not be won militarily and started to negotiate instead, the issue on the table was not a revolutionary transformation of the political system. There was no clash between Marxism and capitalism or liberal democracy. Perhaps more than anything else, the negotiation was about opening up political space so that genuine democracy could flourish and human rights would be respected: that was the leitmotiv of the institutional reforms that were agreed. To be sure, there were Marxists participating in the coalition of five groups of which the FMLN was composed – indeed, the Communist Party of El Salvador was one of the five – but the FMLN’s agenda in the negotiation was ideology-free. The FMLN might have proposed systemic economic and social transformations, but that dog never barked: they said that economic and social policy was not a matter for negotiation between the warring parties; setting it would be

the responsibility of a legitimately elected government. What the election of the FMLN’s candidate, and the admirably civil concession of the defeated ARENA candidate, say about the deal-making of 1990-1991 is that the consolidation of democracy in El Salvador is progressing healthily. Q So is today’s El Salvador a stable country or society? How does it compare with other countries or societies in Central America or the Caribbean Basin? A El Salvador, poor and densely populated, is bedevilled by the problems of many of its neighbours, including an alarmingly high crime rate. It depends to a great degree on remittances from the hundreds of thousands who fled the conflict in search of a better life abroad, principally in the US. It is therefore vulnerable to the whiplash of the current economic crisis. What we can say is that, because of the peace accords, previously nonexistent institutional channels for the peaceful resolution of grievances are now in place, which considerably reduces the chance of instability getting out of hand. Corpses of people murdered for their thoughts are no longer being found on roadsides or near garbage dumps. Q Based on your experience in the El Salvador negotiations and many peace negotiations afterwards, what are the major principles or best practices that today’s and future deal-makers need to keep in mind? A For the UN Secretary-General to be a successful peacemaker, he must adhere unswervingly to two simple rules. Firstly, he must be impartial between parties in conflict, regardless of whether they are states or a state and a rebel group. Secondly, he must insist on compliance by member states with their obligation under the UN Charter to refrain from seeking to influence him or his staff in the discharge of their tasks. Not only his success and his credibility, but those of the office with which he has been entrusted and which he must hand over to his successor depend on this adherence.

A Different mediating institutions each have their advantages and disadvantages. As a general proposition, impartiality should be the default rule of thumb for any mediator. It is self-evident that, if a party in conflict perceives that the mediator is tilting toward another, it will grow suspicious,

The proliferation of would-be mediators sometimes reaches a level that can be very unhelpful to those who are devoted full-time. The refrain about ‘the more the merrier’ doesn’t apply to peacemaking.

Q How do you rate the UN’s capacity today to lead peace or security negotiations in conflict situations? A The Secretary-General’s independence came under severe strain as a result of the ideologically inspired ‘global war on terror’ that was declared in response to the attacks on US territory of September 11, 2001. The GWOT failed to make the indispensable distinction between the feral, nihilist, pre-Westphalian Al Qaeda and groups which are also on lists of terrorist organizations, but act on behalf of a legitimate grievance. A case in point is Hamas, which won a majority in the January 2006 elections for the Palestinian legislature and assumed the government of the Palestinian Authority. The international community had strongly encouraged the holding of those elections and given a green light to Hamas’ participation, in support of PLO leader and PA President Mahmoud Abbas’ policy of inclusion. Abbas had obtained Hamas’ cessation of attacks against Israel and its agreement to enter the electoral field. Arguably, by so doing, it was tacitly accepting the previously scorned Oslo framework. After winning, Hamas invited the defeated Fateh’s participation in the government, and accepted that Abbas should negotiate with Israel, subject only to the outcome being submitted to referendum. Hamas leaders spoke of their willingness to create a Palestinian state within the June 4, 1967 borders – an implicit acceptance of Israel. Hamas was clearly moving in the right

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Q How do these principles translate to situations in which deal-makers are state-based – for instance, heads of governments – rather than rooted in international organizations?

and this will taint the process. But there are cases where different standards apply, and have so been accepted by the parties. One obvious example is in negotiations between Israel and the Palestinians. In these, Israel would be happy to negotiate with the Palestinians without intermediaries, but accepts the US as a third party because it believes that its fundamental interests are safe in the hands of the US, which makes no secret of its commitment to Israel’s security. The Palestinians to date have, for their part, been happy with US involvement because they are convinced that only the US can ‘deliver’ Israel – if anyone can. Note also that Syria, albeit acutely aware of the close Israel-US relationship, insists on US involvement in future negotiations with Israel at least in part because one of its goals is to rebuild its frayed relationship with the US. The Norways and the Switzerlands of this world have to be impartial and seen to be so.

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Impartiality should be the default rule of thumb for any mediator. If a party in conflict perceives that the mediator is tilting toward another, it will grow suspicious, and this taints the process.

direction. This needed to be encouraged, for which they needed to be engaged. The opportunity was squandered: the Quartet, of which the UN Secretary-General is a member (about which a rethink is long overdue), rebuffed the new Palestinian government, imposed absurd conditions on it, and condoned Israeli collective punishment on the Palestinian people so as to subvert the freely expressed will of the electorate. Palestinian institutions which the West had so painstakingly contributed to build are near collapse. In a break with longstanding UN practice, I was prevented from dealing with the new government of the Palestinian Authority, even though, as the UN’s chief envoy for the Arab-Israeli conflict, I was the Secretary-General’s Personal Representative to that Authority. In the same vein, I was also prevented from engaging Syria. If UN representatives do not speak to parties in conflict, particularly when this constraint is perceived to be the result of the pressure of a member state, one of the UN’s competitive advantages is sacrificed. It also raises questions about the Secretary-General’s credibility as a peacemaker elsewhere. As a result of the Secretary-General’s continued participation in the Quartet, he has become associated with policies that have cruelly punished the Palestinian people and discouraged Hamas’ move toward moderation. The policies have also been singularly ineffective: Hamas has not bowed to the Quartet’s conditions, and there is little evidence that its political standing has suffered. The catastrophic setbacks to the prospects for peace between Israel and the Palestinians since – the deep chasm, geographical and political, dividing the Palestinians, the recent war in Gaza, the move away from a two-state solution in the latest Israeli election – might have been avoided if the Quartet had acted cleverly in January 2006, rather than allowing itself to be guided by ideology. The UN Secretary-General had played a useful role in the creation of the Quartet as a vehicle for encouraging the US to take the lead once again in peace efforts, but it was not necessary for him to remain in it beyond. The UN Secretary-General is a poor fit in the Quartet, elbow to elbow with the two greatest military powers and the EU, which – as distinct from the UN – has supranational aspirations. Moreover, his participation in it compromises other responsibilities: he is at the top of the pyramid of programmes and agencies in the occupied Palestinian territory, which work bravely and hard to meet the daily needs of hundreds of thousands of refugees. By his association with

policies that cause the suffering of so many, he compromises his ability to lead the work of those programmes and agencies in the impartial manner that is the core principle of UN assistance. The Quartet and UN programmes and agencies are therefore at cross-purposes: the latter work to repair the damage wrought by the former. Q Now that you’ve brought this up, might I ask whether, in all seriousness, you think that the Israeli-Arab conflict is really soluble? A Without a solution to the Israeli-Palestinian conflict, there cannot be a solution to the overall Israeli-Arab conflict. If one accepts the conventional wisdom that the only possible way out of the

Israeli-Palestinian conflict is a two-state solution, then solubility is in peril. The failure (predictable and indeed predicted) of the Annapolis process – negotiations with half of the Palestinian body politic, as if the other did not exist – proves that Palestinian reunification is a prerequisite. Yet the West remains ambivalent about a Palestinian government that includes Hamas. And, even if it can overcome its qualms, Israel is in a serious internal bind: there have been signs of a growing awareness at the top of the Israeli political class (see Sharon’s actions and Olmert’s words) that, if a two-state solution to the Palestinian conflict is not reached soon, Israel will find itself ruling over an Arab majority between the river and the sea, threatening the whole premise of Israel as we know it – a Jewish and democratic state. But the way that the Israeli political system is structured, it seems impossible to translate that awareness into the bold decisions required to accept a genuinely viable Palestinian state. In the meantime, the Palestinian paradigm has shifted: with the relentless growth of settlements and

the continuing encroachment in East Jerusalem, the Palestinians have lost faith in the willingness of Israel to ever end occupation, and a reunified Palestinian movement might be less willing to accept the terms that seemed close at Camp David and Taba. (In fact, there are those in Israel who posit that there is no viable two-state solution within the confines of historical Palestine, and that to produce one it will be necessary to engage in a complex negotiation to produce territorial swaps and other infrastructural arrangements that involve Egypt, Jordan and possibly Syria.) The hawkish new Israeli government – elected in the wake of the Gaza war – has distanced itself from a two-state solution. The picture is indeed bleak. Should it not prove possible to have a two-state solution soon, some say that Israel may again borrow a page from Sharon’s book and move toward a massive unilateral withdrawal from the West Bank. But that is much more difficult to do than the Gaza disengagement, and might buy some time, but will not achieve security or stability. Everything would then have to be rethought. Q What about individual countries? Are some countries better placed than others to lead international peace or security deals? A There are states for which peacemaking has long been a part of the national agenda. The best known are Norway and Switzerland, which are active worldwide, punching far above their intrinsic weight. There are others which have developed a vocation more recently in their own regions – Qatar, Turkey and South Africa come to mind. Many governments take a proactive interest in following situations and crises without actually taking on a third-party role. The proliferation of would-be mediators sometimes reaches a level that can be very unhelpful to those who are devoted full-time, because it confuses messages and encourages parties in conflict to play one envoy off against another. The refrain about ‘the more the merrier’ does not apply to peacemaking. Unfortunately, mediation is low-tech work, accessible to thousands of diplomats and many foreign ministers hungry for press coverage at home, and therefore hard to resist.

A Canada has a top-drawer diplomacy and track record. Its proximity to the US, possibly a drawback in some spheres, can also be an advantage. Canada’s work in drawing up the blueprint that was approved by the Security Council and eventually led to Namibia’s independence comes to mind.

A The UN’s Department of Political Affairs is mandated by the General Assembly to keep a list of people colloquially known as ‘the great and the good,’ but my recollection is that the people that governments put forward were frequently either 1) unsuitable retired diplomats or politicians, 2) available only for short periods of time, 3) unwilling to take charge of daunting challenges in distant and difficult places that do not make the news, 4) physically or mentally no longer fit, or 5) dead. There are NGOs which have on staff or on call richly talented and experienced peacemakers. Among them are the Humanitarian Dialogue Centre in Geneva and Martti Ahtisaari’s Conflict Management Initiative. Getting the right person or institution is extremely difficult. There are many extremely talented people who are temperamentally unsuited for the work of peace, which requires a cocktail of virtues and flaws more frequently found in certain religious orders or species other than human beings – such as patience, empathy and emotional detachment (I am conscious of the contradiction), a capacity to listen and to adapt, and Gore-Tex instead of skin. Emotional intelligence can sometimes trump the IQ variety. The choice of institution also needs to be carefully weighed. There are advantages to an institution such as the UN because of the resources at its disposal and the ability to segue from peacemaking to peacekeeping and peace implementation. At the same time, the UN might be too intrusive for certain belligerent parties to stomach, including states facing rebellions which they are reluctant to legitimize. Also, the UN is by definition a normative mediator, since those who work at its service cannot – or should not – turn their backs on the body of law developed under its auspices over the years, which may make conflict resolution difficult. On the other hand, there have been cases where a small outfit which was drawn into mediation realized when the time came that it was in above its head, and managed to hand over smoothly to a larger institution when agreements were approaching and a large peacekeeping operation became necessary – for instance, the Communitá di Sant’Egidio to the UN on Mozambique. >>

For more of Alvaro de Soto’s Tête à Tête, including his views on Afghanistan and Pakistan, Sri Lanka and the general good and bad of the world to come, visit www.globalbrief.ca

There are many talented people who are temperamentally unsuited for the work of peace, which requires a cocktail of virtues and flaws more frequently found in certain religious orders or species other than humans.

