Streetwise Professor

May 29, 2015

The US Nails Fifa, But It’s Putin Who Howls

Filed under: Politics,Sports — The Professor @ 5:56 am

Wednesday’s indictments of Fifa board members and others generates a great deal of schadenfreude. Fifa is a corrupt and loathsome institution, and it’s about time for its comeuppance. Hopefully the IOC will get its soon as well.

There is much comic gold to mine here. One nugget is Fifa president Sepp Blatter’s statement that it was he would lead the effort to restore Fifa’s reputation:

“We, or I, cannot monitor everyone all of the time,” Mr. Blatter said. “If people want to do wrong, they will also try to hide it. But it must also fall to me to be responsible for the reputation of our entire organization, and to find a way to fix things. [Note to Sepp: We know very well you are a fixer, but not in the way you use the term.]

We cannot allow the reputation of FIFA to be dragged through the mud any longer. It has to stop here and now.

Yeah. That we police ourselves thing worked so well with the Garcia Report.

Another hilarious aspect of this is that the decidedly un-athletic American who became an informant, the improbably named Chuck Blazer, who motors between huge meals on a scooter, looks like Mr. Creosote in the flesh. Don’t give him a mint!

But by far the best part of this is watching Vladimir Putin totally lose his sh*t over the arrests, and the parallel Swiss investigation of the awarding of the 2018 World Cup to Russia (as well as the 2022 WC to Qatar):

President Vladimir V. Putin sought to transform the burgeoning scandal over corruption in soccer’s international governing body into an extension of the confrontation between Russia and the West on Thursday, accusing the United States of global overreach while invoking the fates of Edward J. Snowden and Julian Assange, the WikiLeaks founder.

Most world leaders remained mum, apparently waiting for more details to emerge, but Mr. Putin went on the offensive immediately.

He used the moment to again portray Russia as under siege — in this case threatened with the humiliating loss of the right to host the 2018 World Cup, a move considered unlikely.

Mr. Putin called the arrests of top FIFA officials in Zurich on Wednesday “another blatant attempt by the United States to extend its jurisdiction to other states,” according to a transcript of an overnight news conference posted on the Kremlin website. Mr. Snowden, the former National Security Agency contractor who leaked classified information about global surveillance programs, and Mr. Assange, whose website published United States military and diplomatic documents, have both eluded American prosecution by taking refuge in other countries.

Note to VVP: idiots who use American banks to launder money and arrange corrupt transactions on American soil are most decidedly in the jurisdiction of the US.

But come to think of it, it’s precisely the fact that Putin knows that all too well which explains his howling like a scalded cat. It hits very close to home. It demonstrates a  vulnerability of which he is all too aware of, and neuralgic about.

Putin also conveniently overlooks the fact that it is the Swiss who have announced that they are examining specifically the awarding of the World Cup to Russia. The US said nothing about that, and indeed, the US embassy in Moscow said the indictments have nothing to do with Russia, so cool your jets, Vlad. Though, of course, Attorney General Lynch’s statement that the investigation is not over clearly looms over Putin and Russia. But the fact that the Swiss are involved makes it harder to make this a purely evil American plot.

It’s also hilarious to see that Gazprom assured Fifa that it would not terminate its sponsorship. So good to know that Fifa still lives up to Gazprom’s high standards for corruption.

Putin’s raising the issue of the “persecution” of Snowden and Julian Assange is also beyond parody. For Putin to credit Snowden as a hero for revealing secrets nearly simultaneously with Russia’s passing a law that makes information regarding the deaths of Russian servicemen on “special operations” during peacetime a state secret is particularly outlandish. To defend  the Pale One at anytime is bizarre. (Perhaps Vlad sees his fate when he looks at Assange-hiding out in a friendly embassy, dependent on a sun lamp for his Vitamin D.)

The statements of the Russian sport minister are also amusing. “We have nothing to hide.” (Who said you did? And if you have nothing to hide, why did you destroy the rented computers on which contained all of the Russian bidding committee’s correspondence and work product?)

The best: “I see no threat to Russia.”

If this is no threat, why is Putin freaking out? His over the top reaction betrays a deep fear that Russia and everyone involved in the WC bid, including Roman Abramovich and Putin himself) will be implicated. So many people arrested have an incentive to sing like birds. So many computers to search (including Fifa’s, which the Swiss are doing presently).

I am actually somewhat surprised at Putin’s reaction. He has been rather relaxed lately. The old cockiness has returned. The insecurity and paranoia of late-2014 and early-2015 had apparently vanished. He would have been much better off had he played this cool, and ignored the issue altogether. By making such a big deal out of it he looks guilty as hell. Which he doubtless is, but he could have fooled a lot more people had he just blown this off. A public fit screams a deep concern that he indeed very much has something-or somethings-to hide.

The next weeks and months should be rather enjoyable, watching  Blatter and Putin rant and squirm. And maybe, in the end, the world’s football-I mean soccer!-fanatics will be spared the torture of visiting Russia in 2018.

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May 26, 2015

Contrary to What Obama Says, the Ayatollahs Don’t Believe That It’s the Economy, Stupid

Filed under: History,Military,Politics — The Professor @ 12:48 pm

Obama gave an interview with his Boswell (on Middle East matters, anyways), Jeffrey Goldberg. In it, Goldberg asked how Obama could be confident in making a deal with a virulently anti-Semitic state. (Goldberg omitted  that it is also a state that has “death to America” as its rallying cry, which is as or more important to Americans.) Respondeth the (self-identified) sage:

“Well the fact that you are anti-Semitic, or racist, doesn’t preclude you from being interested in survival. It doesn’t preclude you from being rational about the need to keep your economy afloat; it doesn’t preclude you from making strategic decisions about how you stay in power; and so the fact that the supreme leader is anti-Semitic doesn’t mean that this overrides all of his other considerations. You know, if you look at the history of anti-Semitism, Jeff, there were a whole lot of European leaders—and there were deep strains of anti-Semitism in this country—” [Of course, Obama can’t resist slagging Americans by comparing them to “Death to Israel” ayatollahs and “European leaders”, e.g., Hitler.]

