Indian Strategic Studies

25 August 2014

Italy’s Downward Spiral

AUG 21, 2014 6

Hans-Werner Sinn, Professor of Economics and Public Finance at the University of Munich, is President of the Ifo Institute for Economic Research and serves on the German economy ministry’s Advisory Council. He is the author of Can Germany be Saved?

MUNICH – Italy is now in a triple-dip recession. But it didn’t get there by itself. Yes, the economy’s long slide reflects Italian leaders’ failure to confront the country’s loss of competitiveness; but it is a failure that is widely shared in Europe.

When the financial crisis erupted in the fourth quarter of 2007, Italy’s GDP plummeted by 7%, then picked up by 3%, dropped again by 5%, rebounded by a measly 0.1%, and lately, during the first half of this year, shrank again, this time by 0.3%. Altogether, Italian GDP has contracted by 9% during the past seven years.

Industrial production, moreover, has plunged by a staggering 24%. Only thanks to stubbornly persistent inflation has Italy’s nominal GDP managed to remain constant. Overall unemployment has climbed to 12%, while the rate for youth not attending school has soared to 44%.

Italy has tried to counteract the economic contraction by increasing its public debt. With the European Central Bank and intergovernmental rescue operations keeping interest rates low, Italy’s public debt has been able to rise by one-third from the end of 2007 to the spring of 2014.

Italy’s new prime minister, Matteo Renzi, wants to stimulate growth. But what he really intends to do is accumulate even more debt. True, debt spurs demand; but this type of demand is artificial and short-lived. Sustainable growth can be achieved only if Italy’s economy regains its competitiveness, and within the eurozone there is only one way to accomplish this: by reducing the prices of its goods relative to those of its eurozone competitors. What Italy managed in the past by devaluing the lira must now be emulated through so-called real depreciation.

The era of low interest rates that followed the decision in 1995 to introduce the euro inflated a massive credit bubble in southern eurozone countries, which was sustained until the end of 2013. During this time, Italy became 25% more expensive (on the basis of its GDP deflator) than its eurozone trading partners.

Seventeen percentage points of this rise can be accounted for by higher inflation, and eight percentage points through a revaluation of the lira conducted prior to the introduction of the euro. Relative to Germany, Italy became a whopping 42% more expensive. That price differential – and nothing else – is Italy’s problem. There is no other solution for the country than to correct this imbalance by means of real depreciation.

But accomplishing that is easier said than done. Raising prices is almost never a real problem. Lowering them or making them rise more slowly than prices in competing countries is painful and unnerving.

Even if a country’s trade unions enable such a policy through wage moderation, debtors would run into difficulties, because they borrowed on the assumption that high inflation would continue. Many companies and households would go bankrupt. Given that disinflation or deflation leads through a valley of tears before competitiveness improves, there is reason to doubt whether election-minded politicians, with their short-term orientation, are capable of staying the course.

Former Prime Minister Silvio Berlusconi wanted to solve the problem by withdrawing Italy from the eurozone and devaluing the new currency. He conducted exploratory conversations with other eurozone governments in the autumn of 2011, and had sought an agreement with Greek Prime Minister George Papandreou, who proposed a referendum that effectively would have meant choosing between strict austerity and exiting the eurozone.

But both leaders had to resign, only three days apart, in November 2011. Higher political considerations, as well as the interests of the banking system, militated against an exit.

The economist Mario Monti, who followed Berlusconi as Prime Minister, attempted a real depreciation, introducing greater flexibility into the labor market in order to force the unions into wage concessions. But Monti’s efforts came to naught; among other problems, the ECB, with its generous financial help, removed the pressure from both unions and companies.

Enrico Letta, who followed Monti as the head of Italy’s government, lacked a clear concept for reform, and in turn was followed by the charismatic Renzi. But, though Renzi expends much verbal energy on the economy, so far he has given no indication that he understands the nature of Italy’s problem.

Renzi is not alone in this. On the contrary, virtually the entire European political elite, from Brussels to Paris to Berlin, still believes that Europe is suffering from a mere financial and confidence crisis. The underlying loss of competitiveness is not discussed, because that is a problem that discussion alone cannot resolve.

So How Is Hamas Different From Islamic State, Israel Wonders?

By Daniel Gordis

AUG 2014

It would have been hard to imagine that Islamic State’s brutal execution of American freelance photojournalist James Foley would worsen the Israeli public's assessment of the U.S.'s role in the Gaza conflict. But listen to the chatter in cafes and on the checkout line in the market, and it seems that it may have done just that.

When the war died down and the cease-fires began, the reservists started to return home. One of them, a student of ours at Shalem College in Jerusalem, had been in the thick of it. When he finally got out for good and came back to campus, I found him in the student lounge, shook his hand and asked, “How are you?”

He looked at me for a moment, exhausted, and replied, “Tell me, what happened to America?”

The question of “What happened to America?” is very much on the minds of Israelis these days. Taxi drivers, commonly cited barometers of public opinion in these parts, have a simple explanation: “Obama hates Bibi.”

It’s not only the drivers. YNet, Israel’s popular news website, ran an article with the headline, “It May Not Be Possible to Repair the Netanyahu-Obama Relationship.”

In reality, matters are less simple. U.S. presidents and Israeli prime ministers have often been at odds. John F. Kennedy harbored no love for David Ben-Gurion. George H.W. Bush detested Yitzhak Shamir. During the peace negotiations with Egypt, Jimmy Carter apparently told his wife that Menachem Begin was a psycho, while toward the end of his life Begin refused to even see Carter.