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Q Has Canada got any peacemaking capacity? Or could it develop such capacity? Should it?

Q What about individual deal-makers like you or people like Martti Ahtisaari? Who impresses you? And is the supply of deal-makers keeping up with the demand generated by conflict, going forward?

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So Was Pearson’s Success an Accident?

QUERY

Did Canada’s greatest ever deal-maker buck an otherwise pedestrian national record of diplomacy? By andrew cohen

Photograph: The Canadian Press

eight years (eight as foreign minister), he had been everywhere and done everything. He was the West’s choice to become Secretary-General of the UN in 1946 and 1953 (vetoed twice by the Soviets). He was elected president of the General Assembly in 1952. He was one of the four-member committee that proposed the State of the Israel, and one of the ‘three wise men’ asked to review the principles of NATO, the creation of which, in 1949, he called his greatest achievement. He was the first foreign minister to visit Nikita Khrushchev in 1955. By Suez, he had spent more than a quarter century attending international colloquies, and he knew all their players, most by their first name. But this was not just one man’s experience. After the war, when it was hard to find money for foreign or defence policy, Canada decided to expand its foreign service – which Senator John Kennedy would later call “perhaps the finest in the world.” In many ways, it was. Pearson was its apotheosis, but it was filled with a corps of brilliant, shrewd generalists. By the mid-1950s, Canada had made a commitment to foreign aid (the Colombo Plan) and to a muscular peacetime army, as well as to activist diplomacy. It had gone into the world with envoys, arms and alms. They were the hard currency of credibility. So, no, Pearson and the role Canada played at Suez were no accident. Canada had positioned itself to succeed, and when the moment came, it seized it. Today? A different story. The world is bigger and Canada is, of course, relatively smaller than it was after the war. But Canada has also chosen to do less. For years, despite the occasional diplomatic inspiration, it has allowed the arms of its internationalism to atrophy. No one expects ideas, arms or aid from Canada anymore (though it has maintained a significant presence in Afghanistan). By and large, the world does not ask much of it anymore and, in turn, Canada does not ask much of itself. Were Canada to achieve some great diplomatic coup today, it would be an aberration. Or, an accident.

Andrew Cohen is a syndicated newspaper columnist, professor of journalism and international affairs at Carleton University, and the author of five books, including Extraordinary Canadians: Lester B. Pearson.

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When Lester Pearson walked into the General Assembly on November 1, 1956, France and Britain were involved in a shooting war in the Middle East that Canada condemned. So did the US and the Soviet Union. Everyone wanted a way out. All day, diplomats had been rushing up to John Holmes, a junior member of the Canadian delegation, asking him: “What’s he got? We hear Mike’s got a proposal? It’s high time. Can he do it?” Mike, as he had been known since he was a pilot-in-training in the Great War, did have a proposal. Later that evening, after the Assembly had passed a resolution calling for a full ceasefire, he would suggest an emergency international force to supervise it. It would become the basis of another resolution, two days later, which would introduce peacekeeping. Pearson would do it. Suez was his finest hour. When he won the Nobel Peace Prize for his creative diplomacy the next year, the citation said that he ‘had saved the world.’ It conferred a saintliness upon Pearson; he would forever be known as the saffron-robed prince of peace, uttering mystical incantations on a mountaintop. It would also confer a new vocation upon Canada. Always a misnomer for a country which had fought three major wars in the twentieth century and was a founder of NATO, peacekeeping has become a part of Canadian mythology and iconography. Was all this an accident? Was Pearson’s success at Suez, and more broadly, his diplomacy of the post-war period, a product of good fortune and happenstance? In a word, no. If Pearson seemed an overnight success at Suez, he was a sensation decades in the making. Put simply, there was nothing accidental about Pearson at Suez, nothing accidental about the luminous foreign service which he had gathered around him, and nothing accidental about Canada’s international stature in those heady days in the middle decades of the last century, which became known as ‘the golden age of Canadian diplomacy.’ By 1956 – and long before – Mike Pearson was the best known Canadian in the world. For twenty-

ILLUSTRATION: JAMES TURNER

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Which intelligence services are the best in the business? BY Wesley Wark

ranking the world’s spies

some well-known fabulists. Ian Fleming gave us a new and reassuring spy for the Cold War: James Bond, Agent 007. John le Carré, Fleming hater and arch-rival, gave us Alec Leamas and George Smiley, intellectually tortured figures grappling with a world of espionage that was a microcosm of all of society’s ills. Tom Clancy brought the spy novel to American shores and gave us a mélange of action and techno-thrills in the service of a distinctive brand of American patriotism. And Hollywood has kept the flame alive by channelling George Orwell into a series of compelling takes on conspiracy and paranoia, from Three Days of the Condor in 1975 to Enemy of the State in 1999. Audience beware. Some of this fabulism has a cautionary point, and much of it is fun. What it does not do is reflect reality.

Wesley Wark is a professor at the Munk Centre for International Studies, University of Toronto, where he teaches on intelligence and security issues. His most recent book is Secret Intelligence: A Reader.

METRIC 1

Popular Culture Sells Espionage Although the temptation is great, one cannot reach into the realm of imaginary spies for real-world yardsticks. Except for this. The popular culture of espionage has added fizz and attractiveness to the idea of spying, giving it public prestige and sometimes shoring up its legitimacy at critical moments. It has undoubtedly performed as an unpaid recruiter, driving young men, and maybe women, into the intelligence business. Spy services need talent, and they need public legitimacy. Popular culture has helped with both, but only in the Anglosphere. Metric No. 1 is thus – if you have a popular culture of espionage, you are ahead. If one is inclined to doubt this, consider that the very origins of modern British intelligence

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uess the world’s best spy services. It sounds like a parlour game for Bond fans, and might be, if only the question were not quite so serious and the answer quite so elusive. Serious because spy services now have a new cachet and weight in a world of fast on-rushing, globalized threats. Elusive because spy services remain charter members of the land of secrets, and stubbornly refuse to reveal too much of themselves in public. While the failures of intelligence services often make the news, their successes rarely do, adding difficulty to the task of measuring effectiveness. Espionage activities have been around for a very long time. But despite a long history and a literature studded with some notable classics, beginning with Sun Tzu’s Tsaoist masterpiece, The Art of War, it seems that only in the post-9/11 age have we awakened to the idea that intelligence services truly matter, and that the popular understanding of spies in our midst may not serve us all that well. With modern spy services entering their second century (British intelligence celebrates its centennial this year), one might think that some agreement exists about how to measure their performance. It does not, however, and no accepted ranking exists, except perhaps at the fuzzy edges of popular wisdom. Where better to start, then, than the place where the mind will quickly, and with little resistance, go – to the dominant images purveyed by spy novels and films. The genre has been shaped by

owe much to a spy panic generated, just before WW1, by the earliest ink-stained wretches of the spy novel genre. The man once lauded as the “great white spy chief,” legendary (at least before his fall) CIA director Allen Dulles, appreciated full well the importance of popular culture. Dulles practiced selling a burnished image of spying in a variety of settings, from Georgetown drawing rooms to media interviews to the inner sanctum of the White House. Indeed, he kept a spy novelist in his agency’s employ, and devoted himself to publishing a collection of his favourite spy stories in retirement. If pondering popular culture yields something for our effort to rank spy services, lifting the lid on history yields more. The history of spying tells us much about why spy services were created, how they evolved, how they prospered, how they coped with failure, how they became powerful. History is a darwinistic laboratory of intelligence survival. METRIC 2

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The Times They Are a Changing

The modern history of espionage begins in the years before WW1, when a handful of European states laid the permanent foundations, or strengthened the activities, of existing spy services in the face of a perfect storm of changes that confronted them. These changes included unsettling shifts in the nature and distribution of power in the international system, which negated the post-Napoleonic ‘Concert of Europe’ and raised the spectre instead of systemic anarchy, imperial overstretch, the unrelenting application of technology to warfare, increasing domestic political turbulence in the wake of industrialization and urbanization, the emergence of new mass political ideologies, and the rise in literacy rates (and hence political appetites). In other words, modern intelligence was born in troubled times, when states suddenly gained an appetite for information that might increase their security and odds for survival. Once the appetite was gained, it was rarely relinquished, though the intensity of hunger could come and go. The history of modern intelligence teaches us that spying flourishes, and is best appreciated and used, in times of perceived unsettling change and national insecurity. Metric No. 2 measures perceptions of threat linked to the capacity of the state to understand intelligence as a form of succour. In a post-9/11 age, it could be argued that the world’s problems come to all corners and to all manner of states, but we can still distinguish those that feel most pressed by the Dylanesque notion of ‘the times they are a changing.’ Those that feel most hard-pressed are most likely to turn to intelligence services for help.

METRICS 3 & 4

Spy Game Changers The history of intelligence also teaches us about the dynamics of change. Good intelligence services are those that are able to ride the waves of change, adapt and utilize them to gain an edge. The game changers for intelligence services, from pre- WW1 days down to the present, have been the intertwined factors of technology and the informational universe. Technology has revolutionized intelligence by introducing new ways of collecting information, which freed classical spy services from the stasis of traditional reliance on the human agent and on slow-moving methods of passing secrets from spies to home capitals. Technology, beginning with Marconi’s experiments in wireless radio transmission, levered open a new dimension of fast-moving and ultimately global communications, which themselves could be targeted by adaptable intelligence services. Thus was born the discipline known as signals intelligence (SIGINT), which began to show its potential in WW1 (the Zimmermann telegram), was the crown jewel of allied intelligence services in WW2 (the Ultra Secret), and indeed went on to play an acknowledged but still difficult to document role in Cold War and post-Cold War contests. Technology also freed intelligence from its lineof-sight constraints and, starting with the ingenious invention of the Wright brothers, created a whole new dimension of aerial, and later, space-based reconnaissance. Inevitably, another acronym was born – IMINT (imagery intelligence). But the technological driver had its downside. While it held tremendous potential for delivery of high volumes of reliable information at speeds unheard of – all the while side-stepping the vagaries of dependence on the human agent and the mailbag – it was pricey and required advanced technological capabilities, as well as a matching industrial complex. To keep up in the technological spy race required steep investments in money and human resources. It also required some degree of burden sharing; that is, a willingness to join with like-minded states to share the costs, the targeting and the take of spy operations. Metric No. 3 is thus the relative effort that states are willing and able to make to harness technology. In other words, how’s your spy machine? Technology took intelligence out of its perennial condition of informational drought or scarcity, and introduced it to an opposite phenomenon of informational glut or superabundance. Spying over the course of the twentieth century became less and less about digging up secret nuggets, and indeed more and more about exploring the vast universe of non-secret, so-called ‘open source’ information.

