issuee 1547 EN

Ottoman Soft Power

In the Name of National Interest?

Picking Up The Pieces

Hugh Pope

Ammar Al-Hakim, President of the Islamic Supreme Council of Iraq

Manuel Almeida

Issue 1547, 01 March 2010

Friend or Foe?

By Michael Hastings

Editorial

Cover

Established in 1987 by Prince Ahmad Bin Salman Bin Abdel Aziz

Established by Hisham and Mohamad Ali Hafez

Editor-in-Chief

ADEL Al TORAIFI

Managing Director TARIK ALGAIN

Published by

Dear Readers, to The Majalla Digital, this week our issue brings W elcome to you an assessment of the upcoming Iraqi elections.

Michael Hastings, author of I Lost My Love in Baghdad: A Modern War Story argues that for Iraq the promise of a truly democratic state seems grim. In “Friend or Foe” Hastings explains that these elections will determine much of Iraq’s near future, not only the internal balance of power but also Iraq’s diplomatic relations with other Arab countries, with the US, and with Iran.

As a complement to Hastings feature, Hugh Pope’s article “Ottoman Soft Power” assesses Turkey’s importance in the Middle East.

Explaining that with EU membership still in sight, Turkey is using the same ideas that brought stability to post-Second World War Europe in an effort to calm the bitter divisions of the Middle East.

We invite you to read these articles and much more on our website at Majalla.com/en. As always, we welcome and value our readers’ feedback and we invite you to take the opportunity to leave your comments or contact us if you are interested in writing for our publication.

The Majalla Magazine HH Saudi Research & Marketing (UK) Limited Arab Press House 182-184 High Holborn, LONDON WC1V 7AP DDI: +44 (0)20 7539 2335/2337 Tel.: +44 (0)20 7821 8181, Fax: +(0)20 7831 2310

Sincerely, Adel Al Toraifi Editor-in-Chief 04

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Issue 1547

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Contents 08 Geopolitics Ottoman Soft Power

11 In Brief Around The World Quotes Of The Week Magazine Round Up Letters

18 Features Friend or Foe?

25 News Analysis Uncovered coup plots highlight the feud between Islamists and Secularists in Turkey

27 Ideas Shape up or Shake out

THE MAJALLA EDITORIAL TEAM London Bureau Chief Manuel Almeida Cairo Bureau Chief Ahmed Ayoub Editors Paula Mejia Stephen Glain Wessam Sherif Daniel Capparelli Editorial Secretary Jan Singfield Webmaster Mohamed Saleh 01 March, 2010

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32 People Profile A New Brand of Iraqi Leadership?

Interview

In the Name of National Interest?

Issue 1547, 01 March 2010

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57 The Political Essay Picking Up The Pieces

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Geopolitics

Ottoman Soft Power

Turkey’s importance in the Middle East is growing, both at the economic level—its economy is already more than half the size of the whole of the Middle East and North African region—but also politically. With EU membership still in sight, Turkey is using the same ideas that brought stability to post-Second World War Europe in an effort to calm the bitter divisions of the Middle East.

T

urkey’s negotiations to join the European Union may have faltered of late, but, in a little-noticed turnaround, it is now using the same ideas that brought stability to post-Second World War Europe in an effort to calm the bitter divisions of the Middle East.

Syria, Jordan, Libya and Lebanon have recently joined Iran and other regional countries enjoying visa-free business and tourism with Turkey. Ankara is also doing all it can to champion the integration of regional infrastructure, has successfully boosted trade with its neighbours, and is now even bringing governments together for joint meetings of senior Cabinet ministers.

This conversion to the basic EU idea of progress through interdependence is still in its infancy, partly because Middle Eastern regimes can fear that regional integration is a political threat. Turkey long shared this tendency too, until the end of the Cold War allowed its sense of security and commercial opportunity to rise. The centreright AK Party government, in power since 2002, has developed even further the country’s growing ties with Russia, Africa and particularly Muslim neighbours in the Middle East.

During the same period, Turkey’s relationship with the European Union has also sped ahead. Despite many obstacles—including Europe’s Turkeyskeptics, the slow pace of Turkish domestic reform, and the stand-off over Cyprus— Turkey remains in a full negotiating process that could plausibly lead to membership of the club in a decade or two.

The e apparently contradictory dynamics have reopened debate on the question of whether Turkey is becoming “European”, “Eurasian”, “neo-Ottoman”, or even “Islamic”. Few take into account the limitations of Ottoman Empire analogies, and the relatively predictable modern Turkish context. This debate is also too often a proxy for domestic political concerns – be it Europeans fearful about jobs, 01 March, 2010

cities, but serve more destinations inside Turkey than in Iran and Arab states. While two Turkish Airlines planes a day connect Istanbul and Damascus, four go to Tel Aviv.

Hugh Pope

immigration and Islam, Arab commentators seeking sticks with which to beat their own governments, or pro-Israel activists seeking to bring U.S. pressure to bear on Turkey.

In fact, the EU and the West in general, contrary to what some Europeans think, need Turkey partly for the stabilizing impact that it wants to have among its eastern neighbours. Ankara’s priority is not a reborn caliphate, but the expansion of an economy that is already more than half the size of the whole of the Middle East and North African region. When Prime Minister Recep Tayyip Erdoğan makes over-enthusiastic statements on visiting Khartoum, Tehran or Damascus, he is partly thinking of the contracts to be signed by the hundreds of business supporters who accompany him.

Similarly, when Erdoğan visited the United States last December, the main public result was a joint committee to boost trade.

AK Party leaders, even if they have left behind the Islamism of their youth, certainly feel a special warmth for fellow Muslim leaders. Some AK Party officials even talk of Erdoğan as the ‘representative of 1.5 billion Muslims’. But Turkey as a whole is more interested in Europe, and visitors to Turkish bookshops will search in vain for much about the Middle East.

Turkey actually sells proportionally less to the Middle East than it did two decades ago, a figure that represents less than a quarter of its total exports. The EU has long accounted for half Turkish trade, and for nearly 90 per cent of foreign investment in 2008. Some four million Turks live in Europe, vastly outnumbering the few tens of thousands in the Middle East. Turkish airline companies fly frequently to a dense web of European

Extraordinary praise in Arab newspapers for Erdoğan when he confronts Israel should also not be mistaken for Arab endorsement of Turkish regional hegemony. Arab envoys to Turkey say they are happy to see a fellow Sunni Muslim state act as spokesperson for their concerns and as a counter-balance to the rejectionist defiance of Shia Muslim Iran. But they say their governments can feel uneasy at Erdoğan’s outbursts of antiIsrael populism, and that they would reject any Turkish effort to do more than offer its good offices in regional disputes.

Turkey’s rising interest in its neighbours persuaded its leading think tank TESEV to ask 2,000 people in seven Arab countries what they thought. In November it published results that found that three-quarters of respondents were in favour of a high-profile role for Turkey in Israeli-Palestinian and other Middle Eastern issues. But 57 per cent said they wanted to see ‘a Muslim country’ in the EU, and 64 per cent believed that Turkey’s EU negotiation process had a positive impact on its role in the Arab world – including 62 per cent in Saudi Arabia.

Turkey also believes EU ideas can help heal the divisions of the region. The recent popularity of Turkish sitcoms and singers in the Arab world is not just because the two have grown closer once again. In a Turkey in which EU-inspired reforms and competition have helped open up society, the economy and culture, Turkish music and films are now simply much better made – and win more prizes in Europe too.

Istanbul based Turkey/Cyprus Project Director for International Crisis Group.

Author of books on Turkey and the Turkic world, as well as the forthcoming “Dining with al-Qaeda: Three Decades Exploring the Many Worlds of the Middle East”.

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Issue 1547

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In Brief Around The World

Quotes Of The Week

Magazine Round Up

Letters

Israeli spying network exposed in Lebanon Six people accused of spying for Israel were arrested by the Lebanese Army during four separated raids.

The suspects are believed to have provided Israel with information about Hezbollah's members and their movements. Advanced communication devices were found in the possession of the suspects.

The arrests were described by senior Lebanese officials as a major blow to Israel's spying networks in Lebanon. The suspects are said to have had a crucial role in the identification of the Hezbollah targets bombed during the 2006 Issue 1547

war. Moreover, other suspects have been accused of monitoring senior Hezbollah officials and are alleged to have played a role in the assassination of the commander of the group in 2004.

While Israel refused to comment on the arrests, Hezbollah figures have called for the death penalty for all suspects convicted of spying. Lebanese arrests had begun in April 2009, and involved a former brigadier general of the General Security directorate.

Arrests ranged from a garage

owner who supplied Hezbollah with vehicles secretly fitted with tracking devised to a Lebanese army general who ran a housecleaning service.

While some of the arrested personnel have been recruited during the 2006 war, some are said to have been spying form Israel since the 80s.

The incident comes as a continuation to the saga of intelligence mishaps suffered

by Israel, triggered last month by the Murder of Hamas' figure in Dubai under claims of Israeli involvement.

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In Brief - Around The World

Around The World 6 9

3 Iran 1 Saudi Arabia Saudi Arabia is planning to bring in a new law to allow women lawyers to argue cases in court for the first time. Justice Minister Mohammed alEissa said the law was part of King Abdullah's plan to develop the legal system.

2 Japan Japan has offered to enrich uranium on Iran's behalf . Iran has not yet responded officially but its parliament speaker Ali Larijani said the offer would be discussed in a meeting with Japanese Foreign Minister Katsuya Okada in Tokyo.

01 March, 2010

Iran says it has irrefutable evidence confirming that terrorist ringleader Abdolmalek Rigi had been aided and abetted by the US government before his arrest.

Iranian security forces said he was at a US base in Afghanistan 24 hours before his capture and had a forged Afghan passport issued by the US in his possession when he was detained.

4 Thailand The anti-government United Front for Democracy or red-shirted people will start from March 12 Traveling to Thailand's capital Bangkok to hold a major rally .Their political demand includes resignation of the coalition government or the House dissolution paving the way for a new general election.

5 Iraq The Iranian ambassador in Iraq, Hassan Kazemi Qomi, said he expects Iraq’s upcoming parliamentary election to result in a strong parliament and government.

Qomi indicated that the enactment of the Iraqi constitution and the formation of an Iraqi parliament and government were the most significant achievements during the past period.

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In Brief - Around The World

8 Burma

2

7 5

3

1

8

9 Nigeria

4 10

Nigeria’s Senate and House of Representatives voted to give Vice President Goodluck Jonathan the powers of president, a move aimed at ending a two and a half month political crisis that has sparked unease .The measures set the stage for the temporary transfer of power from President Umaru Musa Yar’Adua, who has been undergoing medical treatment in Saudi since late November.

10 South Korea

6 Mexico Leaders of more than 30 Latin American and Caribbean nations met in Mexico to form a group that will serve as an alternative to the Organization of American States.

The main difference between the OAS and the yet-to-be-named organization will be that the United States and Canada will not be members.

Issue 1547

A United Nations special envoy to military-ruled Burma (Myanmar) ended a five-day visit to monitor human rights there without being allowed to meet its most famous political prisoner, Aung San Suu Kyi. Tomas Ojea Quintana said he “deeply regretted” not being allowed to see the detained opposition leader.

He also said the junta had given him no indication on the timing or framework of parliamentary elections that it plans to hold this year.

