David Rohde

Last week, 41 American companies received awards at a little noticed White House ceremony. Despite the recession, the companies – most of them small and medium-size businesses – have experienced rapid growth and handsome profits in recent years. And they’ve beaten Chinese, Indian and European competitors at their own game.

How? By selling to a burgeoning global middle class expected to grow by 1 billion people – primarily in Asia – over the next decade.

Zippo Manufacturing Co, the maker of the iconic American cigarette lighter, has experienced 1,000 percent sales growth in China over the last 20 years and 900 percent growth in India over the last eight years. While other American companies have shed jobs, the 650-employee, Bradford, Pennsylvania-based company has added 150 jobs in the last three years and experienced a 20 percent increase in sales, most of it overseas.

“It’s tough to compete, but we’re doing it,” said Greg Booth, the company’s president and CEO, referring to cheap lighters manufactured in Asia. “We’re competing in a category that is under incredible pressure.”

DSC Dredge, a small, Louisiana-based builder of dredges, has increased its overseas sales by 1,300 percent over the last 10 years and nearly doubled in size from 80 to 140 employees. Their biggest overseas customers? Nigeria and Bangladesh, countries that Americans think of as impoverished but are experiencing significant economic growth. The firm’s overseas sales have risen from $1.4 million a year in 2002 to over $20 million last year and make up 65 percent of its business. Charles Sinunu, the director of international sales, said the firm just sold three dredges to Russia and sells to 48 countries worldwide.

“It’s become something where it really wasn’t a big deal 10 years ago, and now it’s a huge deal,” he told me. “Right now, we have a record backlog of business and are actively trying to hire additional people.”

And OSIsoft of San Leandro, California has done the seemingly impossible. While other companies have outsourced programming and technical work to India, the $300 million business software firm has grown from 150 to 750 employees in the last six years. Where are its new customers? In 110 countries around the world. Where are nearly all of its employees? Inside the U.S.

“We basically came to the conclusion that the cost of software development outside the U.S. is more expensive,” said Nand Ramchandani, OSIsoft’s director of business development and government affairs. “We just can’t afford to have negative experiences. We’d rather develop that in house.”

A rough pattern emerged in interviews with senior executives of five of the 41 winning firms, which sell everything from vitamins to “waterless urinal technology” to oilseed presses. The rise of middle classes in China, India and other developing nations was not the death knell of the American middle class, they said. Instead, it represents an opportunity for American businesses that are willing to adapt.

“The real war that is being waged every day is an economic war,” said Tom Kallman, a former Air Force F-15 fighter pilot whose New Jersey-based consulting firm, Kallman Worldwide, won an award for helping other U.S. companies export. “America’s strength and future depends as much on a strong economy as it does on laser-guided bombs and jet fighters.”

American politics, though, is not changing fast enough, the business leaders warned. They expressed derision for the partisan politics of both parties in Washington.

“I can’t state this strongly enough,” said an executive at one of the award-winning companies who asked not to be named. “There aren’t words in our language to express it. They are so far off base it’s sad.”

He and other executives said the problems come from the extreme right and left. Last week, a Tea Party-backed bill to close the U.S. Export-Import Bank, which lends money to American firms that export, was defeated in the Senate. Several of the businesspeople said the bank wasn’t perfect but it was an invaluable tool for countering Asian competitors, particularly Chinese companies that receive state support. DSC Dredge’s Sinunu said the Chinese are “eating our lunch” in Africa, which now boasts seven of the world’s 10 fastest-growing economies.

“I think that would be a horrible thing,” Sinunu said, referring to shuttering the bank. “The Ex-Im Bank is one of the very few things that I can shoot from my quiver to be successful. Getting rid of the Ex-Im Bank would be an absolute disaster for American companies that want to do business overseas.”

Executives from the small firms generally praised an initiative by the Obama administration to consolidate the Commerce Department and six trade- and business-related agencies into a single, more effective body and the president’s goal of doubling American exports by 2014. But they said American government export-promotion efforts still pale in comparison with those of China, Korea and many European countries.

The U.S government does not do enough to support American companies when they have designs stolen or counterfeited overseas, they said. The Commerce Department does not have enough staff based overseas to help American businesses, and post-2001 restrictions on granting U.S. visas to foreigners, particularly from predominantly Muslim countries, alienate overseas customers.

The executive who asked not to be named praised Korea’s government for fiscal discipline, creating exceptional education systems and providing vast loan guarantees for Korean companies that are trying to export.

“I think it’s relatively ingenious,” he said, “to take their government money and utilize it to provide really good financing.”

The awards – and the places these companies have found customers – show that the gravest threat to America’s prosperity isn’t the rise of middle classes overseas. It is Washington’s blind adherence to dated ideologies that handicap our innovative small businesses. The world is changing, but Washington is not.

PHOTO: An employee poses with newly released “dragon totem” models of Zippo lighters to celebrate the upcoming Dragon Year in Beijing, January 13, 2012. REUTERS/Soo Hoo Zheyang

This weekend in Chicago, President Obama will gather with more than 60 heads of state to hold NATO’s 25th anniversary summit. He and other leaders will convene as a Western-created system of international justice – enforced in many places by NATO – has grown stronger, and raised expectations of accountability around the world.

This week, Bosnian Serb general Ratko Mladic finally went on trial in The Hague for war crimes in Bosnia after evading justice for 17 years. Last month, former Liberian President Charles Taylor was convicted of aiding and abetting war crimes by a separate international court. And in a surprising example of the spreading expectation of international justice, protests among the Syrian diaspora have included signs demanding Bashar al-Assad be sent to The Hague.

At the same time, as people around the globe see war criminals brought to justice, they want to see the world’s most powerful armies held accountable as well. Outside the U.S. and Europe, there is a growing sense of a two-tiered system of international justice. The West puts others on trial for war crimes, the argument goes, while exempting its own forces from scrutiny.

“There is a contradiction,” said Richard Dicker, the head of Human Rights Watch’s International Justice Program. “As the reach of justice extends further and as expectations of justice increase, the shortcoming in the uneven landscape – the uneven application of law to all – becomes more stark.”

Some of the perceptions are exaggerated. The U.S. and NATO are not evil incarnate, nor are they perfect. A recent examination by Human Rights Watch, for example, found that the seven-month NATO bombing campaign in Libya killed at least 72 civilians but that the alliance took major steps to try to avoid such casualties. Taylor and Mladic, meanwhile, went out of their way to kill civilians.

The belief that there is a double standard, though, is visceral outside NATO. In conversations with me over the last several years, everyone from Chinese intellectuals to Bosnian Serb civilians to Taliban fighters have passionately believed that the West’s crimes are far worse than those of the people hauled before international tribunals.

Hina Shamsi, the director of the American Civil Liberties Union’s National Security Project, said America’s actions as it targets suspected terrorists around the world undermine its role in bringing fugitives like Taylor and Mladic to justice.

“The U.S.’s use of drones, targeted killings and indefinite detention is actually destabilizing the international system of law it helped to create,” she said.

