David Rohde

The Global Middle

Wall Street’s long occupation of the middle class

David Rohde
Oct 13, 2011 18:31 EDT
Last Friday morning, a 24-year-old New Jersey woman told me why she joined Occupy Wall Street. Around her, balding activists in their 50s tried to rekindle 1960s-era protests. Young Marxists flew red Che Guevara flags. The young woman, though, was different. 

She commuted to the protests, she said, while holding down two part-time jobs. She lived at home and helped her schoolteacher mother, who also worked two jobs, support her jobless, 60-year-old father. She asked to be identified only by her middle name – Susan – because she feared her bosses would fire her for attending protests. She didn’t talk of revolution. She talked of correction.

“Like any great nation and country, there are also hitches in the plan,” she told me. “And things that need to be changed.”

Corporate America has gained the upper hand on the American middle class, she told me. A year after graduating from college, she was working as a part-time manager at two different retail chains in New Jersey. The companies use part-time managers, she said, so they don’t have to pay benefits.

“It’s their policy,” she said, “which is why I’m here.”

Beneath the online vitriol swirling between supporters and opponents of Occupy Wall Street  lies a central question: Does Wall Street help or hurt the American middle class?  A variety of forces are slowly gutting the middle class – and a paucity of values on Wall Street is one of them.

The problem is not every bank. It is a growing slice of the financial sector that has become a vast, computerized casino where staggering fortunes can be won or lost in minutes, with taxpayers left holding the bag.

Members of the middle class, of course, played as well. They bought houses they could not afford, dallied in day-trading and saved too little during an era of limitless credit.

“Finance had become the new American state religion,” University of Michigan Prof. Gerald Davis writes in his book “Managed by the Markets: How Finance Reshaped America.” “All the world was a stock market, and we were all merely day traders, buying and selling various species of “capital” and hoping for the big score.”

The middle class, though, is still waiting for its bailout.

As recently as twenty years ago, middle America saw the country’s financial system as its ally. For decades after World War II, a carefully regulated Wall Street – and the American financial industry as a whole – helped create a growing middle class, according to Yale University political scientist Jacob Hacker. A stable financial industry was a vital part of a vast economic boom, reliably providing home, car and college loans to average Americans, as well as capital to the companies that employed them. Not every banker was malevolent; nor was every corporation evil.

The transformation of Wall Street and America over the last thirty has been meticulously documented. The traditional, Jimmy Stewart notion of American banks and business, where companies built products, reputations and payrolls over time, has been eclipsed by a byzantine, non-transparent and insider-dominated financial industry.

The middle class – for me the 60 percent of American household that make $30,000 to $80,000 a year – have seen their median household incomes shrink in real dollars since the Great Recession ended, while Wall Street salaries have surged. A new study by the New York State Comptroller cited by The New York Times found that the average 2010 financial industry salary was $361,330 — five and a half times the $66,120 average salary of other New York City private sector workers. Thirty years ago, financial salaries were only twice as high as those of other professionals.

Suspicion of Wall Street is not limited to the dozens of large cities where small protests have emerged. When I visited Bowling Green, Kentucky last week to gauge how the American middle class was faring in one small city, local businessmen lamented the role of the financial industry in the demise of several local companies. Executives used easy credit to rapidly expand firms, companies over-extended over time and eventually collapsed.

The anger in Bowling Green and Lower Manhattan is about  excess: excessive risk, excessive ambition, excessive compensation. Companies should make profits, average Americans told me. Skilled executives should be rewarded. And businesses should be viewed as irreplaceable engines of economic growth.

Wall Street, though, should not be an all powerful force that pressures companies to live-and-die by their daily stock value. It should not assign inflated values to fledgling companies. And it should encourage, not deter, companies from developing, innovating and employing over the long-term. Most of all, the financial industry should be held accountable for its performance, like everyone else.

That core moral element – the sense that Wall Street is making money for nothing – is the financial industry’s gravest threat. Recent surveys conducted by Edelman public relations found that Americans’ trust in banks plummeted from 71 percent in 2008 to 25 percent in 2011, a dizzying decline of 46 percent. As this chart from the study shows, the public’s trust in the technology industry, meanwhile, remained high.

The response to Wall Street in Washington has been ideological, petulant and tedious. The left has declared all Wall Street suspect. The right has declared the government – and nothing but the government – evil. The Volcker rule announced this week is an imperfect, but positive step forward. As much as possible, average Americans should be shielded from high-risk trading.

In another era, middle class Americans might be less incensed by the vagaries of Wall Street. The shift of retirement savings, though, from pensions to 401(k) stock plans has hurled middle America into the markets. During the 1929 stock market crash, only 2.5% of Americans owned stocks. Today, when 401(k)s and other financial products are included, the number stands at roughly 50%.

