Our So-Called Foreign Policy: Follow Lithuania’s Lead on China

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China, diplomacy, European Union, Lithuania, One China policy, Our So-Called Foreign Policy, Taiwan

Don’t look now, but the Baltic country of Lithuania (yes, you read that right) has just shown the entire world a terrific way, low-risk and low-cost way to punish China for its worsening bellicosity and human rights atrocities by giving it a great, big black public relations eye. Even better: Though this action need not harm countries taking it one bit, the damage felt by the PRC’s thug leaders will be grievous and therefore capable of generating actual benefits – unlike most such political moves – especially if enough important (and even unimportant) countries participate.

The specific gambit? Permitting Taiwan to set up “a representative office under the name of Taiwan” on national territory. And Lithuania has demonstrated exactly how to do it – in the process demonstrating how this kind of decision can put China into a thoroughly humiliating box.

Lithuania set the process in motion July 20 when it announced its Taiwan decision. Since China’s Communist leaders have always regarded Taiwan as a renegade province whose claims to any form of autonomy amount to a mortal and thus intolerable threat to China’s sovereignty and territorial integrity, no one should have been surprised by Beijing’s response: withdrawing its own ambassador to Lithuania, demanding the departure of Lithuania’s envoy to China, and threatening to cut off diplomatic relations altogether.

Interestingly, Lithuania could have fudged matters in a way apparently acceptable to China had it clearly called the Taiwan facility a trade-focused office, or required it to use the name “Taipei” (the island’s capital) rather than “Taiwan.” However grudgingly, Beijing has tolerated other countries (and indeed the entire European Union, of which Lithuania is a member) taking this approach.

But even more interesting, Lithuania went “the full Taiwan.” Although insisting that it still regarded Communist China as the only legitimate government of China (thus like the United States and most other countries, maintaining full diplomatic relations solely with Beijing in line with a “One China” policy), it accepted the island’s decision to use its chosen name for the office. (That’s a first for Europe.). The “trade office” nomenclature has been rejected as well. (For the record, Taiwan does official business in the United States though “Economic and Cultural” facilities in Washington, D.C. and many other big cities. But the web page for the Washington location calls it an “embassy.”) And Lithuania has refused to back down in the face of China’s bluster.

So now it’s clearly time for every other country that values democracy, human rights, and its own self-respect to follow Lithuania’s lead either in permitting the establishment of explicitly Taiwanese government offices on their soil, or dropping the policy or pretense that existing offices must be strictly commercial entities.

Yes, unlike Lithuania, many major countries have the kinds of economic ties with China that make Beijing’s threats of retaliation understandably troubling. But if all or most act in concert, and stick to their policy guns, and for the time being stick officially with the One China policy, what realistically could or would China do? Withdraw its envoys from dozens of world capitals? Expel just as many foreign ambassadors from Beijing? Tariff imports from just as many trade partners? Cut off all their investments in China? Intensify harassment of all their companies operating in China?

Much likelier: China’ dictators huff and puff, and wind up sitting there and taking it – meaning that a face-obsessed regime would suffer a major indignity in the eyes of its own (face-obsessed) population, and in the court of global public opinion.

More important, Beijing would have little choice but to end its campaign of pressuring other countries to limit strictly Taiwan’s overseas official presence. Unless it wanted to be exposed repeatedly as a paper tiger in this respect? And maybe some governments would want to push the Taiwan relations envelope further, which would only further undermine China’s global image and fears that it – and especially its high tech totalitarianism – represents the wave of the future, and spur more resistance to its dangerous global ambitions.

At the same time, the opposite scenario might be even more crucial: If most countries aren’t willing to call China’s bluff despite the scanty risk levels, Beijing could become even more aggressive, and wring more security-related and economic concessions those with which it interacts. Decades of reckless national policies have already fed this beast with immense wealth and cutting-edge knowhow. Will the world now start feeding it psychologically as well?    

 

Our So-Called Foreign Policy: Biden’s Latest Nod to Trump-ism – Israel-Palestinians Policy?

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Abraham Accords, Antony J. Blinken, Biden, Binyamin Netanyahu, Blob, China, diplomacy, Donald Trump, Gaza, globalism, Hamas, Israel, Jared Kushner, Middle East, North Korea, occupied territories, Our So-Called Foreign Policy, Palestinians, tariffs, Trade, two-state solution, West Bank

As known by RealityChek regulars, one of the leading – and most surprising – features of the Biden administration is a tendency to continue certain Trump administration policies that the current President, and much of the globalist bipartisan policy Blob decried as dangerously naive, xenophobic, short-sighted, isolationist, protectionist [feel free at this point to insert your own scornful epithet].