I interjected by suggesting that anti-Semitic European leaders made irrational decisions, to which Obama responded, “They may make irrational decisions with respect to discrimination, with respect to trying to use anti-Semitic rhetoric as an organizing tool. [Does Obama believe that anti-Semitic rhetoric was an “organizing tool” for the Nazis? If he is excluding them from this, then he is dodging Goldberg’s question.] At the margins, where the costs are low, they may pursue policies based on hatred as opposed to self-interest. But the costs here are not low, and what we’ve been very clear [about] to the Iranian regime over the past six years is that we will continue to ratchet up the costs, not simply for their anti-Semitism, but also for whatever expansionist ambitions they may have. That’s what the sanctions represent. That’s what the military option I’ve made clear I preserve represents. And so I think it is not at all contradictory to say that there are deep strains of anti-Semitism in the core regime, but that they also are interested in maintaining power, having some semblance of legitimacy inside their own country, which requires that they get themselves out of what is a deep economic rut that we’ve put them in, and on that basis they are then willing and prepared potentially to strike an agreement on their nuclear program.”

That all sounds coolly analytical and everything (“organizing tool”, “at the margins where the costs are low”) but it is poppycock dressed up in academic jargon grounded in a category error. Specifically, Obama profoundly misunderstands rationality, and projects his own views of what is rational on others, specifically the Iranians (though he projects on others, including Putin, in other contexts).

Obama argues that “being rational” involves things like “staying in power” and “keeping your economy afloat.” Conversely, he believes that except as an instrument to achieve these ends, anti-Semitism, expansionism, and presumably anti-Americanism and Islamic fundamentalism and Islamic exceptionalism, are irrational. Obama further believes, apparently, that rational imperatives (e.g., a stronger economy, better living standards for Iranians), will trump these irrational urges.

This fundamentally misunderstands what Hayek pointed out long ago: rationality relates to the application of the means best calculated to achieved desired ends. It does not relate to the desired ends themselves, which are inherently subjective and effectively beyond objective reason or logic. In economic terms, if the Iranian leadership gets subjective utility out of killing Jews and Americans and Sunnis, and extending the reach of the Islamic revolution, “rationality” involves the effectiveness of the means chosen to kill Jews, Americans, and Sunnis, and extend the reach of the Islamic revolution, not these objectives themselves. Again, the Nazi example is instructive. Given the costs of pursuing the Holocaust, it may seem irrational. But the Nazis pursued it with a purpose despite these costs. This was rational because they got intense satisfaction out of killing Jews. The huge cost of exterminating the Jews is a testament to its importance to them, not an indication of their irrationality.

In other words, Obama is engaged in the worst kind of mirror imaging, defining his preferences and world view to be “rational”, and projecting them onto the Iranians. In the near term, the main implication Obama and the administration draw from this is that “rational” economic imperatives will drive the Iranians to moderate their aggressiveness and imperial ambitions. The administration is basically the ventriloquist for this article from Reuters.

This is flatly at odds with their current behavior. A severely economically constrained Iranian regime is bending every fiber and digging deep into its limited resources to prop up Assad, foment revolt in Yemen, and fight Isis in Iraq. This indicates what its strong preferences are, and if it receives tens of billions of additional resources, it will inevitably indulge these preferences by increasing its spending on them. Expand their opportunity set, and Iran will engage in more anti-Semitism, more anti-Americanism, more Islamism, and more Persian imperialism. Further, it will respond to domestic discontent not by appeasing it through focusing like a laser on the economy, but by focusing like a laser on crushing the opposition, as it did in 2009 (when Obama stood aside, clearly signaling that he had chosen the ayatollahs over the Iranian people). And all that will be perfectly rational.

Narcissist that he is, mirror imaging comes naturally to Obama. And this very mirror imaging explains why Obama has been surprised so frequently by world events, most notably in the Middle East, but not limited to there by any means. People don’t do what he expects because he expects them to do what he would even though they inhabit different universes. These surprises have translated into failures and fiascos, and the most dramatic decline in America’s strategic position since at least Vietnam, and perhaps even including Vietnam. John Kerry says to give him and Obama the benefit of the doubt. Sorry, but sad experience tells us that would be truly, well, irrational.

Mirror imaging was bad enough when the Soviets were the object of it, but it is beyond insane with the Iranians, who inhabit an entirely different mental, moral, cultural, and religious universe than most Americans do, and certainly different than the one that transnational progressives like Obama inhabit. Ayatollahs don’t believe that it’s the economy, stupid. They believe it’s Islam and Shia Persian superiority, stupid. Given their very different values and preferences, they will make very different choices than Obama projects on them, meaning that he will be surprised, yet again.

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May 23, 2015

Don’t Sh*t the Troops

Filed under: History,Military,Politics — The Professor @ 7:31 pm

I have been scathing in my criticism of the administration’s and the Pentagon’s dishonest spin about the ongoing fiasco in Iraq. Just when I think they’ve pegged the BS meter at 10, they crank it to 11, as in this statement by the appalling Chairman of the JCS, Martin Dempsey, who shamelessly covers for Obama  and his failures:

 Iraqi security forces weren’t “driven from” Ramadi, they “drove out of Ramadi,” the chairman of the Joint Chiefs of Staff said here Wednesday.

