The Great Debate UK

from The Great Debate:

Obama at the electoral tipping point

By Cliff Young and Chris Jackson The opinions expressed are their own.

The Obama administration finds itself between a rock and a hard place.  On one side, an emboldened Republican Party smells blood, with their largely successful (politically speaking) full court press on the debt issue and dominance of the news cycle.  On the other, the economic news—both domestically and internationally—has been depressing at best, and downright scary at worst.

Given this dreary backdrop, the common wisdom among pundits and politicos is that Obama has been winged and is beatable in 2012.  Pundits offer varied reasons for this new found pessimism in Obama.

Some cite the dangers of a weakening economy on voters’ mood for “more of the same.”  Indeed, history suggests that no post-WWII president has won reelection when the unemployment rate was above 7.2 percent—bad news for Obama since unemployment looks to remain above 8.5 percent over the next year. Others stress Obama moving too far to the left with a “big government” agenda, while others say Obama has alienated his base by giving in too readily to Republican demands.  Underlining all these critiques are warnings of a Carter-esque “crisis of confidence” scenario where voters lose faith in Obama’s leadership.

However, is this pessimism warranted?  Is Obama truly on shaky ground?  To answer these questions, we base our analysis on a database of 140 elections from 25 countries used for electoral forecasting and poll validation here at Ipsos.

So what does the empirical evidence suggest?

Taken as a whole, Obama is still a favorite.  That being said, he is dangerously close to the tipping point between a clear favorite and a struggling contender.  We detail our logic below.

from Pakistan: Now or Never?:

Solving Afghanistan and Pakistan over a cup of tea

I have never read "Three Cups of Tea", Greg Mortenson's book about building schools in Afghanistan and Pakistan. I tried to read the sequel, "Stones into Schools" and gave up not too long after the point where he said that, "the solution to every problem ... begins with drinking tea." Having drunk tea in many parts of South Asia - sweet tea, salt tea, butter tea, tea that comes with the impossible-to-remove-with-dignity thick skin of milk tea - I can confidently say that statement does not reflect reality.

So I have always been a bit puzzled that the Americans took Mortenson's books so much to heart. Yes, I knew he boasted that his books had become required reading for American officers posted to Afghanistan; and yes, there is the glowing praise from Admiral Mike Mullen on the cover of  "Stones into Schools", where he wrote that "he's shaping the very future of a region". But I had always believed, or wanted to believe, that at the back of everyone's minds they realised that saccharine sentimentality was no substitute for serious analysis. Just as hope is not a strategy, drinking tea is not a policy.  (To be fair to the Americans, I have also overheard a British officer extolling the virtues of drinking tea in Afghanistan.)

As a result of my scepticism on the miracle powers of tea-drinking, I find I am learning an awful lot more about the thinking of the U.S. administration than I ever did from Mortenson from the fall-out from the allegations of inaccuracies in his books. (Mortenson rejects these allegations in a statement on the website of his Central Asia Institute charity.)

Take for example the detailed account by Jon Krakauer (pdf) charting not only inaccuracies but also alleged irregularities in the finances of the Central Asia Institute. In his opening paragraph, Krakauer notes that President Barack Obama donated $100,000 of the award money from his own Nobel Peace Prize, which he received in 2009, to the Central Asia Institute. I had not known about the Obama connection until I read advance stories on Krakauer's piece.

During his presidential election campaign, Obama made Afghanistan and Pakistan his foreign policy priority. So you might expect that he would have had foreign policy advisers who would have questioned the wisdom of associating publicly with one man. After all, it was quite clear -- whatever you think about the rights and wrongs of Montenson's philanthropy -- that the narrative used to describe his schools in Baltistan as a bulwark against the Taliban and Islamist militants was a bit awry.