7 Afghanistan The collapse that occurred recently to the Dutch government in a dispute over demands to withdraw the country’s troops in Afghanistan has reinforced fears that NATO’s front is crumbling, and that other western nations may bow to mounting public pressure to withdraw their forces.

South Korea had proposed holding working-level military talks with North Korea on February 23 to discuss those issues at the truce village of Panmunjeom. In a counter proposal sent to Seoul by fax, Pyongyang requested that the talks take place March 2 at the Gaeseong Industrial Complex, a spokesman of the Ministry of National Defense said.

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In Brief - Quotes Of The Week

Magazine Round Up

Quotes

Of The Week "The United Nations Security Council should be sidestepped if it cannot agree on the move"

Israeli Prime Minister Benjamin Netanyahu calling for an immediate embargo on Iran's energy sector

"We should begin the construction of two enrichment sites next year. In the two new sites; we plan to use new centrifuges."

Ali Akbar Salehi, Head of the Iranian Atomic Energy Organization

"Syria has to adopt IAEA's Additional Protocol, which permits unfettered inspections beyond a declared nuclear site to check out any covert atomic activity" IAEA DirectorGeneral Yukiya Amano

"We are committed to the nonproliferation agreement between the agency and Syria and we only allow inspectors to come according to this agreement" Syrian Foreign Minister Walid al-Moualem.

01 March, 2010

1

Magazine Round Up 1 Time Washington’s Vicious Circle.

As Ronald Brownstein’s latest book ‘The Second Civil War’ notes, American politics are currently defined by the polarization of government which has crippled progress and resulted in a loss of public faith in Congress.

The first year of Obama’s Presidency has been marred by bipartisan squabbles which have stymied ambitious plans to overhaul healthcare.

The revulsion towards Washington has seen the fledging ‘Tea Party’ movement—a collection of conservative factions united in hostility towards Washington. This article looks how breaking this circle of mistrust and government failings could be achieved and how it developed initially. The author concludes that the re-introduction of a third party voice is necessary to jolt the political system and force the two dominant parties to address their differences and come together.

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2 Newsweek The Charge of the Republicans.

2

Newsweek’s leading article continues the popular theme of the increasingly paralyzed state of Washington. The bickering that plagues Congress has seen numerous bills abandoned and recently long standing senator Evan Bayh resigned citing the increase in partisanship. The absence of a coherent agenda in Washington is a result of the Republican party doing their utmost to derail the plans of the Obama administration. Yet Newsweek suggests that the two parties actually have more in common than they would like to believe and argues that if the Republicans were in charge of the country, much of their policies would resemble the current policies.

3 Standpoint Why Afghanistan must not be abandoned to the Taliban.

Michael Nazir-Ali discusses the situation in Afghanistan and calls for the international community to hold its nerve and refuse to withdrawal from military activity in the country. Nazir-Ali views a sustained military campaign as the only means by which the spread of the Taliban can be halted.

He makes an unusual and somewhat comparison with Marxism to argue that not since the demise of this movement has the world been faced with such an ambitious ideology. The writer is highly supportive of the current American policy in the region and suggests that the possible implementation of democracy would be an important gain for those living in the region.

Cover Of The Week

3

Cover of the Week The NewStatesman

Nuclear Iran

Barack Obama’s hopes to launch a new epoch in relations with the Islamic Republic have stalled and a year on from his coming to power, a stalement prevails. International fears as to the spectrum of an Iranian nuclear bomb have recently increased. Accordingly The New Statesman’s David Patrikarakos interviews Iran’s atomic ambassador to find what has derailed the possibility of bilateral progress and finds relations to be as tense as ever.

The steadfast commitment of the Iranian government to the continuation of its nuclear programme is at odds with the aims of Obama’s administration and has led to prospects of harsh sanctions by the West. Iran’s Ambassador dismisses such a possibility and asserts that the West must learn to accept a reality in which Iran has styled itself as the so called ‘master of enrichment.’

Issue 1547

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In Brief - Letters

Letters

LAST ISSUE

Protecting Marianne

A Tale of Survival and Broken Promises

Today’s concerns about the niqab go far beyond secularism.

I agree with Sarkozy when he said "The Burqa is not a religious sign. It is a sign of subservience, a sign of debasement

I disagree to some extent with the writer. Dubai crisis has had economic and political implications for the region and the whole world. While Dubai is not big enough to set off financial repercussions outside the Middle East, the main fear is that investors could flee risky markets all at once in search of safer havens for their money

Ali Idris

01 March, 2010

Safiy Helal

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In Brief - Magazine Round Up

Issue 1547

15

Features

Š getty images

01 March, 2010

18 18

Friend or

Foe?

By Michael Hastings

Issue 1547

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Features

Friend or Foe? Michael Hastings

Too many disruptive and unpromising events have been going on just before elections in Iraq, and the promise of a truly democratic state where the rule of law prevails seems grim. These elections will determine much of Iraq’s near future, not only the internal balance of power but also Iraq’s diplomatic relations with other Arab countries, with the US, and with Iran.

Iraqi women walk past campaign posters for the upcoming general elections in Baghdad

a recent Saturday night in O nBaghdad, four workers for

a newly formed Iraqi political party, known as Ahrar, tried to put up posters of their candidate in Sadr City. Before finishing the job, they were detained for 24 hours by an Iraqi Army unit. Three days later, in the northern city of Mosul, five of Ahrar’s campaign workers were interrupted while erecting a 12 by 5 metre billboard—unknown gunmen opened fire on them.

The following morning, one of the candidates running on their list was ambushed by an armed 01 March, 2010

militia in the eastern province of Maysan—the candidate escaped but one of his bodyguards was killed. “It is an extremely disturbing situation we have, once again, been faced with,” Ahrar’s leader, Jamal Ayad Aldin said.

“The current government and our opponents will stop at nothing to prevent a fair and democratic election.”

The Ahrar Party’s campaign experience in the run-up to Iraq’s national elections, scheduled

© getty images

for March 7th, is not atypical.

That same week, a string of bombs went off across Sadr City, exploding outside the offices of four high profile Sunni parties, injuring two. The campaign season has been punctuated by massive car bombings targeting government buildings, which have killed over 600 people.

Employees of Iraq’s Independent Election Commission have been victims of assassinations and kidnappings, and over the past three months, political candidates across the country 20

Features have campaigned in fear, as dozens have been targeted for politically motivated killings.

As if persistent violence wasn’t enough of a threat to the elections, the government in Baghdad hasn’t helped much, either, pushing forward on a controversial decision to ban over 400 candidates—mostly secular politicians and Sunnis— from running. This move, which angered the Sunni community and caused one major political party to suspend its campaign, was viewed as a way for the Shiite Islamist parties in government to consolidate their power and get rid of their most powerful secular political rivals.

The public appetite for the vote, too, appears to be greatly diminished. Though reliable polling data is hard to come by, there is plenty of anecdotal evidence. Food ration distribution centers in Baghdad are responsible for handing out voter cards—on a recent visit to one of these shops at a neighborhood in Baghdad, the man in charge said he had only handed out approximately 300 of the 1,400 cards available to eligible voters. “No one cares about this election,” he told me.

“The only people who have picked up cards work for the government.” A Kurdish election official admitted in an interview that, if given the choice, she would “vote for Saddam Hussein.

Ninety nine percent of the people in this office would vote for Saddam if he was on the ballot.”

Baghdad itself has an uneasy, tense, feel to it. An article this week in one Iraqi newspaper, As-Sharq Al-Aswat, said that “Baghdad does not look much different from when it was on the brink of civil war in 2006,” with Issue 1547

sectarian tensions resurfacing as political parties vie for votes among their sects.

The turmoil has added up to an election crisis in Iraq. A botched election, American and Iraqi officials warn, will threaten the country’s fragile security.

If the new government resembles the current government, then it would seem there won’t be much real interest in reconciliation or accommodating one’s political opponents Sectarian violence—which killed tens of thousands of Iraqis during two years of brutal fighting from 2006-2008—could flare up again.

President Barack Obama’s plan to withdraw to 50,000 troops by the end of August could get sidetracked. More importantly, if the government that gets elected is seen by the public as illegitimate and overly sectarian, the stage will be set for another round of bitter fighting after the Americans leave.

Perhaps the most troubling aspect of this election is what it tells us about the next one in 2014. If the new government resembles the current government, then it would seem there won’t be much real interest in reconciliation or accommodating one’s political opponents. What are the chances that in four years, when American influence has diminished even more, that Shiite Islamist

government will be more willing to compromise with its enemies?

Almost every recent signal suggests that a Shiite Islamist government in Baghdad will use its political power not to strengthen Iraq’s democratic institutions, but to strengthen their own power and strangle any opposition party that stands in their way. In fact, we might be witnessing Iraq’s last election, the final gasp of an always suspect democratic process before a return to a more familiar authoritarianism.

Trying to make sense of the ever shifting, violent and often opaque swamp of Iraqi politics is a daunting challenge. However, during interviews with dozens of Iraqi politicians, American diplomatic and military officials, scores of regular voters, as well as the top advisers to the prime minister of Iraq, an unsettling picture emerges. This election will bring in the sixth—yes, sixth—change of government in a seven year period, which has certainly helped create this tremendous political instability.

Despite America’s hope that Iraq is on the path towards a society governed by a “rule of law” and political system buttressed by strong institutions, the reality is that the country still operates on a politics of personality. Whether something is legal or illegal is almost irrelevant. What can be done, and what will be done, is not based on legal or institutional grounds but the force of the political personalities, the parties behind whatever action is being taken, and the armed groups backing them up.

Here are a list of the players, the political blocs, and few possible scenarios for an election 21

Features that CENTCOM commander General David Petraeus called “enormously important.”

Prime Minister Nouri Al-Maliki: Maliki is the accidental Prime Minister. Relatively unknown when he came to power in April of 2006, he was considered a comprise candidate—a weak Shiite, who, the political parties believed, could be easily pushed around. No longer. He made his reputation by bringing relative security back to the streets of the country, doing serious damage to the Sunni insurgency and Al-Qaeda, and standing up to Moqtada Al Sadr’s Shiite militia in Basra. Nowadays, he’s mostly criticized for being too powerful, a leader on his way towards authoritarianism. His critics regularly call him a “dictator.”

Six months ago, Maliki was considered a shoe-in to keep his job as Prime Minister. He was riding high off provincial elections victories where his State of Law Party cleaned up, a win that seemed to indicate an end to sectarian politics and a return to a political culture based on a secular, national, Iraqi identity.

But then a series of high profile bombing damaged his security credentials, killing hundreds and sparking anger against government incompetence and corruption. His moves to reach out across sectarian lines also backfired. He angered members of the Islamic Supreme Council of Iraq—the largest Shiite religious party—and followers of Moqtada Al-Sadr when he refused to join their political coalition this past fall. This in turn angered Iran— which gave its blessing to the Shiite coalition—leaving Maliki with few Shiite allies.

01 March, 2010

He reached out to Sunni leaders, too, but he wasn’t able to get any of the more popular politicians to team up with him. On the international stage, he’s had very poor relationships with Saudi Arabia and Syria, while the Americans continue to have lukewarm feelings about him.

This has left Maliki, as one of his top advisers told me in an interview last month, in very difficult political position, surrounded by and under siege by his enemies. “He’s placed himself over the fire,” his adviser said. “Who knows where we are going to be next month.”