. . . .

“This group of [Iraqi security forces] had been forward-deployed in al Anbar [province] – arguably the most dangerous part of Iraq,” he said. “They believed they were less well-supported. The tribes had begun to come together, but had not … allied themselves with the [security forces].”

The sandstorm precluded U.S. air support against ISIL, and the Iraqi commander on the ground made “what appears to be a unilateral decision to move to what he perceived to be a more defensible position,” the general said.

A more exquisite job of sh*t-house lawyering (or sea lawyering, as they call it in the Navy) would be hard to imagine. Excuse me, General, but they drove out because they were driven out. They drove out because they bugged out. They bugged out because they were outmanned, outgunned, unsupported, and suffering from the typical failures of leadership and morale that beset Iraqi formations. It is impossible to put a favorable gloss on this, but Dempsey did his level best to do so, and in the process brings shame and discredit onto the US and its military.

When he heard a statement that was transparently intended to cover up an unpleasant truth, my dad would say: “Don’t sh*t the troops.” Well, the senior uniformed officer in the US military establishment is shamelessly attempting to sh*t the troops, and the American people.

What’s almost as astounding is that both www.centcom.mil and www.pentagon.gov are leading their anti-ISIS war coverage with Dempsey’s remarks, meaning that the establishment is complicit in sh*tting the troops. This wasn’t a gaffe. It is official writ.

Dempsey is a repeat offender. Not long ago he said Ramadi was not important militarily or symbolically, thereby giving great offense to thousands of soldiers, sailors, and Marines (and their families) who fought and bled for Ramadi, and wrested a hard won victory from the predecessors of ISIS. Dempsey then compounded the offense by giving the typical celebrity non-apology-apology that included an “if” (“if I’ve added to your grief”) and a “but.” Real apologies are unconditional and unqualified. The man cannot leave soon enough.

What would someone telling it straight, and not sh*ting the troops, say? He wouldn’t say what Dempsey said:

“At the start I said three years,” he said. “That still might be the case, we may be able to achieve our objectives in three years. But I said then, and I reiterate now, that there may be tactical exchanges – some of which go the way of Iraqi security forces and others which go the way of ISIL. But the coalition has all the strategic advantages over time.”

He would say the current planned is doomed to failure, and that major changes are needed.

One change being considered is deploying American tactical air controllers/targeters. I wrote posts about this some months ago (like this one), and I definitely agree that this is necessary to make the air campaign more effective.* But in the absence of an even marginally credible ground force in Iraq, even a serious air campaign cannot defeat ISIS. A full-blooded American ground intervention would be required-either that, or turning the place into radioactive glass (which wouldn’t require TACs!). But the cost in lives and treasure is unlikely to be worth the gain. I therefore tend to agree with commenter Chris, and Bob Baer, that Iraq and Syria are doomed to devolve in to bloody statelets run by warlords, divided on sectarian and ethnic lines, and we should learn to live with that. Secure our economic interests, and let the locals party like it’s 699. Focus our attention on China and Russia, both of which have been particularly truculent lately.

In retrospect, it is clear that once Obama pulled out of Iraq in 2011, catastrophe was foreordained. The Iraqi state and military were too dysfunctional to combat effectively a relentless enemy.

Perhaps the situation could have been retrieved, at least partially, if the US had aggressively employed air power when Isis was on its rampage about a year ago, but Obama demurred. That allowed Isis to take Mosul, and expand in Anbar. It is now well-entrenched, and has sufficient human and material resources to withstand whatever the militarily feeble Iraqi and Syrian governments have to throw at it.

It’s about time to admit that. But from Obama through Dempsey to Pentagon press flacks we don’t get such honesty. Instead, we get a constant litany of troop-sh*tting. Enough already. All the spin in the world can’t conceal the obvious.

* I find it interesting that Anthony Cordesman, whom I admire greatly, says that TACs are “critical” because his first analysis of the air campaign mentioned their role only in passing. I wrote him about this, provided several historical references (e.g., some material about Arc Light raids in Vietnam and the role of controllers in aiding the XIX Tactical Air Force in NW Europe in WWII). He said he would put is research assistants to work on the subject, and I guess he has become convinced.

 

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May 19, 2015

Fiasco on the Euphrates

Filed under: History,Military,Politics — The Professor @ 7:54 pm

The situation in Ramadi (and Anbar generally) is an utter fiasco, with the Iraqi forces reprising the rout that occurred in Mosul almost exactly a year ago, thereby helping re-equip Isis with brand new American equipment. To paraphrase Wellington: Isis came on in the same old way, and the Iraqi army ran away in the same old way.

The Shia Hashd militia are claiming that they will retake Ramadi. As if. In Patton’s felicitous phrase, they couldn’t fight their way out of a piss soaked paper bag, especially in the offensive: “militia” means “militarily ineffective amateurs”. Oh they will no doubt die in large numbers, but in another Patton phrase: “No bastard ever won a war by dying for his country. He won it by making the other poor dumb bastard die for his country.” (Or sect, as is the case here.) Their reputation alone will drive those few Anbari Sunnis who haven’t thrown over to Isis out of self-preservation into arms of the caliphate.

