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Spengler

More sitcom than CENTCOM

March 10th, 2014 - 3:53 am

More sitcom than CENTCOM
Cross-posted from Asia Times Online

American foreign policy is more sitcom than CENTCOM. That in a way is the good news. Our failures are comic while those of other nations are tragic. Americans do not understand the tragic impulses of other peoples because they are exceptional. The Europeans failed as nationalists, and are failing as post-nationalists.

Because Americans are not an ethnicity but a union of immigrants committed to a concept, our nationalism discloses a universal impulse. We blunder when we forget how exceptional we are, and ignore the tragic impulses that impinge on other peoples.

Only once in the past century have we read the world aright. We got it wrong when Woodrow Wilson proposed a utopian postwar vision in 1919, when the isolationists tried to stay out of the European conflict in the late 1930s, when Roosevelt and Truman let Stalin absorb Eastern Europe, when we overextended and then turned tail in Vietnam, and when we undertook to turn Iraq and Afghanistan into Western-style democracies. Ronald Reagan got it right when he decided that it was time to roll back communism – but he also understood that we would have to live with Russia as a nation.
We have stumbled into the world’s troubles like incongruous clowns in a tragedy: we observe the anguished faces of the other characters and conclude that everyone else on stage is insane. That is how Americans view Russian President Vladimir Putin. AsTime magazine reported last week:

An Obama administration official leaked to the New York Times on Sunday the fact that German Chancellor Angela Merkel told President Obama she wasn’t sure if Putin was in touch with reality. “In another world,” Merkel reportedly said, according to the leak. Then in a conference call with reporters later in the day, three administration officials took turns firing rhetorical shots: “[B]eing inside Putin’s head is not someplace anyone wants to be.”

I doubt that Merkel ever said it, but that’s a different question. Russia, as Colonel Ralph Peters (retired) told Sean Hannity last week, “believes in Russia”; to the Obamoids, belief in one’s country is prima facie evidence of mental defect. Hillary Clinton, Senator John McCain and Senator Marco Rubio meanwhile compare Putin to Hitler, an example of what the late Leo Strauss derided as “reduction ad Hitlerium”.

Contrast that to President Obama’s characterization of Iran in his interview with Bloomberg’s Jeffrey Goldberg:

[If] you look at Iranian behavior, they are strategic, and they’re not impulsive. They have a worldview, and they see their interests, and they respond to costs and benefits.

That’s been the longstanding view of this administration.

Just how does one define rationality in global politics? Here is a question that helps: What is the rational self-interest of a nation that will cease to exist within the horizon of present-day expectations? We look uncomprehendingly on the petty wars of perished peoples and marvel at the sheer vanity of their forgotten battles. How do we know that someone in the future won’t look back at us the same way? There have been Great Extinctions of the Peoples before in world history, but never with the breadth and speed of the demographic declines in our own era. That should give us something of an objective gauge with which to judge the rationality of actors.

Iran’s unprecedented fertility decline has accelerated – from about 7 children per female in 1979 to only 1.6 last year, according to a UN estimate. Russia, meanwhile, is struggling to emerge from what seemed like a demographic death-sentence only a few years ago. Ukraine is Europe’s poster-boy for demographic death.

Iran is dying a slow and dreadful death: by mid-century more than a third of its people will be over 60, and by the end of the century, half its people will be over 60, imposing an impossible burden on a poor country. Its rulers are taking urgent steps to reverse the fertility decline, opening clinics to treat infertility, which reportedly affects one-fifth of all Iranian couples, against a world average of around 8%. Why infertility is so widespread in Iran is unclear; it might be due to the fact that the reported incidence of chlamydia, a bacterial STD that causes infertility, is several times higher in Iran than in Western countries. Former president Mahmud Ahmadinejad began campaigning for earlier marriage and bigger families in 2009, but fertility has continued to fall.

I argued nearly a decade ago (see Demographics and Iran’s imperial design, Asia Times Online, September 13, 2005) that Iran’s decision to acquire nuclear weapons is an entirely rational response to its demographic decline: “Iran’s motives for acquiring nuclear power are not only economic but strategic. Like Hitler and Stalin, Ahmadinejad looks to imperial expansion as a solution for economic crisis at home. … This may appear to be a desperate gamble, but conditions call for desperate gambles. Ahmadinejad is not a throwback, as I wrote with a dismissiveness that seems painful in hindsight. He has taken the measure of his country’s crisis, and determined to meet it head-on. Washington, from what I can tell, has no idea what sort of opponent it confronts.”

Iran is rational, but not in the way Obama seems to believe. If you need $100,000 for an operation that will save your life and have only $10,000, it is rational to bet the whole stake at 10:1 odds. Iran must break out or break down. That is why it will gamble on nuclear weapons acquisition.