One hundred and twenty-one states have signed and ratified the treaty that created the International Criminal Court in 2002 and agreed that their citizens can be tried there for war crimes. The world’s three most militarily powerful nations – the United States, China and Russia – have declined to join the treaty, depriving the new, Hague-based court of binding jurisdiction over their citizens. As a result, in most cases it would take the passage of U.N. Security Council resolution for an American, Chinese or Russian to be tried by the International Criminal Court. Considering the Security Council vetoes that the U.S., Russia, and China enjoy, that will likely never happen.

The system plays out unevenly in other ways. Moscow’s veto protects those close to it, such as Syrian President Assad. China’s veto, for example, protects North Korea’s autocratic regime. And critics of Israel say America’s veto does the same for Israeli transgressions.

“The most powerful states – among whom there are great distinctions in commitment to the rule of law – nonetheless hold themselves at a distance or beyond these international justice standards,” Dicker said, “creating the perception – and the reality – of hypocrisy and a double standard. And that needs to change.”

In some ways, there is a double standard. To be blunt, Taylor and Mladic are comparatively easy pickings. International pariahs with no powerful allies, their arrests and convictions cost U.S. and NATO leaders little political capital.

Still, their presence in the dock is a positive step that creates a sense of justice for victims. Their convictions and the creation of the International Criminal Court may deter future war crimes, and should be hailed.

But at the same time there is a widespread belief that American, NATO and Israeli forces do not face the same level of accountability. And some elements of the so-called war on terror do skirt international law. The Obama administration stopped some of the Bush administration’s worst practices but has embraced others.

The U.S. should join the International Criminal Court, as nearly all of its NATO partners have. It should end over a decade of indefinite detention without trial in Guantanamo Bay. American drone strikes should be carried out by the U.S. military, be publicly announced, and no longer be covert operations run by the CIA. And when reports of drones killing civilians emerge, they should be investigated, with compensation paid to the victims – as the laws of war require.

But American drone strikes in Pakistan are not as indiscriminate as the Russian army’s shelling of Grozny. The profiling of American Muslims by the New York City Police Department was shameful, but it is not as pervasive as the Chinese government’s harassment of Uighirs. I am not justifying the excesses of America, particularly post-9/11. Our offenses are inexcusable, must end and only reinforce our rivals’ conspiracy theories.

An example of how the conduct of war has skirted, distorted and outpaced the laws of war emerged in Idaho this week. After maintaining a yearlong silence, the family of Sgt. Bowe Bergdahl – the only American soldier in Taliban captivity – gave a series of interviews to the American news media.

The Bergdahls called on the Obama administration to move ahead with peace talks that could involve the exchange of five Taliban prisoners currently in Guantanamo Bay for their son, who has been held captive in a Taliban safe haven in Pakistan’s tribal areas for nearly three years. Legally, the Taliban detainees are not prisoners of war. Nor is Bergdahl. They both exist in an undefined legal – and political – “war on terror” gray area.

(I’ve talked to the Bergdahls intermittently as they have struggled with what to do. They hoped that my seven-month kidnapping by the Taliban in 2008-2009 might have given me some answers. Unfortunately, I had none for them.)

After the Bergdahls went public, administration officials said they were open to continued negotiations. But it’s clear there’s little chance of a deal during a U.S. presidential election campaign season. Peace negotiations with the Taliban – or a prisoner exchange – will be assailed by Republicans as appeasing terrorists.

I am not arguing that more closely abiding by international law will somehow make militants no longer hate the United States. Some of them can only be countered with lethal force. But closely following the laws of war is in our strategic interest. It undermines those who accuse the U.S. of hypocrisy and helps win the support of those who hold the same ideals.

The best course for the United States – and its NATO allies – is to pledge this weekend in Chicago to more strictly abide by the laws of war they have created.

President Obama and other leaders who ignore the perception of a double standard do so at their peril. The U.S. and NATO should ally themselves with the laws of war. They should not allow those standards to become their enemy.

PHOTO: A man wearing a mask of Syrian President Bashar al-Assad demonstrates against Assad in front of the International Criminal Court (ICC) offices in The Hague, June 7, 2011. REUTERS/Michael Kooren

UPDATE: JPMorgan’s surprise announcement late Thursday of a $2 billion trading loss – and the drop in stocks it sparked – is yet another sign of the need for reform.

The numbers are startling. HSBC, the world’s fifth-largest bank, failed to review thousands of internal anti-money-laundering alerts, according to a Reuters investigation published last week.

The bank did not file legally required “suspicious activity reports” to U.S. law enforcement officials. It hired “gullible, poorly trained, and otherwise incompetent personnel” to run its anti-money-laundering effort. Each year, hundreds of billions of dollars flowed through the bank without being properly monitored.

HSBC is not alone. Last month, U.S. regulators accused Citigroup of having major lapses in its anti-money-laundering systems as well. Under an agreement with the Comptroller of the Currency, the agency that regulates national U.S. banks, Citigroup agreed to improve its monitoring operations, but did not pay a monetary penalty or admit any wrongdoing.

For critics of mega-banks, the reports are the latest sign of big banks’ ability to defy regulation, engage in dubious business practices and face few consequences.

In a British court last month, a former Nigerian governor pleaded guilty to pilfering $79 million from state coffers, funneling it offshore and buying six properties in the U.S. and UK. The banks he used to move the illicit money? HSBC, Citibank, Barclays and Schroders.

“Banks get hauled up by the regulators for failing to follow the law, promise to reform, and yet a few years down the line they’re caught doing the same thing,” said Robert Palmer of the anti-corruption group Global Witness. “I think for this to change we need strong penalties for when the banks get things wrong, and in the worst cases, jail time for individual bankers.”

Four current Federal Reserve presidents, meanwhile, are arguing that the Dodd-Frank reforms have not eliminated the “too big to fail” banks, according to a Bloomberg Businessweek article published last month. Despite measures in the legislation banning further bailouts, traders, analysts and bankers simply don’t buy it.

“Markets have come to believe that what the government did in 2008 and 2009 isn’t a one-time deal,” Kevin Warsh, a former member of the Federal Reserve Bank’s Board of Governors, said in a March television interview with Charlie Rose. They think  “that the government will somehow come to the rescue of these big financial firms.”

The result is a half-dozen massive banks that remain so large that their collapse would cripple the U.S. economy and force another government bailout. As a result, the behemoths function as a de facto oligopoly. The sheer size of the banks – and the theoretical government backing that they enjoy – make it impossible for the country’s roughly 20 regional banks and 7,000 community banks to challenge them.

And the country’s biggest banks are getting bigger.

Five U.S. banks – JPMorgan Chase, Bank of America, Citigroup, Wells Fargo and Goldman Sachs – held $8.5 trillion in assets at the end of 2011, equal to 56 percent of the country’s economy, according to Bloomberg Businessweek. Five years earlier, before the financial crisis, the biggest banks’ holdings amounted to 43 percent of U.S. output. Today, they are roughly twice as large as they were a decade ago relative to the economy.