Six months ago, Maliki was considered a shoe-in to keep his job as Prime Minister Maliki, his advisers told me, has chosen a strategy to essentially run on his name alone. It might work—he’s is still the most popular politician in Iraq. This could produce a scenario where Maliki gets the most votes but, because of the way Iraq’s parliamentary system is set up, he won’t be able to cobble together enough of a political bloc in parliament to get himself elected prime minister.

Ahmed Chalabi: Chalabi—once a Pentagon ally who supplied the United States with faulty intelligence about weapons of mass destruction, easing the way

towards the invasion of Iraq—has resurfaced as powerful player in Iraqi politics. As head of the Truth and Accountability Commission (formerly the Debaathification Committee) Chalabi, according to U.S. officials, tried to engineer the disqualification of some 500 candidates from the ballot, claiming that they had ties to Saddam Hussein’s Baath Party.

US officials now claim that Chalabi is an Iranian agent, and the ban was the brainchild of Tehran.

Chalabi’s ban prompted the current political crisis, and US Vice President Joe Biden paid a visit to Baghdad to personally intervene. But the fate of the barred candidates still remains unclear. Because they were largely secular candidates and Sunni politicians, Western officials worry that the country could see a repeat of the 2005 elections, after which the Sunni population felt disenfranchised, leading to widespread sectarian fighting and nearly three years of full blown civil war. No matter the result, expect Chalabi to remain an influential player within the Iraqi government for years to come.

Ayad Allawi: Former Prime Minister Ayad Allawi is again being considered the Great Secular Hope for the country.

As in 2005 election, according to U.S. officials, Allawi appears to be polling well. The trouble is, the polling numbers were not reflected in the result last time, apparently due to a sampling bias of educated, Western-friendly, secular, Iraqis (Allawi performed very disappointingly in the 2005 elections).

22

Features Allawi’s Iraqiya list—the largest secular bloc—was also the list most affected by the candidate ban. They lost one of their most popular figures, Sunni politician Saleh Mutlaq. In response, Allawi has suspended his campaign, and is sending signals that he might boycott the election if Mutlaq isn’t allowed to run. Allawi warned last week that if the election continued as is, it would set the country up for “sectarianism and on the route to civil war.”

The Islamic Supreme Council of Iraq and the Sadrists: The largest Shiite alliance performed poorly in the provincial elections. Now they’re desperately trying to make up ground and keep their grip on power in the national government. The reason for their unpopularity: ISCI, in particular, is widely viewed as a proxy of Iran, an image that wasn’t helped when the talks for the alliance took place in Tehran, with the blessing of that regime.

view as most important—Kirkuk, the disputed oil rich northern city that is divided between Arab an Kurd. The Kurds claim Kirkuk as their own, including it in the boundaries of Iraqi Kurdistan, part of Iraq that is nearly its own independent country already. The Arabs say they have as much right to Kirkuk as the Kurds, and accuse the Kurds of resettling Kurds in Kirkuk to inflate the Kurdish population there.

Although relations with Maliki have been frosty recently, political observers speculate that a post-election partnership with Maliki’s party might be possible if neither group has enough seats to form a government.

American officials consider Kirkuk one of Iraq’s existential issues: a problem with no easy fix that is unlikely to be solved anytime soon. US military officials worry that the Kurdish and Arab tensions over Kirkuk could break into a shooting war, threatening both Iraq and the region’s stability. This almost happened this past summer, with Kurdish forces facing off against the Iraqi Army. The US then instituted a joint Kurdish and Arab patrol plan along the so called Green Line, the boundary between Iraq and Iraqi Kurdistan.

The Kurds: The Kurds are guaranteed at least 40 of the 325 seats, and are expected to get close to 60. Despite internal differences, they are planning to present a unified front in Baghdad. Whatever the outcome of the election, the Kurds will be crucial in determining the next prime minister, embracing their role as the so-called kingmaker.

The Kurds will likely throw their support behind a candidate they think will be most willing to give them concessions on the issue they Issue 1547

The Kurds are guaranteed at least 40 of the 325 seats, and are expected to get close to 60

Certainly, in the coming decades, Kurdish leaders plan to officially break away from Iraq, so a violent conflict might be unavoidable.

The

Americans:

The

blunt

talking US Ambassador to Iraq, Christopher Hill, has been tasked by the Obama administration with overseeing the transition of the American role in Iraq to one of relative normalcy— that is, to forge a more normal diplomatic relationship between the two countries. That’s still a ways off—he’s played an active role first in passing the election law, and then in trying to resolve the dispute over the candidate bans. Expect Hill to be working overtime during the government’s formation process, which, the ambassador has already warned, is likely to take many months.

General Ray Ordierno, commander of all US forces in Iraq, has moved ahead with withdrawal plans despite the continued violence. There are now only 100,000 troops left in Iraq—the lowest at any point during the war. The Americans have convinced themselves that they’ve won the war, and are pushing hard to send the message home that the war has ended—just this week, the military announced a name change for their mission, from “Operation Iraqi Freedom” (which has been the name since 2003) to “Operation New Dawn”.

And, it’s true, for the US, the war is winding down—the question is if the elections will end the war for Iraqis, or if it will be a step towards reigniting the conflict.

Michael Hastings – author of I Lost My Love in Baghdad: A Modern War Story, recently released in paperback, and regular contributor to GQ.

Michael Hastings - Author of I Lost My Love in Baghdad: A Modern War Story, recently released in paperback, and regular contributor to GQ. 23

01 March, 2010

News Analysis

Uncovered coup plots

highlight the feud between Islamists and Secularists in Turkey Issue 1547

25

News Analysis

Uncovered coup plots highlight the feud between Islamists and Secularists in Turkey Wessam Sherif

R

uptures within the Turkish political matrix have widened following the discovery of alleged military plans to overthrow the government in 2003 backed by wiretap evidence. Consequently, four admirals, two staff colonels and an army general were jailed based on the ruling of a court in Istanbul, in addition to the detention of 50 commanders. Among the detainees was the former deputy armed forces chief and retired commanders of the navy and air forces. Furthermore, General Ilker Basbug has postponed a trip to Egypt based on the ongoing investigations.

The coup plan is believed to have been aimed at discrediting AKP’s strategies, showing the Turkish government to be inept under their rule. Codenamed "Balyoz" (Sledgehammer), the plan was to escalate conflict with Greece by compelling Greek jets to shoot down 01 March, 2010

a Turkish plane over the Aegan Sea, in addition to bombing two mosques and a museum in Istanbul disguised as Islamic fundamentalists.

The head of military has denied these allegations, wondering "how could an army that chants 'Allah' when ordering its troops into battle be the same one that could possibly bomb a mosque and injure Muslims at prayer". However, he mentioned that these allegations do seem to have foundations and that is why the investigations are underway.

Several other senior military officials have also been detained based on charges of their involvement in a separate plot to overthrow the government by a rightist group known as "Ergenekon".

Many of the opposition figures have described the detentions as nothing more than an AKP vendetta against

the opposition. "This is not a legal process. This is apparently a sheer process of political showdown," declared the head of the opposition Republican People's Party, Deniz Baykal.

The court ruling has inflamed the situation in the already polarized domestic situation in Turkey.

Secularist opposition has been constantly at odds wit the ruling AKP party that came to power in 2002 and has originally emanated from a now banned Islamist movement. Turkish Prime Minister, Recep Tayyip Erdogan, has significantly curbed the secular backed military power in enforcing a civilian conduct, backed by EU support. Critique to the government accordingly claims that the ongoing case is a tool used by Erdogan to target political opposition in the country.

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Ideas

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01 March, 2010

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Shape Up

or Shake Out By Ranj Alaaldin

Issue 1547

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Ideas

Shape Up or Shake Out The Shia Political Landscape in Iraq's 2010 Elections Ranj Alaaldin With elections in Iraq approaching, various questions dominate the possible outcome of this event. Will sectarianism dominate over secularism? Will centralism dominate over federalism? The answer will depend on what Iraq’s majority Shias vote for and what Iraq’s Shia-dominated parties end up supporting. Iraq’s diversity could end up being the country’s greatest asset and as a result the greatest impediment to attempts to consolidate any sectarian hold on power.

Iraq's former Shiite Muslim prime minister Ibrahim al-Jaafari (2nd L) waves to his supporters upon his arrival at an election campaign rally organised by his National Reform Movement

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will head to the polls I raqis for an eagerly anticipated

election that takes place after months of countless controversies.

Parliamentary deadlocks, terrorist attacks and the banning of electoral candidates are just a few of the problems that threatened to derail the elections in recent months.

Perhaps the most important question regarding the elections 01 March, 2010

is what sort of shape Iraqi politics will take after the elections: will sectarianism dominate over secularism?

Will centralism dominate over federalism? The answer will depend on what Iraq’s majority Shias vote for and what Iraq’s Shia-dominated parties support in the end.

Political scientists often highlight

that division within majority identity groups is essential for stability in highly diverse societies. Potentially a harbinger of good news then, were the cracks beginning to show when Prime Minister Nouri al-Maliki’s State of Law coalition was not included in the final, grand-Shia coalition, the Iraqi National Alliance (INA).

Hoping to lead a nationalistic, 30

Ideas cross-sectarian coalition, Maliki did not acquire the key Sunni and Kurdish figures he hoped to have on board. To compound matters further, terror attacks in the country have hurt Maliki’s security credentials and, therefore, his main (if not only) campaign platform.

As a result, the premier stands vulnerable to the political force of the larger, essentially sectarian, INA. The INA is lead by the Tehran born Islamic Supreme Council of Iraq (ISCI) and includes Muqtada alSadr’s Free Bloc (al-Ahrar), which commands significant loyalty among Iraq’s Shia poor and whose candidates achieved impressive results in the 2009 provincial elections. The INA, which also includes former premier Ibrahim Jafari, collectively achieved 28.2% of the votes in the 2009 provincial elections. The State of Law achieved 28.6%. The contest in the Shia south will, therefore, be a close and hot one.

Although the intra-Shia divisions will have left the impression that the two most prominent Shia groupings will need cross-sectarian alliances after the elections, recent developments have suggested otherwise. Both the INA and State of Law supported the move to ban hundreds of suspected Baathist electoral candidates, with the most high-profile and controversial being that of Salah al-Mutlaq.

The impact of the ban could lead to regression for the Iraqi state, since sectarian tensions may end up dictating the vote instead of other issues such as the lack of basic services, employment and security. Also, having the politics marred by an apparent Shia battle against the Sunnis, may largely be Issue 1547

in the interests of the ISCI and the Sadrists sectarian groupings. This may have ultimately prompted Maliki and his Dawa Party to move away from its secularist stance that proved fruitful in last year’s January provincial elections.

Having said this, nothing is ever what it seems in Iraqi politics.

The importance of other coalitions that include significant Shia but essentially secular figures should not be dismissed. Despite the ban on Mutlaq and the withdrawal of his party, the National Dialogue Front, from the elections there are a number of serious players that may yet produce a few surprises.

Mutlaq may end up being a political martyr, which could then translate into votes for Ayad Allawi’s Iraqi National Movement (INM), which Mutlaq was to run with. Ayad Allawi is also expcted to attract the secular Shia vote.

More broadly, a Mutlaq ban could turn out to be advantageous for other groups like the Unity of Iraq Alliance (UIA), led by Shia Interior Minister, Jawad Bolani and major Sunni figure Ahmed Abu Risha, the leader of the Anbar Awakening force.