Now on top of tariffs, China trade and economic strategy, and North Korea policy, there’s a sign that the Biden approach to the Israel-Palestinian conflict can be added to the list. My evidence? Secretary of State Antony J. Blinken’s remarks this morning on the latest eruption after a meeting in Jerusalem with the Jewish state’s prime minister, Binyamin Netanyahu.

The most specific policy statements Blinken made focused tightly on the need for reconstruction aid for Gaza – where Israeli military strikes aimed at stopping Hamas rocket attacks inflicted serious damage – as well as the need “to work to expand opportunity for Palestinians in Gaza and in the West Bank, including by strengthening the private sector, expanding trade and investment, and other means. Assistance and investment like these will help foster a more stable environment that benefits Palestinians and also benefits Israelis.”

By contrast, there were only the most glancing references to resuming diplomatic efforts to bring lasting peace to the region – principally, Blinken’s report that he and Netanyahu discssed “other steps that need to be taken by leaders on both sides to set a better course for their shared future. As President Biden has said, we believe that Palestinians and Israelis equally deserve to live safely and securely; to enjoy equal measures of freedom, opportunity, and democracy; to be treated with dignity.”

And beyond that – nothing. Not even a mention of a negotiated two-state solution that President Biden continues to support as the end goal of U.S. diplomacy.

That looks awfully Trump-y because a focus on economic development in Israel’s occupied territories to ameliorate their populations’ pressing day-to-day needs and create credible hopes for decent living standards and further progress, and an unmistakable deemphasis on returning Israeli and Palestinian leaders to some kind of bargaining table, was a definite hallmark of the former President’s approach to dealing with the conflict. The idea was that the promise and growing reality of prosperity on the West Bank and in Gaza was the best hope for reducing the appeal of violence and creating the conditions in which realistic compromises could – some day – be accepted.

Indeed, Trump’s peace plan conspicuously began with a purely economic proposal – a fund raised from private investors in the Persian Gulf states and other countries that would spend $50 billion over ten years on infrastructure and development projects in the occupied territories. As the plan’s main author, Trump son-in-law and White House advisor Jared Kushner explicitly stated upon its unveiling, “Today is not about political solutions — we will get to them later.”

And although Mr. Biden just issued a re-endorsement of two-state, it’s more than a little interesting that during his Senate confirmation hearings, Blinken acknowledged that “Realistically it’s hard to see near-term prospects for moving forward on that.” That’s hardly a sign of perceived urgency. Perhaps more revealing: The numerous recent articles (all pre-dating the latest Middle East fighting) reporting Mr. Biden’s determination to deemphasize the Middle East as a U.S. foreign priority to begin with – and evidence the administration was following through in official policy declarations and staffing decisions.

Not that this relative indifference marked a significant change in candidate Biden’s campaign positions. In fact, he praised the Trump “Abraham Accords” that normalized relations between Israel and several Arab countries. And although Mr. Biden did charge that Trump’s strong pro-Israel tilt had made a negotiated Israel-Palestinian settlement “even more difficult,” his campaign’s main foreign policy statement didn’t even mention the issue. (Perhaps that’s because he reserved his more detailed – and somewhat more critical – verdict for his campaign’s articulation of a policy toward “the Jewish community.”)

But the foreign policy Blob’s judgement were much harsher – largely because Trump was seen to be recklessly ignoring the Palestinians’ legitimate aspirations and the supposedly obvious reality that not only was peace between Israel and the Palestinians was impossible without taking the latter’s interests seriously, but that meaningful progress toward pacifying and even stabilizing the entire Middle East was as well. (See, e.g., here and here).

It’s an exaggeration to say that the President has now repudiated this pre-Trump conventional wisdom on the Israel-Palestinian conflict. But he’s clearly in no rush to embrace it. And given his other adoptions of Trump-ian stances, it strikes me as evidence that not only is Mr. Biden moving away from pre-Trump globalism, but that the days of this strategy dominating American foreign policymaking writ large are numbered themselves.    