Current estimates for Western intelligence services suggest that as much as 90% of their intelligence knowledge is derived from open source materials. The coming of the internet has been both an unanticipated blessing and grave curse for spy services, forcing them to rethink the basic tenets of intelligence and to introduce new ways to collect, manage and disseminate information as they edge closer to becoming vast cyber-libraries, where an ability to find the right, relevant piece of available information is the key. Gone are the days when intelligence services were concerned only with secrets, and when the locked steel cabinet, with its red-tabbed folders, was a potent symbol of knowledge. Thus we arrive at Metric No. 4: How is your spy library? METRIC 5

Political Culture

METRIC 6

What’s Your Neighbourhood? Spy services thrive on threats to national security, perceived or real. These threats can be generated along any number of vectors: by internal troubles, border disputes, regional tensions or concerns for global security. Small powers are most likely to concentrate on internal and near threats; medium powers will have a more extended horizon of concern; great powers will tend to have global problems on their minds. The idea of intelligence, once a monopoly of a handful of European great powers, has essentially been exported and globalized. Most of the UN ‘family’ will thus sport some form of intelligence capacity. A transition occurs from law enforcement and policing to intelligence as preoccupation with threats transcends one’s own borders. Thus, most small states, and most states primarily concerned with domestic turbulence, are more likely to invest in policing and internal security capabilities rather than in a full-service spy system. But there are, of course, exceptions to this rule, the most notable being that of the State of Israel – a small state by anybody’s measure, with preoccupations that are firmly focussed on internal security and on relations with its immediate neighbours, but with a significant and much-lauded intelligence system. There can be middle and great powers in the international system that do not devote many resources to espionage. A good example would be Japan, whose approach to intelligence was profoundly shaped by its post-war constitution and the renunciation of a tradition of militarism. Japan became a site for spying by other powers during the Cold War and after, and may, as its economic power blossomed, have acquired

The history of modern intelligence teaches us that spying flourishes and is best appreciated and used in times of unsettling change and national insecurity.

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Le Carré readers will know this, but Bond fans take note. Spy services are bureaucracies embedded in political systems. They are rarely “rogue elephants,” in Senator Frank Church’s famous phrase; they are never partnerships between stern father figure (M) and globe-trotting killer (007). Usually, they take their marching orders from the political leadership, and operate within political systems which they serve and political structures to which they have to adapt. To take one instance, the late and unlamented Soviet intelligence service, the KGB, lived by its official motto – “the sword and shield of the party.” That was its raison d’être. Spy services have cultures that reflect their place in the political system, from bull’s eye centre to life on the peripheries of power. There are many elements to the political culture of intelligence, including a well-educated and welltrained work force; intelligence personnel whose diversity mirrors that of the broader makeup of the state; legal codes and norms; accountability regimes to ensure that intelligence services stay true to their mission, stay legal, and can learn from their mistakes; clear mandates and reporting structures within government; high-level interest in, and respect for intelligence’s role. The political culture of intelligence ideally serves two ends. One is to allow intelligence services sufficient independence and power to pursue the fond, self-imposed maxim of ‘speaking truth to power;’ the other is to provide an intelligence system with the capacity to generate truths in the first place. These are large but delicate ambitions for spy services: a requirement for power and independence, but not too much; a genuine truth-seeking capacity nurtured within a system that inevitably places a premium on secrecy and privileged – but compartmented – access to information.

The political culture metric is a grab bag – hard to reduce to a single measure or thought. But, at its heart, it is about the capacity of a state to take seriously the idea of an independent knowledge source on key questions of national and international security. Metric No. 5 we will label the political culture of ‘truth seeking.’

at least a private sector appetite for industrial espionage, but it has largely eschewed a major intelligence capability. It is at least an arguable proposition that good spy services are most likely to be found in states that live in dangerous neighbourhoods, when that sense of ‘neighbourhood’ transcends the merely local. When it does not, spies give way to cops. The biggest, though not necessarily the best, spy services are to found in the possession of states with global footprints that fear international insecurity. Metric No. 6 is about the geopolitics of danger that animates intelligence work. It involves an understanding of how states deploy spy services to cope with insecurity beyond their borders. A final metric might be suggested by the current economic crisis. Intelligence services need money. Times may change, and if the economic crisis continues to worsen, states might make deep cuts in intelligence budgets. But so far, nothing of that kind has been recorded. Resourcing might become a metric in future, though for the moment it is a ghost. Willingness to spend on intelligence in a post-9/11 age seems a common denominator. The six metrics can be applied to fashion a ‘performance matrix.’ Which countries to try this out on? Some inclusions are inevitable: the US as the world’s preeminent intelligence power in terms of reach, technology and resources; the UK as a twentieth century pioneer with a self-professed ability to ‘punch above its weight;’ Israel for its stature as a Middle East power and as an exemplar of a state that has, even before its formal birth, invested heavily in intelligence. Canada needs to be in the mix because it exemplifies how middle

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While the failures of intelligence services often make the news, their successes rarely do, adding difficulty to the task of measuring effectiveness.

powers tend to adopt a custom-built (or, less politely, jerry-rigged) approach to intelligence. To this grouping, I will add Australia, as a regional power with eyes fixed on the Pacific and South Asia, and as a member of the so-called ‘Five Eyes’ intelligence alliance (with the US, UK, Canada and New Zealand), one of the most unique burden-sharing partnerships in intelligence history. Two BRIC powers – Russia and China – have to be in the mix. The US National Intelligence Council’s impressive forecast of future trends – ‘NIC 2025’ – pays a lot of attention to the BRIC countries, and predicts a tectonic shifting of power West to East as the 21st century proceeds. Russia has, of course, a long tradition of espionage dating back to its first engagement with the West during the reign of Peter the Great, and has shown an impressive recovery since the collapse of the Soviet empire. Russia’s prime minister is, after all, a former KGB officer. China remains – well – a little more inscrutable, but no one doubts that it brings its own methods of large-scale intelligence collection, including cyber-espionage, to bear on its increasingly global interests. And China lays claim to the earliest theoretician of intelligence, Sun Tzu. To this group of seven intelligence powers, I will add one outlier – Pakistan. Pakistan does not just live in a dangerous neighbourhood these days: it is a dangerous neighbourhood unto itself, with serious fears that this nuclear-equipped state could tumble over the brink into failed state status if its internal politics comes awry. Moreover, its military intelligence arm, the ISI (Inter-Services Directorate) – originally a creation of the departing Raj – has been widely credited with contributing to both terrorism operations in Afghanistan and India, and to being a doubtful ally of its own political masters. The methodology, such as it is, will be to apply a numerical coefficient (on a scale of 0 to 10) to each of the performance metrics, and to bundle these into a measure (spy matrix) of the ranking of eight state intelligence services. This is not hard science, econometrics or even that softer thing known as political science. It is just a suggestive – maybe provocative – guess. Here is what we get for scores:

Popular Culture

Threat Perception

Technology

Spy Library

Political Culture

Geoplitics

TOTAL

AUSTRALIA

6.8

CANADA

5.7

CHINA

4.7

ISRAEL

9.2

PAKISTAN

3.3

RUSSIA

5.3

UNITED KINGDOM

8.7

UNITED STATES

9.3

Spy Matrix: Ranking the Intelligence Services

he overall score is an aggregate of each of the individual metrics, according each one equal weight. A score of 5 and above I consider a passing grade; spy services below 5 are failing. Two of our eight spy services garner failing grades; two are stuck at mediocrity; four are good performers – or at least have all the tools to be good performers. If these numbers be true to anything, they show the US and Israel – one superpower and one small power – at the top of the chart of world spy services, neck-and-neck in ratings. Pakistan

ranks lowest, itself a dangerous indication. China does surprisingly poorly; Britain surprisingly well. Canada shows itself better than Russia, but less good than Australia. The moral is that the world’s best spy services are those that know that they live in a dangerous world, supported by governments that know that they live in a dangerous world, and are able and willing to tolerate spies as truthtellers. Or maybe, given all we have learned from the failures of intelligence around the 9/11 attacks and the Iraq war, we should use Mark Lowenthal’s more cautious phrase: truth “approximators.”

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The last century teaches us that the purgatory between the perfect peace and total war is the strategic space in which the major deals of the twenty-first century will be crafted BY Michael Cotey Morgan

20th century paradoxes:

Between War & Peace

Michael Cotey Morgan is a PhD candidate in international history at Yale University. His work has appeared in the Wall Street Journal and the Globe and Mail, among

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other publications.

n a 1914 pamphlet, HG Wells declared that the First World War would pave the way for perpetual peace: “This, the greatest of all wars, is not just another war – it is the last war!… We face these horrors to make an end of them.” He was tragically wrong, of course, as were the scores of statesmen and diplomats who, over the course of the century, devised plans to make war an impossibility. Woodrow Wilson’s League of Nations hardly lived up to its creator’s hopes. The 1928 KelloggBriand Pact, whose signatories solemnly promised to “renounce [war] as an instrument of national policy,” has long been a monument to either naïveté or cynicism, depending on one’s perspective. And, for all of its virtues, the UN has hardly lived up to its foundational promise to “save succeeding generations from the scourge of war.” The twentieth century’s catalogue of horrors tells us that diplomacy has limits. This is not to say that diplomacy has achieved no successes – quite the contrary – but it is essential to understand what it can and cannot do. It cannot solve all problems. Arbitration cannot resolve every dispute. Negotiating cannot end every conflict. And treaty-making cannot always build a desirable peace, because peace is not simply a matter of avoiding armed conflict. It requires more than just a treaty. This means that, in some circumstances, paradoxically, it makes sense to choose war over peace, and to fight to bring a more just and stable peace within reach.

What soldiers do on the battlefield constrains what diplomats can do at the conference table. At the 1945 Yalta summit, for instance, Franklin Roosevelt persuaded Joseph Stalin to sign the Declaration on Liberated Europe, which committed the Allies to building sovereign democratic governments in the countries emancipated from Nazi control. Stalin’s subsequent installation of a communist government in Poland fuelled accusations that, far from standing up for freedom, Roosevelt had in fact betrayed the Eastern Europeans at Yalta. But, regardless of Roosevelt’s intentions, no amount of diplomatic skill – indeed, nothing short of a new war – could have pushed the Red Army out of Eastern Europe. So long as Soviet troops were in place, Stalin had a free hand to do as he liked, and he knew it. In this respect, Yalta was not nearly as significant as its critics (most recently George W. Bush) claimed. When his foreign minister questioned the wisdom of signing the Declaration, Stalin replied: “We can fulfill it in our own way. What matters is the correlation of forces.” A US-Soviet war over Poland in 1945 would have been the height of folly, but sometimes the wisest course of action is in fact to reject diplomacy and to keep fighting. Britain’s decision in May 1940 not to seek peace with Germany may be the century’s most important treaty that never happened. The Turkish rebellion against the 1920 Treaty of Sèvres offers another example of fighting for the sake of a better peace. Sèvres ended the war between the ILLUSTRATIONs: dan page

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Ottoman Empire and the Allies, and proposed to cut the Empire into pieces. Furious at its terms, Mustafa Kemal Atatürk assembled a nationalist army to smash the treaty. His rapid, if bloody, success in the field forced the Allies to negotiate a new agreement, the 1923 Treaty of Lausanne, which kept Turkey – though not the Empire – intact. But one must not conclude that it is always better to war-war than jaw-jaw. When he became US president, Richard Nixon was determined to end the Vietnam War, but only in a way that would not give the impression of defeat. A hasty retreat, he and Henry Kissinger reasoned, would only make the US look weak, and thus damage American security, which relied on the capacity to deter potential aggressors by projecting an image of strength. So even as they brought tens of thousands

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Negotiating cannot end every conflict, and treatymaking cannot always build a desirable peace. In some circumstances, it makes sense to choose war over peace, and to fight to bring a more just and stable peace within reach.