So why all the hand-wringing about the U.S.-Israel relationship now? Many Israelis sense that something deeper than usual is at play. America, they say, has lost the ability to see this particular conflict with any moral clarity.

It is for that very reason that Israelis have taken great interest in Obama calling Islamic State a “cancer” after the gruesome beheading of Foley. Haaretz, Israel’s left-leaning daily and “paper of record,” gave the "Islamic State is a cancer" story top play in both its Hebrew and English editions. So, too, did the Web-based Times of Israel. When Islamic State executes an innocent American -- befuddled Israelis noticed -- Obama has the capacity for outrage and moral clarity. But in Israel’s conflict, even though Hamas is sworn on Israel’s destruction and has been killing innocent Israelis for years, the best that Obama has been able to utter is the standard “Israel has a right to defend itself.”

Is this moral obtuseness, many Israelis wonder, or is there something more pernicious at play? Israelis still remember the days when then-senator and presidential candidate Obama sounded different. In 2008, Obama said in Sderot, Israel: “The first job of any nation state is to protect its citizens. And so I can assure you that if … somebody was sending rockets into my house where my two daughters sleep at night, I'm going to do everything in my power to stop that. And I would expect Israelis to do the same thing.”

That is exactly what Israelis have been doing, for weeks now, with questionable success. But U.S. diplomats and politicians have tried, for the most part, to calm the waters by treating Israel and Hamas as two morally equivalent opponents. Why is Islamic State a “cancer” while Hamas is a legitimate partner in a Palestinian unity-government, about which U.S. Secretary of State John Kerry said, “We will work with it as we need to”?

By Joshua Keating

The New York Times is reporting that prior to the killing of journalist James Foley,ISIS demanded a $100 million ransom for his release. Writing for Reuters, David Rohde, who as a reporter for the Times was kidnapped by the Taliban in Afghanistan in 2008 but managed to escape from captivity after seven months,argues that the U.S. policy of not paying ransoms for terrorist hostages may have led to Foley’s death.

Joshua Keating is a staff writer atSlate focusing on international affairs and writes the World blog.

The moral question of whether to pay ransoms to terrorist groups—which I also wrote about in the context of the Boko Haram kidnappings in the spring—is an agonizing one. It’s hard to stand on principle after reading the accounts of what the Foley family has been through over the past 21 months, or taking into account ISIS’s threat that Steven Sotloff, a journalist for Time who is also in the group’s custody, will be next.

The United States’ no-ransom policy also stands in contrast to the policy of European governments, which often do make under-the-table deals to bring their citizens home. The consequence is that while dozens of European citizens have been released by terrorist groups during the last half-decade or so, very few from America or the United Kingdom—which also generally doesn’t pay ransoms—make it out alive. According to Rohde, due to these divergent practices “at least one major aid organization is not sending U.S. aid workers to areas where they might be abducted. Instead, they are sending citizens from European countries with governments that will pay ransoms.”

Why would the U.S. resist paying ransoms? Because the money that has been paid to terrorists has done undeniable damage, providing al-Qaida-linked groups withan estimated $125 million in revenue since 2008. The group’s North African affiliate, al-Qaida in the Islamic Maghreb, has proved particularly adept at the practice. These payments may now make up the bulk of the revenue supporting al-Qaida affiliates.

But again, it’s not that simple. The tough-guy “we don’t negotiate with terrorists” mantra sounds great in practice, but almost all governments do it from time to time. The U.S., of course, released five Taliban detainees from Guantánamo Bay earlier this summer in exchange for Sgt. Bowe Bergdahl. Secretary of DefenseChuck Hagel’s argument that the U.S. “didn’t negotiate with terrorists” because the deal was facilitated by Qatari intermediaries is a bit of a stretch. And Israel, which no one has ever accused of being soft on terrorism, released more than 1,000 Palestinian prisoners in exchange for captured IDF solder Gilad Shalit (though dozens of them were subsequently rearrested during the recent violence in Gaza).

As counterterrorism scholar Peter Neumann argued in a 2007 Foreign Affairsarticle, governments must at times negotiate and even grant concessions to groups it considers to be terrorists. The decision about whether to do so should be made less on the basis of the group’s relative odiousness than on whether such a deal could help stop violence.

The British government eventually had to sit down with the IRA. Colombia’s president is currently involved in controversial talks with the FARC to end the country’s decades-old unrest. As I argued after the Bergdahl swap, the deal should be seen less in terms of what the U.S. was willing to give up for one soldier than as the Obama administration settling unfinished business before it pulls troops out of Afghanistan and gets out of the business of fighting the Taliban entirely.

But a truce, or even a de-escalation of hostility, between the U.S. government and ISIS or any of its former affiliates in al-Qaida is hard to imagine. While the payment of a ransom could secure the release of a prisoner, it can do little beyond that except provide the group with much-needed funding. It would also encourage more kidnappings, both by ISIS and other groups that would be inspired by its example.

In this case, the U.S. government policy seems like the right one. As Rohde argues, however, it would be helpful if all Western governments were on the same page.