(What’s Left of) Our Economy: Why Pre-Trump Trade Policies Really Were America-Last Policies

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diplomacy, Finbar Bermingham, globalists, negotiations, South China Morning Post, Trade, Trump, U.S. Trade Representative, USTR, {What's Left of) Our Economy

I’ve often struggled to decide whether America’s dreadful trade policies over recent decades have stemmed more from incompetence (as President Trump sometimes charges) or corruption in the form of politicians and diplomats shilling for offshoring business interests or the often economically clueless national security community (as Mr. Trump also sometimes charges).

A report from Hong Kong’s South China Morning Post (which still publishes mostly reliable material even though the city is now part of China) didn’t settle the matter for me. But it once more valuably reminded that their country’s national interests have rarely topped U.S. trade negotiators’ priority lists. Why else would these officials have allowed themselves to be duped by the series of transparently cynical ruses and deceptions from their foreign interlocutors that they themselves describe in the article?

Correspondent Finbar Bermingham makes clear that his aim was to show how major “complications that can arise from issues of language, interpretation and translation during negotiations” and that as a result, “trying to iron out arguments over words, phrases or even grammar can be ‘worse than pulling teeth.’” Instead, what he (and the “experienced negotiators” he interviewed) demonstrated was how easily they could be snookered – and how thoroughly they either forgot or ignored America’s decisive leverage in all these dealings.

Take Elena Bryan. According to this 17-year veteran of trade negotiations with the Office of the U.S. Trade Representative (USTR), “it’s very hard to enforce anything under the Chinese because their system is both complicated and relatively opaque, and there aren’t that many Mandarin speakers around that have the requisite technical trade and legal skills.”

But with its new tariff hike threat (which has the Chinese scurrying back to Washington to try to restart talks), the Trump administration has just suggested how easily this allegedly formidable challenge can be overcome: Tell the Chinese to get serious – and work with standard English – or they get higher tariffs imposed on their goods heading for the U.S. market that their economy desperately needs to produce adequate growth and employment.

Ditto for the claim by Bruce Hirsh, “assistant USTR for Japan and South Korea under former US president Barack Obama,” that “Haggling over individual words was 90 per cent of the game. How much of that was a language and translation issue and how much of that was just the actual negotiation over the substance is hard to say.”

Indeed, if anything, Hirsh’s position – and that of his boss – was even less acceptable, since both Japan and South Korea have even less economic leverage over the United States than China, and they also depend on American nuclear guarantees for their defense. As soon as they started haggling over words, Hirsh should have walked out of the room and urged his President to lower the tariff boom.

Nicole Bevins Collinson, “a textiles negotiator for the USTR in the 1990s,” inadvertently let readers know just how pathetic such excuse-making can become:

“The issue of commas and where they’re placed, and whether you use the words ‘and’ or ‘or’ were always big sticking issues. The other big thing was ‘may’ and ‘shall’. In some languages, those words are the same – or maybe they would just tell us that. What we thought was ‘shall’, they translated into ‘may’ and we were told we can’t use the word ‘may.’”

No wonder the American textile industry has struggled so mightily in the face of often predatory global competition and grew only about a fifth as fast in real terms as U.S. manufacturing overall during the 1990s.

Another type of nonsense-enabling was served up by Jean Heilman Grier, “who between the USTR and US Department of Commerce, spent 25 years negotiating and advising on trade agreements for the US government.”

Grier told Bermingham that “The Japanese…prefer more ‘conceptual’ text. ‘They don’t want the exactitude that we’re often looking for. So that’s where you can kind of get into problems with some of the translations.’” Talk about a great stalling tactic, especially when the folks on the other side of the table seem too happy to play along.

About the kindest interpretation that can be put on this manifest incompetence is that these diplomatic veterans valued reaching any kind of deal, even a bad one, over risking a no-deal outcome. In the words of Mary Ryckman, “who spent 30 years with USTR negotiating a host of trade agreements,” “You have the ‘art of the being vague’ and you agree to be vague because you want to come to an agreement.”

Ryckman’s point underscores a critical truth about American trade diplomacy – the diplomats quoted above and most of their colleagues in the pre-Trump decades weren’t making trade policy. They were simply carrying out orders from the globalists above. So Ryckman, for example, can’t be blamed for the “agreement or bust” imperative she followed. That blunder was on the President at the time.

But the South China Morning Post piece also indicates that none of the officials quoted had the slightest problem with their instructions, even though they all but guaranteed failure from the U.S. standpoint, at least defined commonsense-ically. Despite decades of experience, and of clear failure to achieve the stated goals of their efforts (usually meaningful foreign market opening), they apparently were content to play the dupe. Whether witting or unwitting, though matters much more when it comes to the intentions and records of their superiors than to their own.