Coalition building will be an important factor after the elections as much as it was before. Take for example Maliki’s decision to fiercely criticize the US-backed decision to postpone the banning of the electoral candidates, despite initially refusing to be drawn into the affair. The premier may have made this move in anticipation of a possible INA victory, but, at the same time, has also been at the centre of recent positive developments in the usually gloomy Kurdistan-Baghdad relations (for example the decision

to resume Kurdish oil exports and Maliki’s recent positive references to federalism). Maliki may well be preparing the ground for a possible coalition with the Kurds, who stand united in Baghdad and who will be sought-after coalition partners.

They may end up being pivotal for another Maliki premiership.

Moreover, the INA is essentially an alliance of convenience, one of unlikely bedfellows that recognized their inability to individually pose any serious challenge to Maliki’s State of Law. Critical to this aim is that Ammar al-Hakim’s federalist ISCI and the centrist Sadrists have a history of competition and violent confrontation. Tensions were on display in recent weeks when the two entered a war of words over armed resistance to the US presence in Iraq. Their coming together will have been largely influenced by Iran. In the postelection environment, however, it is almost certain that the INA will disintegrate, leaving everything up for grabs as the post-election coalition building process takes place and the political framework in the country settles. The INA also contains numerous strong, ambitious personalities vying for the premiership and this may become a further dividing factor after the elections.

Iraq’s diversity could end up being the country’s greatest asset and as a result the greatest impediment to attempts to consolidate any sectarian hold on power. Much, however, will depend on Iraqis themselves, and their votes.

London-based researcher specializing in Iraqi politics 31

01 March, 2010

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People

A New Brand of Iraqi Leadership?

Ammar Al-Hakim Š getty images

Issue 1547

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People - Profile

A New Brand of Iraqi Leadership?

Ammar Al-Hakim Even though Ammar al-Hakim is not running in the upcoming elections, he is on path to become Iraq’s new power broker. Against the fears that Hakim will certainly provide Iran with a bigger footprint in Iraqi politics, there is the recent up-shift from a sectarian leader to national politician.

The aftermath of next week’s election will test how real those fears are.

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T

he March 2010 elections in Iraq will mark the second parliamentary election held in the republic’s history, and will determine who will lead the country through a period of transition and change after the American troops withdraw in 2011.

With the expected election coming next week, the leadership of Iraq is genuinely contested.

As the leader of the strongest opposition coalition, Ammar al-Hakim has the potential to become the new power broker in Iraq, at the vibrant age of 38.

Hakim is representative of a new brand of political leadership active in Iraqi politics today. He is a departure from the present Arab political elites in the region. His transition from purely a sectarian leader to an aspiring national leader reflects a wider departure from divisive identity politics in Iraqi politics.

01 March, 2010

Remarkably, he has chosen to not even run in the new election as an individual candidate. His presence in the upcoming election’s cannot be ignored though, and any keen observer of Iraqi politics knows that a victory of his coalition will certainly lead to him becoming the most powerful man in Iraq.

Born in the Iraqi city of Najaf in 1971, Ammar al-Hakim experienced violence and tragedy at a young age.

In 1979, after Saddam Hussein’s security services executed most of his extended family, the eight-year old Hakim, his father, Abdul Aziz, and his uncle, Mohammad Baqer, fled to Iran.

Growing up in the new Islamic republic, Hakim was educated in Tehran, and in the holy city of Qom at the Islamic Arabic University. Hakim excelled in his studies, and showed a mastery of the Qur’an and Shiite religious texts.

His oratory skills were noted as well with many people recollecting that from a very young age, Hakim recited prayers to tightly packed audiences in mosques and at holy festivals across Iran. After his graduation, Hakim began an academic and clerical career in Qom. Hakim also became exposed to politics during his formative years in Iran. At the height of the Iran-Iraq war, his father and uncle established the Supreme Council for the Islamic Revolution in Iraq. This organization sought to establish a new Islamic Republic in Iraq and had support from the late Ayatollah Khomeini. Since that revolutionary period, the Council has moderated its outlook and rebranded itself as the Supreme Islamic Iraqi Council.

With the fall of Saddam Hussein’s regime, Hakim and his father and uncle 34

People - Profile returned to Iraq in the early months of 2003 to help shape Iraq’s emerging political future. His uncle’s violent death in a car bombing in Najaf in August of 2003 was a terrible reminder of the challenges facing Iraq. Through the Supreme Islamic Council, Hakim and his father sought to mobilize the Shia community and consolidate their community’s position as the leading political voice in Iraq. It quickly grew to become the largest and one of the most influential Shia political party’s in Iraq.

Upon his arrival, Ammar al-Hakim witnessed the pain and suffering of the Shia community. In response, he established the Shaheed al-Mihrab Foundation to help address the absence of social services and economic support in his Shia homeland. Since its inception, it has constructed over 400 mosques in Iraq, and established a number of schools in his birthplace Najaf. Through offering social services and economic support to the Shia community, the Foundation has helped deepen and widen his support base.

With his father’s declining health, Hakim became the acting leader in May of 2007. At the time, he envisioned the future of Iraq largely through the lens of sectarian politics.

He considered a Shia federation in the southern Iraq autonomous from Baghdad that would preserve the Shia community’s interests, and prevent Iraq from becoming a centralized state as the best possible future for the Shia community.

The provincial elections in January of 2009 were a shock to the party. His party lost voters to both Prime Minister Maliki’s Dawa Party and Sadr’s bloc of supporters. His campaign relied primarily on religious slogans and images of him and his father. It failed to draw the support he expected. The splitting of the Shia vote raised deep concerns about whether he and his father and their party could survive as a viable political force in the future.

In August of 2009, Hakim experienced a deep personal loss with the passing of his father. Questions emerged whether Hakim could keep the party unified.

Quickly taking the reigns of the party, he staked out a new direction for his Issue 1547

party. At his first press conference, he announced, “I call for the formation of a wide national front to include all lists and blocs and alliances of national powers in our country. With solidarity we can revive the political process and confront the big challenges inside Iraq at the regional level.”

This statement marked a shift in Hakim’s thinking. He concluded that the Shia community was tired of the violence and division that came with sectarian politics. These politics nearly brought Iraq to the point of a civil war in 2005. To compete in Iraqi politics, he needed to form a national coalition with a platform that addressed the needs of all Iraqis and would no longer give the impression that he sought to break apart Iraq.

The provincial elections in January of 2009 were a shock to the party. His party lost voters to both Prime Minister Maliki’s Dawa Party and Sadr’s bloc of supporters With adept negotiation, Hakim formed the Iraqi National Coalition (INC) that presently includes his own party, Sadr’s bloc of supporters, and several Sunni and Kurdish parties to run in this month’s elections. The INC presently mounts a strong challenge to Maliki’s State of Law alliance. Learning a lesson from his last election campaign, he has focused his campaign on issues that concern all Iraqis such as the lack of reliable state services, and has made the move to promote a diverse set of new candidates in the election.

His decision to not run as a candidate in the election reflects his belief that

the party’s image should not be solely focused around him, but instead, a group of promising candidates. His active leadership of the INC and the Supreme Islamic Council clearly indicates that he plans to set and shape the direction and tone of the new government, if his coalition is elected.

Hakim realizes he does not need to be Prime Minister to be Iraq’s power broker and leader.

In a recent interview with Arab News Hakim said, "We don't have a program of slogans. We have a practical program that depends on a clear foundation and has practical solutions to many of the problems faced by the people.” Emphasizing as well that the future of Iraq should rely on strong institutions, he stated, "There are two points of view when it comes to administration. There is the view of the strong man, or the strong institution that creates strong men ...

We depend on the latter”.

Concerns exist in Washington that Hakim’s growing strength in Iraqi politics will lead to a more entrenched role for Iran in its neighboring country’s affairs. The US is even quietly funding and backing Maliki’s State of Law alliance in a hope to limit the chances of Iran gaining further influence with an INC victory.

Viewing Hakim in this lens, too easily stereotypes him as an Iranian puppet.

Even though he has long personal ties to Iran, Hakim has branded himself as an Iraqi leader first and foremost.

He has also reached out to a number of Iraq’s neighbors including Turkey, Syria, Lebanon, Egypt, and Jordan. In an interview with Der Spiegel, he said, “Iraq will stand with its interests, and it is not in the interests of Iraq to take a side on the politics of the region. We wish to be friends with all regional and Arab countries, to which we feel a bond of Arab kinship.”

The upcoming elections will test the appeal of Hakim’s new brand of politics. Iraqi election analysts predict that his coalition, or at least his party, will likely have a place in the new government. If his coalition is elected, Hakim’s next challenge will be to lead the coalition in a way that encourages reconciliation and healing in Iraq after seven years of war and division.

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People - Interview

In the Name of National Interest?

Ammar Al-Hakim, President of the Islamic Supreme Council of Iraq In this interview with The Majalla, Ammar Al-Hakim, President of the Islamic Supreme Council of Iraq (ISCI), denies being influenced by Iran and calls for building "strategic" relations between Iraq and Arab countries, acknowledging that Iraq is partly to blame for the cold relations with its Arab neighbors.

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I

n this exclusive interview with The Majalla, Ammar Al-Hakim, President of the Islamic Supreme Council of Iraq (ISCI), stresses that Iraq enjoys a balanced relationship with its neighbors, including Iran. He voices belief that the call for a federation in Iraq is no longer a priority for the ISCI, though it still supports the federal form of governance.

Al-Hakim notes that the ISCI has failed to establish an electoral alliance with the political bloc of Prime Minister Nuri al-Maliki. He adds that the so-called “Saddamists”, or followers of Saddam, still pose a threat to Iraq, reiterating his support for the recent ban by the Justice and Accountability Commission (JAC), whose decision was postponed until after the elections.

The Majalla: It is said that you will 01 March, 2010

not run in the elections. Is this true?

Indeed, I decided not to run in the coming elections. I want to convey a message that distributing roles among those who are engaged in serving the public is very important. It is very important for the Iraqi citizens to see that we, who are involved in serving the public, are not keen to hold all positions. The current harsh rivalry to win seats in Parliament and positions in the Council of Ministers, or in any other governmental body in the state in Iraq, is not in line with the long history of struggle of those historic leaders involved in these rivalries.

Taking these considerations into account, I feel that my position at the ISCI gives me the freedom of broad action without any restrictions suffered by those who

hold public positions. Such a position gives me the opportunity to adopt the new political project in Iraq and defend public service. Hence, I decided to stay away from the Council of Representatives.

Q: Obviously there is some change in your political discourse regarding Iraq’s Arab identity and the country's position among Arab countries. Are there any electoral motivations behind such a change, or is it an ideologicalpolitical change resulting from new convictions?

Arabism is part of our identity and we will never abandon it. Weakness of focusing on this matter in the past might be due to the exceptional circumstances witnessed

by Iraq and lack of understanding on part of many fellow Arab countries of

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People - Interview the new political experience in Iraq and its outcomes. This has created a kind of confusion in Iraq’s relations with the Arab countries. We believe that the opening of Iraq to the Arab world, sharing interests with the Arabs, and the existence of a warm relationship between the Arabs and Iraq is essential at this stage. The increased talks and clear focus on this aspect is consistent with changes in the regional and Arab perspectives to Iraq, and with the will of the Iraqis who want to strengthen their relation with the Arab countries. Therefore, we have identified at first the press conference, after assuming the presidency of the ISCI, a number of priorities in the performance of the ISCI at this stage. These priorities included focusing on opening to the Arab world and engagement with Arab countries.