The west should take note: there is no avoiding Isis

Shiraz Maher

The increased radicalisation of British jihadis, bolstered by an assured caliphate, has given the militant group global ambitions

YouTube video grab showing Islamic State fighters who claim to be British. ‘Romantic notions of saving oppressed civilians from a government intent on killing them has given way to casual brutality and callousness.’ Photograph: YouTube/PA

For those of who have followed the conflict in Syria and Iraq closely, it came as no surprise – shocking though it was – to discover that a seemingly British jihadist had beheaded the American journalist James Foley. Over the past year jihadists from this country have participated in suicide bombings, tortured detainees in their care, and executed prisoners of war.

It is true that not every British fighter who has travelled to Syria engages in these types of acts. Indeed, many of the early fighters who went did so for humanitarian reasons. Through numerous interviews it is clear to me that their motivations and ambitions were materially different from those who followed them.

Over time, however, it is also clear that attitudes have hardened. Romantic notions of saving oppressed civilians from a government intent on killing them has given way to a culture of casual brutality and callousness.

That nonchalance was epitomised by a British fighter I used to speak with regularly. When he was first in Syria he complained about the brutality of the Islamic State (Isis) and condemned its strategy of kidnapping journalists and aid workers. Months later he published a picture of three captured men with the caption: “Will be killed tomorrow, can’t wait for that feeling when you just killed someone.” Days later he posted a picture of his bloodied hand. “My first time,” he said. What is perhaps more disturbing is that he is an intelligent man who attended Queen Mary University.

A long list of similar incidents could be reproduced here. Indeed, a number of British fighters have celebrated Foley’s murder, often joking in macabre fashion about wanting to “play football”. A man from Manchester using the pseudonym Abu Qaqa tweeted: “Beheaded by a British brother! What an honour! What a beautiful message to America.” Qaqa has himself posted pictures of beheaded opponents on his Twitter account.

Messages like that are ones that Isis seems increasingly keen to direct towards the west. Another British fighter warned of terrorist attacks back home. “To the people of the UK, because of the actions of your government, it will be you who pay the price. Blame them & not us,” he wrote. The most recent Briton to have been killed in Syria, Muhammad Hamidur Rahman, also spoke of his desire to see a repeat of the 9/11 attacks shortly before his death.

Wake up, America — the war has hit home

By Benny Avni

August 20, 2014

Will the videotaped execution of James Foley shock America out of our dangerous flirtation with isolationism?

The gruesome beheading of the 40-year-old photojournalist should scream out a warning to any who still doubt: This isn’t just some war out there. It’s about us.

Some see Foley as a noble but careless man, too courageous for his own good, who unwisely decided to go freelance in faraway war zones, armed with nothing more than a camera and adrenaline.

Kidnapped once, in Libya, Foley still went back to war journalism in Syria — where he was abducted again in November 2012 by forces close to President Bashar al-Assad, who later, apparently, traded him to supposedly anti-Assad jihadis.

In fact, Foley represented today’s purest form of journalism, telling all of us about battle-torn lands. He was the man up front, dedicated to bringing the sounds, sights and smell of war to your favorite couch. Mostly, Foley was an American. One of us.

A Granite Stater in a Gitmo-like orange jumpsuit, he was forced to spew a statement blaming President Obama for his coming beheading, and telling his brother John, “I died” the day John’s US Air Force colleagues attacked the Islamic State from the air in Iraq.

Yet the man who killed him was also, in a way, one of us. Black-clad, his face fully covered, short knife in hand, the killer read out his own statement, amplifying the text force-fed to Foley, and threatening to kill another captive reporter, Steven Joel Sotloff, next — then other hostages.

Staff Sgt. Jacob N. Bailey/U.S. Air Force

Jacob Siegel

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WORLD NEWS

08.21.14

Is the United States About to Ramp Up Its Fight Against ISIS?

In the wake of James Foley’s execution, Obama announced no plans to widen his air campaign against the group. Military officials hint it’s expanding—but not to a ground offensive.

Since U.S. airstrikes began targeting ISIS on August 7, the group, which had been steadily expanding its territory, has been losing ground in Iraq. Now there are signs indicating that the air campaign could be expanding. If it does, the model for what has worked in northern Iraq—U.S. airpower backing local ground forces—gives a preview of what future operations could look like if they spread to other parts of Iraq.

Kurdish fighters stand guard at the Mosul Dam in Mosul in northern Iraq, August 19, 2014. (Reuters)

“What we saw at Mosul,” where U.S. airstrikes allowed Kurdish and Iraqi security forces to push ISIS back, “was essentially our proof of concept,” said Douglas Ollivant, a former Army officer and one of the architects of the “surge” in Iraq who later served on the National Security Council.

ISIS’s answer to its first direct confrontation with the United States came in the form of a video, released Tuesday as the bombs continued to drop on the group’s positions in Iraq, showing the execution of a captured American journalist,James Foley. In the video Foley’s masked killer warns that further U.S. airstrikes will lead to the execution of more American hostages held by ISIS.

Obama v. ISIS: This Time It’s Personal

When ISIS beheaded an American journalist, it meant to intimidate—and provoke—the United States. It should be careful what it wishes for. The gloves just came off.

The Obama administration signaled Thursday that the United States has begun a new war against the so-called Islamic State, and that group’s operatives will not be safe from America’s wrath in Iraq, in Syria, or wherever they can be tracked down.