Our So-Called Foreign Policy: North Korea, China, & the (Inevitable) Limits of Diplomacy

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agriculture, China, commodities, diplomacy, energy, Iran, Kim Jong Un, LIbya, Made in China 2025, manufacturing, Muammar el-Qaddafi, North Korea, nuclear weapons, Our So-Called Foreign Policy, Russia, Saddam Hussein, Saudi Arabia, South Korea, tariffs, technology, Trade, trade deficit, tripwire, Trump, Ukraine

Diplomacy has sure taken a beating these last few days. And revealingly, that looks like a good thing.

Let me explain: I have no problem whatever with countries trying to resolve their differences peacefully, through dialogue and compromise. But in the nuclear age, and especially after America’s Vietnam debacle, this age-old concept has turned into a foreign policy magic bullet in the United States – including among the nation’s bipartisan globalist establishment. So the collapse (for now) of plans for a summit between President Trump and North Korean dictator Kim Jong Un, and the failure so far of the President to make any headway in curbing China’s predatory trade practices, could be welcome developments. For these developments could remind Americans of diplomacy’s limits in promoting U.S. national interests (the overriding priority of the nation’s foreign policy), and how even on crucial issues of war and peace, it can be completely pointless and even dangerously distracting.

On North Korea, there have always been strong grounds for skepticism that negotiations could achieve America’s main objective – the complete elimination of Kim Jong Un’s nuclear weapons. It’s true that Kim has appeared more interested in economic reform than his father or grandfather – who preceded him in power. Therefore, in principle, he would be more responsive to economic carrots and sticks. On the one hand, he might be amenable to surrendering his arsenal in exchange for foreign investment and aid (along with security-related concessions from the United States like formal recognition of his regime, a peace treaty ending the decades-long state of war between Pyongyang and its enemies). On the other hand, he might be more concerned about the impact of the sanctions that President Trump has both broadened and intensified.

Yet it was always difficult to believe that Kim would prize any of these considerations above his regime’s defense against overseas threats, and for these purposes, nuclear weapons are hard to beat. As widely noted, he’s surely been impressed by the gruesome fates of fellow autocrats who gave up their nuclear hopes (Libya’s Muammar el-Qaddafi) or who hadn’t the chance to develop these weapons (Iran’s Saddam Hussein).

Further, Kim also is no doubt aware of a third recent example of a country paying heavily for signing away its nuclear weapon status: Ukraine. In 1994, that nation agreed to dismantle the large nuclear force stationed on its soil when it was part of the Soviet Union, and left there after the USSR’s demise. In return, it received security promises from the United States, the United Kingdom, and Russia that its territorial integrity would be respected. A quarter century later, Moscow has seized effective control over much of the country’s eastern half.

Moreover, if a Trump-Kim summit and follow-on negotiations resulted in a compromise that left the North with some kind of nuclear arsenal, this “victory” could eventually become disastrous for America and its homeland. For there would be no guarantee that Kim would have truly abandoned his family’s goal of dominating the Korean peninsula through nuclear-aided conquest or intimidation of the South. And as long as large U.S. ground forces remained in South Korea, the outbreak of war would still threaten to draw Washington into a conflict with a foe capable of hitting its territory with nuclear warheads.

That still-live prospect should be an awfully powerful reason for switching to a strategy I’ve long advocated – ditching diplomacy, withdrawing the U.S. troops in South Korea that expose the United States to nuclear danger, and permitting North Korea’s neighbors to handle Kim and his nuclear ambitions any way they wish.

Trade diplomacy with China doesn’t threaten to turn an American city into a glowing ruin. But it’s all too likely to result in open-ended talks that do as little to combat the economic and security threats created by Beijing’s trade predation as previous negotiations involving President Trump’s predecessors. As I’ve recently written, even if his administration could come up with a coherent set of priorities, adequately verifying any Chinese compliance with U.S. positions is a pipe dream.

But this latest American attempt at trade diplomacy faces two other seemingly insuperable obstacles. First, the President’s objective of reducing the U.S.’ massive bilateral trade deficit with China appears to neglect the makeup of this deficit – which matters more than its size. Specifically, his proposals to date envision narrowing the trade gap mainly by boosting American exports of farm products and energy to China.