of American soldiers home, they expanded the war – for example, by bombing Cambodia and mining Haiphong harbour – in the hope not of winning, but of creating a position of strength from which to negotiate an end to the conflict. The chimera of credibility lured the US into a dangerous paradox: to preserve the appearance of power, it stuck to a policy that underscored its weakness. The 1973 Paris Peace Accords, which ended the war, kept Saigon’s government in place, and promised free elections, quickly evaporated two years later when a new Northern attack overwhelmed South Vietnam. America’s engagement in Vietnam is a classic case of a war provoking domestic turmoil, but peace treaties can sometimes do the same thing. In 1905, after trouncing the Russians on land and at sea in the Russo-Japanese War, Japan won a favourable deal in the Treaty of Portsmouth, but did not get all of its original demands. When news of the agreement reached Tokyo, there was a riot. Thousands of people violently expressed their

anger at the gulf between what the country had gained and what they believed it deserved. The consequences of the war were worse still for Russia, where the defeat contributed to a revolution that almost toppled the tsar. Fifteen years later, Ireland’s fight for independence demonstrated the risks of a backlash against efforts to establish peace. After several years of guerrilla warfare against British troops, Irish republicans signed a peace treaty with the British government in 1921. The Anglo-Irish Treaty established the Irish Free State, but only as an autonomous dominion within the British Empire – not a fully independent country. The compromises that the Irish representatives had made in order to reach a deal triggered a civil war, dividing the country between the treaty’s supporters and those who saw it as a betrayal of the republican cause. As these cases suggest, diplomats need to remember that their actions can have unintended consequences. And the broader the agreement – the loftier its rhetoric – the harder it is to predict all of its effects. In framing the Treaty of Versailles in 1919, Woodrow Wilson championed national self-determination, a slippery idea in the best of circumstances. No advocate of racial equality, he meant it to apply to Europe, but not necessarily to the European empires. However, as historian Erez Manela’s recent book, The Wilsonian Moment, demonstrates, the subjects of those empires rejected this distinction and appropriated Wilson’s principles for themselves. The result was the growth of powerful nationalist movements in Africa and Asia. Even in Europe, Wilson’s idea created intractable problems, because it proved impossible to draw clear lines between allegedly separate peoples that often lived side by side. Another agreement that took on a life of its own was the 1975 Helsinki Final Act. At the signing ceremony in the Finnish capital, none of the 35 assembled European and North American statesmen could have foreseen the Act’s far-reaching effects. Soviet leader Leonid Brezhnev had originally demanded a pan-European agreement to ratify the continent’s post-war frontiers in order to entrench the status quo and thereby shore up Soviet power. Western leaders added their own desiderata to the agenda – notably provisions for

though the ultimate outcome in this case was happier. Due to the Cold War, it took a quarter century to achieve a modus vivendi over Germany and Berlin, which had been chronic sources of crises in the 1940s, ‘50s and ‘60s. Nowhere is the distinction between peace and the absence of war more salient today than in the Middle East, where former enemies have signed treaties, but peace remains elusive. One might also look to Kosovo, which languishes in the twilight between peace and war, despite a decade of international reconstruction efforts. Due especially to the rise of terrorism, the nature of war has changed over the last quarter century, and remains in flux. Will the nature of diplomacy and peacemaking have to change too? In the past, when major wars ended, it was possible to

Peace is more than just the absence of war. The corollary of this notion is that there exists a limbo between peace and war – where the fighting has ceased, but freedom and stability have not yet taken root.

re-examine the international system’s governing principles. The rules of the road had to adapt to the new era. (Post-war windows of opportunities stay open only briefly, and, as the cliché goes, one should never waste a good crisis.) But whatever one calls the current worldwide conflict with radical Islamism – the ‘war on terror’ or something else – it is hard to imagine that it could conclude with anything resembling the Congress of Vienna or Paris Peace Conference. Politicians and diplomats are wrestling with the dilemma of whether it is possible or desirable to negotiate with non-state actors like Al Qaeda, Hezbollah and the Taliban, which play an increasingly important role in the international system. Just as the tradition of declaring war has declined, it may well be the case that traditional peacemaking – or at least the grand peace conference of the past – may be on the decline too. Over the coming decades, diplomats will have to grapple with the question of what should take its place.

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the freer movement of people and information, as well as respect for human rights. In making these demands, they hoped to encourage liberalization in the Soviet bloc, but held out little hope of revolutionary change. Yet, over the fifteen years that followed, the Final Act’s human rights promises galvanized Eastern European dissident movements, which, in collaboration with Western governments and non-governmental organizations, played a major role in bringing down communism in Europe. One of the Final Act’s key innovations was to recognize “respect for human rights and fundamental freedoms” as a core principle of international security. Security was no longer a purely military question. It also required adherence to certain ideals – chief among them human rights. This was not a sudden shift, but rather a gradual trend that gathered steam in the 1960s and 1970s. Its traces are apparent in the history of the Nobel Peace Prize, which was increasingly awarded to international human rights activists, such as René Cassin in 1968, Sean MacBride in 1974, Andrei Sakharov in 1975 and Amnesty International in 1977. In presenting Cassin with his prize, which recognized his role in drafting the 1948 Universal Declaration of Human Rights, the chairwoman of the Nobel committee underscored the interconnection of peace and human rights. “What kind of peace,” she asked, “can there be in a country where the people are not free?” Peace is more than just the absence of war. The corollary of this notion is that there exists a limbo between peace and war – where the fighting has ceased, but freedom and stability have not yet taken root. Diplomats have to distinguish between a treaty, which silences the guns, and a durable settlement, which makes it possible for genuine peace to take hold. The persistence of instability after WW1 illustrates the difference. In 1919, the Allied statesmen in Paris tried to build a new international system that would hold Germany to account, solve the problem of the continent’s failed empires, and prevent another war. But as the 1920s and ‘30s proved, the Versailles system was anything but stable, despite fresh diplomatic efforts – most prominently, the 1925 Locarno Pact – to put international peace on a sounder footing. A similar pattern followed the end of the WW2,

ILLUSTRATION: henrik drescher

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The current economic crisis fast begets the next wave of global mergers and acquisitions. What’s to be done? BY fred lazar

here has been an upheaval in the global corporate and ec o n o m i c l a n d s c a p e s over the past few decades. Today, China has the largest holdings of foreign reserves of any country – approximately $2 trillion. General Motors, Citicorp, Bank of America and AIG used to be among the largest companies in the world by market value. All four are now on life support as wards of the US government. By comparison, Mittal, the India-based steel company, a non-entity thirty years ago, is today the largest steel company in the world. Indeed, many companies headquartered in Brazil, Russia, India and China (BRIC) have joined the list of largest global companies over the past thirty years. Dramatic changes will continue to characterize the evolution of the corporate and economic landscapes – some, of them, naturally, via the vector of mergers and acquisitions (M&A). But the nature and timing of these changes will depend on how we extricate ourselves from the current crises, as well as by the new rules which will be put in place both unilaterally and multilaterally by nations. While the current focus of regulatory change appears to be the financial sector, there are two key areas which are getting precious little attention, but will doubtless play a critical role going forward: anti-trust policies and foreign ownership. Existing trends in both of these areas indicate that the next merger wave will encounter strong resistance. There appears to be a steady rhythm to merger waves. Like waves on a beach, they rise to a peak and then crash to the ground, with regularity. The height, amplitude and velocity of ocean waves depend on a myriad of environmental factors. The same is true of merger waves. In some respects, the M&A game has changed dramatically in a very short period of time; and in other respects, it is déjà vu all over again. It was

only twenty-five years ago that Kohlberg, Kravis & Roberts (KKR) completed the first $1 billion acquisition by a private equity (PE) firm. Three years later, KKR completed the largest leveraged buyout – the $25 billion acquisition of RJR Nabisco. This was the high-water mark of the 1980s buyout boom. What seemed to be an astronomical transaction in 1988 has since, of course, become commonplace. KKR regained its title for being involved in the largest leveraged buyout by a PE firm when it partnered with TPG Capital and Goldman Sachs to complete a $45 billion acquisition of TXU, a regulated utility and power producer, in 2007. But this acquisition does not rank among the largest acquisitions of the past 10 years – a period during which the telecommunications and pharmaceutical sectors have been the hotbed of mega-deals, followed by the energy, financial services and resource sectors. There have been four $100 billion-plus transactions: the Vodafone/Airtouch acquisition of

Fred Lazar is an associate professor of economics at the Schulich School of Business, York University.

WHITHER global M&a?

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Mannesmann; the AOL merger with Time Warner; the Pfizer acquisition of Warner-Lambert; and the Royal Bank of Scotland et al. acquisition of ABN AMRO Bank. What would have been the largest acquisition of all time (a takeover of Rio Tinto by BHP Billiton) failed, a ‘victim’ of the economic downturn going back to the late summer of 2008. The 1980s buyout boom was driven by strong post-1982 economic growth, the creation and growth of the junk bond market – which provided the funding for the leveraged buyouts – and rising equity values. Black Monday (October 19, 1987) – when stock markets around the world crashed – the collapse of the junk bond market, and the demise in 1990 of Drexel Burnham Lambert – the major player in this market – together with rising interest rates and a recession in 1990-91 caused the 1980s M&A wave to crash. The combination of economic recovery, lower interest rates and lax enforcement of anti-trust

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While the current focus of regulatory change appears to be the financial sector, there are two key areas which are getting little attention, but will play a critical role, going forward: anti-trust policies and foreign ownership.

laws spurred the next M&A wave in the latter half of the 1990s. The three largest deals of all time were completed in 2000 and 2001, just as this wave was subsiding. During the 1990s, the global telecommunications, oil and gas, electronics hardware and financial sectors were reshaped by M&A. The collapse of the technology bubble, higher interest rates and the 2001 recession took the winds out of this M&A boom. But, as economic recovery began in 2003, and interest rates were reduced to record low levels by the US Federal Reserve, M&A activity again took off. Debt financing was readily available, as the global financial markets were awash with liquidity – courtesy of the US Federal Reserve – and no company seemed to be too large to be a target. This time, however, acquisitions covered a wider range of sectors, much like in the 1980s, and sovereign funds and BRIC-based companies began to play a larger role. During this period, M&A activity further reshaped the telecommunications and financial services sectors, as well as the resource, utility and pharmaceutical sectors.

he global meltdown of financial institutions and the ensuing global recession have evidently curtailed the latest M&A boom. But history does repeat itself, and within a short period of time, a new boom will surely be underway – even if there has always been a very high failure rate for mergers, and PE and other firms have written off hundreds of billions of dollars on their latest rounds of acquisitions. JDS Uniphase, at one time a leading Canadian company in the telecommunications networking sector, wrote off $50 billion in goodwill in 2001 on a number of the acquisitions it made during the 1990s wave. Time Warner has written off tens of billions of dollars on its merger with AOL. AlcatelLucent, the troubled French-American telecommunications equipment maker, has written off in excess of $10 billion following its creation through merger. GM is trying to divest itself of two of its acquisitions – Hummer and Saab. Pfizer has been the acquirer in three of the largest acquisitions in the pharmaceutical industry of the past 10 years. These three acquisitions have cost Pfizer almost $240 billion. Yet Pfizer’s market value today is only $90 billion – classic M&A value destruction. Royal Bank of Scotland’s $100 billion acquisition of Dutch bank ABN AMRO, the biggest financial services deal ever, has turned out to be a nightmare for all the parties involved. And the list goes on and on. High failure rates are endemic in global M&A because most acquisitions serve as a poor excuse for CEOs to display leadership. Oftentimes, the herd

effect dominates, as one CEO completes a takeover, thus prompting rival CEOs to follow like lemmings going over a cliff. Indeed, there are very few CEOs who are visionaries and try to grow their companies by being innovative and entrepreneurial. And, as John Kay has pointed out (in The Art of the Deal, p. 10), the winner’s curse has led to disappointing M&A outcomes. The seeds of the next M&A boom are being sewn in the current financial and economic crises. Many companies in financial distress – AIG, Citigroup, Rio Tinto, Teck Cominco and GM – are being forced to dispose of assets. Excess capacity has become pervasive across all industries and countries. The collapse of equity prices has greatly depressed the valuations of most companies – even ones with good prospects, going forward. The firms with solid balance sheets and access to capital will be tempted to acquire one or more of their competitors at ‘bargain basement’ prices. And financial advisors, who stand to collect enormous fees, will once again convince CEOs that there are enormous synergies to be realized through a particular merger or acquisition. Like investors in ‘toxic’ assets and Bernie Madoff’s infamous fund, short-sightedness and delusion will drive CEOs into believing that one plus one can in fact far exceed two. The stage is therefore set for the next wave, and despite the dismal track record for M&A, as the global economic and financial environments improve, the lemmings will be back at work. Having said this, the next M&A wave will face two major impediments: first, more active anti-trust enforcement, and second, a growing backlash against acquisitions made by BRIC companies and sovereign funds. And indeed, just as the US, Canada and Western European countries will try to protect their own industry champions, so too will China, India and Russia. Xenophobia is not the purview of the West alone. During the George W. Bush years, the US Justice Department and the Federal Trade Commission (FTC) did not play an aggressive role in challenging M&A. But the expectation is very clearly that Justice and the FTC will become much more aggressive under the new Obama Administration. Mergers aimed at eliminating excess capacity and competitors – horizontal mergers – are the most problematic for anti-trust enforcers, since they supposedly lead to greater market concentration. Furthermore, large transactions often lead to large job losses, as the acquiring firm attempts to reduce costs to make the acquisition a success. In today’s economic and political climate, there is little tolerance for large companies trying to become more profitable by firing their workers. And while governments are unlikely to try to stop a merger strictly on the basis that it increases