Since U.S. intelligence agencies confirmed the authenticity of a video that showed the beheading of American journalist James Foley this week, the president and top cabinet officers have employed rhetoric about the jihadists of the Islamic State (also known as the “caliphate,” ISIS or ISIL) that echoes the Bush administration in the wake of the 9/11 attacks.

Secretary of State John Kerry called ISIS “the face of evil” and vowed America “will continue to confront [it] wherever it tries to spread its despicable hatred.” Secretary of Defense Chuck Hagel said the military’s response is to “take a cold, steely, hard look at” at ISIS and “get ready” for action.

While the Justice Department on Thursday announced that the FBI would be investigating the murder of Foley, Attorney General Eric Holder also left open the possibility that the United States may not wait for the verdict of a jury and judge. "We will not forget what happened and people will be held accountable one way or the other,” Holder said.

The most notable rhetorical tell came from Obama himself.

In the aftermath of the 2012 attack on the U.S. diplomatic compound in Benghazi, Obama vowed to bring the attackers to justice. This week Obama struck a different tone, saying: "When people harm Americans, anywhere, we do what's necessary to see that justice is done."

The difference between bringing suspects to justice and seeing that justice is done is roughly the same as the difference between treating terrorism as a crime and as an act of war.

Even though special operations teams were dispatched to Libya after Benghazi to target the jihadists suspected of carrying it out, Obama chose to treat the attack, which cost the lives of four Americans, as a crime. It took until June of this year for the FBI in conjunction with U.S. special operations teams to capture one of the ringleaders of the attack and bring him to the United States to face trial.

"When people harm Americans, anywhere, we do what's necessary to see that justice is done."

U.S. STAGED SECRET OPS INTO SYRIA IN FAILED BID TO RESCUE AMERICANS

by Fortuna's Corner

August 21, 2014

http://r20.rs6.net/tn.jsp?

On Wednesday, President Obama spoke at a news conference in Martha’s Vineyard about American journalist James Foley, who Islamic State militants beheaded in a video. The president said groups like IS have “no place in the 21st century.” (AP)

By Adam Goldman and Karen DeYoung August 20 at 8:29 PM

U.S. Special Operations forces staged an unsuccessful operation this summer to rescue photojournalist James Foley and other Americans being held in Syria by Islamic State militants, according to senior Obama administration officials.

The attempt, involving several dozen U.S. commandos, one of whom was injured in a fierce firefight with the militants, was the first known U.S. ground operation in Syria since the country’s descent into civil war. It came after at least six European hostages freed by the militants last spring had been debriefed by U.S. intelligence.

“The president authorized earlier this summer an operation to attempt the rescue of American citizens held by ISIL,” one of the acronyms used to refer to the Islamic State, said one of two senior officials who provided information on the mission.

“We had a combination of … intelligence that was sufficient to enable us to act on it,” the official said, and the military moved “very aggressively, very quickly to try and recover our citizens.”

The official said the effort “was not ultimately successful because the hostages were not present … at the site of the operation.” Other officials said they were believed to have been there, but that they had been moved up to several weeks before the raid.

This September 2012 photo posted on the Web site FreeJamesFoley.org shows journalist James Foley in Aleppo, Syria. (Manu Brabo/AP)

In an announcement following the initial publication Wednesday of details about the operation, the White House and Pentagon issued statements confirming that President Obama had authorized the mission following assessments that “these hostages were in danger with each passing day.”

The Islamic State on Tuesday released a video of Foley’s execution, which it said was in response to U.S. airstrikes in Iraq. Obama called the beheading “appalling” and “a brutal murder.”

The two officials, who were authorized by the White House to speak anonymously to a small group of reporters, would not specify the number or identity of Americans being held alongside Foley. They are believed to number at least four, one of whom, freelance journalist Steven Joel Sotloff, also appeared in the Foley video, as the executioner warned that “the life of this American citizen, Obama, depends on your next decision.”

The failed operation “was conducted by a joint force with virtually every service represented,” one of the senior officials said, including “special operators and aircraft both rotary and fixed wing,” with surveillance aircraft overhead.

That official said that there were a “good number” of militant casualties at the site, but that one U.S. service member received a “minor injury when one aircraft did take some fire.”

The two senior officials declined to specify the location of the raid, whether the hostages had ever been there, the specific U.S. units that had taken part in the operation or how long they were on the ground. “It wasn’t an extraordinarily long period,” one said.

Other current and former U.S. officials, who were not part of the briefing, said that Foley and others were held at an eastern Syria site near Raqaa, a city that is held by Islamic State fighters.

Start Running:KINGS OF WAR

JACK MCDONALD

21 AUGUST 2014

It appears that a British citizen, “John”, was responsible for the murder of US journalist James Foley. No, there will be no link to the video here. Questions abound regarding Foley’s death – did America mess up a rescue attempt earlier this summer? was it the result of a failed shakedown? – as does analysis of its possible strategic impact. Over at War on The Rocks, Brian Fishman’s astute comments about the continuing disconnect between the end goal of “defeating” ISIS and the available means are worth repeating: “without real national consensus to sustain a strategy, there is no viable mechanism to defeat ISIL.” It seems John Kerry, the US Secretary of State, didn’t get the WOTR memo, as he resorted to quite non-diplomatic language to state (via Twitter, of course) “ISIL must be destroyed/will be crushed”. The reason that Fishman’s comments stand out in the morass of “Something must be done” commentary is that it correctly identifies the ultimate restraint on American action in Iraq (not Syria): America itself. How much will a single video change that? I don’t think that can be predicted with any accuracy, but what I do think is that “John”, and others like him, should be very, very afraid.

