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Moody’s Mulls Downgrading U.S. Debt

The U.S. isn’t Greece.  Yet.

Moody’s is no longer so sure about the quality of Uncle Sam’s debt.  Reports the Christian Science Monitor:

The US needs to make significant government spending cuts or else risk losing its gold-plated credit rating that has made extensive borrowing so affordable, Moody’s Investor Service said late Monday.

The announcement was a sobering warning that the country’s burgeoning debt has weakened the country’s economic standing, and that US Treasury Bonds, traditionally a bullet-proof investment, could lose their sterling Aaa-rating if Washington cannot control its federal debt.

If Moody’s were to downgrade the country’s rating, the impact could be severe. It would signal to lenders worldwide that the US is no longer one of the safest places to invest money.

That, in turn, would threaten the country’s ability to borrow freely and extensively from other countries on favorable terms. Investors would likely demand a higher interest rate to finance US debt, which would push federal debt higher still.

“There’s a profound effect in this announcement,” says Max Fraad Wolff, a professor of economics at New School University in New York. “The US has always been the gold standard … and this begins to signal a fall or weakness in US global economic position. That’s a bit like a sea change.”

Obviously we are long overdue for some fiscal responsibility in Washington.  And that means cutting spending across the board.  Lawmakers might start by considering what programs are authorized by the Constitution–and the far larger number which represent unconstitutional political power grabs.

Doug Bandow • March 18, 2010 @ 2:26 pm
Filed under: Tax and Budget Policy

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Hotel Afghanistan: We Can Check Out but Never Leave

The U.S. remains stuck in Iraq, as the country moves toward a potentially messy and not so democratic (lots of disqualified parliamentary candidates, etc.) election.  Iran’s refusal to back away from its nuclear program has intensified calls for an American military strike — which, Sarah Palin assures, would even help the president politically.  North Korea unsurprisingly is showing reluctance to rejoin international talks over its nuclear program: renewed proposals for a U.S. military build-up in South Korea and even war against the North are likely to follow.  And then there is Afghanistan.

Even though President Barack Obama talks about deadlines and drawdowns, there is little in present policy to suggest that the U.S. will be able to leave Afghanistan in even the mid-term.  Afghan President Hamid Karzai certainly doesn’t think so.  He figures on U.S. military support for at least another decade, with continuing international financial support for years after that.

Reports the Associated Press:

Afghan President Hamid Karzai warned Thursday that foreign troops must stay in his country for another decade, as world powers agreed on an exit map including a plan to persuade Taliban fighters to disarm in exchange for jobs and homes.Divisions emerged between the U.S. and its partners over Kabul’s willingness to offer peace to Taliban leaders who once harbored al-Qaida, instead of the more limited deal for lower-ranking fighters emphasized by the Americans.

All agree that reconciliation means bringing on board what Mark Sedwill, NATO’s newly appointed civilian chief in Afghanistan, called “some pretty unsavory characters.”

The conference was called to help the U.S. and its allies find a way out of the grinding Afghan war amid rising U.S. and NATO casualties and falling public support. NATO has agreed to accelerate the training of Afghan security forces and gradually transfer more combat responsibility to them.

“With regard to training and equipping the Afghan security forces, five to 10 years will be enough,” Karzai told the BBC. “With regard to sustaining them until Afghanistan is financially able to provide for our forces, the time will be extended to 10 to 15 years.”

It sounds a bit like the Afghan equivalent of the Eagles’ Hotel California.  Defeat or bribe the Taliban and keep Karzai in power, and we will have “won” — but we still won’t be able to leave.  And the Afghan government, assuming it achieves a modicum of honest competence, will still have little incentive to meet even President Karzai’s distant check-out date.  Who in Kabul will want to do without abundent Western cash 10 or 15 years from now?

In 2001 the U.S. had a simple, important, and achievable mission in Afghanistan:  disrupt al-Qaeda and oust the Taliban.  American military forces succeeded.  Alas, we’ve spent the succeeding eight years attempting to build a nation state where none exists.  It’s time to draw down our forces and again focus on combatting terrorists.

Doug Bandow • February 15, 2010 @ 8:08 am
Filed under: Foreign Policy and National Security

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A Time for Less Government?

The public is unhappy with government.  How could it be otherwise, given the mess our governors have made?  Reports the Washington Post:

Two-thirds of Americans are “dissatisfied” or downright “angry” about the way the federal government is working, according to a new Washington Post-ABC News poll. On average, the public estimates that 53 cents of every tax dollar they send to Washington is “wasted.”

Despite the disapproval of government, few Americans say they know much about the “tea party” movement, which emerged last year and attracted voters angry at a government they thought was spending recklessly and overstepping its constitutional powers. And the new poll shows that the political standing of former Republican vice presidential nominee Sarah Palin, who was the keynote speaker last week at the first National Tea Party Convention, has deteriorated significantly.