I have only been to Baltistan once, on a brief trip organised by the Pakistan Army to visit the Siachen region, the world's highest battlefield, where Indian and Pakistani troops have faced off against each other since 1984. Yet even under the watchful gaze of my army minder, a group of Balti intellectuals who I met in the regional capital Skardu were able to tell me (over several cups of tea) that they felt neglected by Islamabad and excluded from power in Pakistan. Baltistan is part of the former kingdom of Jammu and Kashmir, divided between India and Pakistan, and because of its disputed status, the people there have never been integrated into Pakistan and nor have they been given voting rights.

The political and security issues in Baltistan are related to the rivalry between India and Pakistan, to the dispute over Kashmir, and to the electoral dispossession of a people who have been frozen in time since the partition of the subcontinent since 1947. They are nothing to do with the Taliban, militant Islam, or the war in Afghanistan. That should have been easy enough to find out - have U.S. diplomats never been to Baltistan?  Indeed even without going there, the information was available for free on the Internet. Why did nobody ask any questions?

The U.S.’s big, fat political debt problem

By Kathleen Brooks

The U.S. has practically zero chance of solving its debt problem in the foreseeable future while politicians line up to contest the 2012 Presidential elections.

We have already heard President Obama lay out his partisan cards. He called for Congress to come up with a plan to trim $4 trillion from the U.S. deficit in the next 12 years. His favoured way to do this: end tax cuts for the rich – a well versed refrain from Democrats throughout the ages.

Ironically it was Obama who extended these tax cuts – for everyone – at the end of 2010, which arguably has contributed to the U.S. becoming the only G10 nation to have a rising budget deficit this year, according to the IMF.

The tax question obviously goaded the Republicans and the Speaker of the House of Representatives John Boehner immediately responded by saying that tax hikes were a non-starter. He argued that the U.S.’s fiscal problems were not down to a lack of revenue, but due to unbridled spending coming out of Washington. So there we have it: deadlock before we have even got started.

The wrangle over funding the 2011 budget that nearly closed the U.S. government earlier this month came down to an ideological fight between left and right, with those on the far right demanding cuts to programmes that didn’t support their ideology such as abortion programmes.

This highlights the level of detail and depth of discussion that will be held over the coming weeks and months to make even more radical cuts than those proposed for this year’s budget. Middle ground is virtually non-existent in Washington right now so a failure to come up with a credible deficit reduction plan in time for President Obama’s June deadline is looking increasingly more likely.

Obama blows the starting whistle – who will his opponent be?

-Andrew Hammond is an Associate Partner at Reputation Inc, and was formerly a Special Adviser in the UK Government and a Geopolitics Consultant at Oxford Analytica. The opinions expressed are his own.-

With U.S. President Barack Obama announcing his re-election campaign bid on Monday, the unofficial starting whistle for the 2012 election has been blown.

In a highly unusual move, Obama will be the first U.S. president in modern history to place his campaign headquarters outside of the Washington DC and suburban Virginia corridor (basing it instead in his home city of Chicago).  The president hopes that this break with recent precedent will help recapture the spirit of his hugely successful 2008 campaign as he seeks to become the first candidate in US history to raise $1 billion in presidential campaign finance.

Monday’s announcement aside, the most striking feature of the presidential race so far is the complete absence of any Republicans officially announcing their candidacies to challenge Obama.  This is especially interesting as, with the U.S. economy still weak, the president remains vulnerable to defeat in 2012.

A sizeable number of Republicans are touted as potential candidates, including Senator John Thune; former Massachusetts Governor Mitt Romney; former Alaska Governor Sarah Palin; former Arkansas Governor Mike Huckabee; and former Speaker of the House of Representatives Newt Gingrich.  Former Minnesota Governor Tim Pawlenty has so far moved closest to announcing, by last month launching an exploratory committee.

One key factor which will help determine whether Republicans win back the White House in 2012 is whether the party will speedily and decisively unite around a nationally credible candidate.  A model here would be the 2000 cycle when George W. Bush emerged strongly from a wide field of candidates well before the official nominating season began with the Iowa caucus.