involved in protecting CEOs from their own folly? This leads to my second major concern – the backlash against acquisitions by foreign companies. The Canadian government resisted the proposed takeover of Noranda by a Chinese company. The US government vetoed the proposed acquisition of Unocal by another Chinese company, and prevented Dubai Ports from acquiring six major American ports as part of its takeover of P&O, a British firm. China recently blocked the takeover of one of its domestic firms by Coca-Cola. Germany, France, Russia and China are all building up their national champions in a number of sectors by multiple means: by forcing mergers; by providing various types of financial assistance; by preventing acquisitions by foreign companies; and by restricting investments by foreign sovereign funds. Jean-Jacques Servan-Schreiber highlighted the paranoia of Europe in the 1960s in the face of the possible takeover of their economies by American multinationals. And in the 1980s, Europe and the US feared that their major companies would fall under the control of the Japanese. Today, the fear extends to all countries, and in respect of all foreign companies. There is much concern today that the severe global recession might lead to protectionist measures, as each country tries to protect jobs and/or responds to the protectionist policies of other countries. But this fear involves the protectionist measures of the past – quotas and preferential domestic procurement policies. The greatest real protectionist threats emanate from the massive subsidies (i.e., bailouts) that every major country is providing to many of its key companies; the attempts to strengthen national champions and protect them from foreign takeovers; and the foreign investment barriers, which are fast becoming more widespread. The G20 should be initiating a process to eliminate barriers to foreign investments, and to ensure that there is a level playing field for all companies, regardless of the location of their headquarters. Instead, members will use their time and resources trying to build up and protect their national champions. True to form: the latest G20 meeting had nothing to say about this form of protectionism. Canada has tried on a number of different occasions to create national champions and protect Canadian companies from foreign takeovers. However, on every international comparison of productivity and innovation, Canada continues to rank poorly. Many of the Western European countries have been even more aggressive in creating these policies, and, predictably, their performance has been no better than that of Canada. Creative destruction should be allowed to play out!

The seeds of the next M&A boom are being sewn in the current financial and economic crises. Many companies in financial distress are being forced to dispose of assets. Excess capacity has become pervasive across all industries and countries.

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unemployment, this concern will almost certainly influence the anti-trust enforcers, especially since they are subject to political pressures. So what of international anti-trust policy – just as we anticipate this next inevitable wave of M&A? Every country has three options for managing this next wave, and they are not mutually exclusive. Each country can continue to refine its own antitrust policies, including enforcement practices. Of course, this option perpetuates the current hodgepodge of global rules. The major countries – possibly the G20 nations – could attempt to develop a single global set of rules with a single enforcement agency – the second option. This would be an improvement over the current situation, but is unlikely to materialize. The US, and probably the EU as well, are unlikely to relinquish their autonomy in this area to some international agency. Or, in the alternative, each country could dismantle its anti-trust policies, starting with the merger rules – the third option. This is my preferred option, but it is even less likely to materialize than the second option. Joseph Schumpeter long ago recognized the importance of the pursuit of monopoly power and profits as the primary driver of innovation and risk-taking. However, anti-trust policy patently does not appear to be a positive force for the process of creative destruction – Schumpeter’s “essential fact” of capitalism, and a process that typically produces large productivity gains for the economy. Anti-trust policy cannot encourage competition. Indeed, only the desire to succeed and to gain a competitive advantage can do so. As Schumpeter argued, there is no reason to fear the creation of monopolies, unless, of course, they are the creation of government – national champions. If, instead of wasting time trying to enforce their anti-trust laws, policy-makers had spent their time reforming corporate governance practices, we might have witnessed fewer of the disastrous corporate meltdowns (Enron, financial institutions and sub-prime loans) which spawned the massive economic losses that have clearly been felt well beyond the institutions directly at fault. While the argument in favour of dismantling anti-trust is impeccable, the prospects of this happening are, alas, manifestly minimal – particularly in the current environment, where the surviving leading companies in many sectors might be headquartered in one of the BRIC countries. This, of course, begs the question: if most mergers are unsuccessful, would strict enforcement of merger rules not be good for the economy? Answer: Do we really want governments to get deeply

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IN THE CABINET ROOM

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ILLustration: barry blitt

5 52 2

G GLLO OB BA ALL B BR RIIEEFF •• M MAY AY 220 00 099

Can Obama’s’new’ foreign policy make a difference? BY roland paris

Revenge of

the World

s a candidate for the White House, Barack Obama promised to “renew American diplomacy” and to launch a “new era of international cooperation” that would “begin the world anew.” By discarding the aggressive unilateralism of the Bush Administration and replacing it with ‘smart diplomacy,’ he would rally other nations and tackle the world’s most pressing problems, from transnational terrorism to climate change.

Photograph: MATTHEW CAVANAUGH / CORBIs

is University Research Chair in International Security and Governance at the University of Ottawa.

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Both Americans and non-Americans gobbled up this message. In public opinion surveys on the eve of Obama’s inauguration, majorities in countries as diverse as Egypt, Chile, Germany and India expected the new president to improve US relations with the rest of the world. Anticipation of a major shift in US foreign policy became widespread, thanks in part to Obama’s own messages of impending transformation. Since entering office, he has repeated these messages and reinforced them with high-profile decisions and gestures. He announced the immediate closing of secret CIA prisons and plans to shutter the Guantanamo Bay detention facility within a year. He committed to ending US ‘combat operations’ in Iraq by August 2010, and appointed a special envoy for Afghanistan and Pakistan (reflecting his view of the Taliban insurgency as a cross-border conflict requiring a regional approach, to which he also committed more US troops and money). He signalled a willingness to deal directly with Iran and Syria, and to “press the restart button” on relations with Russia. And he sent messages of conciliation directly to Muslim publics through media interviews and

Roland Paris

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Rather than transforming the US approach, the Obama White House has thus far largely continued a gradual shift in policy that began in the final years of Bush’s second term.

speeches, explaining to a group of Turkish students last month that he was “personally committed to a new chapter in American engagement” with the Muslim world. Obama has earned plaudits for his diplomatic and oratorical skills, but pundits disagree on the extent to which his foreign policy substantively differs from that of his predecessor, George W. Bush. In these early days of the new Administration, US foreign policy has acquired the strange quality of a Rorschach ink blot, evoking wildly different interpretations of continuity or change. (In the Rorschach test, subjects are exposed to abstract patterns, and asked to make sense of these ‘ambiguous stimuli.’ Some see bunnies, while others see monsters.) One group of observers views Obama’s foreign policy as a ‘sharp turn’ from Bush, including his approach to Afghanistan, Pakistan, Iraq, Iran, China, North Korea, Russia and Cuba. Others, however, see more continuity in Bush-to-Obama international policies, particularly from the latter period of the Bush Administration when neoconservatives lost their dominant position to more pragmatic realists, such as Secretary of Defense Robert Gates. Allies of the former president were among the first to make the continuity argument. In January 2009, Christian Brose, a Bush Administration speechwriter, predicted little change in US foreign policy under Obama, arguing that the Bush Administration had already embraced bipartisan ‘pragmatic internationalism’ in its final term. In March, Robert Kagan, co-founder of the neoconservative Project for the New American Century, echoed Brose’s analysis, claiming that there is really only a “pretense of radical change” in Obama foreign policy. On China, North Korea, Afghanistan, Iran, Russia and the war on terror, “the basic goals and premises of US policy have not shifted,” argued Kagan, suggesting that the new president was using “sleight of hand” to create perceptions of change. In recent weeks, the idea that Obama’s foreign policy is rhetorically different, but substantively unchanged, has been repeated in mainstream American and international media. Puzzlingly, such analyses have appeared alongside stories that

continue to proclaim major change in US foreign policy, all of which underlines the Rorschach-like ambiguity of Obama’s ‘new’ approach. For example, on April 17, New York Times White House correspondent Peter Baker observed that Obama has kept intact much of the Bush foreign policy, while “cloaking it in new language,” including promises of engagement. Obama’s approach thus “may seem more different than it really is.” The new Administration’s desire to “press the reset button” on American-Russian relations, for example, came with few specifics, and may have been “more about tone than goals,” wrote Baker. But one day later, the Times reported on Obama’s speech at the Summit of the Americas, where the president called for a “new beginning” in American-

Photograph: the canadian press / Kirsty Wigglesworth

were unclear, but the message was nevertheless well received from the Rio Grande to the Tierra del Fuego – just as his earlier calls for a “fresh start” with Russia, a “new day” in US-Iranian relations, a “new chapter” in America’s dealings with the Muslim world, and a “renewed partnership” with Europe, all elicited positive responses from their intended audiences. It would be wrong to argue that Obama is simply perpetuating George W. Bush’s foreign policy, but the differences on many issues are less striking than their similarities. It is certainly less different than either Obama or his officials are claiming. White House Chief of Staff Rahm Emanuel summed up the new Administration’s accomplishments on April 19: “in the first 90 days, a lot has been done …

Barack Obama’s press conference at the G20 Summit in London, April, 2009

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Cuba relations. The story characterized Obama’s remarks as the “clearest signal in decades that the United States is willing to change direction in its dealings with Cuba,” and quoted unnamed officials describing his speech as an “historic shift” in US policy. How much of a shift was it, really? It is too soon to say. The Administration needs time to prove itself and play out its hand. However, a growing number of observers are questioning the substance behind the new president’s elevated appeals for renewal, which have become a staple of his foreign policy speeches. Before his call for a “new beginning” with Cuba, for example, Obama proclaimed a “new day” in America’s relations with all of Latin America. The concrete implications of that announcement

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Obama will need to continue rallying international support even after the reality of his foreign policy falls short of its promise, as it almost inevitably will.