As a result, an increasingly volatile American financial industry is helping and hurting average Americans to an unprecedented extent. The middle class is more entangled in Wall Street than ever before in U.S. history. And the American middle class is losing.

Photo: Men dressed in suits walk past members of the Occupy Wall Street movement as sleeping materials hang on a clothes line in Zuccotti Park near the financial district of New York October 13, 2011. Protesters with the Occupy Wall Street movement threatened on Thursday to block efforts to clean up the Lower Manhattan park where they set up camp nearly a month ago, raising concerns of a showdown with authorities.  REUTERS/Lucas Jackson

COMMENT

According to businessinsider.com the top 1% owns 50.9% of the stock, bond and mutual fund market, the next 9% owns 39.4%, the next 40% owns 9.3% and the bottom 50% owns 0.5%. 90.3% of US stocks, bonds and mutual funds are owned by 10% of the population and the remaining 60% of the US population owns 9.8% of the wealth of the markets.

The staqtement that 50% of Americans owns stocks and bonds is a meaningless statistic when the other 50% owns virtually nothing.

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Looking to Afghanistan’s future

David Rohde
Oct 7, 2011 17:54 EDT

As the 10th anniversary of the start of the Afghan war is marked around the world, looking forward is more important than looking back. As I noted in an earlier post, staggering mistakes have been made over the last decade. While individual Americans and Afghans have performed heroically, the Afghan and American governments – particularly their civilian arms – have performed anemically. And Pakistan’s intelligence service – the ISI – is the single largest impediment to stability in the region.

Looking forward, the advocacy group Global Witness is on the right track. In a statement, it said that Afghanistan’s management of an estimated $3 trillion in copper, Iron, gold, oil, chromite, uranium and rare earths is the key to the country’s future stability.

“The stakes could not be higher,” said Juman Kubba, a Global Witness official. “Get it right and minerals could be the catalyst for peace and prosperity; get it wrong and there’s a massive risk they will be lost to corruption, or form a new axis of instability and conflict.”

After a decade of development efforts driven by short-term political needs in Washington and other western capitals, Afghans and Americans now have an opportunity to achieve the most important ingredient to success in Afghanistan: sustainability. If properly managed, the country’s untapped mineral wealth can fund a robust economy, a strong Afghan army and a viable government.

For decades, if not centuries, Afghans have yearned for one thing more than anything else: the ability to control their own affairs. The country’s strategic location has led great powers to battle for control of Afghanistan. Afghans, as a result, have developed a deep resentment of foreign meddling. The problem goes beyond the American, Russian and British invasions. Afghans are sick of Pakistan, Iran and India using their nation as battleground for their own proxy wars.

So far, the government of Hamid Karzai has handed the mineral wealth poorly. Hugely lucrative contracts for the extraction of copper have gone to Chinese companies. Many details of the agreements have not been made public. Global Witness is correctly calling on the government to disclose all payments by foreign mining companies to the Afghan government and implement the  Extractive Industries Transparency Initiative or EITI. Last month, President Obama announced that the United States will implement the EITI, a global standard designed to force energy companies and governments to publicly disclose how revenues from mineral wealth are used.

More contracts are expected to be rewarded between now and the departure of most American forces in 2014. It is vital that the Afghan government make those contracts as transparent as possible. Transparency will allow the country’s journalists, activists and citizens to investigate whether the new revenues are used to ensure the creation of a sustainable, licit economy.

The current Minister of Mines, Wahidullah Shahrani, has shown admirable support for transparency. President Karzai must do the same. Washington must insist on the transparency Global Witness is demanding. Otherwise, Afghanistan will fall to the “resource curse” that has led so many countries to squander precious minerals and opportunities.

According to a study by researchers at Brown University, an estimated 33,000 people – Afghan, American and NATO troops, as well as insurgents and Afghan civilians – have died in a largely squandered decade.

If corruption, mismanagement and political posturing in Kabul and Washington continue to fritter away Afghanistan’s mineral resources, instability will persist. When most U.S. troops withdraw in 2014, an even more intense civil war will engulf the country. And the death toll from the decade to come will be even higher.

PHOTO: U.S. military officer CPT Padraic Heiliger from Alpha Co, 2nd Battalion 35th Infantry, Task Force “Cacti” lifts a boy while on patrol in a village near Combat Outpost Penich in Khas Kunar district in Kunar province, eastern Afghanistan October 7, 2011. REUTERS/Erik De Castro

Can Confucius save America’s middle class?

David Rohde
Oct 6, 2011 10:45 EDT

Update: Sorry, in the first version of this column I confused two different companies. The corrected version is below.