The four Federal Reserve presidents – Richard Fisher of Dallas, Esther George of Kansas City, Jeffrey Lacker of Richmond and Charles Plosser of Philadelphia – have expressed concern that such a concentration of assets in the banking industry threatens the financial system.

In a scathing essay published in March in the Federal Reserve Bank of Dallas’ 2012 annual report, Harvey Rosenblum, the bank’s head of research, called for the government to break up the country’s largest banks. Rosenblum argued that only smaller banks – not the increased capital requirements, stress tests and other measures in Dodd-Frank – will prevent another crisis.

“A financial system composed of more banks, numerous enough to ensure competition in funding businesses and households but none of them big enough to put the overall economy in jeopardy,” Rosenblum wrote, “will give the United States a better chance of navigating through future financial potholes and precipices.”

The American public, meanwhile, also feels the reforms were not enough. In a Rasmussen poll conducted last month, 48 percent of Americans surveyed said they continue to lack confidence in the stability of the U.S. banking industry. Forty-seven percent said they were somewhat confident in the system.

Who, then, is happy with the state of America’s banks? Apparently, the two men running for president. So far, both Barack Obama and Mitt Romney have steered clear of calls from the left and right to break up the big banks.

“I’m not looking to break apart financial institutions,” Romney told the American Enterprise Institute’s James Pethokoukis, in March. “I think what caused the last collapse was a convergence, almost akin to a perfect storm, of many elements in our economy and regulatory structure.”

Obama, meanwhile, argues that the new regulations would force banks into orderly bankruptcy proceedings, not bailouts. But many liberal analysts don’t buy it. They argue that bankers still face too few consequences for bad behavior.

An analysis by researchers at Syracuse University found that under the Obama administration federal financial-fraud prosecutions have dropped to 20-year lows, Peter Boyer and James Schweizer wrote in The Daily Beast last week. Prosecutions are down 39 percent from 2003, when executives at Enron and WorldCom were convicted in high-profile cases.

Today, the number of financial-fraud cases is at one-third the level it was during the Clinton administration. (Obama administration officials argue that the number would be higher if new categories of crimes were counted.)

“Casting Romney as a plutocrat will be easy enough,” Boyer and Schweizer wrote. “But the president’s claim as avenging populist may prove trickier, given his own deeply complicated, even conflicted, relationship with Big Finance.”

The skepticism from the right and left is justified. Our largest banks remain “too big to fail,” defy regulation and have paid too small a price for a financial crisis that decimated the middle class. The U.S.’s big banks should be broken up. Smaller banks will be easier to regulate – and foster more competition.

PHOTO: Protesters move along Tryon Street to Bank of America Stadium after the Bank of America annual shareholders meeting in Charlotte, North Carolina, May 9, 2012. REUTERS/Jason E. Miczek

SARAJEVO – Seventeen years and $17 billion later, Bosnia is at peace today, but it is stillborn.

After an international intervention nearly two decades long, Bosnia offers lessons for American officials as they wrestle with continuing violence in Syria, volatile post-Arab Spring transitions and leaving behind a relatively stable Afghanistan. Stopping the killing here proved easier than expected. But halting corruption, sparking economic growth and curbing poisonous local political dynamics has proved vastly more difficult.

Today, the economy is stalled, with half of business activity generated by state-owned companies and unemployment hovering at 25 percent. The country is divided between a Serb entity whose leader talks openly of secession and a Muslim-Croat federation with worrying rifts of its own. And corruption is endemic among senior government officials on all sides.

There are successes. One, surprisingly, is security. In an outcome few expected, fighting has not erupted here since the 1995 Dayton Peace Accord ended a brutal three-year conflict. Predictions that 20,000 American troops who deployed as peacekeepers would be caught in a “quagmire” proved untrue. U.S. forces departed in 2006 without a single American soldier being killed by hostile fire.

One lesson that emerges here is timing, according to Bosnians, Americans and Europeans. If the world is going to intervene in a conflict, the earlier, they say, the better. Bosnia today shows that the longer the fighting drags on, the more tortuous the postwar peace.

On a daily basis, Muslims, Serbs and Croats interact and exchange polite greetings here, but they live separate lives. Across the country, the 100,000 killed during the war haunt the living. Admonitions to turn the other cheek are well and good, but there is little reconciliation.

Exhaustive but slow-moving international war-crimes trials have created a detailed historical record of the atrocities carried out here. But Serb, Croat and Muslim nationalists all see themselves as victims and reject responsibility for war crimes committed by their own community. Future generations, one hopes, may be more accepting.

The second lesson is that without reliable local allies implementing reforms is virtually impossible. International efforts to promote more moderate political parties have failed here. Nationalist Serb, Croat and Muslim parties have won elections, consolidated power and resisted change. Foreign powers have found that they cannot control local political dynamics. Bosnians call the state of politics today “war by other means,” with nationalists continuing their struggles through words, not bullets.

“It’s difficult for outsiders to rearrange the political chairs inside these countries,” said R. Nicholas Burns, a retired senior American diplomat who worked on the Balkans for the Clinton and Bush administrations. “It’s going to be up to local people to do that.”

Today, only 600 European soldiers keep the peace. Milorad Dodik, the current leader of the Bosnian Serbs, uses veto powers and the convoluted government structure created as a compromise in Dayton to block efforts to strengthen the central government. Repeated Western efforts to update the country’s postwar constitution have failed. Foreign diplomats now hope that the carrot of European Union and NATO membership will turn voters against hardliners.

A third and final lesson focuses on civilian aid. When it comes to postwar reconstruction efforts, less is more. The United States and Europe tried to quickly create virtually every aspect of a new Bosnian state: a new army, police force, economy, infrastructure and education system.

The $1.65 billion American civilian aid effort was too broad and too focused on immediate results, according to Westerners and Bosnians. (Ninety percent of the U.S. money spent here – roughly $15 billion – covered the cost of the American troop deployment.) Foreign aid programs followed a predictable but perverse pattern. Donors demanded quick results. Aid officials, in turn, designed projects that met American political needs in Washington, not Bosnian needs on the ground.

Bosnians who have helped implement foreign aid programs argue that picking a handful of projects, establishing limited goals and consistently funding them for long periods is more effective than a rushed, scattershot approach.

Some initiatives fared well. An integrated national army has been created following a massive American training effort. Some well-staffed American police training and judicial reform programs were effective. The establishment of a new national currency gave the country’s economy initial stability. And one simple step – car license plates with no indication of where the driver resides in the country – greatly increased freedom of movement. In general, the more long-term the aid effort, the more successful it was.

Every nation, conflict and era is different, of course. New, unpredictable events shred pristine theories of international relations. But Bosnia’s story offers the lesson that foreign interventions can stop the killing, but not control the peace.

One Western diplomat pointed out that Dodik, the Serb nationalist, was initially hailed as a moderate by the international community. Today, he is seen by Western diplomats as the single largest impediment to unifying the country.