The only thing that can redeem the situation is a major commitment of American ground forces. But that is not in the cards. The most Obama could muster today was a milquetoast statement that he was “weighing” “accelerating” training of Iraqi troops. That is so wildly inadequate to the emergency of the moment that one doesn’t know whether to laugh or cry.

Obama has no one to blame but himself for the appalling choices that face him: he is entirely responsible for this dilemma because of an earlier choice that he made eagerly, indeed, triumphantly. When a preening and supercilious Obama decided to declare victory in Iraq, and withdraw every American soldier, Marine, and airman from the country, he opened the door for Isis. And once Isis barged through, he was left with two, and only two, alternatives: go back in heavy with a major commitment of American combat forces, or turn the mess over to Iran to sort out.

He is constitutionally unable to make the former choice, so by default, he is left with the latter. This helps to explain (but is not the entire explanation) for his deference to Iran on everything. But this will prove unavailing as well, because for all of its blood curdling rhetoric, Iran does not have the military capacity to achieve anything except get a lot of people killed.

So absent a road to Jerusalem conversion by Obama, Isis will consolidate, and likely expand, its hold in Anbar and other parts of Iraq.

Adding insult to injury are statements from the administration and the Pentagon that are so divorced from reality that they would make Baghdad Bob blush. Baghdad Brett McGurk is probably the worst offender, but he has much company.

As I’ve written before, you know that most people in the military must be beside themselves watching this. As I’ve also written, this is being enabled, rather than opposed, by the senior military leadership, especially the outgoing Chairman of the Joint Chiefs. They should all be reading Dereliction of Duty, and thinking very, very hard about how its lessons apply to them, today.

The situation is arguably beyond recovery, at least at any affordable cost. And even were Obama to go against ever instinct in his body and decide to intervene with American combat troops, I shudder to think of going to war under such an uncertain and inept commander.

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May 17, 2015

One Does Not Win Wars By Special Operations Alone

Filed under: History,Military,Politics — The Professor @ 1:42 pm

The administration is hyping an allegedly successful Delta Force attack on an Isis target in Syria. I say “allegedly successful” because even though it appears that at least one high value target was killed, and some intelligence was seized, there are doubts that the raid killed the original target. But even if the raid was successful in that it achieved its objective, it testifies to the broader strategic failure of the American campaign to “counter Isis.”

One does not win wars by special operations alone. As their name implies, special operations are special, exceptional. They can be an important and very specialized component of a military campaign that uses all elements of combat power to destroy a conventional or semi-conventional enemy force that holds territory: they cannot be the entire campaign, or even the main element of that campaign. Special operations support the main operations. They are not a substitute for infantry, armor, artillery, and airpower: they are a complement.

One important function that special operations can perform is reconnaissance and intelligence collection. The information provided by special operators can be used to identify enemy weaknesses and strengths, anticipate enemy movements, and plan main force attacks to destroy enemy units and wrest territory from them.

Even if the Delta operators seized considerable intelligence in the raid, this information will be largely useless in operations against Isis combat power because there is no American or coalition combat force that can use it to devise an effective attack against that power.

Another important task special operation forces can perform is direct action against enemy command, control, and logistics. Such actions can sow confusion in the enemy’s ranks and the minds of its commanders; disrupt communications; impede coordination, command and control, thereby reducing the enemy’s operational effectiveness; and divert forces that otherwise could be used to attack or defend against one’s main forces. But a main force is required to exploit these benefits.

Special operations were employed in these ways during the Iraq War, and in particular in Anbar during the Surge. SEALs and Delta conducted almost daily raids on insurgents and collected significant intelligence that was used by conventional infantry, armor, and air forces in near real time to mount attacks against insurgent targets, and to repel insurgent attacks. The pressure from special operations direct actions attrited the enemy and forced its leadership to devote considerable resources on self-defense. Snipers provided by special operations forces were particularly effective at killing and demoralizing the insurgents.

That is, special operations were a major force multiplier in Iraq, especially in 2007-2008. But that was because there was a force to multiply. Special operations were a key component of a full-spectrum campaign involving conventional American forces and local Sunni tribal auxiliaries. This campaign eventually resulted in a hard-won victory that Obama frittered away in 2011. Today’s news that Ramadi, and with it virtually all of Anbar, are in Isis hands shows that the reversal of fortune is all but complete.

But if you multiply nothing by something, even a big something, you still end up with nothing. And it is abundantly clear that in Iraq and Syria, we got nothin’ for special forces to multiply. Meaning that the ultimate effect of yesterday’s Delta raid, and any other raids to come, will be effectively zero.

Given the grave risks of these raids, the limited number of operators, and the very high cost of training and retaining these unique personnel, they should not be employed in operationally and strategically barren operations. It is almost certain that the recent raid in Syria will be operationally and strategically barren. It should not have been mounted, and similar operations should not be mounted in the future, except as part of a sound operational plan that utilizes conventional forces to achieve a strategically meaningful objective.

Obama is categorically opposed to using conventional forces in Iraq and Syria, but feels that he has to do something, and drones and special forces raids are something, even if they accomplish little or nothing of strategic importance. It is pointless to rely  on these instruments of national power, which are only truly useful if joined up with other elements of that power, as the backbone of a campaign against Isis. If there is a more telling testament to the strategic vacuity of Obama’s “slow burn” campaign than the daring raid in Syria, I would be hard pressed to name it. So much professional expertise and courage put at grave risk to achieve a glittering tactical victory that will have no effect on the ultimate outcome in Syria and Iraq. One cannot win wars by special operations alone, and it borders on the criminal even to try.