[to] change America’s foreign policy and its objectives.” In many key areas of foreign policy, however, there has been relatively little change. Consider the new president’s Iraq policy. As a candidate, Obama pledged to “end the war” and withdraw US forces. Yet the Bush Administration beat him to the punch, negotiating an agreement with the Baghdad government requiring all US combat troops to leave by the end of 2011. Obama responded by calling for a speedier withdrawal, but once in office, he effectively endorsed the deadline negotiated by the Bush Administration. He then added a wrinkle, announcing the intermediate objective of reducing US troops to a maximum of 50,000 by mid-2010 – something he portrayed, somewhat richly, as a major policy change and as an end of the “combat mission.” Candidate Obama also sharply criticized the Bush Administration for neglecting the worsening situation in Afghanistan. Soon after becoming president, he committed additional US troops and development money, and launched a diplomatic initiative for the region. However, while it is true that the US paid too little attention to Afghanistan for most of Bush’s presidency, that situation changed during the last two Bush years when the US steadily ramped up its military, development and diplomatic engagement in response to a series of alarming policy reviews. Obama’s ‘new’ policy towards Afghanistan and environs was largely a continuation of this evolution in US policy. Indeed, the only element of the new Administration’s regional policy that arguably broke from this trend was Obama’s opening to Iran. On human rights and the war on terror, many viewers of Obama’s inauguration breathed a sigh of relief when he rejected as false “the choice between our safety and our ideals,” and insisted that America would not give up its ideals, including the rule of law and the rights of man – “for expedience’s sake.” It was a thinly veiled repudiation of his predecessor, who sat through the speech just a few feet away in apparent discomfort. Obama then quickly issued decisions suspending CIA torture practices and shutting down its secret prisons. More quietly, however, Obama Administration lawyers have appeared in court defending the CIA’s extraordinary rendition programme, in which US agents may capture foreign suspects without due process and then hand them over to other countries for questioning. Obama officials have also quietly supported the Bush Administration’s argument that US-held prisoners in Afghanistan jails have no legal right to challenge their detention. Then, Secretary of State Hillary Clinton appeared to play down human rights in US-China relations, prompting a stream of criticism from human rights organizations, and raising questions about the

seriousness of Obama’s commitment to deliver on his inauguration commitments. The new president has not substantially changed US policy towards Darfur, in spite of perceptions to the contrary. Yes, the Bush Administration sought to undermine the International Criminal Court for many years, whereas the new Administration supported the ICC’s war crimes charges against Sudanese President Omar Hassan al-Bashir. Less widely known, nonetheless, is that American opposition to the court softened during George W. Bush’s second term, that his Administration labelled the Darfur situation “genocide,” and that US officials also indicated that the US would block any attempt to prevent the ICC from indicting Bashir, which is precisely the position taken by the Obama Administration once the ICC ultimately issued its indictment. On Russia, although Obama seems more willing than his predecessor to pursue arms control negotiations with Moscow, bilateral relations under the new American president continue largely as before. There was a brief flurry of commentary following reports of a secret letter from Obama to his Russian counterpart, Dmitry Medvedev, in which Obama allegedly offered to back away from US plans for a missile defense system in Eastern Europe in exchange for Russia helping with sanctions against Iran. But, as it turned out, Secretary of Defense Gates had initiated similar discussions with Russian officials a year earlier, while Bush was still president. Regarding Georgia, which Russia invaded last year and the US continues to support, the new Administration shows no sign of caving into Russia’s demands that outsiders stop ‘interfering’ in its sphere of influence. And NATO is holding military exercises in Georgia, against Moscow’s strenuous objections. On the environment, Obama as candidate promised that the US would become a global leader in responding to climate change. This is one of the foreign policy issues on which President Obama is most likely to distinguish himself from his predecessor. The Bush presidency rejected the Kyoto Protocol, and twisted the findings of US government scientists to suit the ideological prejudices of the White House. Although Bush officials deserve some recognition for the billions of dollars they allocated to research on alternative energy technologies, they were inveterate foot-draggers in diplomatic fora on climate change. Obama’s promises will be tested at the Copenhagen climate summit in December, where countries are supposed to agree on a post-Kyoto Protocol plan for the reduction of global greenhouse gas emissions. But his ability to lead on this issue will be determined largely by the outcome of ongoing debates over US climate change policy at home.

America’s relations with many countries, and to reduce the distrust and anger that accumulated during the Bush years. In communicating messages of change directly to ordinary people in other countries, moreover, he may be strengthening his future bargaining leverage with their respective governments. No regime can ignore Obama’s widespread popularity and the rock star welcome he receives in public appearances. From this perspective, the president’s soaring rhetoric could be a shrewd opening strategy – a brush-clearing exercise that serves to prepare the ground for the next phase of his foreign policy, in which he will demonstrate his ability to convert goodwill into results. Obama has asked for more time before people

the second-term Bush Administration, or has yet to put forward concrete new approaches. While the new Administration is still young, the emerging gap between aspiration and action represents a political vulnerability for Obama. With each announcement of a fresh start or new beginning in American foreign policy, he exposes himself to the criticism that he is failing to translate lofty language into practice – in short, that he is all talk. Such criticisms should not be taken too far. Artful language is more than just talk; it is a tool of effective diplomacy – something that the Bush Administration seemed to forget, until it was too late. Establishing a positive tone in foreign relations can make it easier to strengthen bonds with allies, and to build bridges with adversaries. Obama has used the first months of his presidency to repair

judge the differences between his and his predecessor’s international policies, explaining that “moving the ship of state is a slow process. ” He deserves that time, but he may not get it. The president’s message of renewal and change generates goodwill and creates diplomatic opportunities, but it also raises expectations. Every time Obama announces a new beginning or fresh start, a clock begins ticking in yet another part of the world that is now expecting him to deliver the change that he has promised. In the meantime, his political allies and adversaries back home will be watching closely to see if his foreign policy can deliver tangible results. As a candidate, Obama campaigned on the principle that a more open approach to America’s foreign relations would provide the basis for renewed US leadership in the world. Now he needs to prove it.

Photograph: associated press / IBRAHIM USTA

Demonstrators protest against the visit of Barack Obama in Taksim square in Istanbul, April, 2009

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The president’s domestic objectives are bold and sweeping: through a combination of regulation and investment, he hopes to make deep cuts in America’s emissions of greenhouse gases by introducing a European-style cap-and-trade system on carbon emissions, among other measures. Transforming these aspirations into policy will cost an immense amount of money (at a time when the federal deficit is spiralling higher), and will rankle powerful lobbies and interests. Yet, political success at home is a precondition to moving the US from the sidelines to the front ranks of international leadership on climate change. In most of these areas, Obama has either carried forward the foreign policy that he inherited from

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Saeed Rahnema (against): While it would be

policy of committing even more Canadian troops – and casualties – to Afghanistan. If the Canadian government had not given in to the pressures of the Bush Administration, and not involved itself militarily in Afghanistan, today Canada would not have a ‘critical national interest at stake’ in that country. In the same manner, if the Canadian government had joined the ‘coalition’ to invade Iraq, now Iraq would also be of ‘critical national interest’ to Canada. Unfortunately, Canada now has much at stake in Afghanistan in the face of the serious threats from the Taliban and Al Qaeda. Canada cannot achieve much by continuing what it has been doing to date. With the new US surge in Afghanistan, there is no doubt that the Obama Administration is pushing Canada, among other NATO allies, to not only continue, but also to increase its military presence there. Canada should not give in to these pressures. The US government created this mess, and it is not up to Canada to clean it up. For most of the last century, Canada was able to establish a strong track record and reputation of peacekeeping and peacemaking, and as a nation it needs to regain its independent foreign policy and return to that tradition. By getting involved in a combat mission, and thereby walking away from its history of peacekeeping, Canada has lost much of its international reputation and prestige. On a BBC panel in Brussels on 28 March, 2009, prior to the Hague international conference on Afghanistan, in response to a statement about the American position and Canada’s plans in Afghanistan, the Swedish Foreign Minister stated: “Canada is the US!” – instigating loud laughter among the international audience. This is the new image of Canada, produced as a result of the wrong policies of the present Conservative government – contrary to the far more respectable global image in the age of Trudeau or even Chrétien. Canada can change this image, and would, as a consequence, be far more effective in its traditional role. Canada would be in a much better position to help its allies by focussing its efforts and policies on helping the people of Afghanistan establish a democratic and secular state through involvement in training, education and development.

pointless to refute that Canada now has national interests in Afghanistan, it is important to recognize why this is the case. To perhaps state the obvious, the wrong policies of the past have consequences for the present and for the future. The Liberal government of Jean Chrétien accepted some involvement in Afghanistan to make up for its lack of support for America’s invasion of Iraq. As ill-advised as this was, the involvement was less extensive than is the case today. But Paul Martin expanded Canada’s military presence there, to be followed by Stephen Harper’s almost enthusiastic

Smith: I agree that we begin with where we are. But I am not sure that, even if we had not committed troops to Afghanistan, we would today have no interests at stake. When the US is threatened, Canada has no choice but to respond. The alternative is that the Canadian-US border looks like the US-Mexican border. But I would argue that we are not only threatened by Al Qaeda indirectly, but directly as well. Certainly that is what Al Qaeda spokesmen maintain. The ‘war on terrorism’ made no sense. Democra-

NEZ À NEZ On Afghanistan and the Canadian Interest Canada (still) has national interests at stake in Afghanistan.

Proposition:

Gordon Smith vs Saeed Rahnema

Gordon Smith is the Director of the Centre for Global Studies at the University of Victoria. He has held a number of senior positions in the Canadian government, including Ambassador to NATO and Deputy Foreign Affairs Minister.

Saeed Rahnema is an award-winning professor of political science at York University. He has served as the Director of the York School of Public Policy and Administration, as a member of UN Development Program, and as a Director of the Middle East

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Economic Association.

Gordon Smith (in favour): Of course, Canada has critical national interests at stake in Afghanistan. Those interests very much parallel those announced by President Obama on March 27, 2009. This means – although few Canadians have thought about it – that Canada also has critical national interests in neighbouring Pakistan. That is a subject, however, for another day. Al Qaeda has not been defeated. Indeed, until recently, Al Qaeda held two Canadians in North Africa. Al Qaeda poses a threat to Canada – directly and indirectly. This cannot be ignored, nor can dealing with it responsibly be turned over to others. It is in Canada’s interest that Afghanistan and the bordering regions of Pakistan not again be used as a base from which global terrorist attacks can be launched: think of London, Madrid, Bali and Mumbai, as well as 9/11. This is Canada’s foremost interest in the region. And this entails continuing to make a military contribution, as well as assisting in strengthening Afghanistan’s government and its institutions so that the country can take care of itself in a few years. It is also in Canada’s interest to see stronger cooperation amongst the countries in the region, including China and Iran. Canada needs, however, to improve its focus on the essential elements.

Rahnema: To understand the complexities of the situation and avoid “oversimplification,” we first PHOTOGRAPH: the canadian press / STEPHEN THORNE

need to overcome historical misperceptions. The American “mess” I refer to has a much longer history than Bush not “finishing off Osama Bin Laden” in 2003 or so. It goes back to the latter part of 1970s – to the old superpower rivalries – when the Americans mobilized, unleashed and supported Islamic fundamentalists – among them their ally at the time, Osama Bin Laden. It is an indisputable fact that, after the Soviet defeat and withdrawal from Afghanistan, Americans too abandoned the country, leaving it in ruins and in the hands of religious/tribal warlords and the influence of the corrupt Pakistani military and Inter-Services Intelligence (ISI). And the mess did not end there, but rather continued after the US invasion of Afghanistan. The Americans’ full support in bringing back to power the fundamentalist Mujahedeen and criminal warlords, and putting in place an unpopular puppet government, are cases in point. The Pakistan situation is also part of this same mess. In both countries, Americans sought allies among reactionary forces and the military, and never tried to look for democratic and secular progressive forces. The mess is undeniably American, and unfortunately, Canada, among others,

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cies defending themselves against a threat posed – through much of the world by Al Qaeda – is a matter of national interest. The problem will not go away if it is simply ignored. The US made major mistakes when Bush decided to go into Iraq, rather than finishing off Osama Bin Laden when there was an opportunity to do so, but to say “the US has created this mess” is a tremendous oversimplification. I am all in favour of an independent foreign policy for Canada, and in favour of peacekeeping and peacemaking, but sometimes this involves the use of force. Helping build democracy, better governance, education and development are all good things to do. But they require a modicum of security. And security is on the decrease in Afghanistan. Moreover, there is, as mentioned, the very serious matter of Pakistan. Even if all foreign forces exited Afghanistan tomorrow, does that mean that the Taliban and Al Qaeda would down tools in the border regions, and now also Karachi? I think not.

It is in Canada’s interest that Afghanistan and the bordering regions of Pakistan not again be used as a base from which global terrorist attacks can be launched.