Earlier this summer, I wrote about a “laissez faire” policy towards the “problem” of foreign fighters from Western countries running off to fight in Syria. In a nutshell, my argument was they shouldn’t be prevented from going, but they should be warned that actions have consequences, and some form of open-source watch list should be established. Since then (well, before, even) “John” and his friends have provided us with a steady stream of video footage of ISIS members committing war crimes, carnage and, with the recent Yazidis, threatening to commit crimes against humanity. Taking a step back from the immediate strategic context and potential security challenges, I think it’s quite productive to think in terms of post-conflict justice. Hence the title for this post: over a long enough time span, ISIS’s members are pretty much screwed.

In the short term: will the British government raise a fuss if someone like “John” happens to get hit by an American bomb, or riddled with bullets by American special forces, the Peshmerga, the Iraqi army, the Syrian government, rival foreign fighters, etc? After this, I somehow doubt it. At the end of the day, the only people that can’t kill British jihadis without tripping off lawsuits are British forces, and David Cameron seems very, very wary of committing the UK to Iraq. Even if military force won’t destroy ISIS, I expect that Iraq is going to get more dangerous for anyone who fights for them. Syria isn’t exactly a safe haven, either.

The medium and long term, are, however, more interesting. After all, are the people committing war crimes going to stick around Iraq forever? I doubt it, and when the time comes to leave, they are going to have problems. At the moment security services across Europe are very worried about tracking the foreign fighters that return. One of the problems is that it’s often difficult to convict them of anything, since evidence from Syria and Iraq is scant (at the moment). Western stateslike Canada are finding that their laws intended to stop people fighting abroad don’t really fit with conflict in the 21st century. Many have either rushed through new legislation, or are considering it. But we don’t need new laws for war crimes – “John”, if he is indeed a British citizen, is a murderer, and we have laws that mean British citizens committing murder outside the UK can still be charged with that crime in British courts. That’s why, I think, from the perspective of justice, the deck is stacked against war criminals in jihadi groups for two reasons: politics and information.

The primary reason, I think, is that these are transnational war crimes. Every criminal tribunal prosecuting war crimes has, at some point, had to deal with the balance of justice and peace. Certainly, there can be no “true” peace after massive war crimes without a measure of justice, but at the same time, demands for justice can stoke the embers of conflict. Just look at the recent furore over amnesty in Northern Ireland. Truth commissions ostensibly privilege truth-telling and the need for clarity on behalf of victims over punitive justice. But if “John” ever returns to the UK (willingly? extradited? captured?), the English courts don’t have to concern themselves with such issues – murder is murder. If “John” happens to end up in the US, well, bad luck, I suppose. There is little political barrier to prosecution in either case.

Lack of information is a traditional shield for war criminals. The circumstances of war crimes are rarely clear cut. At this point, we don’t know that much about the leaders of ISIS, let alone who is committing which atrocity. But that’s not to say that we won’t. If King’s College London’s International Centre for the Study of Radicalisation can identify “hidden influencers” in foreign fighter networks from open sources, then we should probably bet that behind closed doors, the security services know more about these people than they can say in public. Aspects of armed conflict that would once be witnessed by individuals alone are now captured and stuck on Youtube for the world to see. Open source citizen journalism can be remarkably effective in answering “Who? What? When? Where? How?” by locating and assembling these fragments of evidence, take, for example, Bellingcat on the recent MH17 shoot down in Ukraine. For those who commit war crimes in their 20s, we should remember that efforts are still being made to track and prosecute Nazi war criminals, some 71 years after the end of World War 2. The authorities now have a world of digital information to work with, which can be stored near-indefinitely. Foreign fighter networks operate in an environment where one hidden camera phone could produce evidence linking individuals to a war crime, that is, if they don’t film it themselves and upload it for the world to see. This means that “John”, and others like him, can’t rely on the immediate anonymity that a mask provides to protect them forever. Members of armed groups that utilise social media are, over a long enough time span, likely to be identified. I doubt that any future government will be willing to “forgive and forget” ISIS’s war crimes, which means that anybody like “John” who makes it back to the UK alive and unidentified should expect to spend the rest of their lives waiting for a knock on the door from the police. Good.

NATO Expansion: Strategic Genius or Historic Mistake?

Eugene Rumer

August 21, 2014

The crisis in U.S.-Russian relations over Ukraine reopens an important debate. Who was right?

Two decades after the debate about NATO enlargement pitted “NATO-firsters” against “Russia-firsters,” both sides have had reasons to say, “I told you so.” And they did. But with Russia and Ukraine poised to go to war with each other, it doesn’t really matter that they did. Little can be done about the escalating crisis in Eastern Europe, even though it was predictable and predicted.

NATO-firsters had a sound argument on their side: the Cold War is over. Europe is at peace. The Soviet threat is no more. Central Europe, that graveyard of European empires, needs help transitioning from its Communist interlude to market democracy. Unless NATO helps and takes the region under its wing, old habits will reemerge and Central Europe will once again get mired in its old internecine rivalries endangering the hard-won peace. NATO has to take the region under its wing; it has to admit new members. Otherwise, the alliance willstagnate and die.