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May 16, 2015

Spinning Like Dervishes on Iran, Syria, and Iraq

Filed under: History,Military,Politics — The Professor @ 8:22 pm

Obama held his stop-worrying-and-learn-how-to-love-the-Iranian-bomb “summit” with the GCC at Camp David. Well,”summit” is something of an overstatement, because four of the most important GCC leaders (most notably Saudi Arabia’s King Salman) took a pass and sent deputies instead. The world saw this as a snub, but the administration spun it as no big deal.

Speaking of deputies and spin, afterwards Ben Rhodes, “deputy national security adviser for strategic communication”, came out spinning like a dervish. One statement was more ridiculous than the next. The Iranians would use the 11 (or is it 12) figure windfall to rebuild their sanction-stricken economy rather than to arm themselves or sow discord abroad. (If they are so anxious to address domestic issues, why endure sanctions for so long?) Further, Ben intoned, the the Iranians are indeed acting aggressively in the Middle East, but their preferred methods are inexpensive, so they have no need to spend the added billions on further aggressive measures. (That’s supposed to inspire confidence? Ever think that its current choice of methods is a concession to their financial straits, and with more money Iran just might adopt new, more expensive-and effective-methods? Further, I’m pretty sure they will pour a lot more into Syria once they get more to pour.) The administration also opined that there is no reason for an arms race in the aftermath of the deal. (Easy for them to say.)

My favorite, though, was Rhodes opining that the deal was “transactional” and not “transformational”, and was focused on the nuclear issue alone. Sorry, Ben, but you don’t get to limit the effects to the ones you intend. Unintended consequences are inevitable. And unintended does not mean unpredictable. The predictable implications-an arms race, including a nuclear arms race, increased Iranian aggressiveness, and higher likelihood of a confrontation that results in a war-are pretty transformational.

Later, Obama strode out to deliver his own spin. More unpersuasive, not to say delusional, bilge. The only real memorial moment was when he was asked about alleged Syrian use of chlorine bombs, and whether this breached his notorious “red line” (ha!) An obviously peeved Obama (he snarkily said he didn’t know why the Al Jazeera America reporter who asked the question was there) gave a lesson in alternative history. He said that “Chlorine, chlorine, itself, historically has not been listed as a chemical weapon, but when it is used in this fashion, can be considered a prohibited use of that particular chemical.” (Obviously, there was no teleprompter.)

Er, the first major chemical weapons attack, almost exactly 100 years ago at the Battle of Ypres (22 April, 1915), involved chlorine. Chlorine was widely used in WWI, and has been used subsequently. Try telling the French, Algerians, and Canadians gassed at Ypres that “historically” chlorine isn’t considered a CW. As Powerline put it, Obama’s epistemology is narcissistic. He believes (or says to believe) things because they are convenient and useful, rather than because they are true. Another Assad violation of the (already risible) chemical weapons red line is inconvenient, so Obama believes that chlorine is not a chemical weapon.

But the spinning didn’t end with the Iran deal or red lines. The administration has been spinning events in Iraq with particular fury, in large part because things there are spinning out of control.

Just yesterday, the chief of staff of Operation Inherent Resolve claimed that the US strategy against ISIS is working:

The coalition and Iraqi security forces strategy to defeat and dismantle the Islamic State of Iraq and the Levant extremist group is clear and on track, the chief of staff of Combined Joint Task Force Operation Inherent Resolve said today.

As he was saying this, ISIS was mounting a furious assault at Ramadi, and was capturing most of the government buildings. If you look at a situation map, you’ll see that ISIS controls the central position in the city, and that Iraqi units are in isolated pockets strung out around its perimeter, vulnerable to being assaulted and taken one at a time.

The official take on the battle is a barrage of euphemisms. “Contested.” “Fluid.” “Dynamic.” Well, maybe, but the best interpretation to put on that is that the battle has yet to be decided. One certainly cannot spin that into “our strategy is working.”

The execrable Brett “Slow Burn” McGurk, “Deputy Special Presidential Envoy for the Global Coalition to Counter-ISIL” (doesn’t that strike fear?!), took the spin to Twitter, claiming that the coalition was mounting intense air attacks in Ramadi. Intense, as in four, which is a joke. Perhaps we are not able to hit more because we don’t have the necessary targeting assets on the ground. But if that’s true, it tells you that the campaign is doomed to be ineffective. (I asked McGurk to please point me to the military text which espoused the “slow burn” strategy. Curiously, he didn’t respond. He was probably too busy reading Clausewitz or something.)

The yawning divide between what appears to be happening on the ground in Ramadi, Baiji, and elsewhere and the Pentagon’s and administration’s Winning! narrative is bringing back unpleasant memories of a similar disconnect that cratered the military’s and government’s credibility in Vietnam. This is not good.

Iran, the Persian Gulf, Syria, Iraq. Everything is going pear shaped, but everything emanating from the administration is a mix of magical thinking and transparently ridiculous spin. Observing this, people in the region are going to figure that at least for the next 20 months, American policy will be adrift, and the administration will be content to watch the region spin out of control. And it will proceed to do so. But you can be sure that all the while, the administration will insist, Kevin Bacon like, that all is well, when anyone with eyes will know it isn’t.

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May 15, 2015

No. Trains Are Not Public Goods and Don’t Exploit Tragedy To Claim They Are

Filed under: Economics,Politics,Regulation — The Professor @ 9:39 pm

One of the least savory aspects of human behavior is the tendency to exploit tragedy for personal or political ends. This low tendency was on display in spades in the aftermath of the Amtrak derailment in Philadelphia. Before the bodies of the dead were even cold, pundits and politicians were out in force moaning that the tragedy proved the lamentable decay of American infrastructure, and the lack of government spending on it. Remarkably (or maybe not), the lamentations have continued even after it was revealed that the train had been going more than twice the speed limit, thereby making it highly unlikely that shoddy track or a poorly maintained train was to blame. No tragedy should go to waste, apparently, and the facts shouldn’t get in the way of a politically useful narrative.