BOWLING GREEN, KENTUCKY–For decades, this bucolic corner of southwestern Kentucky depended on Corvette sales from the local GM plant for its economic life. Now, it’s trying something different.

Last year, the state university opened a “Confucius Institute” that offers nighttime Chinese language classes to local business people. An American auto parts company chose to create 280 new manufacturing jobs here instead of Mexico. And government officials brag about the 19 companies from India, Japan, Finland, Germany, Israel and other foreign countries that have invested locally.

“We just came back from China,” Ron Bunch, the head of the Bowling Green Chamber of Commerce, told me as he escorted Chinese investors around town. “We’re starting an Indo-Kentucky Chamber of Commerce.”

Even the town’s old economy hallmark – the GM plant that is the world’s only producer of Corvettes – is expanding. Fruit of the Loom, which is headquartered here, is slowly growing as well.

While the middle class agonizingly shrinks in other parts of the United States, Bowling Green, Kentucky boasts a growing number of jobs and a lower unemployment rate – 7.9% — than the national average of 9.1%.

“It’s about not fearing globalization,” said Brian Strow, a former city commissioner. “But being an active participant.”

Bowling Green is reinventing itself. Pragmatic, diverse and not politically polarized, this city of 100,000 residents increasingly sees itself in a global context. It is slowly finding its way and providing a sign of hope for America’s beleaguered middle class.

After working as a foreign correspondent and investigative reporter for The New York Times for the last fifteen years, I recently became a columnist for Reuters. The primary focus of my column, “The Global Middle,” will be the state of the middle class inside the United States and around the world.

While the American middle class has struggled in recent years, a new global middle class is emerging in countries like South Africa, Brazil and Turkey. Worldwide, an estimated 70 million people join an “emerging market middle class” each year, earning incomes of $6,000 to $30,000 annually. Economists predict they will surpass the Western middle class in global spending power within twenty years.

This column will examine which economic policies help create middle classes. What lessons from abroad, if any, can be applied to the United States. And whether growing middle classes overseas inevitably mean a shrinking middle class in the United States.

For me, and many others, the creation and preservation of middle classes is vital. Two decades of covering political, religious and ethnic conflict around the world has convinced me that the single largest instrument of stability in any society is a middle class. Whatever their nationality, members of the middle class tend to reject extremist leaders. They try to make governments more effective. And they often cherish the same values, particularly merit, justice and stability.

I plan to visit Bowling Green and other communities inside and outside the United States to see firsthand what is occurring on the ground. My goal is to move beyond political posturing, news media hyperbole and academic theory. Here in southwestern Kentucky, community leaders are trying to innovate, export and educate their way out of Washington’s economic and political paralysis.

There are hurdles, of course. Over the last two years, only 2,200 jobs have been created in a community of 100,000 people. A taxpayer-financed, $25 million industrial park on the north side of town is attracting fewer tenants than hoped. And the desperate courting of foreign investors is a marker of the end of American economic omnipotence.

The Confucius Institute here is one of 74 that have opened on campuses across the U.S (and 322 worldwide) that are affiliated with a non-profit based in Beijing. Critics have said the Chinese government controls the organization and some have even accused it of corporate espionage.

And yet Bowling Green has few other options and a long history of welcoming foreigners. A refugee resettlement center since the 1970s, the city has large Vietnamese, Bosnian and Burmese communities. Thirty languages are spoken in local public schools.

The city defies traditional labels and limits. Neither Rust Belt nor rural, it has diversified from an economy dependent on Corvette sales to mix of services, technology and light manufacturing

While it is the hometown of Sen. Rand Paul, it is neither blue nor red. All local government offices are non-partisan. When party is identified, local Democrats are fiscally conservative. Local Republicans say government plays an integral role in economic growth. The local economic development philosophy is to add small numbers of jobs to existing companies, rather than courting potential white elephants.

“Our greatest strength has been staying the course,” says Kevin DeFebbo, the city manager. “There is a great practicality here.”

Lastly, the town has a college, Western Kentucky University, that is no ivory tower. Increasingly, the university is the region’s economic engine. In 2001, the university and state purchased a 300,000 square foot local mall on the south side of town and turned it into a research center that holds laboratories, private companies and a high tech start-up incubator.

One of its fastest growing tenants is Pure Power Technologies, a spinoff of a local carburetor manufacturing company. the research and development arm of a local heating and garden tool manufacturing firm that went bankrupt in 2008 after losing jobs overseas and being bought and sold by a series of private equity firms. Today, it creates develops and designs diesel engine control systems. Its director travels widely overseas to drum up new business. president is a university graduate, as are all eighteen of its employees.

“He’s in Brazil today,” said Doug Rohrer, a former business executive who runs the center. “He’ll be in China on Monday.”