But, Russia-firsters countered—Russia will not like it; not now, not ever. Russia is weak now and cannot do much to oppose NATO enlargement, but once it recovers a measure of its strength, it will act to counter any expansion. Russia is more important to Europe and the United States than Central Europe, and it makes much more sense to work out the terms with Russia than to make Central Europe happy. Besides, they added, it makes as much sense for an alliance in trouble to take on new members as it does for a couple having matrimonial difficulties to have more children in the hope of saving the marriage.

NATO enlargement, NATO-firsters replied, is not aimed against Russia. It is a move toward Russia, intended to bring the zone of stability and prosperity closer to its borders. Russia will eventually realize that NATO enlargement is beneficial and will accept it. And if it does not—too bad, it wasn’t meant to be. Expanding NATO now, while Russia is weak, is the right move anyway. It is a hedge against future Russian neoimperial resurgence.

More than two decades since the debate started, both sides can claim to have been right. Central Europe’s progress in the past twenty years has exceeded everyone’s expectations. The region is stable, democratic and prosperous, and fully integrated into NATO and the EU. NATO enlargement has paid off.

INNOVATIVE TECHNOLOGIES AND AMERICAN SOLDIERS OF FORTUNE

By Jay Mallin Sr. and Robert L. Scheina

AUGUST 14, 2014

Innovative technologies have always offered an avenue of employment for American soldiers of fortune. They honed the skills required in order to use these cutting-edge technologies while serving in the American armed forces. Examples of these technologies include observation balloons, torpedoes, submarines, dynamite, nitroglycerin and the airplane. All were seen as potentially the great equalizers, the weapons that could empower the underdogs in their struggles against their more powerful enemies. Frequently, the employers of these American soldiers of fortune were American arms merchants who were hired by some foreign underdog to mitigate the strength of the more powerful.

One has good reason to be skeptical that the observation balloon could change the course of a war, particularly following its indecisive debut during the U.S. Civil War. Yet this was exactly what happened in the War of the Triple Alliance (1864–70) between Paraguay and Brazil (supported by Argentina and Uruguay). Do not relegate this conflict to “just another banana war.” The war lasted almost six years, and Paraguay alone suffered about 150,000 casualties—half its population.

Aerial Observation

American balloonists Ezra and James Allen were hired by the Brazilian government to reconnoiter a strong Paraguayan defensive position from the air. The Allen brothers learned their trade while serving in the Union Army. The brothers traveled to Brazil, taking along their balloon and inflation equipment. Intelligence gleaned from the American-operated observation balloon permitted the Brazilian Army to bypass the Paraguayan defenses known as the Lines of Rojas. These defenses had brought the Brazilian advance to a halt and prevented the Brazilians from forcing the Paraguayans into a decisive engagement. The reward for the Allen brothers was the proof of the success of their balloon operations during the war. Emperor Dom Pedro II presented the brothers with a bonus of $10,000 in gold. Rarely were American soldiers of fortune paid well for their services, in spite of promises. This was one of the exceptions.

Should retired generals be allowed to "cash in" and keep their commissions?

BY MAJOR MATT CAVANAUGH

August 21, 2014

Should retired generals and admirals be allowed to "cash in" and keep their commissions? I realize this is thin ice, but as a commissioned officer and member of the Profession of Arms, I think there's something to talk about here.

Last week I picked up an errant copy of the the Wall Street Journal, and as I turned past the "Mansions" section (typically "flyover" territory for me in a newspaper) - I came across a story about the sale of General (Retired) Alexander Haig's home in Palm Beach, Florida - for $8.75 million. [Note: he passed away in 2010] That interested me, so I did some more digging, and found that his estate has another home up for sale for $5.5 million in McLean, Virginia (12,000 square feet). Though Haig did write a couple of books, it appears that the majority of his post-retirement wealth came from service on corporate boards: Commodore International, Newsmax Media, and America Online.

This reminds me of the flap a few years ago over hundreds of retired generals and admirals being (highly) paid as "senior mentors" for various parts of the military establishment. One example cited was General (Retired) Anthony Zinni's corporate board work for Dyncorp which compensated him nearly a million dollars in 2008, while at the same time he was providing paid advice to a military command. To provide context, General Zinni's military retirement pay was about $129,000 in that same year. Interestingly, the issue dried upovernight when a basic set of rules and monetary caps were put in place. Not to be cynical here, but it's hard to miss the fact that this mentorship program essentially ceased when the pay was reduced and made transparent: not exactly selfless service for these generals and admirals.

I'm uncomfortable with the notion that senior members of the Profession of Arms, who have been granted access and privilege in order to perform service to the American public while on active duty, are then able to monetize this access in retirement to significant personal benefit. I don't think there's anything wrong with making money, but when the money becomes a windfall and particularly when they continue to publicly represent the military profession - that's where I have a problem.

I'd suggest a simple test for all retired officers (i.e. lieutenant colonels as well as lieutenant generals):

If post-retirement private sector work involves national security (i.e. defense contractor, public commentator), broadly construed...

And when income from that work exceeds double the amount of military retirement pay, then...

The individual should relinquish their commission, as private financial interests have clearly impaired their (mostly dormant) obligation to act on behalf of the nation's interest.

Instead of "General (Retired)" or "General (Ret.)" as a honorific, such an individual might be listed as "General (Former)" or "General (Fmr.)." This would enable the individual to maintain their title, while at the same time publicly announcing that the official commission is no longer held.