The opening is clear: Public dissatisfaction with how Washington operates is at its highest level in Post-ABC polling in more than a decade — since the months after the Republican-led government shutdown in 1996 — and negative ratings of the two major parties hover near record highs.

Surely this is a moment for a true political entrepreneur, someone who believes in liberty–across the board–willing to challenge Washington’s bipartisan consensus that government should grow ever bigger and more expensive.  Someone who opposes expensive, and often deadly, social engineering at home and abroad.  Someone willing to simply leave the American people alone, rather than determined to conscript them into yet another annoying, intrusive, and expensive national crusade.  Someone willing to back up his or her rhetoric about individual liberty with action.

Doug Bandow • February 11, 2010 @ 10:11 am
Filed under: General; Government and Politics; Political Philosophy

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Sacrificing Liberties in the Name of Security

The new Justice Department Inspector General report finds that the FBI broke the law in seeking phone records.  Reports Jacob Sullum of Reason magazine:

In a report (PDF) issued today, Justice Department Inspector General Glenn Fine shows that the FBI routinely broke the law for several years by demanding telephone records through informal methods that were not authorized by statute. The abuses, which involved thousands of records, are especially striking because it is not very hard for the FBI to obtain this information legally. The Electronic Communications Privacy Act (ECPA) allows the bureau to demand records from phone companies through a “national security letter” (NSL) signed by the director or an official he designates. Under FBI policy, any special agent in charge can sign an NSL, which simply states that the records sought are “relevant to an authorized investigation to protect against international terrorism or clandestine intelligence activities.”

In 2003 FBI officials began dodging this minimal requirement by asking telecommunications carriers to suppy records without the legally required NSL “due to exigent circumstances” and promising to provide an NSL after the fact. These so-called exigent letters, which were often used when no emergency actually existed, were an extralegal contrivance that violated ECPA, bureau policy, and guidelines issued by the attorney general. The retroactive NSLs promised by the exigent letters often failed to appear because there was no authorized investigation to which they could be linked. To fix that problem, FBI officials resorted to another illegal procedure, issuing “blanket” NSLs tied to no particular investigation.

Even these pseudolegalities look downright upright next to the FBI’s other informal methods of obtaining records, which included requests by email, phone, post-it note, and in-person oral communication as well as “sneak peeks,” which were about as legitimate as they sound. The failure to follow the established NSL process is legally significant because ECPA prohibits telecom companies from disclosing customer records to the government except in specified circumstances. One of them is not when an FBI agent shows up at your office and says, “Mind if I take a look at that?”

The targets of the FBI’s illegal record grabs are unknown, with one major exception. “Some of the most troubling improper requests for telephone records,” the inspector general’s report notes, “occurred in media leak cases, where the FBI sought and acquired reporters’ telephone toll billing records and calling activity information without following federal regulation or obtaining the required Attorney General approval.” In 2008 FBI Director Robert Mueller apologized for the bureau’s improper snooping on foreign correspondents for The New York Times and The Washington Post.

Obviously, federal agencies require investigative authority to combat terrorism and other crimes.  But those investigations need to be conducted in accordance with the law and Constitution.  We must never forget that it is a free society which we are defending.

Doug Bandow • January 21, 2010 @ 9:24 am
Filed under: Law and Civil Liberties

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So Much for That Argument for War!

Remember when President George W. Bush was pushing war for democracy? Excited neoconservatives promised that a new wave of democratization was about to roll through the Middle East, sweeping out authoritarian and anti-American regimes.

Oops.

Reports the Washington Times:

The most significant finding of the latest report is the decline in freedom in the Middle East, [Arch Puddington] said.

Three countries — Jordan, Yemen and Bahrain — were reclassified from “partly free” to “not free,” and freedoms declined in Morocco and Iran.

“Freedom House saw the region as a whole as headed slightly in the right direction after 9/11,” he said. “But that has changed.”

Not only are countries moving backwards, but America’s friends and allies are leading the parade:  Jordan, Morocco, Bahrain.

So much for that justification for invading and bombing other lands.

Doug Bandow • January 13, 2010 @ 8:45 am
Filed under: Foreign Policy and National Security

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Another Hero(ine) of Freedom Dies

Freya von Moltke, the last of the leading plotters against Hitler, has died. 

Reports the New York Times:

“He put the question to me explicitly — ‘The time is coming when something must be done,’ ” Freya von Moltke said. “ ‘I would like to have a hand in it, but I can only do so if you join in too,’ and I said, ‘Yes, it’s worth it.’ ”

So, with a wife’s assent, began a famous challenge to Hitler. At the height of the Nazi victories, Count Helmuth James von Moltke invited about two dozen foes of Nazism, many of them aristocrats like himself, to imagine a new, better postwar Germany.