What works in Bowling Green may not work elsewhere. Other communities lack the resources that exist here. But there is real change in this area. I will write more about Bowling Green and its efforts to fight back, and track over time its success or failure. For now, business people, local officials and teachers are engaging the outside world and succeeding. An odd mix of Corvettes, American pragmatism and foreign investment is helping Bowling Green’s middle class claw its way back.

PHOTO: Corvette fans look over the new 2006 Z06 Corvette during its roll out for Corvette fans and the general public. REUTERS/John Sommers


COMMENT

The real problem is that what we once called the “middle class” has lost self-government and become just another bunch of peasants ruled by aristocrats.

Our money needs to be under our control, not Wall Street’s, not Washington’s, not Beijing’s. The dollar is simply priced to high. A Chevrolet Corvette is a good, fun car, but if you price it at $250,000. you will not sell many, nor make many, nor employ many. It is a matter of price.

If needed, we should abandon “free trade” and slap up tariff walls. We are a continental country and can manage if we must. So what if a bunch of rich people in New York can no longer try to boss the world around? What did they ever do for us? Export all our jobs and profit from it? Yeah. That’s it.

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from The Great Debate:

Awlaki and the Arab autumn

David Rohde
Sep 30, 2011 17:33 EDT

By David Rohde
The opinions expressed are his own.

The death of Anwar al-Awlaki this morning is welcome news, but Washington policymakers should not delude themselves into thinking the drone that killed him is a supernatural antidote to militancy. Yes, drone strikes should continue, but the real playing field continues to be the aftermath of the Arab spring; namely vital elections scheduled for October in Tunisia and November in Egypt.

A series of outstanding stories by reporters from Reuters, The Washington Post, The New York Review of Books and The New York Times, have aptly laid out the stakes. Islamists are on the rise in Egypt, Libya and Tunisia, but an extraordinary battle is unfolding over the nature of Islam itself.

“At the center of the debates is a new breed of politician who has risen from an Islamist milieu but accepts an essentially secular state,” Anthony Shadid and David Kirkpatrick wrote in today’s New York Times. Common values, in other words, are emerging between the West and the Islamic world. These “post-Islamist” politicians argue that individual rights, democracy and economic prosperity are elements of an “Islamic state.”

Whether these politicians represent the most potent weapon ever fielded against militant Islam or a Trojan horse will emerge in the months and years ahead. More than any other figure, the new breed’s standard-bearer is Turkish Prime Minister Recep Tayyip Erdogan. Pledging that conservative Islam is compatible with individual liberties, Erdogan holds the rise of his culturally conservative but economically liberal political party as a beacon for a new Middle East. Turkish critics, though, accuse Erdogan of a creeping authoritarianism masked by rapid economic growth.

For now, the “post-Islamists” should be taken at their word. The false Pax Americana of dictatorial regimes that once dominated the region is no longer viable. And the “post-Islamists” are a vast improvement over Awlaki and his ilk. For Awlaki and hard line Salafists, the only true “Islamic state” is one led by self-appointed clerics who rule by force and brutally regulate the minutia of everyday life.

At an astonishing rate across the Middle East, an internet-fueled communications revolution has implanted the ideals that the United States publicly espoused for decades, but privately failed to back. Washington is reaping a cultural amalgam that its rhetoric has slowly sown.

Recent opinion polls in Egypt show a desire for individual liberties while maintaining conservative Islamic culture, the electoral recipe that brought Erdogan to power in Turkey. A Gallup poll of Egyptians found that 96 percent of those polled supported freedom of speech and 75 percent favored freedom of religion. At the same time, more than 90 percent believed “Sharia” – or Islamic law - promotes justice for women, human rights, economic equality and a fair judicial system.

“Put simply, Egyptians seem to see no contradiction between the faith to which they adhere and the democratic ideals to which they aspire,” Dalia Mogahed, the director of the Abu Dhabi Gallup center wrote in an analysis of the polling. “Egypt tops the region in two things: Egyptians are the most likely to say Muslim progress requires democracy, and the most likely to say Muslim progress requires attachment to spiritual and moral values.”

“Working out the proper relationship between these two priorities,” Mogahed concludes, “will be the next phase of the revolution.”

The stakes in “the next phase of the revolution,” in fact, are enormous. If the “post-Islamists” are true to their word and respect electoral politics, their rise will represent a devastating blow to militant Islam. They will deliver the popular ideals of justice and accountability that hard line Islamists insist can only be emerge from clerical rule.

The West must not dismiss the “post-Islamists” as closet terrorists, nor blindly accept their saccharine speeches.  Instead, it should highlight, defend and promote the ideals that Americans and Egyptians share: freedom of speech, freedom of religion and justice for women. Culturally conservative Muslims should not be confused with terrorists.

