Archive for the ‘Globalization & International Trade’ Category

7
Dec

Barack Obama’s foreign-policy goal in his second term: to avoid costly entanglements

By cynical tradition “abroad” is where American presidents go to seek a legacy, after their domestic agendas have stalled. This is especially true of second-term presidents. As they lose momentum at home, the temptation is to head overseas in search of crises that only American clout can resolve.

At the outset of his second term, Barack Obama seems to be planning the opposite approach. Mr Obama and his team believe that his outstanding task is to secure a domestic legacy. Their fear is that foreign entanglements may threaten that goal. It may help that he secured something of a global legacy on the day he was elected four years ago amid worldwide adulation, peaking with a Nobel peace prize awarded after less than a year in office, essentially for not being George W. Bush.

On the 2012 campaign trail, Mr Obama earned some of his warmest applause when he vowed to bring troops back from Afghanistan, ending more than a decade of war-fighting that has cost thousands of American lives and more than a trillion dollars. Time for nation-building “right here at home”, he constantly declared, to cheers. In a newspaper essay on November 23rd Mr Obama’s former White House chief of staff, Rahm Emanuel, rammed the point home. Democrats need to make America globally competitive, wrote Mr Emanuel, now mayor of Chicago. Whether it means fixing failing schools, potholed roads, snail-like internet networks or a broken immigration system, the second-term mission must be to “come home and rebuild America”.

Yet the world keeps calling. From Gaza to Syria, Jordan, Egypt, Iran, the disputed waters around China or even the euro zone, foreign crises threaten to sidetrack Mr Obama. Read more…

As published in www.economist.com on December 1, 2012 (from the Print Edition).

16
Nov

By Paola Subacchi

Throughout the just concluded 18th Congress of the Chinese Communist Party ubiquitous television screens in trains and metro stations broadcast a live feed of the Chinese assembly. Beijing’s busy people, however, seemed not to pay close attention: for them, it was business as usual.

The Chinese public’s indifference to their country’s ceremonial transition of power is hardly surprising. All critical decisions were taken well ahead of the Congress, behind closed doors, with very little input from outsiders. This apparently seamless transition, however, is widely expected to usher in a complex and potentially difficult decade for China – and for the rest of the world.

China is at a turning point. With more than 100 million people still below the official poverty line and per capita income currently just over $6,000 in nominal terms, robust economic growth must be maintained. Outgoing President Hu Jintao indicated that China’s total GDP and per capita income should double by 2020, which will require 7.5% average annual growth. Is this feasible?

Recent improvements in data for industrial production, fixed investment, and retail sales suggest that the Chinese economy, which had slowed in recent quarters, may already be on the mend. But the authorities remain cautious, given that China’s economic outlook depends heavily on external conditions, which is the source of most current uncertainty. However, as things stand, most independent economists expect 7-7.5% annual GDP in 2013-2017, while the International Monetary Fund forecasts a more optimistic 8.2-8.5% rate during this period. Read more…

Paola Subacchi is Research Director of International Economics, Chatham House, London.

As published by Project Syndicate on November 16, 2012.

7
Nov

The Second Coming of Barack Obama

By Kemal Derviş

The race was tough, but US President Barack Obama has won re-election. The question now, for the United States and the world, is what will he do with a fresh four-year term?

To win re-election with a still-weak economy and unemployment close to 8% was not easy. Many leaders – Nicolas Sarkozy, Gordon Brown, and José Luis Rodríguez Zapatero come to mind – have been swept away by economic discontent in recent years. Although the financial disaster erupted on George W. Bush’s watch, after eight years of a Republican presidency, Obama had to carry the burden of an anemic recovery.

Obama won not only because of his extraordinary personal resilience, but also because a sufficient number of middle-class voters, while unhappy with the pace of economic progress, sensed that an Obama presidency would help them more than the policies championed by his Republican challenger, Mitt Romney, which were perceived as tilted to the affluent. Moreover, America’s ongoing demographic transformation makes it harder for candidates who are unable to reach out strongly to Latinos and other minority communities – something that Romney singularly failed to do – to carry the country.

Some aspects of the campaign, particularly the amount of money spent and its negative tone, struck many observers as objectionable. But the competitiveness of American democracy – the fact that an alternative always exists, and that those in power have to fight hard to stay there – was on admirable display for the whole world to see.

Obama will embark on his second term with the global economy at a crossroads. In the US, the uneven and weak recovery has been sustained by extraordinarily expansive monetary policies and ongoing large fiscal deficits. While corporate coffers hold mountains of cash, private investment stagnates. In Japan, solid economic performance remains elusive, while prime ministers succeed each other at a breathtaking pace.

Likewise, Europe is on life support, thanks to European Central Bank President Mario Draghi’s astute maneuvering and promises of unlimited intervention in sovereign-debt markets. But unemployment is at its highest in decades and growth has essentially stalled, even in Germany, while the troubled southern economies are mired in deep recession. The situation in Greece, moreover, has become socially unsustainable; Greece is small, but a total collapse there could have very negative financial and psychological effects elsewhere. Read more…

Kemal Derviş, a former minister of economy in Turkey, administrator of the United Nations Development Program (UNDP), and vice president of the World Bank, is currently Vice President of the Brookings Institution.