For him, his wife’s participation was essential, as she remembered the conversation in “Courageous Hearts: Women and the Anti-Hitler Plot of 1944,” a 1997 book by Dorothee von Meding.

The dissidents met at the count’s ancestral estate, Kreisau, which Bismarck had given his legendary great-great-uncle, Field Marshal Helmuth von Moltke the Elder, for his victories over Austria and France.

It was a perilous act of resistance. As many as half of the dissidents were later executed, some for actively plotting to kill Hitler, others for thinking the unthinkable: they had marshaled logical, moral and religious arguments to question the legitimacy of the Third Reich. Their high-minded planning for a future without Nazis angered a regime that expected to endure 1,000 years.

Mrs. Moltke, who disdained the title of countess, was the last living active participant in the group. She died of a viral infection on Jan. 1 at her home in Norwich, Vt., her son Helmuth said. She was 98.

In his book “The Rise and Fall of the Third Reich” (1960), William L. Shirer said the Kreisau circle had provided “the intellectual, spiritual, ethical, philosophical and, to some extent, political ideas of the resistance to Hitler.”

It is easy to become frustrated with politics today, and grow weary of fighting for liberty.  But some people risk death when they take up the banner of freedom.  So it was with Freya von Moltke, whose husband, Count Helmuth James von Moltke, was executed by the Nazis, along with so many others.

Now, as then, “something must be done,” in Helmuth von Moltke’s words.  But we have a far easier task than did those opposing Hitler, many of whom paid with their lives.  We have no excuse for not carrying on.

Doug Bandow • January 11, 2010 @ 8:56 am
Filed under: Government and Politics; Political Philosophy

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Protecting Property Rights

The Left tends to dismiss property rights as being for the rich and powerful.  But the rich and powerful usually can take care of themselves whether their rights are formally recognized or not.  It is the poor and middle class who most need legally enforceable property rights.

No where is that more clear than in cases of eminent domain.  The government rarely moves against the rich and powerful, seizing their lands to redistribute to the poor.  Most often the government takes the property of the poor and middle class to redistribute to the rich and influential.

So it is in New York City.  George Will describes one case now working its way through the courts:

On Aug. 27, 1776, British forces routed George Washington’s novice army in the Battle of Brooklyn, which was fought in fields and woods where today the battle of Prospect Heights is being fought. Americans’ liberty is again under assault, but this time by overbearing American governments.

The fight involves an especially egregious example of today’s eminent domain racket. The issue is a form of government theft that the Supreme Court encouraged with its worst decision of the past decade — one that probably will be radically revised in this one.

The Atlantic Yards site, where 10 subway lines and one railway line converge, is the center of the bustling Prospect Heights neighborhood of mostly small businesses and middle-class residences. Its energy and gentrification are reasons why 22 acres of this area — the World Trade Center site is only 16 acres — are coveted by Bruce Ratner, a politically connected developer collaborating with the avaricious city and state governments.

To seize the acres for Ratner’s use, government must claim that the area — which is desirable because it is vibrant — is “blighted.” The cognitive dissonance would embarrass Ratner and his collaborating politicians, had their cupidity not extinguished their sense of the absurd.

If the courts took the Constitution seriously the outcome of this case would not be in doubt.  But today the Constitution only occasionally affects the operations of modern American government.  Let’s hope that principle trumps politics when the case reaches New York’s top court.

Doug Bandow • January 4, 2010 @ 1:03 pm
Filed under: Law and Civil Liberties; Political Philosophy

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Iran Tottering Towards the Brink?

More demonstrations and more deaths in Tehran over the weekend.  It’s a nasty situation and we should offer hopes and prayers for those fighting for a free Iran.

Rouzbeh and Trita Parsi, with the European Institute for Security Studies and National Iranian American Council, respectively, speculate on how close Iran might be to the brink:

With the government growing increasingly desperate—and violent—the new clashes on the streets in Iran may very well prove to be the breaking point of the regime. If so, it shows that the Iranian theocracy ultimately fell on its own sword. It didn’t come to an end due to the efforts of exiled opposition groups or the regime change schemes of Washington’s neo-conservatives. Rather, the Iranian people are the main characters in this drama, using the very same symbols that brought the Islamic Republic into being to close this chapter in a century-old struggle for democracy.

Revolutions are never easy to forecast and the forces of repression in Iran retain many tools.  But let us hope that the Iranian people are able to free themselves, and to do so without the brutality and violence reflected in so many other revolutions.