Our regional tour and visits to many Arab countries were in such a context.

Q: What is the shape of your electoral alliance? Are you going to contest the elections in alliance with al-Maliki or others?

Now, as you know, the time is over for forming alliances. The picture has become clear that the Iraqi National Coalition (INC) with its known powers comprises allies and partners such as the ISCI, Badr Organization, the Sadr Trend, Reform Trend, the Party of Virtue, and some 40 political entities from different sectarian, religious, national and political directions. We have exerted great efforts to unify positions of the INC and Maliki's State of Law Coalition to form a single coalition. We did that as we thought that the presence of a large bloc in parliament would help us attract other blocs and consolidate efforts to enhance the national Iraqi project. These efforts, however, have not succeeded, but we have a broad coalition of known forces.

We have tried to compensate for these unsuccessful efforts and the original idea with a broader project involving inviting the INC to form a broad national front that includes the most important political parties and blocs, which are consistent with the INC regarding the programmes of the next stage, on the Iraqi scene.

Q: You were quoted as not objecting to the participation of the Baathists who are not being prosecuted in politics. What is the motive behind such change, given you were of the

strongest opponents to any Baathist participation in political life?

We have not called for the participation of the Baathists. Instead, we have called for engaging Iraqi citizens, who were forced to join the Baath Party during a specific period of time because of life pressure and pressure put on them, but have not committed any abuses or have not held top positions in the party. Let us deal with them as Iraqi citizens and let them exercise their natural roles in life.

We still believe that the Baath Party is a great danger in terms of its thoughts and organization. According to sources from the Iraqi security forces, the party has been involved in the abuse of Iraqi people and in explosions that target innocent citizens at the present time. We believe that Saddam's followers, who committed abuses in the past and do the same now, represent a fundamental threat to the new democratic national project in Iraq. We will not forgive the Baath Party, and will not tolerate Saddam's followers.

We are open to citizens who were forced to join the party without committing abuses in the past or in the present.

Arabism is part of our identity and we will never abandon it.

Weakness of focusing on this matter in the past might be due to the exceptional circumstances witnessed by Iraq Q: It was notable that activity of the JAC was revived before the elections.

This raises the belief that there were retaliatory political goals behind this move? Don’t you believe that such a move is contradictory with democracy, given that the majority of those banned from running in elections have participated actively in the political life after the fall of the former regime?

No country is to blame for enforcing laws ratified and legislated in parliament via effective participation and voting

by MPs. According to the Justice and Accountability Law, that received a sweeping majority vote at the time of passing it, candidate in elections should be endorsed by the JAC, particularly those covered by the law. We reject that this move is based on political or aggressive goals. We reject politicizing laws or dealing with citizens in a selective manner. I think that such accusations lack many facts. Some people considered that the banning decision of JAC target a certain sect. Facts show that two thirds of those banned are Shiites, and only one third were Sunnis. Therefore, if a certain sect is targeted, it is one that two thirds of candidates banned belong to it, not the sect that to which one third of candidates banned belongs.

I do not think that aggression has been involved in this matter. Enforcing law is an important thing and we place great importance on working hard to broaden participation and to give opportunity to all people who meet the specifications and other conditions of running in elections. We believe that adherence to the Constitution is the key in any democratic country in the world. We do not know any exceptions, regarding that rule, which can allow candidates to run for office in the most important institution in the Iraqi state, the parliament, without meeting constitutional requirements.

What substantiates this attitude is the fact that most of the banned people have not contested the decision of banning them from running in elections. Out of more than 560 people, only 68 submitted appeals against the decisions to ban their running in elections, which means that nearly 500 people did not present appeals and they accepted the decision. Their lists also accepted the decision and soon nominated alternative candidates. This means that they accepts this decision and understand it. So why are other parties questioning the decision. The problem lies with those 68 people who have made appeals and the court is now looking in their appeals to be sure of correctness, or otherwise, of decision to ban their running in elections.

Q: It is clear from your statements, especially during your last visit to Lebanon, that you are seeking greater openness to Arab states. Is it an attempt to achieve a kind of balance to your strong relations with Iran?

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People - Interview Q: Some people say that changes in your position resulted from changes in the Iraqi popular mood in the preelection period. Would you agree?

Iraqis holds slogans that read in Arabic "No to the return of criminal Baathists" during a protest in the central shrine city of Najaf Š getty images

Iraq has good relations with neighboring Iran and has justifications for these relations: the long geographical borders across 1400 km, and joint historical, economic and political interests. We want to start a new stage that involves respect for sovereignty and sharing interests with all countries of the region. Iran is one of the important neighbors of Iraq.

Engagement with the Arab countries and sharing interests with them, in order to achieve a balance in regional relations of Iraq, is an important approach for us and is a key motive that gives us enthusiasm to reassure Arab countries and encourage them to have a positive and constructive role in dealing with the situation in Iraq.

Q: Some people accuse the ISCI of previously implementing Iran's policies in Iraq. What is your position?

We are not an opposition group operating underground and we are required to explain our positions. We are a big political entity and we have broad popular base, and our offices and political positions are known. In addition, our representatives in parliament, in the cabinet, and in the Iraqi state institutions are well known. Today, and after seven years of building political experience in Iraq, major powers like the ISCI are not supposed to be regarded doubtfully in relation to their positions. It is known that we have taken many positions on very 01 March, 2010

sensitive issues that went in different directions from those of the Islamic Republic’s interests. We respect the Islamic Republic and appreciate their consideration for their interests, but we are Iraqis and we act upon Iraq’s national interest when we estimate our positions.

Q: What is your position towards Iran's move to control Iraq' s Fakkah oil field?

Since the first hours after receiving the news, we started following up the issue and we considered raising the Iranian flag on this well as a wrong act. We expressed this through the media and handled the issue through communication with officials.

We believe that our communications and follow-up have had a fundamental role in solving this problem. The ISCI differs from some political parties regarding their mechanisms of action. However, we believe that is important to address the issue and not to deliver fiery statements in the media. Therefore, the ISCI did not make such statements when we had problems with many neighboring countries in the region. Instead, we adopted a calm policy and searched for solutions, and exerted diplomatic efforts and political contacts to resolve dilemmas and promote confidence with others.

Iraq today is not a country of rivalries, animosities, and fiery statements that complicate issues, rather than contribute to solving them.

Our project was clear and had been adopted by Ayatollah Mohammad Baqer al-Hakim. He introduced it in a clear and open manner for more than two decades since the fall of the regime. The ISCI also put forward a clear national project to build the new Iraq so as to achieve social justice, independence, sovereignty, freedom for citizens, equal opportunities and genuine partnership between the elements and sectors of the Iraqi people.

Moreover, we were pleased to find that many of the concepts put forward in the national project by the ISCI are today part of the Iraqi constitution, and of the mainstream political process in the country. This does not prevent changes in the Iraqi political scene. The ISCI, as an important political entity, monitors and controls its own performance and movement and diagnoses errors in its performance, whether they are in its political or regulatory system or in its communication mechanisms with the people. The ISCI addresses, corrects and develops its performance. There is an ability to assesses variables and formulate a discourse and performance in line with these changes to keep pace with change.

Life goes on and no political entity can shut itself to the world. We believe that a political entity must be flexible and we underline fundamentals and develop in the details that are consistent with the expectations of the Iraqi people including the different powers and political leaders.

Q: There is also a lot of talk about a change in your position regarding the Kirkuk issue. You opposed making Kirkuk part of the Kurdistan Province and emphasized its Iraqi identity. Will this have an impact on your strong coalition with the Kurdistan Alliance?

Where did this impression come from?

We always said that Kirkuk represents a small model of Iraq. It has a good mix of nationalities, sects and religions. We have also called for a peaceful coexistence between the different sects in Kirkuk based on love and mutual respect. We also called for the respect of the will of the people of Kirkuk and their decision to run their affairs in the way they see fit. This was, and still is, our official position. All our relationships and alliances with Iraqi 38

People - Interview political parties, including the Kurdistan Alliance, have only one goal: to serve the interests of the country. These alliances were formed under the constitution and the law, for the purpose of defending the rights of all citizens.

Q: Do you still adhere to your previous position of establishing a federation in the centre and in the south of Iraq?

This is not just the position of the ISCI. It is a constitutional fact. Under the federal system mentioned in the constitution for the building of the Iraqi state and its administrative formations, it is possible to form federal regions. This new administrative system may be new to the Iraqis. Thus, the ISCI tried to explain this constitutional right on several previous occasions. But today the ISCI does not see a need for making this matter one of its top priorities. It is a guaranteed right for the Iraqis, and they may fulfil it whenever they wish. They are also free not to implement it at that time or at a later time. The decision is entirely theirs.

But we believe that it is our duty, as one of the political forces, to explain the constitution, which the Iraqi people voted for, and show the Iraqis their rights, then leave it to them to choose.

Q: Many analysts believe that Iraqi religious parties have lost a lot of their influence, and that the scene has become open for secular parties. What do you think?

We respect all political parties and respect the Iraqi voter’s choices. The Iraqi people are free to give their trust to whom they see worthy of it. However, the recent elections of the provincial councils have shown the powerful status of the Arab Islamic forces, especially in the Arab areas located in the provinces of the south and north of Baghdad. Also, the basic forces shaping today's national coalition are Islamist forces, which have won more than 90% of the seats south of Baghdad, and more than 70% of the seats of Baghdad. This confirms that the Iraqi people still trust the Islamist forces.

I don’t know the background of this impression that says that there is decline in the power of Islamic forces.

Q: You spoke in Beirut about the absence of an Arab role in Iraq. What role did you expect the Arabs to play?

And what do you think the objectives Issue 1547

of this role might be?

We are looking for a strategic relationship between Iraq and Arab countries at all levels, including the political, economic and security levels. Iraq is an Arab country. The majority of its citizens are Arabs. Its Arab identity, history, and culture are bright and clear. Therefore, there should be joint and real interests between the Arab countries and Iraq. In addition, Iraq should build good relations with the important countries in the region, such as Turkey and Iran, as well as the rest of the world. We want the new Iraq to be a friendly Iraq that enjoys strong relations with other countries, and not a hostile and isolated Iraq.

We believe that the Iraqis are partly to blame for the Arab countries’ hesitation to engage in Iraq.

Arab countries are concerned about the democratic political project in Iraq and its outcomes Q: Do you think that the ISCI is to blame for the absence of an Arab role in Iraq in the past?

We believe that the Iraqis are partly to blame for the Arab countries’ hesitation to engage in Iraq. Arab countries are concerned about the democratic political project in Iraq and its outcomes. Iraqis should have made an effort to explain the new political reality in Iraq in order to reassure the Arab States and eliminate their concerns. The Arab states should also open their doors, arms, and minds to reach out and listen to the Iraqis. They should try to understand the new phase that Iraq is going through. Iraq and the Arab States share responsibility in this matter. We are not saying that that the Arab countries take full responsibility.

But this does not also mean that the Iraqis

are the ones to take full responsibility.