“Like Karzai in Afghanistan, he started out as a great popular leader,” said the diplomat, who spoke on condition of anonymity, “and things went sour.”

Over the last 20 years, I covered Afghanistan, Iraq and Bosnia. Each society is vastly different, but all three have experienced U.S.-led interventions. Iraq and Afghanistan – and the 6,400 American soldiers who have perished there and the $1.2 trillion spent – rightly cloud American views of intervention today. But not all U.S. efforts abroad have been debacles.

In the end, Bosnia is a partial success. It is not the sweeping failure that American isolationists contend. Nor is it the sweeping success that backers of humanitarian intervention hoped. An imperfect peace, though, is better than the carnage that the people of Bosnia endured.

PHOTO: 11,541 red chairs are pictured along Titova Street in Sarajevo as the city marks the 20th anniversary of the start of the Bosnian war, April 6, 2012. The Balkan country still deeply divided, power shared among Serbs, Croats and Muslims in a single state ruled by ethnic quotas and united by the weakest of central governments. REUTERS/Dado Ruvic

SREBRENICA, BOSNIA — Six months from now, a municipal election will be held in this isolated mining town, the scene of the largest massacre in Europe since World War Two.

The town’s current mayor, a 33 year-old Bosnian Muslim, says the election will hand Bosnian Serbs control of the town and complete the “ethnic cleansing,” or removal, of all Muslims from eastern Bosnia. Serbs say it is democracy, plain and simple.

Seventeen years ago, Serb forces executed 8,100 Muslim men and boys here in the largest single mass killing of the war in Bosnia. The U.S. and its European allies – who had declared the town a U.N. protected “safe area” – stood by as the Serbs rampaged for days in the summer of 1995.

In local elections since then, a special exemption has been granted that allows Muslims who lived here before the war to vote in Srebrenica – even if they no longer reside here. This year, the country’s High Representative – a foreign overseer with sweeping powers – plans to issue no such exemption. In a visit to the town this week, he called for Serb and Muslim politicians to compromise.

“The challenge in Srebrenica goes far beyond the elections,” said Valentin Inzko, an Austrian diplomat who has pressed local officials to take more responsibility since becoming high representative in 2009. “People want a better life, and the key to that is constructive politics and economic development.”

Under the exemption, Muslims have controlled the municipal government, interned the bodies of 5,137 of the victims in a sprawling memorial here and tried to reverse some of the impact of the killings by slowly moving back. Today Srebrenica’s population, which was 75 percent Muslim before the war, is evenly split between Serbs and Muslims.

And that is where the good news ends. Already a glaring symbol of international fecklessness, the town’s sorry state today sets a new standard for Western half-measures gone astonishingly wrong.

The 17-year effort to move Muslims back to this town began with a whimper. Clinton administration officials, eager to avoid American casualties, made little effort in the late 1990s to arrest the Serb nationalists who carried out the executions. Fears of violent clashes blocked large-scale efforts to return Muslims to Srebrenica.

Frustrated, the roughly 30,000 Muslims who had survived the town’s fall scattered across Bosnia and the world. Roughly 20,000 resettled in Muslim-controlled parts of Bosnia. An additional 15,000 fled abroad; an estimated 7,000 arrived in the United States.

Many of them eventually settled in St. Louis, Missouri, a city with a Bosnian community already 80,000 strong, the largest in the United States. Today, roughly 5,000 refugees from Srebrenica live in St. Louis. The Midwestern American city is home to more Bosnian Muslim survivors of the massacre than Srebrenica itself.

One of the Srebrenica refugees who arrived in the U. S. was Camil Durakovic, the town’s current Muslim mayor. After he survived the fall of Srebrenica at the age of 16, his family resettled in Manchester, New Hampshire. After attending a local high school, he graduated from Notre Dame in 2003 and planned to attend graduate school in the U.S.

A 2005 summer trip to Srebrenica convinced him that his home was here. He started working for the town’s mayor. When the mayor passed away earlier this year, Durakovic, a burly man with a boyish face who wore a pin-striped suit and pink shirt in the town hall today, took over.

In an interview in his office on Thursday, he said returns of Muslim families rose from 2002 to 2005, largely as a result of heavy American and European support. In recent years, though, they have slowed. The economy has not helped. Unemployment is 50 percent in Srebrenica, making it a difficult place to settle for Muslims and Serbs alike. Today, 3,500 Bosnian Muslims live in Srebrenica. Because Serb officials decline to pay their pensions and other government benefits, many Bosnian Muslims maintain their official addresses in Muslim-controlled parts of Bosnia.

As a result, even though half the town’s residents are Serbs and half are Muslims, its registered voters are roughly 60 percent Serb. Unless the high representative or national government grants another exemption allowing Muslims who lived in the town before the war to vote, Serb politicians will likely gain control of the local government this fall. With foreign aid and interest in the town dwindling, Durakovic and other survivors predict that Muslims will flee.

“It will be the finalization of the genocide,” Durakovic told me. “Definitely.”

Radomir Pavlovic, the likely Serb candidate for mayor in the October municipal elections, insisted that Muslims had nothing to fear. But he then echoed the divisive statements of the head of his political party, Bosnian Serb leader Milorad Dodik. Initially perceived as a moderate by the West, Dodik has rejected rulings by the International War Crimes Tribunal that genocide occurred in Srebrenica and has systematically thwarted international efforts to unify the country.

Pavlovic, the probable mayoral candidate, expressed views that are widely held among Bosnian Serbs. He said he believed 2,000 – not 8,000 – Muslims died in the executions, blamed “foreign mercenaries” for the killings and expressed sympathy for General Ratko Mladic, the Bosnian Serb commander now on trial in the Hague for carrying out genocide after evading arrest for 16 years.

“Others are more responsible than him and will go unpunished,” Pavlovic told me. “It’s always the pawns that get blamed.”

Denial is nothing new here. After the fall of Srebrenica, Bosnian Serbs insisted that no mass killings had occurred and blocked journalists from investigating them. (Bosnian Serb forces jailed me for 10 days in 1995 after I discovered mass graves near the town while covering the conflict for the Christian Science Monitor.) After the bodies were exhumed, the Bosnian Serbs said too little attention was paid to the Serbs killed by Muslims around Srebrenica. As many as 1,300 Serbs may have died here, as Pavlovic argued, but that number is dwarfed by the 8,100 Muslim dead.

The high representative has until May 9 to grant an exemption for Bosnian Muslim voters here. He should immediately do so. The Dayton Peace Accords mercifully ended the war in 1995, but they created a still-born country with a constitution that makes it easy for corrupt nationalists on all sides to divide the country.

Until desperately needed constitutional reforms are implemented, the Bosnians who lived in Srebrenica before the conflict should be allowed to vote here. Serb nationalists should not gain control of a town that was 75 percent Muslim before the war. Genocide should not be rewarded.