There are many examples of the mo’ guvmint types exploiting the deaths of 8 people in Philly, but for 99.9 percent pure, unadulterated stupidity, you have to read this screed by Adam Gopnik* in The New Yorker. Where to begin?

To leverage the Philadelphia tragedy into a justification for more government spending, Gopnik has to claim that railroads, and passenger railroads in particular, are public goods:

And everyone knows that American infrastructure—what used to be called our public works, or just our bridges and railways, once the envy of the world—has now been stripped bare, and is being stripped ever barer.

. . . .

This week’s tragedy also, perhaps, put a stop for a moment to the license for mocking those who use the train—mocking Amtrak’s northeast “corridor” was a standard subject not just for satire, which everyone deserves, but also for sneering, which no one does. For the prejudice against trains is not a prejudice against an élite but against a commonality. The late Tony Judt, who was hardly anyone’s idea of a leftist softy, devoted much of his last, heroic work, written in conditions of near-impossible personal suffering, to the subject of … trains: trains as symbols of the public good, trains as a triumph of the liberal imagination, trains as the “symbol and symptom of modernity,” and modernity at its best. “The railways were the necessary and natural accompaniment to the emergence of civil society,” he wrote. “They are a collective project for individual benefit … something that the market cannot accomplish, except, on its own account of itself, by happy inadvertence. … If we lose the railways we shall not just have lost a valuable practical asset. We shall have acknowledged that we have forgotten how to live collectively.”

Trains take us places together. (You can read good books on them, too.) Every time you ride one, you look outside, and you look inside, and you can’t help but think about the private and the public in a new way.

In point of fact, railroads are not public goods, as defined by economists. Not even close. I get no benefit whatsoever from your trip on a train, or a train that ships a good to you. The benefits of rail travel and rail transport are internalized by the traveler and the consumer of the transported good.

Further, what characterizes public goods is non-exclusivity. If you produce it, I get to consume it too, and you can’t exclude me from doing so. Not true of railroads. You have to buy a ticket to ride.

Meaning that if the value of the service exceeds the cost of providing it, market forces will lead to its provision, in approximately the efficient quantity. Yes, indivisibility and market power issues may lead to some distortions, but the gross under provision that Gopnik and Judt fear will not happen. Period.

Yes, trains take us places together-but they also take us places alone. And we internalize the benefits of the company-or the solitude. You internalize the benefit of the book you read or the view you see: it affects me not one whit.

Given these facts, there is no case here whatsoever for public provision of this service. If Gopnik or Judt get psychic benefits out of other people riding on trains, let them buy them tickets: why enlist the coercive powers of the state to subsidize what they value?

Perhaps-perhaps-there was justification for subsidizing transcontinental rail in the mid-19th century, but even that is doubtful: the success of the James J. Hill’s Great Northern, which received no government land grants,  is a great counterexample. Privately funded rail investment boomed starting in the 1850s, and soon roads criss-crossed the northeast and midwest. Indeed, it is arguable that there was over investment.

Gopnik has a theory why there is not more investment in railroads (underinvestment in his view, in fact). Anti-government libertarian fanatics. (Shhh. No one tell him that the protagonist of Atlas Shrugged runs a railroad.)

The reason we don’t have beautiful new airports and efficient bullet trains is not that we have inadvertently stumbled upon stumbling blocks; it’s that there are considerable numbers of Americans for whom these things are simply symbols of a feared central government, and who would, when they travel, rather sweat in squalor than surrender the money to build a better terminal.

No, actually. It is the fact that the high speed rail projects that so enamor leftists like Gopnik-and Jerry Brown and Obama-are colossal boondoggles that pass no cost benefit test whatsoever, even if you make dreamy assumptions about ridership or the value of carbon allegedly saved.

Consider the California high speed rail project, much beloved by Brown. For $6 billion, the first phase will connect . . . wait for it . . . Merced and Bakersfield.  North Nowhere to South Nowhere. Buck Owens would have been so proud. But it will be a white elephant that California cannot afford, and ironically, will divert resources from other infrastructure that California could definitely use.

If you want to find an era in which investment in rail was truly throttled, go back to the halcyon days of the 60s and 70s, when nearly a century of rate regulation, combined with the rise of air transport and the (government funded) creation of the interstate highway system brought the entire industry into severe financial distress, and drove many famous rail companies to bankruptcy. (It’s an irony, no, that government infrastructure spending undercut the left’s beloved railroads?) Investment in track and rolling stock plummeted, and the industry was truly decrepit. And that was almost completely the result of archaic and inefficient regulation. Government almost killed rail.

The freight industry was reborn starting in 1980, with the passage of the Staggers Act, which deregulated rates. As surely as day follows night, the freight rail industry was revitalized. The profit motive worked wonders. Economic forces were permitted to work, and routes were rationalized, resulting in the closure of uneconomic routes that the government had forced roads to retain. Economically viable routes were expanded.  Innovation, in particular the development of intermodal systems, led to dramatic improvements in efficiency and incredible integration between ocean, rail, and road freight.  The private enterprise that Gopnik and Judt believe cannot possibly lead to good except by accident (“inadvertence”) revived what their beloved government had almost strangled.