I think the Iraqis have made a lot of efforts. Today, they focus more on this aspect, and we hope that the pace of understanding and openness between the Arabs and Iraq will continue. As a major political entity in the Iraqi scene, the ISCI is partly responsible for this matter.

Therefore, in the press conference, which I held after becoming the President of the ISCI, I declared several priorities, including openness to the Arabs. Also, I have taken practical steps in this regard.

I made a regional tour that included many Arab countries. We hope that our efforts and those of our partners in the political process, in addition to other national efforts, might be able to solve this problem. We hope to see a growing and deep-rooted relationship between the Arab countries and Iraq.

Q: Do you still hold your position regarding paying financial compensation to Iran for the Iran-Iraq war?

We never supported the payment of such compensation. The statement of His Eminence Sayyed Al-Hakim in 2003, which he delivered while he was holding the rotating presidency of the Governing Council, was misunderstood.

His Eminence had made our position clear through speeches and official statements which he delivered. We have always called for the kind countries, which Iraq is indebted to, to drop these financial commitments and debts in order to help Iraq and its new political experience. The ISCI played a key role in abolishing more than 80% of Iraq's debts. These debts exceed $110 billion.

This was made through the efforts of the former Iraqi Minister of Finance His Excellency Dr. Adel Abdul-Mahdi, and also the current Minister of Finance Mr. Baqr Jabr al-Zobidy. Those two leading figures in of the ISCI played a major role in paving the way for talks with the concerned countries, and handled this issue in an efficient and serious way.

They were the ones behind this great victory for Iraq. More than 80% of Iraq’s debt has been dropped. We support the idea of convincing these countries to deal positively with the reality in Iraq.

Interview conducted by Shereen Alfaedy 39

01 March, 2010

Economics International Investor

Markets

Vitamin AAA Deficiency Stephen Glain By

Issue 1547

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Economics - International Economics

Vitamin AAA Deficiency

The American Economy Stephen Glain

The releasing of the US federal budget for 2011 has unleashed a vivid debate about not only the size of the projected deficits, but also the lack of government effort to reduce it. As Congress has proven incapable of raising taxes, this means the US will be heavily indebted for a generation at least.

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sooner had the N ogovernment released

US its budget for fiscal year 2011 did Moody’s Investment Services weigh in with its stern response.

“Unless further measures are taken to reduce the budget deficit further or the economy rebounds more vigorously than expected,” the rating agency reported in an issuer note, “the federal financial picture as presented in the projections for the next decade will at some point put pressure on [America’s] triple A government bond rating.”

It was a wonky way of saying the US had taken a step closer to national bankruptcy, a warning 01 March, 2010

that could just as easily have been issued to Greece, Portugal, Spain or Italy. With the bailouts and stimulus packages ladled out in response to the 2008 credit collapse straining balance sheets worldwide, investors await anxiously for the first major default. The dubious association of America as just one among a host of countries on the brink of bankruptcy was little noticed or remarked upon in Washington DC, a fact that should be of great concern to serious-minded individuals everywhere.

A few years ago, as the US was running budget deficits worth a half-trillion dollars annually and the federal government

was swelling in size–on the eve of the 2008 crash, real discretionary spending during George W. Bush’s two terms as president had risen by 44 percent–the suggestion that Washington might default on its sovereign debt was roundly dismissed. So long as the US dollar served as the world’s reserve currency, it was argued, the Treasury could endure any crisis simply by printing money.

Just over a year into the Obama administration, economists and investors are no longer taking American solvency for granted.

Officials in China, America’s top banker and increasingly seen as less a partner than a potential adversary, have 42

Economics - International Economics suggested that the days of the dollar as the world’s fiat currency may be numbered.

Late last year, French President Nicolas Sarkozy called for a new global monetary system at the top of which the dollar was conspicuously absent.

There are reports that some major sovereign wealth funds are diversifying their foreign exchange reserves away from the US currency.

Considered separately, such statements and gossip amount to little. Taken together, however, they reflect growing concern that the once-mighty dollar and the shaky US economy behind it are no longer the sure things they once were.

“Investors are getting nervous about this,” says Morris Goldstein, a senior fellow at the Peterson Institute for International Economics. “The question is do you believe Obama’s budget can cut the deficit? If not, you run into problems because the perception of sustained high deficits means high long-term interest rates, particularly if the dollar goes into decline. So it’s important to convince people you’re serious about this.”

Fortunately for the global economy, China has rebounded from the immediate impact of the credit crunch and has all but relieved the US as the engine of global growth. (With a gross domestic product of $4.3 trillion, China will soon replace Japan as the world’s second largest economy but is still less than a third the size of America’s GDP.) That is particularly good news for developing regions such as the Middle East, where China has become a major source of investment and a key trading partner.

However impressive China’s rise, it is not inexorable. Sooner or later, the country’s business cycle will turn south. The country faces the spectre of potentially ruinous inflation as Issue 1547

property and equity prices enter bubble territory. Sooner or later, Beijing will have to allow its currency to appreciate against the dollar in a bid to pre-empt inflation, a delicate transition that could destabilize the economy if not managed well.

The short-term focus, however, remains on the US The concern is less about the size of America’s debt, which is indeed vast, but Washington’s dystopic polity.

In an unusual move, the Obama administration included in its budget projection a ten-year outlook that forecast $1 trillion annual deficits averaged out for the next decade. In response, members of a gridlocked Congress spent much of the following week trying to salvage pet projects slated for the budget knife, including costly weapons systems the Pentagon itself has identified as unnecessary.

In short, Washington has done little to assure investors it is at all serious about deficit reduction.

Optimists cite America’s redemptive performance in the 1990s, when a robust economy – powered by a high-tech boom that would ultimately go bust – grew its way out of a budget deficit and entered the new millennium with a tidy surplus.

The magnitude of indebtedness the US faces today, however, is the greatest since 1950. For the US to reclaim some measure of fiscal stability, it will require the kind of political leadership and courage that Washington abjectly lacks.

According to the Obama budget, the ratio of debt to the gross domestic product will have risen to 77 percent by 2020.

Beyond that, however, is where the real debt-trap lies. Members of America’s baby-boom generation–those born from 1945 to 1960 or so–are already beginning to retire. Soon, the nation’s entitlement programs will lurch from surplus to shortfall as a growing number of retirees draw more from

their accounts than workingage individuals are paying in. Economist’s estimate the long-term funding gap just for Medicare, the national healthcare plan for the elderly, at $36 trillion. Medicare, together with Social Security, the national retirement scheme, and Medicaid, a subsidized medical program for the poor, accounts for two-thirds of the budget.

Absent fundamental reform, some studies show, these mandatory expenditures will have all but crowded out America’s non-defense budget items by 2020. A decade beyond that, economists warn, the value of public debt is expected to reach 100 percent of GDP. Reform, of course, requires negotiation and compromise.

Having watched lawmakers bludgeon themselves with no result over Obama’s health care bill, economists are not hopeful that Congress can make the hard choices needed to navigate the economy from the shoals of insolvency. At the very least, many fear a slide back into recession, followed by a generation of sluggish growth.

The last several decades have been filled with unfulfilled prophesies about America’s decline as a superpower, dating back to the 1950s when rightwing alarmism distracted the nation from its clear superiority over Soviet Russia. In the 1980s, it was Japan that was supposed to have replaced the US as the world’s economic leader. Soon, it will be China’s turn, so say the experts.

The US has some ways to go before it becomes just one global power among many. The clout that comes with a $14 trillion economy, after all, is not easily dismissed. Washington has clearly shown, however, that even the world’s most powerful nation cannot indefinitely draw down its treasury without depleting its authority along with it.

43

Economics - International Investor

Great Expectations The Chinese Renminbi As the Chinese economy rapidly recovers from the economic downturn created by the global financial crisis, questions about the sustainability of its exchange rate arise again. Although a revaluation would be welcomed abroad, contrary to common assumptions, this action would be no panacea, nor would it happen overnight.

I

s China about to revalue its national currency, the renminbi? As its economy heads into a second year of rapid recovery from the economic crisis, rumours are circulating again that a rise in the exchange rate, which has barely budged against the US dollar for two years, may be imminent. But if that happens, do not expect dramatic global consequences any time soon.

There are many reasons to think that a stronger RMB would be beneficial, for China and for the world. It could help combat growing inflationary pressures and deter the hot money inflows that bedevil the country’s domestic monetary policy. It would also boost Chinese consumers’ spending power by making imports cheaper and spur industries to upgrade to higher value-added products – both stated government aims.

A revaluation would be widely welcomed abroad, particularly in the US, where China’s heavily managed exchange rate has long been bitterly criticised. It is blamed for artificially depressing the price of Chinese exports, generating big current account surpluses and contributing to the build-up of global financial imbalances that some economists believe fuelled the crisis. By letting its currency strengthen, China could reduce the risk of bruising conflicts with trade partners.

However, these are mostly hopes, not certainties, and many of them are likely to be disappointed. For one thing, any renminbi appreciation will almost certainly be modest and gradual. A big move would be bound to face powerful resistance from politicians in the country’s export-oriented coastal provinces, who fear it would add to the millions of job losses already caused by the crisis.

Furthermore, it is doubtful that even a sizable revaluation of, say, 30 per cent, would be enough to curb China’s persistent external surpluses. A recent study by researchers at Columbia University, based on analysis of long-run data from 170 economies, fails to find any consistent correlation between 01 March, 2010

In order for them to share more of China’s prosperity, its economy needs to be rebalanced, to make consumption - not investment and exports – its main growth driver. Beijing has talked for years about promoting that shift. But progress has been slow and may well have been reversed by heavy reliance on investment, which generated almost all of last year’s growth, to power recovery from the crisis.

Guy de Jonquières movements in exchange rates and current account peformance.

Linkage is especially tenuous in China’s case because so many of its exports consist of items – such as consumer electronics products - that are assembled from imported components. Revaluation would cut the cost of the latter in local currency terms, limiting upward pressure on the price of China’s exports and consequently the probable impact on the trade surplus.

In truth, explanations for the country’s external surpluses mostly lie elsewhere.

These stem mainly, not from unfair trading practices, but from the fact that China saves far more than it invests or spends at home.

Like oil-rich Middle Eastern nations - which increasingly owe their wealth to Chinese demand - its economy simply cannot absorb all the money it makes, despite its dizzyingly high levels of fixed asset investment. The surplus cash has therefore to be exported.

Much of it flows to the west, because that is where the world’s biggest, deepest and most liquid capital markets are.

It is anomalous that so much wealth is regularly transferred to rich countries from poorer ones. It is odder still that Chinese public opinion celebrates as a sign of strength the vast foreign exchange reserves amassed as a result of its external surpluses.

In reality, the surpluses and bulging reserves reflect structural and policy flaws that have prevented the country’s citizens benefiting as much as they could from its economic success by holding down their living standards.

Re-balancing requires action on four fronts.

First, savings rates must be lowered – not just in households, but in companies and the central government, which are now reckoned by many economists to be China’s biggest savers. Second, modernisation of the country’s distorted and primitive financial system should be accelerated, in order to ensure that savings are invested more productively and capital allocated more efficiently.

Third, household incomes must rise faster in order to support higher consumption, after several years in which they have grown more slowly than corporate profits. And fourth, more jobs need to be created by reforming and opening up services markets, which are potentially by far the biggest job creators but which, in China, are often dominated by politically influential stateowned enterprises that lock out private competitors.