PHOTO: People walk near coffins prepared for a mass burial at the Memorial Center in Potocari, near Srebrenica July 11, 2011. Thousands of grieving Bosnian Muslims buried hundreds of newly identified victims of the notorious Balkan war massacre and expressed hope justice would finally be done with Serb commander Ratko Mladic on trial.  REUTERS/Marko Djurica

Barack Obama is going to save America’s middle class by taxing the rich and fostering an American manufacturing renaissance. Mitt Romney is going to revive it by creating more jobs for women and rewarding successful people instead of punishing them.

Welcome to the so-far deeply disappointing 2012 general election. This week’s middle-class-related broadsides from both campaigns bordered on the comic.

Obama’s promoting of the Buffett Rule in Florida on Tuesday was smart politics, but the measure is unlikely to create jobs or significantly reduce the deficit. Even liberal pundits assailed it as an election-year “gimmick.”

And Obama’s concept of reviving American manufacturing is politically appealing but completely untested. As my colleague Chrystia Freeland noted, it flies in the face of decades of Anglo-American conventional wisdom that state interventions in the economy inevitably fail. Whether Obama is right or wrong will not be known before Election Day.

Romney, meanwhile, used a piece of carefully selected economic data to try to attack a 19-percentage-point advantage Obama enjoys among female voters. On Tuesday, he toured a Delaware company that has a female CEO and said women have suffered 92.3 percent of job losses since Obama took office in January 2009. Within hours, the figure, while technically accurate, was criticized as misleading.

Since the recession began in December 2007, men have lost 3.3 million jobs and women have lost 1.2 million jobs, according to the New York Times Economix blog. The surge in job losses among women is primarily due to cuts in the female-dominated government sector. Those reductions were backed by Republicans, not Democrats.

Both campaigns can – and must – do better. A deeply shaken American middle class is yearning for honest debate and realistic approaches to the country’s economic and fiscal dilemmas.

The far left and far right have gotten louder thanks to Fox, MSNBC and the corporate owners of those media outlets, which profit financially from the division they sow. But I believe Middle America – and the independent voters who will decide the election – will award the White House to the candidate who shows the most pragmatism and political courage.

In truth, there are no simple answers when it comes to helping the middle class or understanding what is happening to it. No official U.S. government definition of the “middle class” exists. Nor does a consensus: Democrats say the middle class is in free fall, while Republicans insist it is doing just fine.

Whatever is occurring, public opinion polls show deep unease in Middle America. An ABC News/Washington Post poll conducted last week found that 76 percent of Americans believe the country is still in recession and 68 percent think it is headed in the wrong direction.

Economists broadly agree that the best way to help the middle class is to create large numbers of high-paying new jobs. It is also crucial to rein in the federal deficit and make Social Security and Medicare – two cornerstones of a middle-class retirement – financially sustainable. The problems are far more complex than Warren Buffett paying less tax than his secretary or conservative diatribes against government regulation.

As Matt Miller correctly pointed out in the Washington Post this week, both parties are ignoring hard truths and hard choices. “The big Republican lie” is that the American government does not need to raise taxes in any form as baby boomers retire and the number of people on Social Security and Medicare doubles. And “the big Democratic lie” is that the country can solve its staggering fiscal problems by raising taxes only on people who make over $250,000 a year.

“More than most political deceptions,” Miller wrote, “these two warp the debate in ways that make pragmatic progress impossible.”

Miller’s solution? A truth-telling third-party candidate. The chances are low, but the stirrings of an independent bid still exist. Independents now make up 34 percent of voters across the country, according to a 2011 poll by the Pew Research Center, compared with 34 percent identifying themselves as Democrats and 28 percent as Republicans. A website, Americans Elect, has collected 2.5 million signatures in an effort to place an as-yet-unchosen independent candidate on the ballot.

I share their disappointment. So far, the two-party system is failing to spark the serious debate we desperately need.

Obama should detail exactly how he would tackle the deficit and create a lean but effective federal government. Romney should stop blaming government for all of America’s evils. Obama should announce specific reforms that will make Social Security and Medicare sustainable. And Romney should propose a reduction in defense spending instead of an increase.

Both candidates should take risks, be less political and get off their talking points. That is a naive sentiment, of course, but the country is divided, adrift and urgently in need of new models.

Romney, beware. Obama, for now, is winning the battle for Middle America.

Asked in last week’s poll which candidate would do a better job “defending the middle class,” Obama had a 10-percentage-point advantage over Romney. Asked which was a bigger problem in America, 52 percent chose “unfairness in the economic system that favors the wealthy” and only 37 percent said “over-regulation of the free market that interferes with growth and prosperity.”

And Obama, beware. He may narrowly win re-election, but avoiding hard truths is no way to gain a mandate. Tactical compromise has not served the White House well for the past four years. Is the Buffett Rule really the legacy Barack Obama wants to leave?

PHOTOS: President Barack Obama speaks about tax fairness and the economy at Florida Atlantic University in Boca Raton, Florida, April 10, 2012. REUTERS/Kevin Lamarque  Republican presidential candidate and former Governor of Massachusetts Mitt Romney (L) walks into a campaign event with business owners Lorri Grayson (C) and Becky Suppe during a campaign event in Wilmington, Delaware, April 10, 2012. REUTERS/Tim Shaffer

TUNIS – Like it or not, this is the year of the Islamist.

Fourteen months after popular uprisings toppled dictators in Tunisia and Egypt, Islamist political parties – religiously conservative groups that oppose the use of violence – have swept interim elections, started rewriting constitutions and become the odds-on favorites to win general elections.

Western hopes that more liberal parties would fare well have been dashed. Secular Arab groups are divided, perceived as elitist or enjoy tepid popular support.

But instead of the political process moving forward, a toxic political dynamic is emerging. Aggressive tactics by hardline Muslims generally known as Salafists are sowing division. Moderate Islamists are moving cautiously, speaking vaguely and trying to hold their diverse political parties together. And some Arab liberals are painting dark conspiracy theories.

Ahmed Ounaies, a pro-Western Tunisian politician who briefly served as foreign minister in the country’s post-revolutionary government, said that he no long trusted Rachid Ghannouchi, the leader of Tunisia’s moderate Islamist party. Echoing other secular Tunisians, he said some purportedly moderate Muslim leaders are, in fact, aligned with hardliners.

“We believe that Mr. Ghannouchi is a Salafist,” Ouanies said in an interview. “He is a real supporter of those groups.”

Months after gaining power, moderate Islamists find themselves walking a political tightrope. They are trying to show their supporters that they are different from the corrupt, pro-Western regimes they replaced. They are trying to persuade Western investors and tourists to trust them, return and help revive flagging economies. And they are trying to counter hardline Salafists who threaten to steal some of their conservative support.

The decision this week by Egypt’s Muslim Brotherhood to field a candidate in the country’s presidential elections – which begin next month – is one example. The Brotherhood, which had promised not to field a candidate, said it entered to block a hardline Islamist from winning the presidency. Liberals scoffed at the explanation, accused the Brotherhood of seeking dictatorial powers and pulled out of the country’s constitutional assembly.