Total fertility rate for Russia, Ukraine, and Iran 

Source: UN and CIA

Apart from some fine work by the demographer Nicholas Eberstadt, though, the glaring facts of Iran’s demographic predicament have escaped notice by America’s policymakers. Not so the demographics of Russia: the prevailing view among Western analysts (and especially hawkish ones) holds that Russia is a doomed nation. In December 2011, Professor Eberstadt published an essay entitled “The Dying Bear: Russia’s Demographic Disaster” in Foreign Affairs. Last year I reviewed on this site Ilan Berman’s book Implosion, which stated this widely held view as follows:

Russia is dying. Russia is undergoing a catastrophic post-Soviet societal decline due to abysmal health standards, runaway drug addiction, and an AIDS crisis that officials have termed an “epidemic.” The population of the Russian Federation is declining by close to half a million souls every year due to death and emigration. At this rate, the once-mighty Russian state could lose a quarter of its population by the middle of this century. And according to some projections, if Russia’s demographic trajectory does not change, its population could plummet to as little as fifty-two million people by 2080. It’s a phenomenon demographers have described as “the emptying of Russia” – a wholesale implosion of Russia’s human capital and a collapse of its prospects as a viable modern state. (See see Reports of Russia?s death are exaggerated , Asia Times Online, October 15, 2013)

A specter is haunting Russia: the specter of depopulation. The cohort of Russian women of child-bearing age is so depleted that even a recovery of Russia’s birth rate will not forestall severe problems. Nonetheless I thought Berman’s thesis one-sided and overstated. Russia’s total fertility rate has recovered from around 1.2 a decade ago to 1.7 last year, and Russia’s population increased slightly in 2013 for the first time in almost two decades.

We do not know quite why this has occurred, but it seems that Putin’s aggressive efforts to promote fertility have had some effect – unlike in Iran. Like Jonah’s prophecy to Nineveh, the threat of extinction may have motivated Russia to change course. And like Jonah, our modern prophets rankle at the prospect that the ban of doom may have been lifted.

I suspect that Russia’s revived nationalism has a great deal to do with rising fertility. That includes the revival of the Orthodox Church, which is consubstantial with the Russian state. Countries that lose their faith and their identity also lose their motivation to bring new generations into the world; that is how civilizations die, the title of my 2011 book on demographics and geopolitics. Putin’s nationalism is also a rational response to an existential threat. The Germans might go gentle into that good night, but Russia will fight for its identity and its future existence.

Russian nationalism – historically an imperial more than a national identity – always was a brutal business, and especially nasty towards national minorities, as my ancestors from the Pale of Jewish Settlement on the Western order of the Russian Empire knew all too well.

A core goal of Putin’s national revivalism is the reintegration of Russians left stranded in the “near abroad” by the collapse of the Soviet Union: Russia’s imperial policy of salting its border states with Russian settlers backfired when the evil Soviet empire collapsed. From the Russian vantage point this is not a matter of scoring points but an existential issue, a sine qua non of what it means to be Russian, and exemplary of the motivation for Russians to want their culture to continue.

Western pundits ridicule Putin’s claim that Russia is a bulwark against Western decadence. From a Western standpoint, Putin’s methods are repugnant. But they are the only methods Russia has ever known. The problem is that Western Europe is decadent. Most European countries are headed for demographic extinction. Russia, which seemed passed the point of no return, is struggling to retrace its steps.


Total fertility rate for Russia and selected European countries
Source: UN and CIA

That leaves the West with a conundrum concerning the Russian intervention in Crimea and possibly elsewhere in Russian-majority areas in Ukraine. Russia does not want to be like other European countries. Hungary, Poland, and the Baltic States have the lowest fertility rates of any nations in the West, ranging from just 0.82 children per female for ethnic Magyars in Hungary (excluding the Roma) to about 1.2 for Poland. That is where Russia was in 2000. Russia prefers the fecund past to the bleak future of the Europeans. That is why the nations of Europe fought the First World War 100 years ago: to avoid becoming what they are today. They fought to sustain belief in their destiny as nations. As Col. Peters said in the cited interview, “Putin believes in Russia’s destiny.”

The re-assertion of Russian identity, meanwhile, is as brutal a business as Russian self-assertion has been since the time of Peter the Great. Putin’s patriotism is not my patriotism. I don’t particularly like what Putin did in Crimea, but it was delusional to expect any other course of action. Russia is short of Russians, and it cannot ignore the 22 million Russians left stranded in newly independent republics of the former Soviet Union.