Passenger rail did not experience a similar revival, but that too was driven by economics. Rail cannot compete with air on long distance travel, especially when the value of time is considered. For shorter trips, the point-to-point convenience and flexibility that cars offer means that driving typically dominates rail.

Gopnik claims “We all should know that it is bad to have our trains crowded and wildly inefficient—as Michael Tomasky points out, fifty years ago, the train from New York to Washington was much faster than it is now.” We know no such thing. Indeed, the massive subsidies necessary to keep passenger rail operating in the US tell us the exact opposite: that it is economically unviable.

It is beyond funny that liberals consider passenger rail a “symbol and symptom of modernity.” In 1880, maybe. In 2015? Seriously? Now it is an anachronism.

In brief, there is no “plot against trains.” If anything conspires against passenger trains, it is economic reality, and they have survived only by coercing you and me to pay for it. Economic reality is quite congenial to freight rail, and it has thrived as a result, without us being compelled to subsidize it.

Gopnik’s economic illiteracy is annoying, but his supercilious tone and East Coast superiority makes his ignorance almost unbearable: he fits in perfectly at the New Yorker, and personifies the famous cover depicting the view of the US from 9th Avenue. A condescending ignoramus. Not an appealing combination.

In sum, it’s appalling enough that Gopnik, like others, leaped to use the Philadelphia tragedy to advance his pet political cause.  It’s even worse that this pet political cause is economically retarded.

*Gopnik’s name cracks me up, because in Russia the term “gopnik” (го́пник) refers to lower class street punks known for their drinking, loutish behavior, petty criminality, and stylish dress, usually consisting of Adidas track suits and dress shoes. In other words, го́пники are pretty much the antithesis of Manhattan prog Adam Gopnik, and no doubt the typical го́пник would take great pleasure in beating the snot out of the likes of Adam Gopnik.

 

 

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May 12, 2015

Samantha Power, Magical Thinker–Like Her Boss

Filed under: History,Military,Politics — The Professor @ 12:45 pm

This administration has a well-documented track record for making delusional statements, but this one by Samantha Power (in an interview with Charlie Rose) is in the running for Most Delusional:  “I think you’re going to see a push on diplomacy in the coming weeks, and it is our hope that perhaps also, if the nuclear deal can go forward and we get the terms that we need in that space, that you’ll start to see a shift in Iran’s posture [on Syria].”

Why? First, because “Iran is stretched” by its commitments to Syria, Iraq, and Yemen.

Um, the $50 billion “down payment”, with more to follow, will unstretch Iran quite a bit. It will provide a lot of wherewithal that they can pump into Syria, and elsewhere. That Iran has spent such large sums on Syria at a time when it is desperately burdened by sanctions demonstrates clearly the high strategic value that the mullahs place on Assad, and controlling Syria. The deal which Powers is flogging will increase Iran’s capability to achieve its strategic objectives. The clear implication is that Iran will increase dramatically its support for Assad once a deal is done, not withdraw it as Powers fantasizes.

Second, she claims that Iran “wants to be part of the international community.” Typically idiotic transnational progressive projection. No. The mullahs don’t crave to be liked by Samantha and the transnatprog set: countries that screech daily about exterminating Israel aren’t all that concerned about their image in the West. Indeed, these theocrats despise the West. That they say they want to be part of the international community just tells you that they have figured out that Western elites lap up that bilge.

Iran wants to be free to pursue its objectives without constraints from the international community. Its role in Syria has nothing to do with the constraints it currently faces, and once the sanctions are lifted, there is zero possibility that other constraints will be imposed because of its role in Syria.

Now let’s turn to reality. There are reports that Assad’s chief of the National Security Bureau has been arrested. Why? For plotting a coup. The reason for his dissatisfaction? Iran’s increasing control over the Syrian government:

The role being played in the war by Iran, Syria’s regional ally, is said to be at the heart of the arguments, with some of the “inner circle” afraid that Iranian officials now have more power than they do.

Iran’s influence has been crucial in bolstering Syria’s defences against the rebels, but even that has been crumbling in the face of recent rebel advances in the north.

So Iran is just going to drop Syria because it wants to be popular at Davos? Obviously not. It is intent on controlling Syria, and a nuclear deal will enhance its ability to do so.

Like with so many other things, this administration’s view of reality is totally inverted. Obama and his minions say the Iran deal will cure every ill in the Middle East. In fact, it will exacerbate almost all of them because it will dramatically enhance the resources and capabilities of a revisionist power that threatens virtually every other nation in the region. The conflict in Syria will become more intense and protracted, not less, when Iran gets its hands on billions with the potential to make billions more. And conflicts with Gulf countries are much more likely in a post-deal world. It is also likely that a resurgent Iran would raise deep alarm in Turkey, especially given that Turkey is adamantly anti-Assad. Thus, conflict with Turkey is more likely too.

This deal is a Pandora’s Box. With one difference. I don’t think that hope is inside of it.

 

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May 11, 2015

Merkel in Moscow: A Laudable Sentiment, A Misguided Message, and a Lost Opportunity

Filed under: History,Military,Russia — The Professor @ 7:17 pm

Angela Merkel tried to walk a thin line on VE Day. She traveled to Russia, but did not attend the atavistic, militaristic, and jingoistic parade on the 9th. Instead, along with Putin, she laid a wreath at the Tomb of the Unknown Soldier on the 10th. She also met with Putin, and criticized him for Crimea and Donbas.