This amounts to a formidable agenda.

Even if China’s cautious current leadership summons the will to tackle it, braving likely opposition from powerful lobbies and entrenched vested interests, it will take many years to achieve. A renminbi revaluation – and better still, a steady move towards a more flexible currency regime – could contribute to positive structural change. But China’s foreign critics should recognise that on its own, it is not the magic bullet that many of them claim.

Senior fellow at the European Centre for International Political Economy. He previously worked for The Financial Times

44

Now you can follow the majalla anywhere anytime on your

Issue 1547

Economics - Behind the Graph

The Rise of the Dragon China is in everyone’s mind in every country and in all levels of society. The American and European Governments for one complain about an undervalued exchange rate that undermines the competitiveness of their industries, creating significant trade imbalances. Blue-collar workers in developed and developing countries complain about the Chinese competition, and the delocalization of their industries to cheaper labour countries, in particular to China. Entrepreneurs are avid to get one

foot in China, even if this means dealing with very opaque institutions staffed by shady bureaucrats. Intellectuals and academics either admire the rapid development of the Chinese economy or frown upon their undemocratic institutions and the oppression of Chinese citizens, often both at the same time. The bottom-line is that no one is indifferent.

The global reverberations from the stellar growth of the Chinese economy are

not new. Neither is the underlying engine of such development: a significant part of the good economic performance can be attributed by the combination of investment in infrastructure and cheap labour. But this is not all. One of the factors contributing to the rapid economic growth is the fact that although labour is cheap in China, it is nevertheless relatively skilled when compared to other countries.

Controlling the Population

Source: CEIC Data

In Development Economics, basic growth theory explains that an economy open to the world should specialise in the production of goods in which it has a comparative advantage. This means that an open economy should produce goods that require a factor of production that is abundant in the economy relative to other factors. Economists usually assume two main factors: labour and capital. With more than 1.3 billion people, China has a great abundance of labour, and therefore specialise in the production of labour-intensive goods. As the ration between capital and labour change, so does the production pattern. An important part of economic development is the increase of GDP per head. A population growth greater than GDP growth therefore means a negative growth of GDP precipitate. One of success of the Chinese government was to control population growth to increase the welfare of its citizens.

Education, Education, Education

Much like other communist countries in the past, the Chinese regime has invested in basic education. This means that an unskilled worker in China is more skilled than a similar worker in other developing countries.

This increases the competitiveness of China as a production location to multinational corporations. China is also slowly moving up the chain of production, specializing in more capital-intensive goods. This is made possible by the rapidly growing availability of highly skilled workers. In 2008, more than 120 thousand student graduated in engineer and, overall, more than 300 thousand students got their master degrees. The trend is clear, high-tech companies are increasingly delocalizing to China, and in particular to its North-Eastern provinces.

Source: CEIC Data

Studying Abroad

As per capita income rises, individuals are more and more able and willing to invest in their children’s education. As such, a growing number of students leave China to to university in Canada the US and Europe. In 2008 70 thousand students returned to China with freshly obtained degrees from first class educational institutions.

These numbers are likely to keep growing, eventually contributing to the development of a high-end industrial park. This, however, reveals an underlying trend. As the economy grows wealthy, labour becomes more expensive. Constraint to internal population mobility implies that wages in big cities are rising fast. This is leading many labour intesive industries to delocalize from China to other cheaper labour countries such as Vietnam.

01 March, 2010

46

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Economics - Index Markets Page Industrail Production Latest

Output

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01

% Change Since Feb 18 Since Dec 31 0.27 -1.79 -0.33 -1.54 -0.88 -2.49 -2.86 -7.51 -2.61 -7.14 -0.72 -5.12 -0.11 -6.73 0.78 4.10 -2.71 -12.29 -1.38 5.23 -1.02 -1.62 -0.24 5.33 0.85 5.62 -5.25 9.26 0.64 2.64 -0.79 -5.82

Index Feb 25 3502.96 2234.22 5278.23 3640.77 5532.33 2749.15 20399.57 1518.06 1581.94 6701.7 6846.36 7378.8 6465.69 1530.2 1207.99 8645.1

New York (Dow) New York (Nasdaq) London (FTSE 100) Paris (CAC40) Frankfurt (DAX) Singapore (STI) Hong Kong (Hang Seng) Barhain (BSE) Dubai (DFM) Oman (ASE) Qatar (DSM) Kuwait (KSE) Riyadh Cairo (Case 30) Japan (Nikkei) Mumbai (BSE)

-2.5 -4.7 -2.2 -4.7 -3.9 -5.3 -0.2 +3.0 +4.0 +11.5 +4.7 -1.0 +4.7 -0.3 -8.0 +6.5 +8.3 -3.2 -2.1

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2010

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2009

/0 1

United States United Kingdom France Germany Euro Area Japan UAE Barhain Oman Qatar Kuwait Saudi Arabia Egypt Brazil Russia India China Hong Kong Singapore

qtr

0 8

Latest

Prices

48

Issue 1547

01 March, 2010

THE MAJALLA

31

Reviews Books

Issue 1547

Readings

Reports

51

Reviews - Books

Wall Street’s Thriller Too Big to Fail

Andrew Ross Sorkin October 2009 Faber As governments slowly declare victory over the global financial crisis and turn their attention to the next battle—namely the one of fighting burgeoning public deficits—people are left as if dumbstruck, not knowing exactly what hit them. Andrew Ross Sorkin’s new book is an excellent account of the ins and outs of the events that hit the world economy in the first decade of the 21st century.

A

s Aldous Huxley wisely put it, “the charm of history and its enigmatic lesson consist in the fact that, from age to age, nothing changes and yet everything is completely different.” As the global economy slowly recuperates, many people may feel like King Pyrrhus of Epirus (319-272 b.c.), who after defeating the Roman Empire reportedly said that one more such victory and he would end up going back to Epirus alone. When looking at the numbers and facts of the global financial crisis one can only be but amazed by its dreadful and earth shattering 01 March, 2010

In a period of less than 18 months, Wall Street had gone from celebrating its most profitable age to finding itself on the brink of an epochal devastation

effects. So high has been the cost of victory for the global economy that its effects are likely to be felt for decades to come.

In order to avoid repeating the past, one needs first to learn from it. In this sense, Andrew Ross Sorkin’s Too Big to Fail: the Inside Story of How Wall Street ad Washington Fought to Save the Financial System and Themselves is not one more book on the events leading to the crisis, it is the book. Not only did Mr. Sorkin succeed in writing an informative account, but he also succeeded in writing a real page-turner, 52

Reviews - Books

to the point that the reader has the impression he is reading a thriller rather than a book on the financial crisis.

Mr. Sorkin ably tells a single story from two different angles. First, the book is an illuminating illustration of an economic idea: that when companies become too big and interconnected—in this case investment banks—the government cannot allow them to go bankrupt because the consequences to the economy would be disastrous. To be sure, if the failure of Bear Sterns and Lehman Brothers could unleash such hellish conditions into the world economy, one could hardly imagine the outcome if the other dominos had kept on falling.

Secondly, the book remains above all a book about egos. It exemplifies to perfection what blind egomania can achieve when found in men with (too much) power. In this sense, the story is about men who thought they were too big, too powerful to fail. As Lord Acton once put it “Absolute power corrupts absolutely.”

While this facet of the book was certainly the hardest to construct, it was also the author’s biggest success.

From over 200 interviews with the main protagonists of the events leading to the collapse of Lehman Brothers and AIG, Mr. Sorkin was able to construct the series of episodes leading to the near collapse of the world economy. Structuring the book like the movie Crash, Mr. Sorkin builds his story from a neutral point of view, while at the same time preserving Issue 1547

a sound sense of cause-andeffect. This is perhaps one of the main reasons why the book stands out among the plethora of books on the global financial crisis.

The storyline overwhelmingly revolves around two characters, Hank Paulson, US Treasury Secretary, and Dick Fuld, CEO of Lehman Brothers. It is full of interesting trivia.

One learns, for instance, about the rivalries between the US

The idea that financial wizards had conjured up a new era of lowrisk profits, and that Americanstyle financial engineering was the global gold standard was officially dead Treasury and the Securities and Exchange Commission (SEC), which Mr. Paulson refers to as the “gang that can’t shoot straight.”

One also learns about ‘the palace coups’ in many Wall Street institutions and the machinations used to sideline many able individuals and potential whistleblowers.

In addition to the ins and outs of the protagonists’ entourage, the book outlines the main causes of the crisis and the conspicuous and slow erosion of confidence in the financial

system throughout 2006 and 2007. It shows how the top management of financial institutions encouraged risk prone behaviour, creating over-exposure to economic downturns. It also shows how close Morgan Stanley and Goldman Sachs were in following Lehman Brothers over the cliff and how close the whole system came to collapsing.

Perhaps the most interesting and telling passage in the book is the one outlining the conflicting relationship between American and British financial regulators. In the passage, Sorkin describes how close Barclays Capital was from buying Lehman Brothers—and thus of stopping the first domino from falling—and how this move was unravelled by “the British unwillingness to import America’s cancer.”

However, the book is not without shortcomings. First, the level of detail presented in the book’s 600 pages is such that it may sometimes overwhelm the reader, who might have the impression of reading the equivalent of People Magazine for Wall Street.

Second, given that one of the book’s pillars were interviews with the protagonists, the reader is sometimes left wondering whether some passages are not based on self-congratulatory accounts of events. Nevertheless, the book remains an excellent and highly interesting account of what Mr. Paulson has dubbed a true economic 9/11.

53

Reviews - Readings

Readings Books Ground Truth: 3 Para Return to Afghanistan Patrick Bishop February 2010

Bestselling author Patrick Bishop writes from a position of exclusive access to British troops in this gripping account of British military involvement in Afghanistan. Bishops offers no easy answers on whether military action was the correct course to take in Afhganistan. As a view from the ground, with the author often present at defining moments, this book provides invaluable insight on the conflict. The testing physical and moral hardships of soldering are encapsulated perfectly by the narrative. ‘Ground Truth’ is a current and important work which will influence the agenda for discussion of the Afghan conflict for many years to come.

The Fall of the West The Death of the Roman Superpower Adrian Goldsworthy February 2010

The fall of the Roman Empire has been a subject of fascination for years and numerous reasons have been advanced to explain its collapse. Historian Adrian Goldsworthy describes this collapse with his trademark combination of individual stories combined with an understanding of the wider picture. As a military historian, Goldswirthy’s strength lies in his military assessments of the Empire. Interesting though his analysis is, a more multithreaded approach may have been of benefit. The broad promise of the title implies a comparison with modern day Empires and is somewhat misleading as the content does not deliver this. It is perhaps impossible to write a history of the Roman Empire without making comparisons to contemporary politics but the title of this volume is rather obvious in its comparison.

‘My Prison, My Home’ Haleh Esfandiari January 2010

This is the true story of one women’s traumatic ordeal in the country she called home.

An eight month saga began with a state-managed robbery of documentation and ended with 100 days of solitary confinement. The Iranian-American academic Haleh Esfandiari’s experience in a land she once called home is a revealing insight into Iran’s difficulties in dealing with the outside world. It is also an account of the country’s rich history and reveals the failure of the current regime to suppress the population’s spirit of resistance. From these threads of history and personal experience Esfandiari weaves an emotional memoir. The lack of bitterness in the narrative is astonishing, as Esfandiari notes her story is a reflection of the ongoing and bitter tensions between Washington and Tehran. This memoir is a stark reminder of the need for mutual understanding between the two countries and is highly relevant for anyone wishing to better understand their relations.