The Obama administration is staffed by the sort of utopian liberal internationalists who attended conflict-resolution seminars at Ivy League colleges. Putin seems a throwback, and that is just what he is: he is trying to revert to Russian identity prior to the 1917 October Revolution, not without some success. To compare him to Hitler is Billingsgate. The hawks seem upset that Russia has not chosen to accept its decline with Stoic resignation. It is easier to condemn Russian brutality than to suggest an alternative path by which Russia would remain viable a century from now.

It was inevitable that Russia would intervene if Ukraine became unstable. It is tragic in the full sense of the world, namely an outcome to which the participants are driven by circumstances they cannot control. Russia’s interest in Ukraine, particularly in the Russian-speaking eastern half of the country, is existential not opportunistic.

As in Georgia, there was nothing the United States (let alone the Europeans) could have done to hinder it, and nothing they can do to reverse it. The tragedy will play itself out, and at the end of it – the very end – there will be no Ukraine, because there will be no Ukrainians.

Whether Russia survives into the next century is an open question upon which the crude conclusions of hawkish foreign policy analysts shed no light. I do not know the answer, but I am sure that America will have to deal with Russia as a strategic power for the indefinite future – a power of second rank, perhaps, but not one to be trifled with in its back yard.

I am an American and a hawk who wants America to be the world’s dominant superpower. Whatever our errors, we are the only nation in the world capable of altruism. We hawks had a mandate after September 11, 2011, such as no-one had in America since Pearl Harbor, and we misplayed hand after hand until our chips are nearly gone. If we fail to understand the underlying trends that drive events and the motivations of the main actors, we will be out of the game entirely.

What should we have done in Ukraine? As I wrote on February 20, the West had the opportunity to promote a constitutional referendum including the option of partition. If Russian speakers in Crimea or the Donbas region preferred affiliation with Russia, so be it. Ukraine’s constitution was in ruins before the Russians moved in. The odious Viktor Yanukovich beat the “Gas Princess” Yulia Timoshenko in a reasonably fair election in 2010, and proceeded to abuse his presidential powers. When the Maidan Square demonstrators chased him out, Ukraine’s parliament voted unanimously to dismiss him. The absence of a single “nay” recalls Soviet-era majorities.

The West could have been midwife to a new national consensus – either a single Ukraine reaffirmed by popular mandate, or a decent divorce on the Czech-Slovak model, or perhaps a federal solution somewhere in between. Instead, we encouraged a constitutional crisis in Ukraine. Now we are stuck with the dubious Ms Timoshenko, one of the wealthiest oligarchs to emerge from Ukraine’s post-independence theft of national assets, and an intransigent Russia in possession of Crimea.

Spengler is channeled by David P Goldman. He is Senior Fellow at the London Center for Policy Research and Associate Fellow at the Middle East Forum. His book How Civilizations Die (and why Islam is Dying, Too) was published by Regnery Press in September 2011. A volume of his essays on culture, religion and economics, It’s Not the End of the World – It’s Just the End of You, also appeared that fall, from Van Praag Press.

What Happened in Ukraine?

March 5th, 2014 - 4:45 pm

European media are reporting the leak of a taped phone call between the Estonian Foreign Minister and European Community foreign policy chief Lady Catherine Ashton alleging that the same snipers killed demonstrators as well as security forces during the Maidan Square uprising. The Estonians are no friends of Putin–quite the contrary. Russia and Estonia have been bitterly at odds for years. Russian stated media posted the call on YouTube. Presumably they got the tape from the Russian spy agencies.

Writes the London Guardian:

A leaked phone call between the EU foreign affairs chief Catherine Ashton and Estonian foreign minister Urmas Paet has revealed that the two discussed a conspiracy theory that blamed the killing of civilian protesters in the Ukrainian capital, Kiev, on the opposition rather than the ousted government.

The 11-minute conversation was posted on YouTube – it is the second time in a month that telephone calls between western diplomats discussing Ukraine have been bugged.

In the call, Paet said he had been told snipers responsible for killing police and civilians in Kiev last month were protest movement provocateurs rather than supporters of then-president Viktor Yanukovych. Ashton responds: “I didn’t know … Gosh.”

It’s a lead story on Der Spiegel’s main German language news page and extensively covered elsewhere. It raises the question: to what extent was Maidan Square the triumph of Western-looking lovers of democracy (surely true to some extent) and to what extent was it an intra-oligarchical mob war (surely true to some extent)?

Not a word in the US media yet, judging from a Google News search.

Ukraine Is Hopeless … but Not Serious

March 1st, 2014 - 4:54 pm

There isn’t going to be a war over Ukraine. There isn’t even going to be a crisis over Ukraine. We will perform our ritual war-dance and excoriate the Evil Emperor, and the result would be the same if we had sung “100 Bottles of Beer on the Wall” on a road trip to Kalamazoo. Worry about something really scary, like Iran.