In this context, do omens look good for Republicans in 2011/12, or might the party be on the verge of a turbulent and indeed potentially divisive contest?

from Pakistan: Now or Never?:

Afghanistan: Petraeus, personalities and policy

Buried in the Washington Post story on Marc Grossman taking over as the new U.S. envoy for Afghanistan and Pakistan are some interesting references to the possible departure of U.S. commander General David Petraeus.

"... virtually the entire U.S. civilian and military leadership in Afghanistan is expected to leave in the coming months, including Ambassador Karl Eikenberry and the embassy's other four most senior officials, Gen. David H. Petraeus, commander of the U.S.-led international coalition, and Lt. Gen. David Rodriguez, who runs day-to-day military operations there," it says.

"No final decisions have been made, but military officials said that Petraeus, who took command last July, will rotate out of Afghanistan before the end of the year," it adds.

Petraeus has been talked about for a while as a possible successor to Admiral Mike Mullen, Chairman of the Joint Chiefs of Staff  (CJCS),  who is expected to retire in October.  Any move would be part of a broader shake-up in the administration, which will also see Defense Secretary Robert Gates retire this year.

The question is what this move, if confirmed, would mean for policy.  Petraeus, more than anyone else, has been identified with the intensified military campaign in Afghanistan which, according to critics of the policy,  has reduced prospects of a political settlement by alienating Taliban leaders who might otherwise be coaxed into peace talks. 

Petraeus has been a towering figure in Washington and difficult to challenge politically. He had what was seen in the United States as a good track record in Iraq. And he was backed by Gates and Secretary of State Hillary Clinton -- making it very hard for those within the U.S. administration who disagreed with his assessment to win President Barack Obama over to their point of view. 

Moreover, Obama had already sacked two generals -- Generals David McKiernan and Stanley McChrystal -- and could hardly dismiss a third. (If I remember rightly -- and no doubt someone will correct me if I am wrong -- no president since Abraham Lincoln has changed his generals so frequently in wartime.) Promoting Petraeus would be far easier.

UK deficit cutting – lessons for the US

The news that China is engaged in talks over the building of a rival to the Panama Canal ought to set alarm bells ringing in Washington – and not just because of its obvious geopolitical implications. It is yet another sign that the Chinese have finally woken up to the fact that relending their hoard of dollars straight back to the USA is not a very smart policy, at least not as long as the Federal Government carries on spraying out greenbacks like a tipsy GI on furlough, and without Chinese support, the outlook for the Treasury bond market looks threatening.

Those who argue that it is a bad time for imposing austerity should be ignored – in the good times there was no sense of urgency, and in any case deficit reduction has to be a multiyear project. The Federal deficit is running at over 10 percent of GDP and the projections for the coming decade on unchanged policies are too frightening to contemplate.

That is the background to the Obama budget – in qualitative terms, it is very similar to the scenario faced by Britain’s new Coalition Government when it came to power last May. What lessons can America draw from the UK experience?

One caveat needs to be made at the outset. Since the mills of government grind slowly, the full impact of Britain’s austerity budget is only just beginning to be felt, so some judgements may be a little premature. However, start with Britain’s mistakes. It was a gross error to ringfence any spending items – and the choice of the National Health Service and Overseas Aid as protected species was particularly perverse, not least because it left the defence budget to sustain a sizeable cut while the country is still at war. America should nominate no sacred cows. The burden of the cuts has to fall overwhelmingly on the big spending programs: social security, Medicare and Medicaid, and defence.

Politically, cuts in spending might be easier to achieve if they were set in the context of an overarching vision – something Britain’s Premier has tried to achieve with his so-called Big Society, which appears to mean encouraging voluntary organisations of one kind or another to take over the provision of a whole range of services from government, saving the taxpayer many billions of pounds in overheads, while at the same time proving far more responsive to local people’s needs and aspirations. It has to be said that, so far, this Big Idea has been greeted with cynicism bordering on contempt by Britain’s political class and with total indifference by the rest of the population, but only time will tell. It is hard to imagine a Democratic president wholeheartedly embracing this particular strategy of making a virtue out of a necessity, but given the emphasis on voluntary groups (especially churches) something along these lines might be popular with the Tea Party, and could form the basis of a deal on taxes, which is sorely needed.