Canada should leave the military operations and the massive human and financial costs, and try to regain its traditional role and global status.

was dragged into it. It is also undeniably true that the world now faces a zealous adversary in Afghanistan and Pakistan – an adversary which, given the chance, would impose its obscurantist worldview. The formal alliance between the Taliban and Al Qaeda needs to be confronted very seriously. My point is that Canada, despite its tarnished image, can play a more important and more effective role in Afghanistan, thereby leaving the military operation to Americans, who can easily replace two battalions or so. If the Americans ‘win’ in Afghanistan – whatever that means – the only way to ensure that the country does not once again slip back into the hands of the Taliban or their successors is to support, develop and invest in the foundations of democracy. Canada should, and still could, support its allies through projects, programmes and efforts in Afghanistan that focus on economic and social development. Canada should leave the military operations and the massive associated human and financial costs, and try to regain its traditional role and global status. It also needs to get a better and more critical understanding of its development efforts, many of which have been wasted for lack of a clear vision and institutional constraints.

Smith: I fully agree with your history, Saeed. And we both agree that the real question is what should be done now, and by whom. My view is that Canada should end the current level and form of military engagement in 2011, but that it should be prepared to stay on militarily in a training role. Canada need not remain in a ‘search and destroy’ role. There will be security needs, however, and we have a responsibility to make a contribution. It would be too easy to say that we will only focus on democracy-building and development. Indeed, there are real questions which need to be asked as to how to do the latter effectively. Democracy and development require security. We also need to be more clear-headed about the prospects of separating Al Qaeda elements from the Taliban, and ‘extreme’ Taliban from ‘accidental’ or ‘opportunistic’ Taliban. And we need to think through what Canada can do (non-militarily) in Pakistan. As a member of NATO, the G8 and the increasingly important G20, Canada has a voice and some influence. Indeed, if it plays its cards well – working with other like-minded governments – it can have considerable influence. And while Canada does indeed have a history of peacekeepers, it also certainly has a long and proud tradition of a people who have fought where its interests and those of its closest friends are at stake.

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Rahnema: There is no doubt that, without security, and

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in face of the brutalities of the Taliban and Al Qaeda, no development project can become operational. You build schools for girls, they come and blow them up and summarily execute the teachers, as they have done so many times. (We should, of course, remember that this was also the policy of the Mujahedeen warlords in the 1980s – the same groups that are now in power.) No doubt, the situation is very complex, and it takes time and the right policies to resolve it gradually. One policy which is lurking around these days is the search for ‘good’ Islamist fundamentalists. The policy of rapprochement with ‘good’ Taliban, which points to the miserable failures of the American, Canadian and other NATO allies in Afghanistan, is misguided. It involves major concessions and compromises to these backward elements, and has serious implications for human rights – among them the rights of women. In terms of zealotry and ruthlessness, there are few differences between Al Qaeda and the Taliban, and indeed among the Taliban themselves. Obviously, I am speaking of their leadership, and not the operatives and orderlies who easily change sides depending on who is more powerful. This idea was first put forward by Hamid Karzai, who wishes to stay in power at all costs. The latest episode in this fiasco was his attempt to appease the Hezara and the Taliban through the legalization of one of the most archaic aspects of the Shari’a regarding rape within marriage. His move, however, created a backlash and led to condemnations by most NATO members. The policy of appeasing the Taliban was also followed by the Pakistani government in the Swat border region. Western governments, while they may rhetorically condemn these legalized sanctions, in reality do not seem to care much insofar as these can reduce their burdens in the region. This is where we witness the amazing hypocrisy of advocating ‘democracy for the Muslim world’ – while in practice giving concessions to Islamists and ignoring the secular forces of these societies, whose existence is even denied. We have witnessed this throughout the region. In Pakistan, where, as a result of more extensive and longer-standing development processes than those in Afghanistan, secular forces are stronger, the gradual Talibanization of some regions of the country has created a major backlash. After the recent public lashing of a young woman, we saw a series of demonstrations by women and men condemning the action and demanding the suppression of the Taliban. One can only hope that the post-Bush US Administration under Obama will recognize that aligning with corrupt civilian and military functionaries, and appeasing religious fundamentalists, will not solve the region’s ever-expanding crises. Empowering secular, progressive forces is the only solution to this ordeal. We should hope that the Canadian government will also do the same, and leave its lingering Bush-era foreign policy behind.

If you had a friend going through some tough times, how would you help? Last year, we gave our friend Chad

» We’ll call him

Chad

12 million dollars.

chad canada Would you just give your friend money or would you be

more creative?

The mainstream discussion about Canada’s relationship to Africa is how much money we should give. Is that creative? Of course we also trade with Chad and other African nations, but:

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Canada imports goods worth just $3,000 from Chad each year. How can we be more creative, realizing better trade relationships? Canada’s top export to 12 African countries is used clothing. How can we be more creative to not undermine the local textile industry?

Creativity requires connections. What if the people, universities, government, and businesses of Canada unleashed not just our money, but also our creativity, for a friend like Chad? 64

Ewb.ca/creativeconnections

The New Nuclear Century On the tenuous state and future of nukes, nuclear states and nuclear proliferation with the former Deputy Secretary-General of the United Nations LOUISE FRÉCHETTE Q Does Iran have a nuclear weapon? A I don’t think so, but it is certainly acquiring the capacity to have one if it so wishes. Q So what’s to be done about Iran (on the nuclear front)? A There is no magic solution to the Iranian challenge. I do not believe that military action would solve the problem, and it could have very dangerous long-term consequences. This leaves the diplomatic route. There is a need for a much stronger coalition if we want the pressure to be effective. China and Russia have sent ambiguous signals, and many leading developing countries have watched from the sidelines.

TÊTE À TÊTE

have stayed out of the Nuclear Non-proliferation Treaty (NPT) altogether, and there have been too many cases of breaches on the part of signatories: we had the cases of Iraq under Saddam Hussein and Libya, and now we are dealing with North Korea and Iran. We need more than the current piecemeal approach to shore up the NPT. We need to accelerate the pace towards total nuclear disarmament, and place uranium enrichment and reprocessing activities under some form of international control. Only a non-proliferation regime that is based on equal treatment for all countries will be sustainable in the long-run.

Louise Fréchette is a Distinguished Fellow at the Centre for International Governance Innovation (CIGI) and former Deputy Secretary-General of the UN. She is a member of the Advisory Board to the International Commission on Nuclear Non-Proliferation and Disarmament established by the governments of Australia and Japan in October 2008.

Q But it seems quite improbable at this stage that Iran will fold to diplomatic considerations. What does a world with a nuclear Iran look like? A Iran may not “fold to diplomatic considerations,” as you put it, but it could very well bend if it were submitted to intense, coordinated and unequivocal pressure from all major powers, as well as from its neighbours – which is not the case at the moment. If Iran were to acquire nuclear weapons, there is a high risk that other countries in the region would follow suit. Q What about North Korea?

A The non-proliferation is fraying at the edges. Three major countries

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A The six-party talks remain the best avenue. Good bilateral relations between the US and China are essential on this file. Q More generally, how robust is the existing international nuclear anti-proliferation regime?

Q Total nuclear disarmament? Is that at all realistic? A No one is talking about instant, unilateral disarmament. This will be a long process, requiring a high level of trust among nuclear power states, as well as robust verification mechanisms. It is admittedly a challenging proposition, but the alternative is not the status quo: it is the multiplication of countries with nuclear weapons capabilities. This is no doubt the reason why such hard-nosed experts like Henry Kissinger and George Schultz are now advocating complete nuclear disarmament, and why the American and Russian presidents themselves have put the issue back on the agenda. Q Looking ahead 15 years, how prevalent will nuclear energy be in the mix of international energy sources? A I do not see a major shift in nuclear energy’s share of the energy mix, but given the growth in energy demand that can be expected in the coming decades, just maintaining the current share will mean a significant increase in the number of nuclear power plants operating around the world. Current projections, even tampered by the current economic crisis, show a large number of new plants being built over the next 15-20 years. Q Which countries will emerge as winners as a result? Which countries as losers? A I do not think there is a question of winners and losers. The nuclear option will make sense for some countries and not for others. Countries with civilian nuclear programmes do not necessarily have an advantage over those that do not, except if they are highly vulnerable to disruption from their traditional energy suppliers. Q What are some of the key exogenous factors or shocks that could change some of the above futures?

A Many basic tools of international governance in the nuclear area already exist, but the treaties and conventions have to be better respected, and that includes practical steps towards full nuclear disarmament. The International Atomic Energy Agency, the central institution in nuclear matters, must also be given the means to fulfill its responsibilities to ensure that the spread of nuclear energy production is done in optimal conditions of safety, security and non-proliferation. Three specific new steps could be taken to strengthen the existing system: 1) achieve universal acceptance of more intrusive inspections by the IAEA under the so-called Additional Protocol, 2) achieve the entry into force of the Nuclear Test Ban treaty, and 3) negotiate a treaty to curtail the production of new fissile material necessary for the production of nuclear weapons. Q How would this strengthening impact non-state actors?

No one is talking about instant, unilateral disarmament. That will be a long process, requiring a high level of trust among nuclear states.

A The measures described above are intended to reduce the risk of proliferation by states. The risk coming from non-state entities like terrorist groups is not so much that they could lay their hands on an actual nuclear bomb, but that they could disseminate radioactive material by detonating a conventional bomb. There is already a fair amount of international cooperation on issues regarding the protection of nuclear installations and radioactive material, but more could be done to ensure that all countries take all necessary precautions. Q Who’s to lead in setting these best practices?

A Many countries have traditionally been in the forefront of international initiatives to strengthen international nuclear governance. Canada is one of them. As the number one producer and exporter of uranium, as a major exporter of nuclear technology, and as a country with strong historical credentials on issues of non-proliferation and disarmament, Canada is very well placed to play an active role on the international scene. These issues should go up the priority list of the Canadian government as it gets ready for the next review conference of the NPT in 2010.

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A I see two particularly important factors. One is technology. Technological advances that permit the production of cheap and green energy sources in the massive quantities required could make the nuclear option less attractive, especially for those countries primarily motivated by a desire to reduce greenhouse gases. The other is geopolitical developments. Major conflicts in energy exporting regions, escalating tensions in relations between exporters and importers, and disruptions caused by terrorist attacks could make the nuclear option more attractive for those concerned with energy security.

Q What are to be ‘best practices’ or key instruments – legal or other – in international nuclear governance in the coming decades?

THE DEFINITION

and management. Throughout all regions and countries, we must move quickly to train the leaders and practitioners who will manage the complex course ahead.” » John W. McArthur is the CEO of Millennium Promise, a Research Associate at the Earth Institute

The education of the international business or political leader of the future must... “include serious exposure to the art of the story. Films, plays, songs, and memoirs all tell stories, and the highest expression of story is the literary novel. Many people regard stories as mere entertainment. “I only read books of business and politics,” someone will boast. “I want to learn something.” But what we learn from non-fiction books has a brief shelf-life. What passed for state of the art knowledge in the fields of technology, science, business, and medicine, only a generation ago, is now regarded as obsolete. And much of the ‘factual information’ we now accept as gospel will one day cause our grandchildren to hoot with laughter. Ironically, facts are temporary, while fiction is as permanent as the rocks and the stars. If knowledge is the goal of learning, we will learn more from reading a Jane Austen or a Cormac McCarthy over breakfast than a fact-packed newspaper. And what we learn from good fiction will still be true twenty years from now. Educators have long known that kids learn more quickly if facts are buried in the medium of a story. They make society and behaviour intelligible. And, at its best, good fiction teaches us what it is to be human.” » Jake MacDonald is a Canadian journalist and

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author whose new book is entitled Grizzlyville.