Note: this would have no impact on military retirement pay or financial benefits - only the commission as a symbol of the military profession.

We don't allow active duty officers to profit from their access and privileges - to simultaneously represent private and public interests - why shouldn't the self-policing Profession of Arms set some reasonable boundaries for retired members?

Top Six Strategic Threats to Worry About in Today’s Global Headlines

Elaine M. Grossman

August 20, 2014

OMAHA, Neb.— What do hundreds of nuclear-weapons wonks discuss when cloistered for two hot August days in a windowless Midwest conference center? Turns out, it’s not just nuclear weapons. It’s about their deepest and well informed fears of how conflicts dominating today’s global headlines could translate into real life-altering events for Americans.

Elaine M. Grossman is a contributing correspondent at National Journal. Grossman previously served as executive editor and senior correspondent for National Journal's Global Security Newswire. She is a veteran national security and foreign affairs reporter whose articles have won 14 national ... Full Bio

No one is ruling out the risk — even if remote — that a newly aggressive Russia or China might someday put a mushroom cloud over New York City. But the more urgent worries today are radical extremists who will stop at nothing, new nuclear powers stumbling into cataclysmic mistakes, and attacks in the cybersphere or space that might paralyze a nation.

The threats facing the United States and its allies now are “complex and dynamic, perhaps more so than at any time in our history,” Adm. Cecil Haney, commander of U.S. Strategic Command, told an annual symposium last week on “strategic deterrence.” That military term refers to the largely mysterious art of preventing the most undesirable violence from occurring. Historically, it essentially meant preventing nuclear war from the Soviet Union. But Haney is carrying the torch in a new era of strategic deterrence, one that tries to deter even an individual terrorist from acquiring radiological materials to make a “dirty bomb.” And the community is looking beyond singular, end-of-the-world nuclear events at a globe in constant conflict, from Gaza to the Internet and beyond.

“In some ways, we’re in a very different political environment…where conflict is the norm,” said James Lewis, senior fellow and director of the Strategic Technologies Program at the Center for Strategic and International Studies. “It’s going to be a world of continuing low-level conflict.”

Shai Feldman, who heads Middle East studies at Brandeis University, described an instant-classic letter to the editorpublished last August in London’s Financial Times, underscoring how the rapidly shifting alliances in that complex region boggle defense and diplomatic strategies around the planet. Particularly when groups like Hamas, Hezbollah and the Islamic State are involved. “Can deterrence work in a chaotic realm?” Feldman asked. “What do you do when you don’t have a single address for deterrence?”

The threats furrowing the brows of government officials and top issue experts begin with terrorism.

HOW TO SAVE THE INTERNET: WE NEED A CDC FOR CYBER CRIME

by Fortuna's Corner

August 21, 2014

http://www.fortunascorner.wordpress.com

Peter W. Singer had a August 19, 2014 article on the website Wired.com, with the title above. Mr. Singer begins his article noting that “the Internet may be made up of software and hardware; but, it is an ecosystem that depends on a key human value: trust. The networks and the systems must,” he writes, “be able to trust the information we are sending, and in turn, we have to be able to trust the information we receive.”

“This system of trust,” he writes, “has allowed business around the world to share data rapidly and reliably on almost every issue — except their own security. Too many firms,” he contends, “are still unwilling to share crucial information about the network data attacks, data breaches, and outright cyber theft we they’ve experienced — and, what they do to defend themselves. Companies keep everything from basic facts to crucial technical details from one another, and notably, from the government, largely because they’re suspicious and fearful about what others might do with that information. The fears run the gamut: Tech companies worry about their brand, potential prosecution, even exploitation by the intelligence community; consumer firms wonder how the stock market will react; oil companies fear aiding their competitors; and energy companies are nervous that the information will end up being exploited by those they fear far more hackers: environmental lawyers.”

“The result is that, as cyber security guru Kevin Mandia of FireEye puts it, “Nobody gets smarter.” Victims of attacks may learn how to adjust to a new threat, but only after the fact, while the world at large too often doesn’t get the guidance needed to bolster [cyber] defenses in a timely manner.”

Just As The CDC Plays A Part In Public Education On Preventive Health Care — So Too, Could A Cyber-CDC Be a Hub For Better “Cyber Hygiene”

“Discussions of what government should do about this predicament tend to focus on some kind of change in the law to raise regulations and/lower liabilities. That is well and good,” Mr. Singer writes, but government should also think about building a new organization for the cyber age. And, it can do so by taking inspiration from one of the most successful agencies created in the past,” he argues.

“The Centers for Disease Control and Prevention started out in 1946 with a mission to prevent malaria in the U.S.,” Mr. Singer notes. But, he adds, “It has since become the bulwark of the modern American public health system; not only ending the scourge of malaria within the U.S., but helping eliminate global killers like smallpox. Now, it stands guard against new outbreaks like Ebola and pandemic flu. The CDC succeeded,” Mr. Singer contends, “because it established itself as a hub for research on threats that the private market wasn’t equipped, or motivated to confront; and, the public system wasn’t well organized to handle. In doing so, it became a trusted clearinghouse for public and private actors, by sharing important — but, anonymized information with anyone who needed it. Though its leadership is appointed by the government, its staff is recruited from a wide range of specialties — to enhance its independence and credibility.”