Doug Bandow • December 28, 2009 @ 10:04 am
Filed under: Foreign Policy and National Security

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Let Us Hope (and Pray) for Peace

There is something immensely moving about young men and women willing to sacrifice their lives for their country.  Indeed, patriotism mixed with a desire for action can be a fearsome thing.  This combination was on display at West Point after President Barack Obama’s speech on Afghanistan.

The Washington Post reported on a phone call between Academy professor Mike Meese and his son, an Academy sophomore:

Said Col. Mike Meese, chairman of West Point’s social studies department: “There has been an incredible intensity here ever since 9/11. The cadets have a strong belief that this is the defining struggle of their lifetime. Every one of them elected to come here because they want to be a part of it.”

Not long after the speech, Meese received a call from his son, Brian, in his second year at West Point, who watched Obama from the second-to-back row with a solemn face. Brian had spoken with his friends on the walk back from the auditorium to their barracks, and none of them could stop obsessing over one number Obama had highlighted in his speech: 18 months. The deployment of 30,000 additional troops was something they had expected — it was the future for which they had prepared. But why had Obama so forcefully emphasized that he would begin a drawdown of troops in 18 months? What if the war was over by the time they graduated?

Brian Meese, the latest aspiring officer in a family with three generations of service, had prepared to fight in a war ever since he was 12. He had accompanied his father to almost a dozen military funerals, and each one strengthened his resolve. At West Point, he studied Arabic instead of Spanish, judging it more practical for a soldier destined for the Middle East.

“Now I might not get to go,” Brian told his father over the phone this week, his voice betraying disappointment.

“I think you will still have your chance,” his father said. “All of the evil in the world is not going to be defeated by the summer of 2011.”

“You’re taking care of Iraq. You’re taking care of Afghanistan,” Brian told his father. “What’s going to be left for me?”

I can’t help but admire Brian Meese’s desire “to go,” almost irrespective of circumstances. I see the same desire in my nephew, who is currently training to be a SEAL.

Yet war always should be a last resort, a horrid necessity to protect life and liberty within civilian society.  The latter may seem boring in a sense, but it embodies the highest values, the ones for which we sometimes must risk everything.  Thus, we should hope and pray that there won’t be anything “left for” Brian Meese to do in the Army.  Although war can showcase the sublimest of values, such as heroism and self-sacrifice, it more often serves the worst of humanity, spreading death and destruction with wild abandon.

Alas, Mike Meese undoubtedly will be proved right.  There is more than enough evil to go around.  Indeed, there is no reason to believe that evil will ever disappear.  Which is a good reason why the objective of the U.S. government should not be to combat evil, but to protect the lives and freedoms of the American people.  Only the latter goal is realistic, let alone consistent with the principles of individual liberty and limited government.   Unfortunately, the president’s plan to expand America’s military role in Afghanistan seems more directed at the former.

But until the lion lies down with the lamb, the world will remain a dangerous place.  Which means we will continue to need the services of brave young men and women like Brian Meese and my nephew.  I can only hope that when their time for action comes (as seems certain, given present policies), they will be better served by their political leaders than have been so many equally brave American military personnel in the past.

Doug Bandow • December 7, 2009 @ 8:37 am
Filed under: Foreign Policy and National Security

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Korea’s New ‘Berlin Wall’

Between 1961 and 1989 East Germany distinguished itself by routinely killing people seeking freedom.  Roughly one thousand people died trying to get over the Berlin Wall and similar barriers along the rest of the border between the two Germanies.

North Korea is following suit.  With anger apparently running high after a currency swap seemingly designed to seize what little wealth people had accumulated privately, the government of Kim Jong-il has instructed its border guards to shoot anyone attempting to flee what amounts to one giant prison camp.

Reports the Associated Press:

North Korea has ordered its border guards to open fire on anyone who crosses its border without permission, in what could be an attempt to thwart defections by people disgruntled over its recent currency reform, a news report said Saturday.

The National Defense Commission — the top government body headed by North Korean leader Kim Jong Il — recently instructed soldiers to kill unauthorized border crossers on the spot, South Korea’s mass-circulation Chosun Ilbo newspaper said, citing unidentified sources inside the North.

It said the order could be an attempt by the communist government to stop members of North Korea’s middle class who are angry over suddenly being deprived of their money from leaving the country.

This horrid system can’t end soon enough.

Doug Bandow • December 7, 2009 @ 8:35 am
Filed under: Foreign Policy and National Security

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Never a Recession in Washington

For those of you worried about starving bureaucrats, politicians, and consultants clogging the streets of Washington, D.C., don’t be.  Everything is fine here!  In fact, there’s more money than ever to spend.

Reports the Washington Post:

As struggling communities throughout the country wait for more help from the $787 billion stimulus package, one region is already basking in its largess: the government-contractor nexus that is metropolitan Washington.