That effort, of course, is a long, complicated and arduous one involving diplomacy, effective economic development and a new way of viewing Islam. The missile strike that killed Awlaki was instant and seemingly satisfying: American technology felled one of militant Islam’s most articulate spokesmen. But only electoral politics, economic growth and consistently applied American standards will render his words irrelevant.

Photo: Anwar al-Awlaki, a U.S.-born cleric linked to al Qaeda's Yemen-based wing, gives a religious lecture in an unknown location in this still image taken from video released by Intelwire.com on September 30, 2011. REUTERS/Intelwire.com

COMMENT

See our recent post regarding the broader context of this alleged assassination:

http://essential-intelligence-network.bl ogspot.com/

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from The Great Debate:

Help Pakistan rein in the ISI

David Rohde
Sep 23, 2011 18:12 EDT

By David Rohde
The opinions expressed are his own.

Admiral Mike Mullen’s blunt declaration on Thursday that a Taliban faction known as the Haqqani network acts as a “veritable arm” of Pakistan’s military intelligence agency is a welcome shift in U.S. policy. After a decade of privately cajoling the Pakistani military to stop its disastrous policy of sheltering the Afghan Taliban, the United States is publicly airing the truth.

Pakistan’s top military spy agency, the Directorate of Inter-Services Intelligence (ISI), supported the Haqqanis as they carried out an attack on the American embassy last week, Mullen said during Congressional testimony. Last year, they arrested a Taliban leader who engaged in peace talks without their permission, according to American officials. And many Afghans suspect ISI involvement in the assassination this week of the head of Afghan peace talks that did not involve Pakistan.

The airing of the ISI’s links to the Haqqanis is long overdue. To me, the ISI is a cancer on Pakistan. It is vital, though, that American officials punish the Pakistani military--not all Pakistanis--for the ISI’s actions.

Dominated by hard-line ultra-nationalists obsessed with defeating archrival India, the ISI has killed Pakistani journalists who openly criticize it, harassed human rights activists and undermined efforts to establish democracy. A shadow government unaccountable to the country's weak civilian government, the ISI is widely feared by Pakistanis.

The agency is dominated by military officers wedded to a paranoid, antiquated and dangerous mindset the C.I.A. helped foment during the 1980s anti-Soviet jihad, according to American and Pakistani officials. More ultranationalists than jihadists, ISI officers believe they are the true guardians of Pakistan. To them, the U. S. is an untrustworthy and dissolute nation that is in rapid decline. India is Pakistan’s primary threat. And militants are proxies that can be controlled.

Instead of blaming all Pakistanis for the action of the ISI, the United States must help Pakistan reform an out-of-step, out-of-control agency. Military aid to Pakistan should be halted until the ISI stops sheltering the Afghan Taliban. At the same time, civilian aid to Pakistan should be continued and even increased.

I have a clear bias when it comes to the ISI and the Haqqanis. In November 2008, two Afghan colleagues and I were kidnapped outside Kabul by the Haqqani network. Within days, they shifted us from Afghanistan over the border into Pakistan’s tribal areas. There, the Haqqanis enjoyed a safe haven where they plan spectacular attacks on Kabul, hide from American troops and hold kidnap victims. After seven months of imprisonment, we escaped from captivity.

During my time in Pakistan’s Tribal areas, I saw no effort by Pakistani security forces to confront the Haqqanis. Instead, Afghan Taliban, Pakistani Taliban and foreign militants openly walked the streets of large towns, set off explosions during bomb-making classes and brainwashed young men into being suicide bombers. The Taliban operated the local police, schools and road repair crews. The Afghan Taliban fighters that the U.S. thought it had defeated in 2001 had simply shifted a few miles east, into the tribal areas of Pakistan.

Pakistani civilian officials say the Pakistani military views the Haqqanis as proxies they can use to thwart Indian encroachment in Afghanistan. When American forces pull out of the country, Pakistani generals see the Haqqanis as a card they can play in the resulting vacuum. If peace talks do emerge, the Haqqanis can serve as Pakistan’s proxies there as well.

The delusion of this approach is the ISI’s belief that the Haqqanis can be controlled. The agency has lost control of militants it trained in the 1990s to attack Indian forces in Kashmir. Now known as the “Pakistani Taliban,” the militants have declared war on the Pakistani army and state, killing an estimated 2,100 Pakistani civilians this year, according to news accounts.

During my time in captivity, I saw repeated examples of the Haqqanis and the Pakistani Taliban working seamlessly together. Afghan Taliban derided the Pakistani army as an apostate force that was the enemy of any true Muslim. The ISI's obsession with India is prompting it to follow policies that endanger Pakistan.