As published in www.project-syndicate.org on November 7, 2012.
6
Nov

Notes on the Decline of a Great Nation

The United States is frittering away its role as a model for the rest of the world. The political system is plagued by an absurd level of hatred, the economy is stagnating and the infrastructure is falling into a miserable state of disrepair. On this election eve, many Americans are losing faith in their country’s future.

The Statue of Liberty in New York: After a brilliant century and a terrible decade, the United States, in this important election year, has reached a point in its history when the obvious can no longer be denied: The reality of life in America so greatly contradicts the claim — albeit one that has always been exaggerated — to be the “greatest nation on earth,” that even the most ardent patriots must be overcome with doubt.

 

The monumental National Mall in Washington, DC, 1.9 miles (3 kilometers) long and around 1,586 feet wide at its broadest point, is a place that showcases the United States of America is in its full glory as a world power. A walk along the magnificent swath of green space, between the white dome of the Capitol to the east and the Lincoln Memorial, a temple erected to honor former president Abraham Lincoln, at its western end, leads past men in bronze and stone, memorials for soldiers and conquerors, and the nearby White House. It’s a walk that still creates an imperial impression today.

The Mall is lined with museums and landscaped gardens, in which America is on display as the kind of civil empire that promotes the arts and sciences. There are historic sites, and there are the famous steps of the Lincoln Memorial where Martin Luther King once spoke of his dream, and of the dreams of a country to be a historic force, one that would serve the wellbeing of all of mankind. Put differently, the National Mall is an open-air museum for an America that, in 2012, is mostly a pleasant memory.

After a brilliant century and a terrible decade, the United States, in this important election year, has reached a point in its history when the obvious can no longer be denied: The reality of life in America so greatly contradicts the claim — albeit one that has always been exaggerated — to be the “greatest nation on earth,” that even the most ardent patriots must be overcome with doubt.

This realization became only too apparent during and after Hurricane Sandy, the monster storm that ravaged America’s East Coast last week, its effects made all the more devastating by the fact that its winds were whipping across an already weakened country. The infrastructure in New York, New Jersey and New England was already in trouble long before the storm made landfall near Atlantic City. The power lines in Brooklyn and Queens, on Long Island and in New Jersey, in one of the world’s largest metropolitan areas, are not underground, but are still installed along a fragile and confusing above-ground network supported by utility poles, the way they are in developing countries. Read more…

As published in www.spiegel.de on November 5, 2012.

 

5
Nov

By Tony Karon

U.S. President Barack Obama greets Republican presidential candidate Mitt Romney at the end of their third and final debate at Lynn University in Boca Raton, Fla., on Oct. 22, 2012

Superbarrio Gómez ran the most underreported campaign of the 1996 U.S. presidential election. The masked Mexican wrestler turned social activist showed up in New Hampshire during the primary season and declared himself a “candidate” even though his foreign citizenship rendered him ineligible. Decisions affecting the lives of Mexicans are made in the White House, he reasoned, so Mexicans should have a say in choosing its occupant. It’s a sentiment that’s widely shared: two-thirds of the 26,000 respondents from 32 countries in a recent poll believe that the White House has an important impact on their lives, and for that reason, almost half believe they should have a vote in the U.S. presidential election. (If they did, President Barack Obama would be a shoo-in, according to almost every poll.)

The level of interest in this U.S. election, however, is considerably lower than that of 2008. One reason for this may be that any global citizen tuning in to the campaign’s foreign policy debate would have struggled to find substantial differences between what Governor Mitt Romney advocated and what the White House is doing. There is also a growing sense of the relative decline of U.S. global power. The U.S. remains the world’s most militarily powerful country and its largest economy, but its ability to shape economic and geopolitical events in distant climes has steadily declined over the past decade — whether it’s Afghanistan or Iraq, the rapidly changing Arab world or Europe’s debt crisis, Washington struggles to impose its will.

That said, the Oval Office remains the world’s strongest single center of power, and the outcome of Tuesday’s vote will be closely watched. Here are five places where the stakes are particularly high:

1. Syria: Breaking a Stalemate?

Syria’s civil war has killed upwards of 20,000 people, but the country remains locked in an effective stalemate: the regime of President Bashar Assad is unable to destroy the rebels, and the rebels are unable to destroy the regime. Given the sectarian stakes and the danger of igniting a wider regional conflict, as well as a fear of the growing influence of extremist elements among the rebels, the U.S. has held back from direct intervention, and even from enabling the rebels to receive heavier weaponry that could neutralize some of the regime’s military advantages. Read more…

Tony Karon is a senior editor at TIME, where he has covered international conflicts in the Middle East, Asia, and the Balkans since 1997.

As published by www.time.com on November 5, 2012.

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