Both sectors of the U.S. economy are obviously important. But neither can become a major driver of sustainable American prosperity, because they’re essentially involved in producing commodities – which have never added nearly as much value to national economy as manufactures. That’s why developing countries invariably view a transition from agriculture to industry as the key to their hopes for rising living standards, and why even wealthy energy producers like Saudi Arabia have resolved to focus more on manufacturing and other higher value activities.

And P.S. – that’s no doubt why the Chinese clearly consider this American demand the most appealing on the Trump agenda.

As for the intertwined threats of continued and rampant Chinese intellectual property theft, and of China’s master plan to lead the world in a wide array of “industries of the future” (the Made in China 2025 program), U.S. tariffs on the goods and services these policies already enable Beijing to produce and export could well deal its ambitions a major blow. And clearly, that’s the Trump administration’s aim.

But if so, why negotiate over these matters? The United States has made reasonably clear what it wants China to do. And it’s declared its intent to retaliate with trade curbs if China balks. If the Trump administration is serious about this approach, and confident that it will succeed, what is there left to talk about? Either the Chinese accede (in which case, as I wrote this week, towering verification challenges would remain), or they dig in their heels and the tariffs follow.

Further talks, unless they’re simply aimed at clarifying American positions, can only muddy the waters and encourage endless Chinese foot-dragging – including regularly throwing Washington a few crumbs of market share – by telegraphing a Trump reluctance to pull the trigger. All the while, the Chinese tech prowess ostensibly alarming Americans across the political spectrum will keep growing.

And as with the case of the Korean crisis, a far better American approach would be disengagement – i.e., a series of measures aimed at reversing the disastrously wrongheaded twenty-year U.S. effort to more closely link the nation’s fate to a country with which mutually beneficial commerce was never possible. The Trump administration has already taken some important steps in this direction. Chiefly, it has greatly tightened restrictions on Chinese takeovers of economic assets in the United States. And the President’s threatened tariffs have induced some factories to move from China to the United States. But as previously indicated, the administration also seems bent on helping U.S. companies invest more in the Chinese economy, which can only further widen the trade deficit and hand China more cutting edge American technology. And it’s given no hint of a comprehensive strategy to bring manufacturing supply chains now concentrated in China back to the United States.

The latter task, in particular, will entail a long-term effort – not exactly the American governing system’s strong suit these days. And success will also depend on thoroughgoing domestic policy reform. (See this article for one sensible list.) But compared with the apparent belief that, over any policy-relevant time frame, China’s will become an economy compatible with America’s, it’s the height of realism.

Im-Politic: Why Trump’s Debate Victory over CNBC Really Matters

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2016 elections, Ben Carson, CNBC, diplomacy, Donald Trump, fast track, Im-Politic, multinational corporations, offshoring, presidential debates, Rand Paul, Republicans, Ted Cruz, Trade

No, this isn’t an endorsement, but the way Donald Trump handled the dispute over its planned presidential debate format between CNBC on the one hand, and several Republican candidates including him on the other, shows precisely why he could well transform U.S. trade policy – and possibly American foreign policy – dramatically for the better if elected.

Along with Ben Carson, Ted Cruz, and Rand Paul, Trump protested CNBC’s original plans for two hours of actual debating time, plus up to 16 minutes of commercials, with no opening or closing statements by the contenders. The four protesting candidates wanted the event’s total time capped at two hours, and insisted that opening and closing statements be included in that total.

As these disagreements indicate, the gulf between CNBC and the four Republican hopefuls wasn’t terribly wide. But what’s important about this story is how and why these candidates – and especially Trump – prevailed even though the rest of the much more numerous Republican field apparently was fine with CNBC’s intentions.

Essentially, the four dissenters recognized that they had decisive leverage. (Their absence – especially Trump’s – could cost the cable network valuable ratings.) They threw around their weight. And they won. And when it comes to trade policy (and many other international challenges and opportunities facing the United States) that’s exactly what U.S. leaders from both parties have consistently failed to do for decades, even though the United States typically holds all the main cards.

This is especially true in trade policy, because the United States has long served as the market-of-last resort for a world full of major and minor trade powers alike that desperately depend on ever higher exports for adequate growth. But Washington’s failure to wield its relative power and leverage effectively arguably has undercut important American objectives in the national security sphere, too – for example, in persuading free-riding allies to bear a greater share of the West’s common defense burden.