In Tunisia, Ghannouchi and his Ennahda party are the focus. Tunisians say debates over religion are distracting the country’s new government from its primary problem – a sputtering economy. Secularists accuse Ennhada of being too lenient on hardline Salafists, who enjoy little popular support here. Salafists have the right to protest in the new Tunisia, secularists argue, but should not be allowed to violently attack other groups.

Salafists attacked a television station in October after it aired the animated film “Persepolis,” which featured a portrayal of God. They partially shut down a leading university for two months this winter and attacked a group of secular demonstrators last month.

At the same time, a Tunisian judge jailed a newspaper editor for eight days in February after he published a photograph of a soccer player and his nude girlfriend on the cover of a local tabloid. On Thursday, two young men were sentenced to seven years in jail for posting cartoons of a nude Prophet Muhammand on Facebook.

In a recent interview here, Ghannouchi flatly dismissed supporting hardline Islam. Asked whether Tunisia’s divisions were broadening, he answered carefully.

“I am not pessimistic,” he told me. “There is a chance to reach a compromise.”

A 70-year-old, Sorbonne-educated Islamist intellectual who spent 14 years in various Tunisian prisons and 22 years in exile in London, Ghannouchi reaffirmed his liberal interpretation of Islam and democracy. While Islamic hardliners dismiss democracy as an affront to God’s authority, Ghannouchi fervently embraces it. Democracy and Islam are not only compatible, he argued, but they follow the same traditions.

“The real spokesman of Islam is public opinion, which is the high authority, the highest authority,” he told me. “Legislation, represented by the assembly, the national assembly.”

Ghannouchi says the Prophet Muhammad’s use of Shuras – or councils – to make non-religious decisions shows that democracy has existed in Islam since its birth. Government affairs should be decided by democratic vote, he said, not fatwas from religious autocrats. And he embraced full rights for minorities, international human rights treaties and free-market capitalism.

In an interview in New York, a delegation from Egypt’s Muslim Brotherhood that was visiting the U.S. to reach out to Americans professed the same views.

“Our number one priority is to build a democratic Egypt,” Khaled Al-Qazzazz, the group’s foreign relations coordinator, told me, “with complete democratic institutions.”

Yet significant numbers of Tunisians, Egyptians and Americans simply do not trust the Islamists. They believe that after gaining power, they will insert Islam into school curriculums, roll back women’s rights and reduce individual freedoms.
The fear is that they will follow the route of Hamas, the Islamist movement that won elections in Gaza and Islamized local institutions after years of relatively secular Fatah rule.

In private, American officials say they hope to create economic and political incentives that make being part of the international system appealing to Islamists. That strategy is the correct one.

Holding office and being responsible for creating prosperous economies, better government services and less corruption will moderate Islamists. If they govern and fail, their popularity will erode. U.S.-backed crackdowns on Islamists will only increase their support.

In interviews, Tunisian and Egyptian Islamists said they did not want American meddling in their political affairs but said they were eager to be part of the world economy. Becoming Hamas-like international pariahs seemed to hold little appeal to them. They too know that a by-product of a globalized economy is that isolation now carries a staggering economic cost.

Asked what U.S. policies would most help Muslim moderates, Ghannouchi said “encourage investment,” “encourage tourism,” and training and educational exchange programs. Asked what U.S. policies most hurt Muslim moderates, he said unilateral U.S. military interventions that fuel anti-Americanism.

On Thursday in Washington, 300 people packed a Carnegie Endowment conference at which Islamists from Tunisia, Egypt, Libya, Morocco and Jordan tried to explain their views and their goals. Americans asked Islamists if their commitment to democracy was real. Islamists asked the same question back. Some exchanges were tense, but an awkward dialogue emerged.

There is the possibility, of course, that the Islamists are sincere. Tunisian and Egyptian Islamists who spent years in exile and in jail may not want to repeat the sins of their persecutors. If Islamists abide by democratic norms, their right to participate in electoral politics should be respected. Believing in God and democracy is possible.

An extraordinary debate about the very nature of Islam is unfolding across the Middle East. In the months and years ahead, it will frighten, confuse and alarm Americans, but it is vital that Washington allow it to play out.

PHOTO: Rachid Ghannouchi, leader of the Ennahda movement, Tunisia’s main Islamist political party, speaks at a news conference in Tunis, February 23, 2012. REUTERS/Zoubeir Souissi

Update: At Leila Charfi’s request, I added a paragraph below and shortened her quote to give it more context. She was concerned that the original version highlighted the role of the Internet in Tunisia’s revolution but did not credit street protesters. At least 219 protesters died during the uprising, according to the UN.

TUNIS — Last November, dozens of young Arabs lined up for the chance to meet him. When he spoke of his struggles and triumphs, they hung on his every word. And when only one of the 50 attendees was chosen for training, some of the young Arabs grew frustrated and complained of being excluded.

A jihadist back from battling Americans in Afghanistan? A recruiter for al Qaeda’s North African affiliate? A Hamas member looking for volunteers to attack Israel?

No, the visitor was a Tunisian-American eBay executive who has worked for Apple and Oracle, and founded two Silicon Valley startups. His audience? Young Tunisian entrepreneurs and programmers who dream of turning this city into the Arab world’s Silicon Valley.

“There is a lot of potential,” Sami Ben Romdhane, the eBay executive, told me in a telephone interview this week. “I don’t see any difference between students who are graduating there and students who are graduating here and in Europe.”

Fourteen months after a Facebook-facilitated popular uprising here sparked the Arab Spring, the appeal of American technology remains overwhelming. But a sputtering economy, the emergence of hardline Islamic Salafist groups and the failure of the United States and its European allies to deliver on promises of assistance are prompting growing frustration and instability.

Tunisia’s revolution and its aftermath show how rapid technological change has altered economic, diplomatic and political dynamics worldwide. But outdated American notions of power – particularly in Congress – are preventing the United States from keeping pace. A decades-long American practice of spending vastly more on military efforts than civilian ones is handicapping a vital attempt here to create a democratic, free-market country that is a model for the Arab world.

The United States’ strongest weapons against Islamic militancy are not CIA operatives, drones or infantry battalions. They are the modern, new high-tech office buildings that Hewlett-Packard, Fidelity, SunGard, Microsoft and Cisco have opened here in recent years. In the wake of the revolution, Tunisians dream of their country becoming a hub for cloud, big-data and open-government computing in the region.

Leila Charfi, a Tunisian who runs the Microsoft Innovation Center here, said the street protests that toppled the government were facilitated by Facebook and Twitter. Now, Tunisians embrace technology.

“The revolution was through the Internet,” said Leila Charfi, a Tunisian who runs the Microsoft Innovation Center here. “People are hungry to use new technology,” she said, “and develop a new country with IT.”

To be sure, the fate of Tunisia rests in the hands of Tunisians. The country’s first democratically elected government since independence from France in 1956 is being criticized for indecisiveness. The economy is slowing in many areas for local reasons, not foreign ones. And the United States is providing $300 million in assistance to Tunisia, including $100 million announced on Thursday.