Reports from stimulus recipients show that a sizable sum has gone to federal contractors in the Washington area who are helping implement the initiative — in effect, they are being paid a hefty slice of the money to help spend the rest of it.

The contractors’ work hardly differs from the basic operations of the federal departments hiring them. The Energy Department is paying Technology & Management Services, a Gaithersburg firm, $6.9 million to review applications for renewable energy loan guarantees. The Department of Homeland Security awarded Deloitte Consulting’s Arlington branch $8.6 million to provide “program management and support” for the stimulus plan’s $1 billion airport security initiative, and gave McKing Consulting, a Fairfax firm, a $1.5 million contract to review applications for fire department construction funding.

Held against the total stimulus package, the contracts represent a relatively small portion of spending. But they help explain why the Washington area is weathering the recession so well.

It’d sure be a tragedy if the people doing so much to wreck the economy and deprive us of our liberty suffered as a result.  But no worries.  Washington is truly recession proof!

Doug Bandow • December 5, 2009 @ 7:49 am
Filed under: Government and Politics; Tax and Budget Policy

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A Victory for Property Rights

Ilya Shapiro warns us that the U.S. Supreme Court probably will not uphold property rights in a case involving Florida beachfront property.  But property rights did receive an unexpected boost in New York yesterday, where an appeals court overturned a taking for the benefit of Columbia University.

Reports the New York Times:

A New York appeals court ruled Thursday that the state could not use eminent domain on behalf of Columbia University to obtain parts of a 17-acre site in Upper Manhattan, setting back plans for a satellite campus at a time of discord over government power to acquire property.

In a 3-to-2 decision, a panel of the Appellate Division of State Supreme Court in Manhattan annulled the state’s 2008 decision to take property for the expansion project, saying that its condemnation procedure was unconstitutional.

The majority opinion was scathing in its appraisal of how the “scheme was hatched,” using terms like “sophistry” and “idiocy” in describing how the state went about declaring the neighborhood blighted, the main prerequisite for eminent domain.

The $6.3 billion expansion plan is not dead; an appeal has been promised, and Columbia still controls most of the land. But at a time when the government’s use of eminent domain on behalf of private interests has become increasingly controversial, the ruling was a boon for opponents.

“I feel unbelievable,” said Nicholas Sprayregen, the owner of several self-storage warehouses in the Manhattanville expansion area and one of two property owners who have refused to sell to the university. “I was always cautiously optimistic. But I was aware we were going against 50 years of unfair cases against property owners.”

New York state is not a particularly friendly venue to property rights, but the judges rightly saw through the claims made by state official to justify seizing property from a private person for the benefit of a private organization.  The ruling could be reversed, but nevertheless is an important affirmation that property rights warrant constitutional and legal protection even in New York.

Doug Bandow • December 4, 2009 @ 10:05 am
Filed under: Law and Civil Liberties

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Iranian Thugs Take Crackdown Worldwide

Political repression is old news.   Thuggish regimes have been holding their citizens prisoner for centuries.  But Iran’s government now is borrowing an innovative Soviet and Nazi tactic:  targeting family members of dissenters, even those living in the U.S.

Reports the Wall Street Journal:

His first impulse was to dismiss the ominous email as a prank, says a young Iranian-American named Koosha. It warned the 29-year-old engineering student that his relatives in Tehran would be harmed if he didn’t stop criticizing Iran on Facebook.

Two days later, his mom called. Security agents had arrested his father in his home in Tehran and threatened him by saying his son could no longer safely return to Iran.

“When they arrested my father, I realized the email was no joke,” said Koosha, who asked that his full name not be used.

Tehran’s leadership faces its biggest crisis since it first came to power in 1979, as Iranians at home and abroad attack its legitimacy in the wake of June’s allegedly rigged presidential vote. An opposition effort, the “Green Movement,” is gaining a global following of regular Iranians who say they never previously considered themselves activists.

The regime has been cracking down hard at home. And now, a Wall Street Journal investigation shows, it is extending that crackdown to Iranians abroad as well.

In recent months, Iran has been conducting a campaign of harassing and intimidating members of its diaspora world-wide — not just prominent dissidents — who criticize the regime, according to former Iranian lawmakers and former members of Iran’s elite security force, the Revolutionary Guard, with knowledge of the program.

Read the rest of this post »

Doug Bandow • December 4, 2009 @ 7:34 am
Filed under: Foreign Policy and National Security; Law and Civil Liberties

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George W. Bush: The Washington Times as the Onion

Yesterday I thought I was reading the Onion.  The Washington Times headlined its article “Bush Warns of Dangers of too Much Government”:

Former President George W. Bush said Thursday that America must resist the “temptation” to allow the government to take over the private sector, taking a subtle shot at his Democratic successor by warning that too much state intervention and protectionism will squelch the economic recovery.