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Reviews - Readings

Reports The Afghan Test Bed in Marja

Anthony H. Cordesman

Center for Strategic Studies & International Studies.

February 16th 2010.

The coming year is likely to be critical in determining if the war in Afghanistan is sustainable or winnable. This report address the current situation and author Cordesman argues that there must be sustained progress in the military effort to prove that the new strategy of a surge in troops was the right choice. The report additionally discusses how Afghan government must prove it has the capacity to become an effective partner in this strategy. Cordesman argues that the fighting in Marja is proving particularly important in challenging the Taliban. Cordesman concludes that if the Karzai government cannot show it is able to improve security in partnership with the coalition, its legitimacy in the eyes of the population will be lost.

This very real possibility is viewed as a potential catalyst in the failure of the entire war.

Stateless Again Palestinian-Origin Jordanians Deprived of their Nationality Human Rights Watch February 1, 2010

Human Rights Watch has called for Jordan to stop withdrawing nationality arbitrarily from Jordanians of Palestinian origin in a recently published report. The report details that authorities have stripped more than 2,700 of these Jordanians of their nationality between 2004 and 2008 and the practice is continuing. The Middle East Director at Human Rights Watch has criticized the Jordanian government for ‘playing politics with the basic rights of thousands of its citizens.’ Jordanian officials have defended the practice and argue it is a means to counter any future Israeli plans to transfer the Palestinian population of the Israeli-occupied West Bank to Jordan.

The report documents the difficulties of those who find themselves stripped of their citizenship, arguing that without nationality individuals are finding it difficult to obtain health care, find work, own property, travel, and send their children to public schools.

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Change We Can Believe In Obama Nation?

US Foreign Policy One Year On LSE Ideas Report January 2010

Obama’s election was greeted by the world as an opportunity to re-engage with a milder, friendlier US. How much has the foreign policy of the United States changed since he came in office? The latest report by LSE Ideas argues that despite symbolic efforts, American foreign policy has not changed enough.

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aving recently completed the first anniversary of his year in office, Obama’s achievements and shortcomings have been under more scrutiny than usual. A new report “Obama Nation” by LSE Ideas join the debate by bringing together distinguished authors form the academic world to evaluate the various dimensions of American foreign policy since Obama came to power.

In the life of American president’s 01 March, 2010

the first one hundred days and the first year in office are considered important harbingers of the policies that are to shape their tenure. The first one hundred days set a tone, and the remaining year is the time to “walk the walk,” so to speak. Obama impressed the world in his first one hundred days by introducing rhetoric that had been largely unheard of from an American leader in a long time. When asked to describe the Obama doctrine in April, he noted that “whilst the

US remains powerful, it is only one nation… other countries have good ideas too, other countries represent different cultures and histories, and have their own interests.” It is this doctrine that the LSE ideas report aims to assess. Namely, how much has he really done to break from the American “exceptionalist” doctrine that the world associated to the Bush administration?

Of particular interest to this discussion 56

Reviews - Reports were the articles from the report that focused on Obama’s policy in the Middle East, especially with regards to the War on Terror. Obama was commended in these articles for the intentions that his symbolic policies demonstrated. Most notably amongst these was his issuance of executive orders that suspended the operation of military tribunals at Guantanamo Bay, and the aim to close the facility within a year. Obama also outlawed torture and the use of secret prisons operated by the CIA with an order that ensured legal interrogation.

His decisions were thus interpreted by the report as an important symbolic break from past American policy.

However, in terms of implementing measures that radically changed the US’s foreign policy, the report was far less positive. Differences in assessments were raised by the various authors commissioned in the report, with some emphasizing more than others the difficulty for any administration to radically change a country’s foreign policy. The report noted in particular that ultimately the best intentions to engage with the Middle East might be undermined by realist state behaviour. More interestingly, Guelke pointed out that the expectation for radical change in America’s foreign policy was always misplaced “considering that Obama campaigned for the presidency as centrist.”

The report, however, did acknowledge the difficulties that Obama’s aims in the Middle East faced. Amongst the multiplicity of obstacles that would stand in the way of the US to capitalize on its new diplomatic rhetoric were the flawed elections in Iran and Afghanistan.

Both of these, it was argued, undermined the immediate relevance of diplomacy with those countries.

For Iran specifically, in view of the regime’s lack of legitimacy prospects of engagement grew weak as the Iranian government became more dependent on a nuclear card to maintain a modicum of support from its constituents.

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In a complementary article on Obama’s policy in the Middle East, writers noted that despite the disappointment felt in the region towards Obama, all was not lost. The authors argued that “just one major success for Obama [was needed] to provide a snowball effect in the region upon which the White House can build.” However, they maintained that in order for Obama’s foreign policy to be as effective as it needs to be in the region, the administration would have to be firmer in its decision making.

The report, however, did acknowledge the difficulties that Obama’s aims in the Middle East faced. Amongst the multiplicity of obstacles that would stand in the way of the US to capitalize on its new diplomatic rhetoric were the flawed elections in Iran and Afghanistan Overall the report is informative in its analysis of Obama’s foreign policy record after a first year in office. Not only does it delineate the extent of the policies put in place, it also describes their aims, and the obstacles that might have stood in the way of their ideal realization. The report is also expansive in scope, as it addresses not only the region’s the US engages with but also brings in important themes that influenced the foreign policy of the US, such as the global financial crisis.

Despite these strengths, that Obama’s first year in office was covered as extensively as it was by both the media and the academic world rendered many of the assessments made by the report trite. As a result, there was nothing particularly innovative

regarding the conclusions the report arrived at. Furthermore, because the report was comprise of articles written by different academics, there was a degree of disconnection between the articles included. True, this provided the report with the full range of views held on Obama’s first year in office. However, this rendered the report weak in producing a consistent message with regards to the measures that the government should put into place to better engage with the rest of the world—if indeed that is their aim.

Surprisingly, while the obstacles the US faces abroad were considered extensively in the report, much less attention was paid to the US’s internal politics and how these affected the foreign policy formulation of the administration.

That this was ignored is especially surprising considering one recent event in the US that undoubtedly impacted the amount of attention the administration wants and can pay to foreign policy. This would have been clearer had the report covered the impact of the election of a Republican Senator for Massachusetts and the impact this will have on the Obama administration to further health care reform. As a recent interview with Professor Eugene Rogan in the Majalla indicated recently, this event drastically changed the priorities of the administration. Prior to Brown’s election, Obama was banking on delivering health care reform. With this prospect lost, the administration has no choice but to focus on the economy. Until the economy is not significantly improved upon, despite Obama’s interests in ameliorating the US’s relations with the Middle East, these efforts will have to take a back seat to the foremost domestic issue on the agenda. Domestic issues such as these have and will continue to impact the government’s interest in promoting proactive policies in the Middle East.

For the full report please refer to:

www.lse.ac.uk

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The Political Essay

Picking Up The Pieces As tradition dictates, Obama’s first year in office was carefully scrutinized by the media and the general public, at home and abroad. It is surprising how the legacy of two George W. Bush mandates seems to have, if not vanished, considerably faded from people’s memories. And while this legacy will hardly work as a political handicap for Obama, it should at least set the limit of what is reasonable to expect his Administration to achieve.

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ast month was the anniversary of Obama’s first year in office.

As tradition dictates, Obama’s performance was scrutinized by everyone, from the American public to the international media, on a variety of issues like health care reform and Afghanistan. Not surprisingly, the general tone was that, although Obama does face some challenges of a magnitude that predecessors like Clinton did not, it is time to transform words into actions.

Indeed, after so much promise, the key word becomes “delivery” What is surprising is how the legacy of two George W. Bush mandates seems to have, if not vanished, considerably faded from people’s memories. Obama can be blamed for having raised the stakes too high, and for delivering a message of hope and change that met cold reality after his election. Yet, had he run his campaign on a more cautious message, and with an excessive dose of pragmatism, he wouldn’t have been elected in the first place. Although Bush’s legacy will hardly work as a political handicap for Obama, especially at home, it should at least set the limit of what is reasonable to expect his Administration to achieve.

In his inauguration speech, Obama delivered a more cautious message.

Resuming well the scenario at home, he said “Homes have been lost, jobs shed, businesses shuttered. Our health care is too costly, our schools fail too many, and each day brings further evidence that the ways we use energy strengthen our adversaries and threaten our planet.” At least for his first term Obama’s task will be to pick up the pieces of his predecessor’s legacy, not only at home, but also abroad.

Unilateralism, the belief that the US could pursue its goals either with or without its allies, the doctrine of pre-emption, all started to gain momentum in the first few months of the Bush Administration.

The aftermath of the 11 September 01 March, 2010

some more declared than others. These ranged from overthrowing a dictator and promoting democracy in the Middle East, to fighting proliferation of WMD and terrorism, and defending human rights. Assuming that Democracy and the rule of law would easily be implemented in Iraq after Saddam was gone, the supposed “walk in the park” became the biggest state-building mission the US ever got involved in.

Manuel Almeida terrorist attacks gave a body to these ideas. From now on, the mission would determine the coalition, and not the other way around, which led to America’s overstretch, and to the shattering of many of its most important alliances.

24 hours after 9/11, and for the first time in NATO’s history, the allies invoked Article 5, the collective security clause of its Charter, in a statement that transmitted the message “today we’re all Americans”.

Given the insurmountable differences preceding the invasion of Iraq, most European partners soon realized they wouldn’t be Americans for long. Never in 60 years of history was the transatlantic relationship in such a low state as in the post-9/11 years.

The “who needs allies, multilateralism and soft power” logic also led to the worst period in the relationship between Russia and the US. In particular, the plan to build a missile defence system on the outskirts of Russia’s border was naturally faced by Putin’s government as aggressive behaviour, and US-Russia diplomatic relations resembled that of the Cold War. The “War on Terror” led to two invasions.

The first one—Afghanistan, which goal was to overthrow the Taliban regime, chase al-Qaeda members and deprive them of their safe haven, was generally consensual. The second one—Iraq, had a confusing mix of justifications,

The common aspect of both interventions, besides being part of the “War on Terror”, was that there was no mid-term plan. And while state-building soon became the aim in Iraq, it took a few years for the Bush Administration to realize that had to be the way to go also in Afghanistan. These huge operations of re-building or building states wore out state resources and drew attention away from other serious problems—like the financial crisis, which went ignored by the political sphere until it was too late.

With no attempts made to engage Iran, the Bush Administration soon placed it in the “Axis of Evil” list. The IsraeliPalestinian issue only made it to Bush’s agenda 2 years into his 2nd mandate, when the feeling was already there that the goal of the Administration was to clean up its image. The Bush Administration was also able to alienate Saudi Arabia, one of its most important allies in the Middle East.

All this is not something that can simply be resolved by a speech in Cairo, another one in Berlin, plus a visit to Saudi Arabia, and a reset button with the Russians. As Obama said in his inauguration speech “Today I say to you that the challenges we face are real, they are serious and they are many. They will not be met easily or in a short span of time. But know this, America: They will be met.” Obama is right, at least for the first part.

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01 March, 2010

THE MAJALLA

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