I single Trump out because none of his three comrades in arms in this tussle has made trade policy a centerpiece of their campaigns. In fact, Texas Senator Ted Cruz and his Kentucky counterpart Rand Paul have been strong supporters of the substance of America’s current trade strategy, though both opposed (for procedural and political reasons) the recent (successful) attempt in Congress to award fast track negotiating authority to President Obama. Moreover, unlike Trump, neither Carson nor Cruz nor Paul has touted deal-making and bargaining as among their strongest suits. 

At the same time, Trump’s victory over CNBC underscores how incomplete his attacks on American trade diplomacy have been. For Washington has signed deficit-fueling and deals and reached similarly counterproductive trade policy decisions (like long coddling China’s currency manipulation) not mainly because U.S. officials can’t size up a situation accurately – a charge consistent with Trump’s claim that they’re incompetent and lack elementary street smarts.

Instead, they repeatedly fail at trade bargaining tables to advance and defend the interests of the American economy as a whole primarily because they haven’t considered that their job. They view themselves as agents of offshoring-happy multinational corporations, whose campaign contributions have ensured that their trade priorities prevail even when success comes at the expense of America’s productive sectors.

That’s why, as I keep arguing, Trump’s trade policy rhetoric should mainly demonize these U.S. corporate special interests, not foreign governments. (And why it’s encouraging that he’s shown signs of making this pivot.) At the same time, since the United States no longer dominates the world stage as in the early post-World War II decades, accurately assessing power balances and recognizing when compromises are needed has also become an important ingredient for diplomatic, and presidential, success.

So Trump should promise that he’s independent enough to be working for Main Street (because he doesn’t need that special interest money), that he’s tough enough to press clear advantages hard, and that he’s smart enough to “know when to fold ’em.” What other candidates can credibly make this combination of claims?

Our So-Called Foreign Policy: Obama Ignores the Diplomacy Lesson Taught by China’s Aid Bank Gambit

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allies, Asian Development Bank, Asian Infrastructure Investment Bank, China, diplomacy, international organizations, international relations, Obama, Our So-Called Foreign Policy, power, TPP, Trade, trade agreements, Trans-Pacific Partnership, World Bank

You have to be a regular visitor to the furthest reaches of business news websites to be up to speed on the controversy over dealing with the new Asian Infrastructure Investment Bank (AIIB) China has organized. Which is a shame, because the issues involved bring up our most fundamental ideas about how international relations are actually carried out and how they should be carried out.  They show how violently many of them clash.  And they point to the dangers of learning the wrong lessons.

The bank is an institution that Beijing says will serve two main purposes. First, it will speed up lending to Asian countries for urgently needed infrastructure projects that has been slowed by concerns about adequate spending controls, environmental standards, merit-based contracting practices, and similar conditions typically attached by existing development organizations like the World Bank and the Asian Development Bank. Second, it will give Asians more control over their own destinies, because those existing aid organizations are still dominated by Western countries – and by extension the supposedly Western values epitomized by their aforementioned policies.

The United States initially opposed the AIIB’s creation. But when China pushed ahead anyway, Washington began focusing on urging its regional allies and other Asian countries, as well as prospective non-Asian donor governments, to give it the cold shoulder. Unfortunately, many of these countries have ignored U.S. wishes, too – including Britain, Germany, France, Italy, and probably Australia.

The results add up to a major setback for American diplomacy – but also a self-inflicted one. U.S. leaders have viewed the Bank’s creation as part of a Chinese master plan to ensure that the rules of commerce in the economically dynamic Asia-Pacific region are written by free market countries and therefore reflect free market norms, rather than by Beijing and other champions of more secretive, more discriminatory, and more nationalistic practices. In addition to opposing the Bank’s creation, the Obama administration also has sought to respond by concluding the Trans-Pacific Partnership (TPP) trade deal, whose provisions it believes will lock the region into a free market future, and create incentives for countries seeking to join (like China) to change their ways.

But China’s successes are just the latest reminder that Washington completely misunderstands the forces that separate the winners from the losers not only in Asian politics, but around the world. For as widely reported, even America’s closest partners are cooperating with China because the lure of Chinese economic power, and the promise of increasing access to China’s enormous actual and potential market, have proven irresistible. All maintain generally free market, and thus rule-based, economic systems at home.  But none of these governments seems concerned about entering arrangements with countries like China, which actively reject the primacy of rules and all of their corollaries, like openness, and accountability to consumers, voters, and the like.