The approach to taxation ought to follow UK in at least one respect. Faced with the need to raise revenue to cover at least a third of the projected turnaround in the fiscal balance, any significant rise in taxes on income was ruled out from the start. Instead, the Coalition raised expenditure tax (aka Value Added Tax) from 17.5 percent to 20 percent. Although the American situation is made more complex by the presence of local sales taxes, it still should be possible to raise revenue either by a federal expenditure tax or by an increase in the tax on gasoline, which could be presented as a step towards lessening the country’s dependence on imported oil and/or a green tax to appeal to Obama’s own supporters.

Ideally, just as the Bowles-Simpson deficit reduction commission recommended, the rise in indirect taxation would be combined with the long-overdue abolition of most of the direct (i.e. income) tax exemptions which do so much to narrow the tax base and, more importantly, distort spending and saving patterns – and which make the U.S. tax code a nightmare of complexity (matched, however, by Britain’s tax code).

What WikiLeaks reveals about the changing map of global power

-Andrew Hammond is a Director at ReputationInc. The opinions expressed are his own-

The WikiLeaks release last month of around a quarter of a million classified U.S. State Department documents has, by critics, been variously characterised as the “September 11 of world diplomacy” (Italian Foreign Minister Franco Frattini); an “attack on the international community” (U.S. Secretary of State Hilary Clinton); and a threat to “democratic sovereignty and authority” (French Government Spokesman Francois Baroin).

Debate will long continue, across the world, about the rights and wrongs of WikiLeaks’ actions. Nevertheless, there can be no doubt that the episode has, highly regrettably, caused not inconsiderable damage to the United States.

Underlying many of these issues is the fundamental question of what the Wikileaks affair reveals about the changing map of influence and power in a world that continues to be transformed by the information revolution and economic globalisation. To date, these forces have generally reinforced U.S. pre-eminence for several reasons, including the country’s relative technological edge over much of the rest of the world (which will decrease over time); the fact that its dominant culture and ideas are very close to prevailing global norms; and its multiple channels of communication which help to frame global issues.

However, as the WikiLeaks’s releases underline, this emerging environment has simultaneously raised new challenges not just for the United States, but for all countries. For instance, with technological advances leading to vast increases in information, international publics have generally become more sensitive to “spin” and propaganda. Here, governments must not just compete for credibility vis a vis their foreign counterparts, but also with new actors such as Al-Jazeera and indeed WikiLeaks.

Information that appears to be spin or propaganda, or indeed sensitive leaks that are damaging, can undermine the credibility of a country and/or its government. For instance, pre-war intelligence controversies about Iraq damaged the reputation both of the United States and United Kingdom, and also of the Blair and Bush administrations.

In this current context, key dangers from the WikiLeaks episode for Washington (and certain of its allies) is potential backlash from some international publics, and also foreign elites proving more cautious in sharing information and cooperation going forwards. As Representative Peter Hoekstra, the ranking Republican on the House of Representatives Intelligence Committee has asserted, a “catastrophic issue here is a breakdown in trust”.

from Tales from the Trail:

Reuters/Ipsos poll: 52 pct don’t think Obama will be re-elected

President Barack Obama is not up for re-election this week, but the outcome of congressional elections will be seen as a referendum on his policies.

A Reuters/Ipsos  poll predicts that Republicans will take control of the House of Representatives by winning 231 seats, compared with 204 seats for Democrats, in the midterm elections Tuesday.

Among likely voters, 50 percent said they would vote for the Republican candidate, while 44 percent said they would vote for the Democrat, the poll showed.