“A similar gap could be filled by creating a “Cyber-CDC,” Mr. Singer contends. “Forming an agency whose core mission is cyber security research and information sharing — would help change the nature of the game. It’s not just that there are many similarities between the spread of malware and communicable disease (even the terminology is the same — “viruses,” “infection,” etc.), it is that the CDC plays a key role no missing in cyber security — in terms of the trust factor. We similarly need a publicly funded research organization, trying to understand emerging [cyber] threats, as well as a reliable clearinghouse, transparently sharing information to anyone, and everyone who needs it.”

“As with the CDC in public health, the cyber version would not replace all the other players, but fill a gap that now exists between the public and private space, especially when it comes to the trust factor. It could be structured in a similar way, with leadership appointed by the government; but, with staff recruited across a wide range of specialties to aid its independence and credibility. Or, as one writer for the Cyber Security Law and Policy blog joked, “Essentially, take everything the CDC already does; and, slap a cyber in front of it.”

“Forming an agency whose core mission is cyber security research and information sharing would help change the nature of the game,” Mr. Singer said. “By having a research focus and origin, it would distinguish itself from organizations like NSA, law enforcement agencies, the federal Computer Emergency Readiness Team, trade groups and private companies that now all try to play this intermediary role. These groups each bring strong capabilities; but, they also often have mixed interests and dueling motives that can undermine trust. What’s more, this new agency would have a more cohesive structure, mandate, and funding than the valiant — but, outgunned volunteer outfits that also play in this space,” Mr. Singer noted.

“Implementing a cyber version of the CDC might even have a wonderful side benefit to the diplomatic tensions that so trouble the Internet today. By focusing on research and information sharing, it could serve as a hub for cooperation with all the various state and international agencies, as well as non-state actors that matter in cyber space. Such an entity might serve as a key intermediary in evermore heated political environments, just as CDC proved to be a trusted diplomatic back-channel during the Cold War,” Mr. Singer wrote.

“The benefits of such an [cyber[] organization,” Mr. Singer concludes, “would extend all the way down to the individual level. Just as the CDC plays a key part in public education on preventive health care, so too could a “Cyber CDC,” be a hub for better “cyber hygiene.” “When the HeartBleed security bug was discovered in April — creating potential web vulnerabilities on a mass scale — everyone from software companies and media outlets to the NSA was asked for answers, but none of their responses was fully trusted,” Mr. Singer observed.

“There are many technical and legal, and policy gaps in cyber security today. But, maybe what is missing most is an intermediary we can trust. This new problem might best be answered by an old success story,” Mr. Singer suggests.

Interesting idea. I do not know whether it is a good idea; or, the right one. We probably should have some kind of wisdom of the crowd/social media gathering of the best ideas for cleaning up the Internet and preventing, or mitigating cyber ‘viral’ outbreaks. Once we have collected all the suggestions/ideas, use our big data mining to cull down a manageable list of the top five ideas or so — and, either promulgate the pros/cons of each — as well as attempt to understand the unintended consequences — both good and bad. And, go from there. My own guess is, there is no one right answer; and, most certainly no “silver bullet” solution that will get us to Shangri-La. Like democracy, the Internet is imperfect; but, it is the best we have right now. One thing that doctors at the CDC know is the Hippocratic Oath — “First, Do No Harm.” We should also have a Cyber Hippocratic Oath, and proceed carefully down the road to a better and safer Internet. V/R,

SOME PRINCIPLES OF CYBER STRATEGY – ANALYSIS

By John J. Klein,ISN Security Watch

AUGUST 21, 2014

Although cyberspace has existed for decades, the strategic principles of cyber-warfare have not yet been devised. In beginning to do so, John J. Klein believes that similarities between the cyber and maritime domains suggest that the thought of Sir Julian Corbett should be used as inspiration.

We humans have a habit of allowing the latest technological marvels to overwhelm our more critical strategic sense. – Colin S. Gray

Although cyberspace has existed for a few decades, strategic thought on cyber warfare lags significantly behind the technology that enables it. Much of this condition has to do with the mistaken belief that past strategic thought is not applicable to this man-made domain. Yet because of the importance of the Internet to the global economy and national security, it is critical to understand the fundamental principles of cyber strategy. Without such strategic principles, resources may be squandered on ill-conceived endeavors, while failing to achieve the intended national security objectives in the cyber domain.

The cyber domain

The cyber domain, or cyberspace, has been defined by Andrew Krepinevich as the world’s “computer networks, both open and closed, to include the computers themselves, the transactional networks that send data regarding financial transactions, and the networks comprising control systems that enable machines to interact with one another.” As such, the cyber domain utilizes expansive lines of communication involving a global network, along with hubs of activity at server farms or network hardware locations. Cyber activities involve international commerce and finance, social media, information sharing, and more recently, military-led activities. Cyberspace is not the sovereign territory of any one state, but incorporates both global commons that can be uncontrolled and widely distributed hardware located within sovereign territory. Additionally, cyber operations directly impact and are interrelated with the land, sea, air, and space domains.

Despite the ubiquitous nature and importance of the cyber domain, very little has been written regarding its strategic significance and importance relative to the land, sea, air, and space domains. Nevertheless, as was the case initially with the air and space domains in conducting warfare, analogy to other forms of warfare can be beneficial when developing strategic principles. In fact, using historical analogy to develop cyber strategy may be unavoidable. When considering potential candidates for developing a cyber strategy through analogous comparison, the maritime domain seems strikingly similar.