One former American military official who served in Pakistan presented an even more frightening scenario to me earlier this year. He said that Pakistani generals might have concluded that the Haqqanis have grown so powerful in North Waziristan that the Pakistani army cannot defeat them. After coddling the Haqqanis for a decade, the ISI has created a Frankenstein it cannot control.

COMMENT

Haqqani has been and is CIA operator so Mr.David should ask what if CIA did all this. Fabricating evidence is so easy when you plan the event yourself, who knows who is talking to whom and who knows when and where it is recorded. There is no independent evidence of any event, it is all about what you want to hear.
ISI supported CIA covertly so many times and handed over Talibans and Al-Qaida in thousands so why not Haqqani?

In retrorespect do you remember Raymond Davis, where is this sharp shooter “Diplomat” as declared by Mr.Obama in his public speech. Have you tried him in USA as promised by Senator Kerry, after killing two innocents in Lahore. Mr. Raymond Davis(what ever his real name may be) did not even appeared in any court of Law in USA so are the Americans operatives allowed to freely kill some one in other part of World and return home safely with the help of American Consulate and be free?
Pakistanis are very lucky that Raymond Davis was caught and pubic pressure resulted in media led investigation about CIA contractors roaming in Pakistani cities. ISI helped his legal escape but more pleasant results emerged that suicide Bombings have almost stopped in Pakistani Cities after legal eviction of Raymond Davis and similar gang of contractors hired by CIA. Circumstantial evidence and events indicate that these CIA hired security contractors were the culprits behind arranging suicide bombings in Pakistani cities to frustrate the people and to give excuse to Government to keep aligned with CIA. Mr. Raymond Davis event provided the general public deep insight and forced Govt to (unwillingly) evict contractors like him which saved many lives. Do you know ISI role, they provided the lawyer and money to let Mr. Raymond Davis out !!!

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from The Great Debate:

Creating a “light, long term footprint” in Afghanistan

David Rohde
Sep 22, 2011 16:08 EDT

By David Rohde
The views expressed are his own.

This is a response to Rory Stewart's book excerpt, "My uphill battle against the Afghanistan intervention."

The most important phrase in Stewart’s essay is his statement that a “light, long-term footprint” should be adopted in Afghanistan. I agree but he paints a dark picture of all Western efforts in the country.

While Stewart is correct in many of his arguments, he presents a seductively simplistic picture of abject failure. Unquestionably, Washington has focused too much on the military effort. And Stewart is right to argue against a policy of simply pouring in more foreign troops. Yet his portrait of foreigners achieving nothing in a decade stokes a dangerous isolationism gaining credence in both liberal and conservative circles in the West.

It is presented in subtle terms, but Stewart’s argument of cultural differences plays into an ugly, colonial-era view that Afghanistan and the greater Middle East are inherently backward. The region’s people, culture and faith, an extreme interpretation of the argument goes, have nothing in common with the West.

The region is not inherently backward, nor anti-Western. It is enduring a long and bloody conflict between religious conservatives and urban liberals. Instead of walking away, the United States and Europe must find a more effective way to back those liberals over the long-term.

The notion that the west can simply walk away from Afghanistan is an appealing fantasy.  A hasty American withdrawal and rapid Taliban takeover of Afghanistan will strengthen the Pakistani Taliban's effort to seize control of Pakistan and its nuclear weapons. A nuclear-armed Taliban state will destabilize the greater Middle East, a region the world economy still depends on for oil. Unless Washington adopts radically new energy policies and stances toward Israel, the U.S. will need stability in the Greater Middle East for decades to come.

In recent testimony before the U.S. Congress, Secretary of State Hillary Clinton said that “an entire year of civilian assistance in Afghanistan costs Americans the same amount as 10 days of military operations." Stewart is correct in declaring such an imbalance a core failure in Afghanistan, but he goes too far. His portrait of virtually all aid projects failing is one dimensional.

Since 2002, the number of children in Afghan schools has soared from 900,000 to 7 million. Thirty-seven percent of students are girls. A vast improvement in healthcare has emerged, with the percentage of population enjoying access to basic health care rising from 9% to 64%. Infant mortality has declined by 22 percent. Over 5 million refugees have returned to Afghanistan, increasing the country’s population by 20 percent.

In many ways, the country’s cities are thriving, with Kabul’s population tripling from an estimated 1 million in 2002 to 3.5 million today. Young urban Afghans relish mobile phones, access to the Internet and a flood of Afghan-produced popular culture. Many see comparatively liberal Dubai or Turkey as their role model, not conservative Saudi Arabia. At the same time, the Taliban retain support in the rural south and east, the country’s traditionally conservative areas.

Overall, it is simply untrue to suggest that nothing has been achieved in Afghanistan or that the western presence has only made things worse.