“recognize that the common global agenda is not just multilateral, but also multi-sectoral. Essential priorities like macroeconomic coordination, food production, energy, climate change, security and disease control are deeply interrelated. A new generation of science-savvy generalists is needed to bridge the insights of specialists across health sciences, physical sciences, social sciences

at Columbia University and a faculty member at Columbia’s School of International and Public Affairs.

“sensitize them to ethical issues so that they recognize when they are raised; have some idea of how to go about dealing with those issues; and can identify when they need professional help to do so. Ethics education should encourage in our leaders open-mindedness without loss of principle; courage without loss of prudence – that is, wise ethical restraint; and use of all their ‘human ways of knowing’ without loss of analytic rigour. These ways include common sense; imagination and creativity; intuition (especially moral intuition); reason; ethics; ‘examined emotions;’ intellectual, emotional and spiritual curiosity, as well as its necessary companion, doubt; and experiential knowledge, which cuts across all our other ways of knowing. Ethics education should result in leaders seeing good ethics as essential to good business, and bad ethics as bad business – no matter how lucrative this might be. These future leaders would regard ethics as integral to their leadership, and not, as has often been the case, a requirement unjustifiably restricting their ‘right’ to do business or at best an ‘add-on’ for public relations purposes. They would also know that the ethical tone of an organization is set by a small handful of leaders at the top: if those people are ethical, the organization as a whole will be ethical – and strive to be ethical. If I had a wish list of values-virtues that ethics education might elicit in the international business or political leader of the future, it would include: the moral courage to say ‘no,’ even at financial or political cost to themselves or their organizations; the capacity to exercise wise moral restraint; personal and professional honesty, authenticity, integrity and trustworthiness; and the ability to engage their ethical imagination in such a way as to hold our world – which includes our ethics and values – in trust for future generations.” » Margaret Somerville is the Samuel Gale Professor of Law, Professor in the Faculty of Medicine, and founding Director of the Centre for Medicine Ethics and Law at McGill University. She is the author of The Ethical Canary: Science, Society and the Human Spirit and The Ethical Imagination: Journeys of the Human Spirit.

It is no longer possible for business or political leaders to be narrowly focussed; they must have a broad vision of the world. In an interdependent world, leaders must essentially train to be not only national citizens, but global citizens with a national passport. Understanding people across the boundaries will become a critical skill for our leaders, and ILLUSTRATION: CHRISTIAN NORTHEAST

their education must give them knowledge and understanding on a cross-cultural platform...” » Major General Muniruzzaman is the President of Bangladesh Institute of Peace and Security Studies. He specializes in South Asian security.

For the rest of this opinion, and those of marc kielburger, jack mintz, deszö horváth, lorna marsden, jennifer jeffs, yves fortier, tom quiggin, sujit choudhry, hugh segal and george roter, visit www.globalbrief.ca

G L O B A L B R I E F • M AY 2 0 0 9

“be comprehensive in nature, reflecting the current nature of globalization.

STRATEGIC FUTURES What will the Arctic end-game among competing countries and parties look like?

“C

reation of an international legal regime based on the UN Convention on the Law of the Sea. The differences are negotiable, and the issues manageable. And the new trend in Russia-West relations is quite positive. If it holds, the benefits of cooperation will outweigh any potential benefits from excessive competition.”

» Sergei Plekhanov is an associate professor of political science and Coordinator of the PostCommunist Studies Programme at the Centre for

G L O B A L B R I E F • M AY 2 0 0 9

International & Security Studies at York University.

“As the world witnessed on August 2, 2007, Russia planted a flag (literally) on the Arctic seabed – thus claiming parts of the Arctic to be sovereign Russian territory – an act which has been challenged by Canada, the US and Norway. These littoral states, as well as Denmark and Finland, and nonlittorals or ‘outsiders,’ such as China, Japan, and the EU, have looked at the Arctic as an area for possible new transit routes, energy supplies, and fishing grounds. Growing fossil fuel needs and depleted national fisheries are forcing countries to look for new areas of resource wealth. Climate change and innovations in technology (including seabed mapping, GPS and transportation) are making it easier for countries and private companies to explore the Arctic Circle. While outsiders are looking at the Arctic as a land (or sea) of opportunity, the littorals are quite concerned about the national security implications of what an actual ‘northwest passage’ through the Arctic and northern Canada may mean for increased commercial shipping traffic (and the corresponding increase in risk of major environmental damage), as well as increased naval military traffic (and the corresponding likelihood of increased intelligence and reconnaissance patrols). It is also not out of the question that dedicated terrorists could resort to entering Canada and the US through

extreme northern routes. Russia is the key player in determining whether the Arctic Circle or ‘High North’ will be an area of strategic competition or regional cooperation in the years to come. As Moscow continues to (unhelpfully) insert itself into the security affairs of continental Europe and the transatlantic alliance, there is an opportunity for Russia to play a constructive and non-confrontational role in working with the Arctic littorals and outsiders to promote a zone of security cooperation and smart environmental stewardship. Such an action by Moscow could very well mark a new beginning for North America’s and Europe’s relations with Russia. To do this, however, Moscow will have to officially and publicly accept that it shares the same security and environmental concerns as those of its neighbours, that partnering with the littorals is not a zero-sum game, and that Moscow is not in any way entitled to special rights or benefits to the Arctic seabed by virtue of its participation in a regional effort. This would be a significant and notable shift in Russian policy-making, and one that may very well make the difference as to whether the Arctic will remain peaceful. Absent this step by Moscow, the ‘Arctic endgame’ likely will be one that we have seen repeatedly in history: a costly economic and military struggle for resource accumulation and access to the sea lanes.” » Daniel P. Fata is VicePresident at the Cohen Group in Washington, D.C. and a Transatlantic Fellow at the German Marshall Fund of the US. From September 2005 to September 2008, he served as the US Deputy Assistant Secretary of Defense for Europe and NATO Policy.

“I doubt that Russia will turn out to be an efficient player in the ‘Arctic game,’ because it has no need to be. Most likely, Russia will be a ‘media player’ – promoting stories about expeditions, special ‘Arctic troops’ and advanced technologies developed especially for ‘Arctic climate.’ It will open many opportunities for different interests groups to gain funds from the Russian federal budget, but will, in turn,

be unable to provide real presence in the region.” » Leonid Kosals is a professor in the Higher School of Economics (Moscow), having also worked for many years in association with the Russian Academy of Sciences.

“There is no ‘end-game’ in the Arctic. Cooperation – not conflict – is the more accurate paradigm. With the exception of Hans Island, there are no sovereignty disputes over land in the Arctic. The unresolved differences concern a) coastal state jurisdiction over shipping in the Northwest Passage, b) the delimitation of maritime boundaries in the Barents, Beaufort and Lincoln Seas, and c) the extent to which each of the five Arctic Ocean countries has sovereign rights over the continental shelf more than 200 nautical miles from its shore.

photographs: associated press

There is no great cause for concern. Canada and the US have ‘agreed to disagree’ over the Northwest Passage while cooperating on maritime surveillance and pollution prevention. They – along with Denmark, Norway and Russia – have also agreed that overlapping continental shelf claims will be resolved according to the rules in the UN Convention on the Law of the Sea. As the sea-ice melts, all five countries are increasing their military presence. But the concern is with non-state actors – whether criminals, terrorists or companies skirting environmental rules.”

A Russian deep-diving mini-sub is lifted

» Michael Byers holds the Canada Research

from the water after

Chair in Global Politics and International Law at the

planting the Russian

University of British Columbia. He is a project leader

flag (oposite page)

with ArcticNet, a consortium of scientists from 27

under the North Pole

Canadian universities and five federal departments.

in August, 2007.

EPIGRAM

The Art of the Deal Final meditations on the wheel and deal BY DOUGLAS GLOVER

Douglas Glover is a Governor-General’s Award-winning novelist and short story writer. His last book was an extended essay on Cervantes and

G L O B A L B R I E F • M AY 2 0 0 9

Don Quixote.

A deal is not the ideal. We have some history in the Bible. Eve breaks a real estate agreement with God in the early chapters. Then there is that sharpish episode with Jacob and his brother Esau over birthright and inheritance. And Jacob was followed by Bernie Madoff – no, sorry, he comes later. We call people who sell illicit drugs on street corners ‘dealers.’ ‘Pork’ is the unsavoury little word used in America to describe lucrative (and often seriously tangential) side deals included in legislation to ensure its passage in Congress. There is also double-dealing, doublecrossing, dirty-dealing, fraud, AIG and mortgage derivatives – all bad, bad words associated with deals. Politicians and Wall Street traders and investment bankers all make their livings doing deals. We tend not to trust them, tolerate them at best – especially these days. A deal is not the ideal. In a perfect world, in heaven, where angels speak and everything is understood, there is no call for deals. Deals flourish under the sign of Babel and the category of time. They share the essential ambiguity of language and human nature: we try to be good, but have an unfortunate capacity for dishonesty, greed and an unhealthy will to power. Yet we live in a sea of ambiguity; it is impossible to function without it. George W. Bush, a Puritan and a fundamentalist in more ways than one, was afraid of ambiguity and refused to negotiate with Iran. In fact, he refused to negotiate with almost anyone except, oddly enough, North Korea. Barack Obama, in contrast, campaigned on the idea that he would negotiate with anyone, assuming, one guesses, that diplomacy is cheaper and less messy than Shock and Awe. One notices that the American press is suspicious of his trust in words, in negotiation, in making deals. Politicians are politicians, and we often disparage them for being good at the essentials of their craft – compromise, consensus and deal-making. But if you combine these with vision, a certain savoir-faire, elegance, a nice suit

and an appropriate stage, you become a statesman. One man’s pork-barrel politics is another man’s Nobel Prize. Blessed are the peacemakers and the few banks still willing to lend money, for they shall move us forward into the Promised Land or – dare we hope – another bull market. History is a wrecking yard of botched deals, yes. A deal is not the ideal. But deals are the gears of exchange: they make things work, they propel us into a future, willy-nilly, sanguine or otherwise. A good deal is a moment of clarity, of sudden understanding, of practical adjustment: one absolutely fascinating element of deal-making is the negotiation of functional equivalents between apparently incommensurable entities. There is art and elegance here, along with the ambiguity and the ever-present possibility that the guy you are talking to is a crook. Deals create their own hermeneutics, their own systems of definition, interpretation and appeal. They also create their own shadowy quasi-legal systems. Indeed, one of the prickliest elements of large-scale international deal-making is the procedure for inventing a high power (now that God and the gold standard have failed us) – a court of appeal, as it were, that supersedes the legal power of sovereign nations which recognize no power higher than their own. At a certain point, there are deals that seem to defy the law of gravity – floating in space above and between nations (and the UN). That hissing you hear late at night when the traffic dies down is the sound of money escaping from the credit default swaps market – a brilliantly nimble Dadaist system of deals that flourished briefly between common sense, greed and so-called worldwide securities regulations. Which is all to say, in the end, that the deal sits at the centre of everything that makes us human, at the centre of politics, business, criminality and love – for what is love but a deal between two hearts, a matter of trust, translation and a set of pragmatic equivalents? illustration: Jim Frazier

Mugunga camp for internally displaced persons, North Kivu, Congo, September 2008. CRISIS GROUP/NEIL CAMPBELL

Field-based analysis and highlevel advocacy to prevent conflicts. “We should all be thankful that we have an organisation like Crisis Group that contributes to peace and security in helping to resolve conflicts, to ring the alarm bells of the international community, and to be a mirror for the conscience of the world.”

INSIDE BACK COVER

Colin Powell, Former U.S. Secretary of State, 2008

G L O B A L B R I E F • M AY 2 0 0 9

www.crisisgroup.org

Any major conflict causes terrible human suffering – and is shockingly destructive of life, property and opportunity. The International Crisis Group has grown – from it’s modest beginnings in 1995 to become the leading independent source of analysis and advice on the prevention and resolution of deadly conflict – working to rid the world of the scourge of 7mass 3 violence, terrorism and war.

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