Looking ahead to the 2012 presidential election, 52 percent believe Obama will not win re-election, while 35 percent think he will.

The Reuters/Ipsos national survey found that 51 percent disapproved of the way Obama is doing his job, while 45 percent approved.

The Obama administration received the worst ratings for its handling of the economy, taxes and the deficit -- all key election issues this year. On the Iraq war and the environment, the administration was seen has having made a positive difference, according to the poll.

Other recent polls:

What can the U.S. learn from the Spending Review?

Watching George Osborne present the results of the Government’s Comprehensive Spending Review last week, two thoughts went through my mind.

On a personal level, how could I have been so wrong about Cameron and Osborne? A pre-election blog of mine was titled “A Pair of Lightweights”. Both have already done enough to assure even the most cynical observer (which probably doesn’t mean me) that they are every bit as serious as the job they face.

The other thought was: are they watching in Washington?

America is in a hole every bit as deep as Britain.  The Federal budget deficit is yawning (9 percent of GDP compared with 10 percent in the UK in 2010). The Obama healthcare plan is going to add trillions of dollars to the already-crippling cost of Medicare and Medicaid, and there is the prospect of having to bail out many states and cities, especially those which rely on property taxes for their major source of revenue. The USA needs its Osborne moment before it is too late.

Yet, before anything like it could happen, the situation will have to get far far worse, so bad that the air of crisis is palpable to every American from sea to shining sea. Could the Federal Government cut spending drastically when the unemployment rate is near 10 percent? Could it reduce the defence budget while the GI’s were in action in Iraq and Afghanistan? Could it tell insolvent states to tighten their belts?

And again, how could the President – it would presumably have to be Mr Obama or his successor, not the Treasury Secretary – actually deliver the cuts he (or she) proposed? Whereas in the UK, even with a coalition government, George Osborne can announce measures which are more or less certain to be implemented, the US President could only ever tell the world what proposals he is going to send to Congress, then spend weeks and months arm-twisting, flattering and bribing its members to endorse them.

What would emerge at the end of this process would be a bill containing some of the original ideas intact, some modified to varying degrees and some totally eliminated, and the whole thing larded with billions of dollars of pork (some of which may get attached to other bills as a quid pro quo).

from The Great Debate:

Obama, Moses and exaggerated expectations

-Bernd Debusmann is a Reuters columnist. The opinions expressed are his own-

President Barack Obama is close to the half-way mark of his presidential mandate, a good time for a brief look at health care, unemployment, war, the level of the oceans, the health of the planet, and America's image. They all featured in a 2008 Obama speech whose rhetoric soared to stratospheric heights.

"If...we are willing to work for it, and fight for it, and believe in it, then I'm absolutely certain that generations from now, we will be able to look back and tell our children that this was the moment when we began to provide care for the sick and good jobs for the jobless; this was the moment when the rise of the oceans began to slow and our planet began to heal; this was the moment when we ended a war and secured our nation and restored our image as the last best hope on earth."

The date was June 3, 2008. Obama had just won the Democratic Party's nomination as presidential candidate. He was also winning the adulation of the majority of the American people, who shrugged off mockery from curmudgeonly Republicans who pointed out that the last historical figure to affect ocean levels was Moses and he had divine help when he parted the Red Sea.

Obama took to the campaign trail again this month to help Democratic candidates for the mid-term elections on November 2 and he would need divine intervention to prevent his party from losing control of the House and possibly the Senate.

The vote is in part a referendum on his first two years in office and the adoration has faded, not least because it would have been difficult for anyone to actually meet the high expectations he raised in dramatic speeches.

There is a certain symmetry between next month's mid-terms and those four years ago, when Democrats took control of both houses of Congress (and consolidated it in 2008). The result stemmed from dissatisfaction with the economy, with the Republican Party and with President George W. Bush. Now there is dissatisfaction with the economy (much more troubled than in 2006) with Democrats, and with Obama.