As the Obama administration has made far-reaching moves into the auto, real estate, health care and financial sectors to fight the economic recession, Mr. Bush, without mentioning the president by name, said, “The role of government is not to create wealth but to create the conditions that allow entrepreneurs and innovators to thrive.

“As the world recovers, we will face a temptation to replace the risk-and-reward model of the private sector with the blunt instruments of government spending and control. History shows that the greater threat to prosperity is not too little government involvement, but too much,” said Mr. Bush, who has remained out of the limelight since leaving office and rarely criticizes his successor.

Mr. Bush has addressed private groups since leaving the White House in January, but Thursday’s speech, delivered at Southern Methodist University in Dallas, was his first major public policy address since leaving office

Mr. Big Spender, aka George “ break the budget, expand Medicare, centralize control of education in Washington, bail out anyone and everyone, violate civil liberties, treat the president as an elective dictator, and initiate a needless war” Bush, is worried about government doing too much.

I can’t take it any more.  I’ve been working in Washington too long.

Doug Bandow • November 15, 2009 @ 9:44 am
Filed under: Government and Politics; Political Philosophy

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Iraq: Making Few Friends and Less Profits

When the Bush administration started its misguided adventure in Iraq, the president and his Neocon chorus presumed that the U.S. would be acquiring a loyal, even obseqious ally.  With the American-subsidized bank embezzler Ahmed Chalabi in charge, Baghdad would create a Western-style democracy, enshrine women’s rights, recognize Israel, provide the U.S. with permanent military bases, and offer a new market for American businesses.

Alas, we’ve struck out:  zero for five.  Although America’s uber-hawks bridled at reference to our “occupation” of Iraq, Iraqis had no hesitation in using the word and surprised the Bushies by demanding a deadline for the withdrawal of American forces.  And Iraqi opposition to the U.S. occupation has affected their attitude toward Americans in other areas.

Although none of this is, or at least should be, surprising, the lack of success by private U.S. companies should provide a particularly powerful lesson of the perils of intervention.  Reports the New York Times:

Iraq’s Baghdad Trade Fair ended Tuesday, six years and a trillion dollars after the American invasion that toppled Saddam Hussein, and one country was conspicuously absent.That would be the country that spent a trillion dollars — on the invasion and occupation, but also on training and equipping Iraqi security forces, and on ambitious reconstruction projects in every province aimed at rebuilding the country and restarting the economy.

Yet when the post-Saddam Iraqi government swept out its old commercial fairgrounds and invited companies from around the world, the United States was not much in evidence among the 32 nations represented. Of the 396 companies that exhibited their wares, “there are two or three American participants, but I can’t remember their names,” said Hashem Mohammed Haten, director general of Iraq’s state fair company. A pair of missiles atop a ceremonial gateway to the fairgrounds recalled an era when Saddam Hussein had pretensions, if not weapons, of mass destruction.

The trade fair is a telling indication of an uncomfortable truth: America’s war in Iraq has been good for business in Iraq — but not necessarily for American business.

American companies are not seeing much lasting benefit from their country’s investment in Iraq. Some American businesses have calculated that the high security costs and fear of violence make Iraq a business no-go area. Even those who are interested and want to come are hampered by American companies’ reputation here for overcharging and shoddy workmanship, an outgrowth of the first years of the occupation, and a lasting and widespread anti-Americanism.

While Iraq’s imports nearly doubled in 2008, to $43.5 billion from $25.67 billion in 2007, imports from American companies stayed flat at $2 billion over that period. Among investors, the United Arab Emirates leads the field, with $31 billion invested in Iraq, most of that in 2008, compared to only about $400 million from American companies when United States government reconstruction spending is excluded, according to Dunia Frontier Consultants, an emerging-market analyst. “Following this initial U.S.-dominated reconstruction phase, U.S. private investors have become negligible players in Iraq,” Dunia said in a report.

So much for the old theory of mercantilism.

Think about it.  The U.S. overthrows the dictator, pours in billions of dollars for reconstruction projects, and promotes democratic elections — and instead of applauding America and filling the land with statues to George W. Bush, the locals prefer to buy goods from other people.  Maybe invading and bombing other countries, disrupting and wrecking other societies, and killing and injuring other people isn’t the best way to promote good relations with the rest of the world.

Doug Bandow • November 15, 2009 @ 9:40 am
Filed under: Foreign Policy and National Security

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Afghanistan: A Run-Off with One Candidate?