Merkel said this to explain her visit:

“We cannot close the book on our history,” Ms. Merkel said in her weekly video message May 2. Despite deep differences with Russia over Ukraine, she said, “it is important for me to lay a wreath on May 10 together with the Russian president in remembrance of the millions of dead for which Germany is responsible from World War II.”

Those are laudable sentiments, but she could have done things differently, and better. Indeed, her Russian-centric approach is deeply flawed, and has implications for current events.

Ukraine and Belarus suffered far more, proportionally, than did Russia during WWII. Not that Russia got off lightly. Clearly not. But in terms of loss of life, and in terms of German war crimes, Ukraine and Belarus were ground zero.

Merkel could have and should have gone to Kiev to participate in Ukraine’s far more restrained and somber commemoration. She should have laid a wreath there, in remembrance of the millions of dead in Ukraine for which Germany is responsible. Then she could have gone to Moscow on the 10th.

By going to Moscow only, and not Kiev, she implicitly accepted Russia’s assertion that it is the heir to the Soviet Union; that to Russia is due the honor and the glory for defeating the Nazis; and that Germany owes apologies to Russia, or that at least Russia accepts apologies on behalf of all other ex-Soviet peoples. This implicitly subordinates Ukraine, Belarus and other former-SSRs to Russia. By going to Russia only, she implicitly stated that Russia is the first among nations spawned from the collapse of the USSR, and that the others are inferiors.

This is a particularly dangerous message to be sending now, when Russia is quite explicitly attempting to subordinate these other nations by force, economic pressure, and subversion. Merkel is effectively validating Putin’s belief that Ukraine is not a “real country,” and that Ukraine’s independence is illegitimate and a historical injustice.

By visiting Kiev, Merkel could have sent a very different message. She could have paid homage to those that Germany victimized from 1941-1945, while also saying that the lesson and legacy of the Second World War should be that large aggressive nations should not dominate small and weak ones.  Should could have implicitly upbraided Putin, given support to those he wants to dominate, and made amends for wrongs that Germany inflicted on non-Russians.

Merkel walked a thin line, but she could have walked a much better one.

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Gazprom Agonistes

Filed under: Commodities,Economics,Energy,Politics,Russia — The Professor @ 12:26 pm

It has been a hellish few months for Gazprom. It’s profits were down 86 percent on lower prices and volumes and the weak ruble. Although the ruble has rebounded, the bad price news will persist for several months at least, given the lagged relationship between the price oil and the price of gas in the company’s oil-linked contracts. The company has been a die-hard defender of the link: another example of be careful what you ask for.

Moreover, the EU finally moved against the firm, filing antitrust charges. Although many of the European Commission’s antitrust actions, especially against US tech firms, are a travesty, the Gazprom brief is actually well-grounded. At the core of the case is Gazprom’s pervasive price discrimination, which is made possible by its vertical integration into transportation and contractual terms preventing resale of gas. Absent these measures, a buyer in a low-price country could resell to a higher price country, thereby undercutting Gazprom’s price discrimination strategy.

It is interesting to note that the main rationale for Gazprom’s vertical integration is one which was identified long ago, based on basic price theory, rather than more elaborate transactions cost economics or property rights economics theories of integration. Back in the 1930s  economists identified price discrimination as a rationale for Alcoa’s vertical integration. There was some formal work on this in the 70s.

Gazprom is attempting to argue that as an arm of the Russian state, it is not subject to European competition rules. Good luck with that. There is therefore a decent chance that by negotiation or adverse decision that Gazprom will essentially become a common carrier/have to unbundle gas sales and transportation, and forego destination clauses that limit resale. This will reduce its ability to engage in price discrimination, either for economic or political reasons.

The company is also having problems closer to home, where it is engaged in a battle with an old enemy (Sechin/Rosneft) and some new ones (Timchenko/Novatek), and it is not faring well.

Gazprom and Putin have always held out China as the answer to all its problems. There were new gas “deals” between Russia and China signed during Xi’s visit to the 70th Victory Day celebration. (Somehow I missed the role China, let alone the Chinese Communists, played in defeating the Nazis.) But the word “deal” always has to be in quotes, because they never seem to be finalized. Remember the “deal” closed with such fanfare last May? I expressed skepticism about its firmness, with good reason. There is a dispute over the interest rate on the $25 billion loan that was part of the plan. Minor detail, surely.

Further, Gazprom doesn’t like the eastern route agreed to last year. It involves massive new greenfield investments in gas fields as well as transportation. It has therefore been pushing for a western route (the Altai route) that would take gas from where Gazprom already has it (in western Siberia) to where China doesn’t want it (its western provinces, rather than the more vibrant and populous east). The “deal” agreed to in Moscow relates to this western route, but as is almost always the case, price is still to be determined.

If you don’t have a price, you don’t have a deal. And the Chinese realize they have the whip hand. Further, they are less than enamored with Russia as a negotiating partner. Who could have ever predicted this? I’m shocked! Shocked!:

Chinese and Russian executives and advisers said that in addition to the challenge of negotiating prices acceptable to both sides, energy deals between the countries have also been hampered by mutual distrust and Chinese concerns about antagonising the US.

“The Russians are unreliable. They are always flipping things around for their own interest,” said one Chinese oil executive.

Who knew?

Putin is evidently losing patience with the company, and its boss Alexei Miller, is far less powerful than Sechin and Timchenko. When it was a strategic asset in Europe, and offered real possibilities in Asia, it could defend itself. Now that leverage is diminishing, its future is much cloudier.

The impending new supplies of LNG coming online in the US and Australia dim its future prospects further.

In sum, Gazprom is beset by many agonies. Couldn’t happen to a better company.

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