Yes, too many aid projects were short-term efforts designed to meet political needs in Washington, London and other foreign capitals. More than any other factor, short time frames and a lack of Afghan involvement doomed projects. Development programs have succeeded in other countries, but they spanned decades.

The core failure of the western effort in Afghanistan has been the inability to produce security across the country. Without security, all efforts at political, economic and social reform will fail, whether they are Afghan or American led. That fueled a belief that more troops were the answer.

When I covered Afghanistan from 2001 to 2008, Afghans and American officials both believed that foreign troop levels were too low. With roughly 25,000 American troops in Afghanistan as compared to 140,000 in Iraq through 2007, many hoped more foreign troops would finally increase security. The Obama troop surge raised the level of U.S. troops to 100,000 in 2010.

It was not wholly ineffective, as Stewart contends. The surge greatly weakened the Taliban in their strongholds in the south, bur failed to stop high-profile suicide bombings and assassinations. Clearly, maintaining such high American troop levels is financially unsustainable over the long-term. Afghans must lead the fight, not Americans.

The presence of foreign troops alone has not led to failure in Afghanistan, as Stewart argues. Two other dynamics doomed the effort as well. Pakistan’s continued support for the Afghan Taliban - particularly the Haqqani network - gives them a sanctuary to plan high-profile attacks in Kabul. At the same time, President Hamid Karzai’s inability to ease the country's deep ethnic tensions, endemic corruption and weak governance hampers Afghan security efforts. Yes, there has been failure in Afghanistan, but the fault lies with Pakistani generals, President Karzai and American officials.

The assassination this week of the head of the Afghan government’s peace council shows that the Taliban are a ruthless movement that will not easily reconcile with Afghan moderates. The presence of foreign troops does aid Taliban recruitment, but hardline Taliban will not suddenly moderate if American forces withdraw. The retaliation they will mete out to their Afghan opponents will be savage.

Sadly, intensifying civil war is likely Afghanistan’s future. The Pakistani military's policy of backing the Afghan Taliban, which Admiral Mike Mullen confirmed in unusually blunt Congressional testimony today, will continue. Hardliners in New Delhi, in turn, will back the Northern Alliance. India and Pakistan will engage in an unnecessary and pointless proxy war whose primary victims will be Afghans.

The U.S. must gradually withdraw its forces while continuing a long-delayed process of training Afghan security forces. Afghan President Hamid Karzai must be forced to keep his promise to leave office when his term expires in 2014. And American military aid to Pakistan must be cut off as long as its generals continue to back the Taliban.

If an Afghan government emerges that is committed to reconciling with Taliban moderates, fighting Taliban hardliners and continuing to rebuild the country, Washington should back it with large amounts of American aid, not large deployments of American troops.

All Western effort in Afghanistan is not folly. The United States and Europe must develop a long-term strategy that backs local moderates as they lead the fight against hardline Taliban. Stewart is correct that the effort since 2002 served Afghan moderates poorly. Simply abandoning them would be an even greater disservice.

PHOTO: Student leaders of the first grade class at the Gandanak Girl's School participate in a visit by the regional command's cultural advisor, in Daykundi province, June 8, 2011, in this photo provided by ISAF Regional Command (South). REUTERS/U.S. Army Sergeant Sam P. Dillon/Handout

from The Great Debate:

The 9/11 generation

David Rohde
Sep 8, 2011 12:16 EDT

By David Rohde
The opinions expressed are his own.

In a speech last week at the American Legion convention in Minneapolis, President Obama rightly hailed what he called “the 9/11 generation,” the five million Americans who served in the military over the last decade.

“They’re a generation of innovators,” he declared. “And they’ve changed the way America fights and wins at wars.”

The following day, at a ceremony marking his retirement from the military, Gen. David Petraeus affirmed Tom Brokaw’s similar praise as the two men toured Iraq in 2003.

“He shouted to me over the noise of a helicopter before heading back to Baghdad: ‘Surely, General, this is America’s new greatest generation'," Petraeus recalled. “I agreed with him then, and I agree with him now.”

I agree as well. There is a kernel of truth – and hope – in both statements. There is a 9/11 generation, one that extends beyond the valiant military members both men correctly hailed. Instead, it includes all Americans who experienced the attacks and responded to them over the last decade.

Its members include the tens of thousands of civilians who worked as diplomats, aid workers and contractors in Afghanistan and Iraq; the millions of police, firemen and teachers who stabilized American society in the fall of 2001 and subsequent years; and the tens of millions of innovative businesspeople and workers who brought the American economy roaring back after the attacks.

As a reporter, I covered the 9/11 generation in action. From the collapse of the World Trade Center, to the invasions of Iraq and Afghanistan, to the death of Osama bin Laden, I watched them toil though a bewildering decade.