It appears that opposition candidate Abdullah Abdullah won’t contest the run-off which the U.S. forced on President Hamid Karzai after the latter’s supporters stole votes with great fanfare in the initial poll.  But Secretary of State Hillary Clinton says don’t worry, be happy.  Reports Reuters:

U.S. Secretary of State Hillary Clinton said on Saturday that a decision by Abdullah Abdullah not to contest a second round of the Afghan presidential election would not affect the vote’s legitimacy. Asked at a news conference in Jerusalem about reports that aides to the first-round runner-up said he would not run, Clinton did not make clear whether she was confirming that Abdullah would not run but she said: “I think that it is his decision to make.” She continued: “I do not think it affects the legitimacy. There have been other situations in our own country as well as around the world where in a run-off election one of the parties decides for whatever reason that they are not going to go on.”

If Secretary Clinton believes this, she is not only smoking but inhaling.  The U.S.-supported president in a nominal democracy at the center of a concerted nation-building campaign committed massive electoral fraud.  Only under extreme pressure did he agree to a run-off (when is the last time a candidate’s agreement was required to hold a run-off set by law in the U.S.?).  Now the leading opposition candidate has given up the contest, doubting its feasibility and fairness.

This doesn’t affect President Karzai’s (fast dwindling) credibility?

The Obama administration needs to narrow U.S. objectives, focus on counter-terrorism rather than counter-insurgency, and begin withdrawing American combat forces.  I make these arguments in a new article on the Huffington Post.

Doug Bandow • November 1, 2009 @ 1:45 pm
Filed under: Foreign Policy and National Security

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The Rising Cost of War in Afghanistan

As Iraq collapsed into sectarian fratricide, the primary victims were Iraqis.  As combat rises in Afghanistan, Americans and other allied personnel are the primary targets.  And the casualty toll is rising.

Reports the Washington Post:

More than 1,000 American troops have been wounded in battle over the past three months in Afghanistan, accounting for one-fourth of those injured in combat since the U.S.-led invasion in 2001.

The dramatic increase in amputees and other seriously injured service members comes as October marks the deadliest month for U.S. troops in Afghanistan.

Expanded military operations, a near-doubling of the number of troops since the beginning of the year and a Taliban offensive that has included a proliferation of roadside bombings have led to the great increase in casualties. U.S. troops in Afghanistan are suffering wounds at a higher rate than those who were serving in Iraq when violence spiraled during the military “surge” two years ago. In mid-2007, 600 U.S. troops were wounded in Iraq each month out of about 150,000 troops deployed there. In Afghanistan, about 68,000 troops are currently installed, with about 350 wounded each month recently.

Pentagon press secretary Geoff Morrell acknowledged that the casualties in Afghanistan have surpassed Iraq surge proportions and noted that the violence in Afghanistan is directed more against U.S. and other coalition forces, whereas it was heavily sectarian in Iraq. “It shows you how we are the targets and how effectively they are targeting us,” Morrell said.

President Obama should ponder well the rising costs as he considers U.S. strategy in Afghanistan.  First, what is Washington hoping to achieve, and are the benefits worth ever more American deaths and injuries?  Second, whatever he thinks is the best strategy, are the American people likely to support it over the long term?  There would be nothing more foolish than to escalate and plan for years of war only to be forced into a speedy and unplanned withdrawal as the public demanded an end to what it saw as a useless conflict.

Defending America should be the administration’s top priority.  That means a strategy of counter-terrorism rather than counter-insurgency.  However much we might want to transform Afghan society and government, we are not likely to be able to do so at reasonable cost in reasonable time.  We should step back from the brink rather than take the plunge into the potentially bottomless Afghan abyss.

Doug Bandow • November 1, 2009 @ 1:44 pm
Filed under: Foreign Policy and National Security

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New Poll Shows Support for Lifting Travel Ban to Cuba

Even Cuban-Americans appear to have turned against U.S. policy.  Reports the Miami Herald:

A new poll of Cuban Americans shows a strong majority favor allowing all Americans to travel to the island, a major shift from a 2002 survey that showed only a minority supporting the change, the Bendixen & Associates polling firm reported Tuesday.

Executive Vice President Fernand Amandi said he was surprised by the magnitude of the swing in just seven years — from 46 percent in favor in 2002 to 59 percent in the Sept. 24-26 survey. Only 29 percent were opposed in the new survey, compared to 47 percent in 2002.

…A campaign to allow all Americans to travel to Cuba has become a key Washington battleground this year for those who favor and oppose easing U.S. sanctions on the island. Permitting such travel would allow U.S. tourists to visit Cuba. Only Cuban Americans are now allowed virtually unrestricted travel to the island.

At least three bills lifting all restrictions on travel are now before Congress — two in the House and one in the Senate. While most analysts believe the House may well approve some version of the measure, they say it will have little chance of gaining Senate approval because of opposition from Sen. Bob Menendez, a powerful Democrat.