In other words, President Obama’s focus on rule-writing is completely misplaced. Fortunately, the United States has ample power of its own. In fact, as the most important final market by far for all countries currently involved in the TPP negotiations, and for all countries hoping to join, as well as the military protector of many of these nations (and of the Europeans flocking to the AIIB), the United States should have no trouble keeping the lid on China’s influence. A simple declaration that “If you want the benefits of trade with and protection by the United States, you need to act like it,” should suffice – along of course with the determination to walk this walk.

But the most important ingredient for this strategy is a U.S. chief executive who recognizes that world affairs is still mostly jungle, not civics class. Troublingly, the record indicates that Americans won’t get one until January, 2017 at the earliest.

Our So-Called Foreign Policy: The Crucial and Neglected Difference Between Real and Non-Real Countries

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diplomacy, Middle East, Our So-Called Foreign Policy, real countries

Although he’s not aware of the service he’s rendered, everyone seeking to understand U.S. foreign policy’s challenges better in regions like the Middle East owes a debt of gratitude to Harvard economist Ricardo Hausmann. He’s unwittingly presented a reminder that most of the countries in this part of the world may look like political units that are called nation-states, but that they lack the critical attributes of these “real countries.” As a result, strategies seeking to manipulate or rely on them as if they were real countries – like recent and current U.S. approaches to the region – are bound to fail.

In his latest column for the Project Syndicate website, Hausmann probes the question of why the modern world has been seeing the kind of “selective convergence” in national economic performance that has broken past patterns of economic growth. The author, a former Chief Economist at the Inter-American Development Bank, notes that this selective convergence (or divergence, depending on your vantage point) is especially puzzling because rapidly globalizing trade and investment were by definition rapidly diffusing equalizing factors like technology.

His explanation is that some third world countries in particular have closed themselves off to trade and investment, in a mistaken effort to protect and nurture local industries. The argument is pretty muddled, but Hausmann also misses a more fundamental reality.

In previous eras, when convergence and divergence were uniform, the entities converging and diverging were all what I’ve previously called “real countries.” In other words, all were well organized and cohesive enough either to develop modernizing technologies and other capabilities on their own, or to assimilate capabilities available abroad. A set of countries that capitalized on these opportunities (in Western Europe, North America, which were eventually joined by Japan) pulled rapidly ahead of a set of countries that simply didn’t (like India) or wouldn’t (like China).

More recently, as Hausmann points out, many countries, in particular from the developing world, have taken advantage of global technology and capital flows. Largely through successful absorption and imitation of existing technologies, they have impressively closed the gap with wealthier competitors.

But what Hausmann overlooks is that today’s world also contains entities that were of course present before, but never included in studies of national wealth – entities that aren’t really countries at all. The third world regions in which they’re currently found, such as sub-Saharan Africa, were controlled in times past by others, and for the most part were economically inert.

Today, these regions are politically independent in an official sense, so their economic performance is counted by those interested in the subject. They’re still for the most part economically inert, however – not mainly out of choice, but because they’re simply not up to the challenge. They possess the form of real countries in many ways but not the substance.

As I wrote for the The Atlantic in 1993, “non-real countries” typically boast “heads of state, armies, and postage stamps. They send ambassadors abroad. Underneath, however, they are something else entirely: some are legal-political fictions, some family corporations in which the restive immigrant employees greatly outnumber the indigenous owners, others ‘tribes with flags.’ All are under constant assault by centrifugal forces ranging from ethnic and religious tensions….For many regimes, [scapegoating] is the only hope of survival.”

As a result, modern studies of national economic performance count not only established high-income countries and lower-income countries successfully playing catch-up, but entities that only superficially resemble countries, and that consequently can’t possibly make noteworthy economic progress. In other words, economic convergence today doesn’t include a large number of countries because they aren’t really countries to begin with.

Drawing this distinction nowadays is even more important for U.S. foreign policy and national security, since the Middle East – the subject of my 1993 article – is still comprised largely of entities not fitting the bill of real countries. Yet American leaders – and most of their critics on the Left and Right – keep treating the region as if it’s little more than a hotter, drier, much less secular version of Western Europe. Hence the emphasis on mobilizing the “front-line states,” engaging “regional partners,” and other ideas assuming that most Middle Eastern actors are interested in making the kinds of commitments on which traditional diplomacy rests, and that they’re able to keep whatever commitments they make.