And while Washington is influential here, Europe is and will be the dominant foreign player. France, the former colonial power, is the country’s largest foreign investor. European countries provide the bulk of aid. And traditional exports to Europe are vital to Tunisia’s economy, particularly agricultural products, clothing and auto parts.

But Tunisians – justly proud of their revolution – insist they are eager to serve as a model for the region. With little oil, they realize that economic innovation is the only way ahead. And they are looking to America’s high-tech industry for inspiration and training.

A closer look at the Silicon Valley executive’s visit revealed a well designed State Department program with too few resources. Ben Romdhane, the executive, traveled to Tunisia under Partners for a New Beginning, an initiative launched by the Obama administration after the president’s 2009 address in Cairo. The program is designed to increase business, cultural and educational exchanges between the United States and the Arab world.

In conversations, Tunisians generally praised Obama’s approach. They clamored for American business investment, tourists and exchange programs but said they opposed unilateral U.S. military interventions or American meddling in their domestic politics. At the same time, they disparaged radical Islam and said they yearned for prosperity, modernity and a place in a high-tech global economy.

Yet the program that brought Ben Romdhane and 19 other American technology entrepreneurs and angel investors here is so small that the delegation members had to pay their own airfare and hotel bills. The prize for the one Tunisian entrepreneur chosen for mentoring was three months in the TechTown Incubator in Detroit, Michigan. The U.S. government did not pay for the prize; the American Arab Chamber of Commerce in Detroit, Wayne State University and TechTown did.

Such a tepid effort shows how the U.S. and its European allies risk losing the post-Arab Spring peace. Since the ouster of dictator Zine El Abidine Ben Ali in January 2011, economic growth has dropped to near zero, foreign investment is down 30 percent and local businesses are desperate for a strong summer tourist season.

The prospects of Libya and Egypt are even bleaker, according to American officials. Tunisia holds by far the most promise of the Arab Spring countries. It has a population of only 10 million, a long history of moderation, universities that produce 6,000 engineers a year, millions of bilingual Arabic and French speakers, and centuries of interacting with Europe.

“We can have centers for excellence for IBM, Apple and Google for the region,” said Khalil Zahouani, a 34-year-old, Microsoft-trained and Swiss-educated Tunisian entrepreneur who runs a 70-person startup that provides computing services to European and Arab phone conglomerates. “It could be an outsourcing hub.”

To be fair, the State Department is mounting some innovative efforts. A $20 million enterprise fund has been created for Tunisia. Modeled after funds created for post-Communist Eastern Europe that made money for the U.S. government, the fund will invest in promising Tunisian businesses. A separate $8 million USAID program to train high-tech Tunisian entrepreneurs is planned as well. But those numbers are a tiny fraction of the $1.2 trillion the U.S. spent on the American military efforts in Iraq and Afghanistan since 2001.

In Tunisia’s impoverished interior today, there is little sense of change. In the town of Gafsa, unemployed people demanding jobs have blocked roads to the town’s phosphate mine, the fifth-largest in the world. Production is down 40 percent. And a Japanese company recently shut down its local factory after wildcat strikes.

In Sidi Bouzid, the farming town where Tunisia’s uprising began, the luster of the revolution is fading. At 85, Ahmad Kadachi is the dean of the town’s street vendors. Fifteen months ago, he was astonished when a fellow vendor – 26-year-old Mohamed Bouazizi – doused himself in gasoline, set himself on fire and sparked the Arab Spring.

As he sold tea from his ramshackle wooden cart, Kadachi called Bouazizi a hothead, while thanking him for the freedom he had brought. But he said Tunisians, Egyptians and Libyans were being denied a primary goal of their revolutions: prosperity.

“Everybody is talking and talking,” Kadachi told me. “No one is doing anything.”

Tunisians say they do not want handouts, loans or traditional aid. They want investment, exchange and a chance to be part of the world economy. So far, Washington’s antiquated focus on military might has let them down.

PHOTO: Workers in a call center in Sidi Bouzid, Tunisia. REUTERS/David Rohde

ROCHESTER, N.Y. – Cashiers are barred from interacting with customers until they have completed 40 hours of training. Hundreds of staffers are sent on trips around the U.S. and world to become experts in their products. The company has no mandatory retirement age and has never laid off workers. All profits are reinvested in the company or shared with employees.

A doomed Internet startup? Occupy Wall Street fantasy? Bankrupt retailer recently purchased by Walmart?

No, a $6.2 billion-a-year, 79-store-supermarket chain with cult-like loyalty among its customers. Wegmans, which operates its 79 stores in New York, Pennsylvania and four other East Coast states, shows that a business can generously train its workforce and profit handsomely.

Privately owned by the Wegman family, the chain employs 42,000 people – 20 times the number who work for Facebook – and defies quarterly-driven Wall Street wisdom. Executives say their most important resource is their workers.

“Our employees are our number one asset, period,” said Kevin Stickles, the company’s vice-president for human resources. “The first question you ask is: ‘Is this the best thing for the employee?’ That’s a totally different model.”

Yet the company is profitable. Its prices are low. And it is lauded for exemplary customer service.

“When you think about employees first, the bottom line is better,” Stickles argued. “We want our employees to extend the brand to our customers.”

The Wegmans model is simple. A happy, knowledgeable and superbly trained employee creates a better experience for customers. Extraordinary service builds tremendous loyalty. Where, though, is the profit?

High volume, according to company executives. The chain’s stores are enormous – usually 80,000 to 120,000 square feet – larger than a typical Whole Foods and roughly double the size of a traditional supermarket. And they feature a dizzying array of 70,000 products, nearly twice the number available in a standard grocery store. Across the East Coast, Wegmans supermarkets have the highest average daily sales volumes in the industry.

Employees are omnipresent in stores and do seem knowledgeable. With little prompting, they launch into exhaustive but friendly accounts of where the meat, fish or produce they sell hails from, what each item tastes like and how best to prepare it.

A fish salesman raved about the exhausting standards of the company’s distributor in Alaska. A butcher said he had visited the ranch where a steak came from in Montana. And Maria Benjamin, a 38-year Wegmans veteran, started running a store bakery after managers loved her homemade Italian cookies.

“They let me bake whatever I want,” said Benjamin, one of 1,015 people employed at the company’s 135,000-foot flagship store in Pittsford, New York. “They’re really down-to-earth, wonderful people.”

Executives say the company is also able to invest in its employees and focus on steady, strategic growth because it is not publicly traded. They said cutting jobs or shipping them overseas was, in part, the product of having to relentlessly please the stock market.

“Some of that is that public mentality,” said Stickles, who has an MBA and once planned to be a stock broker. “The first thing they think about is the quarter. The first thing is that you cut labor.”

The Wegman family, which grants few interviews, has owned and run the company since 1916. Robert Wegman, whose father and uncle opened the first store, dramatically expanded the business in the 1970s by being one of the first chains to vastly expand store size, include pharmacies and use bar codes.