One would think that even the most rabid hawk could agree that a policy which has failed for 50 years has … failed.  There’s no guarantee that ending economic sanctions would spur political liberalization in Cuba.  But after a half century of failure, it makes sense to try something else.

Doug Bandow • October 25, 2009 @ 5:43 pm
Filed under: Foreign Policy and National Security

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I’m From the Government, and I’m Here to Give You a Golf Cart

How would we be managing if Congress hadn’t voted to subsidize virtually everyone everywhere in the name of stimulating the economy?  Well, taxpayers wouldn’t be buying people golf carts.  It turns out that golf carts meet the federal criteria for high-mileage cars in the stimulus legislation.

Editorializes the Wall Street Journal:

We thought cash for clunkers was the ultimate waste of taxpayer money, but as usual we were too optimistic. Thanks to the federal tax credit to buy high-mileage cars that was part of President Obama’s stimulus plan, Uncle Sam is now paying Americans to buy that great necessity of modern life, the golf cart.

The federal credit provides from $4,200 to $5,500 for the purchase of an electric vehicle, and when it is combined with similar incentive plans in many states the tax credits can pay for nearly the entire cost of a golf cart. Even in states that don’t have their own tax rebate plans, the federal credit is generous enough to pay for half or even two-thirds of the average sticker price of a cart, which is typically in the range of $8,000 to $10,000. “The purchase of some models could be absolutely free,” Roger Gaddis of Ada Electric Cars in Oklahoma said earlier this year. “Is that about the coolest thing you’ve ever heard?”

The golf-cart boom has followed an IRS ruling that golf carts qualify for the electric-car credit as long as they are also road worthy. These qualifying golf carts are essentially the same as normal golf carts save for adding some safety features, such as side and rearview mirrors and three-point seat belts. They typically can go 15 to 25 miles per hour.

In South Carolina, sales of these carts have been soaring as dealerships alert customers to Uncle Sam’s giveaway. “The Golf Cart Man” in the Villages of Lady Lake, Florida is running a banner online ad that declares: “GET A FREE GOLF CART. Or make $2,000 doing absolutely nothing!”

In a normal world this would be shocking, even scandalous news.  Taxpayer money wasted buying carts for golfers.  Uncle Sam as reverse Robin Hood, stealing from the needy to enrich well-heeled golfers.  Legislators would be scrambling to change the law.

But the issue has earned barely a peep in Washington.  No surprise, those benefiting from Washington’s largesse aren’t complaining.  After all, they consider it to be just about “the coolest thing” around.

And with legislators now used to wasting not just billions but trillions of dollars, what are a few thousand wasted dollars on a golf cart or two?  This nonsensical tax write-off is barely a rounding error in the federal budget today.  The 2009 deficit was $1.4 trillion.  The federal government is likely to run up another $10 trillion in red ink over the next decade — assuming away a deluge of new bail-outs of Fannie Mae, Freddie Mac, the Federal Housing Administration, and the host of other money-losing federal subsidy operations.  What of golf cart subsidies?  Not worth a second look.

The golf cart subsidy gives new meaning to the old line:  I’m from the government, and I’m here to help you.  The only people not on Uncle Sam’s “to help” list are taxpayers.

Doug Bandow • October 19, 2009 @ 8:52 am
Filed under: Government and Politics; Political Philosophy; Tax and Budget Policy

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Totalitarian Leftovers in Eastern Europe

The Berlin Wall fell 20 years ago.  A hideous symbol of the suppression of liberty, it should remind us of the ever-present threat to our freedoms.  Even two decades later the legacy of repression continues to afflict many people in Eastern Europe.  For instance, those in countries formerly behind the Iron Curtain still struggle with the knowledge that their friends and neighbors routinely spied on them.

Reports the Associated Press:

Stelian Tanase found out when he asked to see the thick file that Romania’s communist-era secret police had kept on him. The revelation nearly knocked the wind out of him: His closest pal was an informer who regularly told agents what Tanase was up to.

“In a way, I haven’t even recovered today,” said Tanase, a novelist who was placed under surveillance and had his home bugged during the late dictator Nicolae Ceausescu’s regime.

“He was the one person on Earth I had the most faith in,” he said. “And I never, ever suspected him.”

Twenty years ago this autumn, communism collapsed across Eastern Europe. But its dark legacy endures in the unanswered question of the files — whether letting the victims read them cleanses old wounds or rips open new ones.

Things have never been so bad here, obviously, but that gives us even more reason to jealously guard our liberties.  Defend America we must, but we must never forget that it is a republic which we are defending.

Doug Bandow • October 19, 2009 @ 8:45 am
Filed under: Foreign Policy and National Security; Law and Civil Liberties; Political Philosophy

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