Egregious mistakes were made and the threat of terrorism still lingers. Yet the 9/11 generation has largely won its struggle. Bin Laden is dead. Al Qaeda is greatly weakened. And by remaining steadfast allies of the moderate Muslims who have joined the struggle against militancy, the threat of terrorism will continue to be minimized.

By any measure, the 9/11 generation is a greatest generation that can now innovate American society back to prosperity. Why, as a generation and society, do they continue to doubt themselves so deeply?

Among Americans, the weakness that I witnessed over the last decade was not incompetence or cowardice in the field. It was growing dogmatism at home.

In Afghanistan and Iraq, blind belief in one’s own political views was rare. The soldiers, CIA officers, diplomats and aid workers I met did not see the world in terms of political parties. They did not question the intelligence or morals of anyone who disagreed with them. Instead, they generally listened, searched for pragmatic solutions and found that sacrificing for others gave great meaning to their own lives.

The opposite was true in the halls of power and on partisan cable news television shows in the U.S. On the home front, bias, denigration and bombast triumphed. On the battlefield, principle, pragmatism and sacrifice prevailed.

At one point over the last decade, I was kidnapped by the Taliban and held captive for seven months. I despised my captors and saw them as a group of criminals masquerading as a pious liberation movement. What struck me was the fact that the Taliban questioned our values.

Americans were selfish, feared death and interested only in the pleasures of this world, they told me. We were greedy, impatient and did not stand by our promises. Any Muslim who worked with us, they said, was as well. The vast majority of Americans I met in the field proved them utterly wrong. So did the moderate Afghan journalist who was kidnapped with me and eventually helped me escape.

I now live a few blocks from the World Trade Center. After bin Laden’s death was announced, I went to the site to report on public reaction. Teenagers, most of whom were in grade school on September 11, 2001, chanted ugly slogans.

Four people weren’t shouting. A 29-year-old Brooklyn army reservist was about to depart for Afghanistan on his fourth combat tour since 2001. He said he came to pay his respects to the dead. A 25-year-old Pakistani college student said bin Laden had defamed Islam. He said he hoped the Al Qaeda leader’s demise would reduce tensions between the United States and predominantly Muslim countries.

A 43-year-old businessman from Philadelphia said he hoped bin Laden’s killing would end ten years of war, economic collapse and bitter political division. And a 40-year-old construction worker from Queens said he hoped Americans would unite again as they had after 9/11.

“This country needs something to carry us forward,” he told me.

Bin Laden’s goal was to make Americans more dogmatic, to get us to see the world solely through the distorted lens of religious bigotry. The more we blamed all Muslims, the better for bin Laden. The greater our division and paranoia, the better for Al Qaeda.

The four members of the 9/11 generation who stood silently that night embodied the American values that are slowly defeating Al Qaeda: sacrifice, respect, unity and optimism. They are a new greatest generation.

They show that the lesson of the post-9/11 decade is idealism, not cynicism.

PHOTO: A U.S. flag is seen on a twisted piece of steel from the September 11th attacks on the World Trade Center, is seen at a memorial site across from Ground Zero in Jersey City, New Jersey August 11, 2011. REUTERS/Shannon Stapleton

COMMENT

“5 million of who went to war, millions more who served in other significant ways); and a generation of children whose lives have been imprinted by events they can’t yet begin to fathom.”

As much as I sympathetic with the trauma that kid suffered – I am also aware that both he and his father and every other person serving in the military is a volunteer. I hated the draft but g had a deferment. But the draft had the benefit of making sure the war was not put on self-serving, self-perpetuating and automatic status.

A stagnant economy that seems determined to widen the gap between rich and poor is also ideal for keeping an all-volunteer army staffed. The country is becoming as fascist as the Roman Empire and can marginalize anyone not in uniform and guarantee that only those with military service ever have access to ever rarer employment prospects and all in the name of a war that never has to end. It is too easy to invent a terrorist threat.

And you exploit a generation of children that may have been too young to actually know much of what went on at the time. The memorials are making a kind of state religion with holy icons, sacred pilgrimage sites and all the trappings of a popular religion devoid of any spiritual significance. And that popular religion can be abused as easily – even more easily – but all the con men and opportunists that tend to dominate state support religious establishments.

The next generation – the 9/11 generation as the writer calls them – is not likely to enter a brave new world, but one that is very controlled by some very powerful grandees that are noble (and unaccountable) in all but title. And America has had homegrown aristocrats before.

These new aristocrats will not be nearly as accountable for the influence as the old world equivalent. They will never put their own skins or children on the line and will expect their less fortunate, less educated and less intelligent to do the fighting and dying for them. And they will be able to create all the propaganda, home grown patriotic pseudo-religious sentiment they like and broadcast it anywhere they like.

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