Today, the chain is run by Robert’s son, Danny, 65, and his two daughters, Colleen, 41, and Nicole, 38. Mary Ellen Burris, a 78-year-old senior vice-president and family confidant, said the owners refuse to open more than three stores a year because “we cannot continue to be the best if we try to go at a faster pace.” She said the family has no interest in taking the company public.

“No, absolutely not,” Burris said. “It takes away your ability to focus on your people and your customers.”

Like other companies, Wegmans has made mistakes. Over the years, it has had to close nine stores that failed to generate adequate revenues. And critics have accused it of moving stores out of poor urban neighborhoods and focusing its operations on wealthy suburbs. And while the benefits are generous, its pay rates are good, not extraordinary.

Wegmans has also clearly benefited from being based in Rochester, a small but historically prosperous area in upstate New York that was the birthplace of Western Union, Kodak, Xerox, Bausch & Lomb and other companies. Wegmans treats its employees well in part to keep them from gravitating to other firms.

Competition has also forced the company to change. The arrival of Walmart-owned supermarkets caused a sharp reduction in prices in 2004.

“It was clear that people were gravitating to the discount stores,” said Jo Natale, the company spokeswoman. “And so we completely changed the way we did our prices.”

But she and other executives insisted that Wegmans’ real advantage was the company’s happy, high-quality workforce. It sends butchers to Colorado, Uruguay and Argentina to learn about beef. It sends deli managers to Wisconsin, Italy, Germany and France to learn about cheese. Last year, it awarded $4.5 million in college scholarships to employees.

The company has half the turnover of its peers. In February, Fortune magazine declared it the fourth-best company to work for in America in 2012. In 2005, it was number one.

“What some companies believe is that you can’t grow and treat your people well,” Burris told me. “We’ve proven that you can grow and treat your people well.”

Wegmans is a model. It shows that companies can train, innovate and profit at the same time.

PHOTO: Daniel Wegman/Wegman handout

To a growing number of Americans, Afghanistan is a festering pit where the United States has no vital interests. To a growing number of Afghans, the United States is a self-absorbed and feckless power that is playing games in their country.

Both caricatures are wrong. Yes, American troops should gradually withdraw from Afghanistan. And yes, the government of Afghan President Hamid Karzai remains corrupt and largely ineffective. But what is needed is a decisive agreement between the Afghan and American governments on the way forward, not sniping at each other in public and pandering to domestic political audiences.

First, let’s discard some myths:

Afghanistan is strategically unimportant to the United States: For even the most cynical Americans, a stable Afghanistan is important because of the roughly 100 nuclear warheads sitting in neighboring Pakistan. If hardline Taliban regain control of southern Afghanistan, it will be a safe haven for Pakistani Taliban and foreign militants. Attacks against Pakistan will definitely be plotted, and attacks on the United States could be planned from there as well.

All Afghans want Americans forces to leave immediately: The shameful video of Marines urinating on Taliban corpses, burning of Korans and massacre of 16 civilians will clearly increase the number of Afghans who want American soldiers out. In a November 2010 poll, 55 percent of Afghans said U.S. forces should withdraw immediately, but only 9 percent supported the Taliban. In some ways, there are two Afghanistans. The Taliban enjoy support in the rural south and east, but many Afghans – particularly the 23 percent who are city-dwellers and comparatively prosperous – fear that a post-American Afghanistan will quickly descend into civil war. They want the U.S. to help craft a political settlement before leaving. The violence today in Afghanistan is gruesome, but more Afghans died during the civil war of the 1990s.

An immediate American withdrawal will bring peace to Afghanistan: Michael Semple, an Afghanistan expert and longtime proponent of negotiating with the Taliban, argues that a hurried American withdrawal decreases the likelihood of reaching a negotiated agreement with the Taliban. “Any further acceleration would reduce the chances for a peace agreement,” he told me in an email, “and even increase the chances of a civil war.” If the Taliban think all U.S. forces are leaving in 2014, why would they come to the negotiating table and compromise now?

All Taliban are rabid fundamentalists uninterested in compromise: The decision by the Taliban’s leadership to negotiate with the U.S. was a controversial inside the group, according to Semple. Pragmatists supported it. Hawks opposed it. A political settlement in Afghanistan is the one way the Taliban can gain international acceptance and free themselves from the control of Pakistan’s intelligence service. That carrot is real; the United States should use it. Today’s “suspension” is a negotiating tactic. Talks will and should continue.

Accelerating the withdrawal of American troops is smart election year politics for Obama: A chaotic American withdrawal from Afghanistan will not help the president’s re-election effort. Stephen Biddle of the Council of Foreign Relations argues that Obama should maintain his current approach in Afghanistan and try to keep the country out of the news. “This is not a major political issue,” Biddle said in a conference call today with reporters. “The smartest approach is to be reasonable and centrist. Take the issue off the table.”

What should we do?

Hold steady: A mixed message is one of the things that has undermined Obama’s strategy in Afghanistan. He vastly increased American forces in 2009 but then announced they would leave in 18 months. The president says U.S. forces are withdrawing but is trying to negotiate a long-term agreement that will allow some American forces to remain in the country. The administration should adopt a clear message, stick to it and quietly look for an alternative to Karzai, who has promised to not run for re-election when his current term ends in 2014.

Deploy Afghans, not Americans: Most American forces should withdraw from Afghanistan by the end of 2014 as planned. But the U.S. should complete negotiations with the Afghan government to keep a residual force of 10,000 to 15,000 primarily Special Forces soldiers in the country to train Afghans and provide air support. The US and its NATO allies should guarantee at least five years of funding for Afghanistan’s now 350,000-strong security forces. A proposal to reduce the force to 230,000 should be rejected. The roughly $6 billion it will cost to fund Afghan forces annually is a fraction of the roughly $120 billion the U.S. spent in Afghanistan last year. Properly funded Afghan forces backed by U.S. Special Forces and air power can hold off the Taliban. The Taliban and their Pakistani backers can face stalemate through 2017 or negotiate.

Transfer Taliban commanders: The administration should transfer five Taliban commanders now held in Guantánamo Bay to house arrest in Qatar. The step will move forward talks with the Taliban and trigger a promised public statement from the group renouncing international terrorism and severing ties with Al Qaeda. If the Taliban fail to make the announcement or make other concessions, their unwillingness to compromise will be confirmed.

Pressure the Pakistani military: Guaranteeing the long-term funding of Afghan security forces and negotiating with pragmatic Taliban is the most effective way to pressure the Pakistani military to back a peace settlement. Pakistani army commanders must be convinced that the Taliban will not quickly triumph in a post-American Afghanistan. Instead, Pakistan will have a chaotic civil war, vast amounts of Afghan refugees and a Pakistani Taliban sanctuary on its border.

Afghanistan matters. Washington has cards to play. And there is still time for all sides to step back from the abyss of civil war.

PHOTO: A U.S. military Black Hawk helicopter flies out of Forward Operating Base Joyce in Kunar province, eastern Afghanistan, March 15, 2012. REUTERS/Erik De Castro