Until Washington and the rest of the foreign policy establishment recognizes that lines on a map do not a real country make, all aspects of America’s Middle East strategy, and their leading alternatives, will become formulas for quagmire.

Our So-Called Foreign Policy: How Obama Keeps Feeding Palestinians’ Delusions

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diplomacy, Hamas, Israel, Middle East, negotiations, Our So-Called Foreign Policy, Palestinians

As bad as developments on the ground are, the biggest blow delivered lately to prospects for a lasting end to the violence between the Israel and the Palestinians came from Secretary of State John Kerry. The main problem: He’s heading back to the Middle East to negotiate another ceasefire.

The idea evidently was Kerry’s. The Secretary was caught on camera yesterday grousing to an aide about the collateral civilian damage from Israel’s invasion of Gaza, and then concluding, “We’ve got to get over there” to calm the situation. President Obama agreed.

Most pundits and foreign policy establishmentarians will applaud this latest exercise of “American global leadership.” Yet history teaches that whatever short-term gains such diplomacy may produce will be more than offset by further violence over the longer term that makes prospects for an enduring settlement ever bleaker. For this American – and other forms of outside – interventionism can only feed Palestinian delusions that what has been decisively lost on the battlefield can be regained at the negotiating table, via external pressure for Israeli concessions.

As explained in this op-ed of mine published 12 years ago, these Palestinian hopes are delusional, and U.S. and other diplomatic involvement is counter-productive, because both assume that Israel’s position of massive and indeed growing strategic superiority can be negated or defined out of existence. Yet since international paper guarantees – which have a discouraging history of quickly being broken or explained away – can never achieve or protect a strong nation’s security nearly as well as its own devices, foreign peace-making attempts inevitably amount to dressed up efforts to urge Israel to surrender advantages that are not only invaluable, but that it is literally in no danger of losing.

Also inevitable: The greatest victims of ceasefire talks, shuttle diplomacy, peace conferences, and the like will remain the Palestinian people. These exercises not only inevitably convince their leaders that foreign pressure on Israel can negate their massive military inferiority. They just as inevitably lead Palestinian extremists in particular to exploit the only semblance of an effective weapon they (rightly) believe they still possess – the ability to arouse Western indignation through periodic outbursts of violence bound to trigger Israeli reprisals and therefore Palestinian civilian casualties.

Because the United States and other foreign democracies do have consciences, this strategy has periodically succeeded in saving Palestinian paramilitaries from total defeat, and enabling them to fight (ineffectually) another day. But it has no chance of generating enough pressure to achieve the goal most of the leadership (at least from time to time) says it wants – a Palestinian state with full sovereignty, including the unfettered right to field its own armed forces, but which Israel, for the foreseeable future, rightly perceives as unacceptably risky.

In fact, as my 2002 article makes clear, conceivable foreign interference lacks the ability even to generate anything remotely deserving to be called a “negotiation.” For the Israelis’ ability to achieve their own main objectives through their own efforts and capabilities means that the Palestinians can offer them nothing that is worth accepting a significant compromise. Moreover, as implicitly recognized by the Palestinians’ persistent but vain hopes in a Washington savior, they have no chance of mustering the military power to force meaningful Israeli concessions on their own, and no one inside or outside the region will provide the men or materiel to change realities on the ground.

If the Obama administration – and its successors – really wants to foster a lasting Israel-Palestinian peace settlement, they will adopt a hands-off strategy. Such non-interference will at least stop encouraging Palestinian obstinacy and extremism, and could well force a critical mass of Palestinians and their leaders to accept the reality of strategic defeat.

Fortunately for this continually exploited and beleaguered population, in this case, strategic defeat does not doom it to political defeat. For unlike most of history’s victors, Israel, for all its flaws, is a pluralistic democracy, and therefore predictably contains a large voting bloc that’s anxious for genuine peace sooner rather than later. Therefore, the Palestinians have an opportunity – and have always had an opportunity – to strengthen this constituency and start winning significant compromises by conclusively demonstrating peaceful intentions. Not that this approach is sure to work. But unlike sporadic violence, it’s not sure to keep failing.

At the same time, however, the Israeli democracy also contains a large voting bloc that’s eager to expand West Bank settlements further and continue squeezing the Palestinians. So if the Arab residents of the West Bank and Gaza, truly want better and freer lives, they’ll start changing their behavior right away. Contrary to the longstanding conventional wisdom about this conflict, time is anything but their friend.