Ukraine isn’t a country: it’s a Frankenstein monster composed of pieces of dead empires, stitched together by Stalin. It has never had a government in the Western sense of the term after the collapse of the Soviet Union gave it independence, just the equivalent of the family offices for one predatory oligarch after another–including the “Gas Princess,” Yulia Tymoshenko. It has a per capital income of $3,300 per year, about the same as Egypt and Syria, and less than a tenth of the European average. The whole market capitalization of its stock exchange is worth less than the Disney Company. It’s a basket case that claims to need $35 billion to survive the next two years. Money talks and bullshit walks. Who wants to ask the American taxpayer for $35 billion for Ukraine, one of the most corrupt economies on earth? How about $5 billion? Secretary of State Kerry is talking about $1 billion in loan guarantees, and the Europeans are talking a similar amount. That’s not diplomacy. It’s a clown show.

Ukraine’s revolution is odd, even by recent standards. The deposed premier Viktor Yanukovych won the 2010 presidential election against Yulia Tymoshenko, after Tymoshenko’s “Orange Revolution” regime made a ghastly mess of everything. Yanukovich made matters worse. Clearly a lot of Ukrainians got together at Maidan square, ranging from democratic idealists to rent-a-mob demonstrators paid by Ukrainian oligarchs to the sort of hoodlums who think the other side should have won the Second World War. What sort of regime do we have now? As CNN reported Feb. 27, there is

Arseniy Yatseniuk, 39, named as Prime Minister and a practiced politician who has been the chief opposition voice at Maidan Square. While closely associated with former Prime Minister Yulia Tymoshenko — who was freed from prison in the wake of last week’s protests — he can at least do business with the West and talk tough with hard-nosed IMF suits. A realist, on Wednesday he warned that the new government will need to invoke some very unpopular decisions, given the dire state of the economy. “We are a team of people with a suicide wish — welcome to hell,” he said.

Ukraine’s economy is close to Egypt’s in per capital GDP, and its governance is similar: desperately poor people can’t make it through the day without government subsidies, especially for energy. The oligarchs have looted the country so that it has to borrow money from foreigners to maintain the subsidies, leaving Ukraine with $137 billion in foreign debt, and a need to borrow an additional $20 billion a year. Putin offered just under $20 billion in cash and subsidies, and Yanukovych accepted his offer. The alternative was maybe $15 billion from the IMF provided that Ukraine cut subsidies first. Yanukovych, who is neither a Ukrainian patriot nor a Russian stooge, but a man on the make, decided he couldn’t sell the austerity package. That’s why he went with Russia. For the demonstrators at Maidan square, staying in the Russian orbit meant more of the same misery. Some of them decided they would rather die than live that way, which is perfectly understandable. But what precisely to they expect to get from the Europeans, let alone the U.S.? Finding $35 billion of taxpayers’ money has a vanishingly small probability.

Putin bungled things badly: he thought a bailout would solve the problem. That blew up in his face. The West bungled things badly: it has a $35 billion bill on its desk and no intention of paying it. John McCain went to Maidan in December and said the American people were with the Ukrainian demonstrators. He meant in spirit, not in their capacity as taxpayers. The Ukrainian opposition didn’t bungle so much as take a collective bungee jump without a cord. Just what do they propose to do now?

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Ukraine Should Vote on Partition

February 20th, 2014 - 5:42 am

Update: “Careful What You Wish For in Ukraine” (Asia Times Online)

Excerpt:

Western governments are jubilant over the fall of Ukrainian President Viktor Yanukovich, a Russian ally. They may be underestimating Vladimir Putin: Russia has the option to hasten Ukraine’s slide into chaos and wait until the hapless European Union acquiesces to – if not begs for – Russian intervention. 

That leaves the West with a limited number of choices. The first is to do nothing and watch the country spiral into chaos, with Russia as the eventual beneficiary. The second is to dig deep into itspockets and find US$20 billion or more to buy near-term popularity for a pro-Western government – an unlikely outcome. The third, and the most realistic, is to steer Ukraine towards a constitutional referendum including the option of partition. 

Judging from Russian press coverage, Moscow already has washed its hands of the feckless Yanukovich. Russia Today whimsically observed on February 22 that Yanukovich lacked the sangfroid of Mikhail Saakashvili, the former president of Georgia and an ally of the West:

Yanukovich could also have dispersed the protesters and maintained public order in the country, whatever criticism it might have brought. This is how the then Georgian president, Mikhail Saakashvili, acted in 2007. He brutally suppressed a peaceful protest and called an early presidential election, which he won, instead of an early parliamentary election, which the opposition demanded and which his party could well have lost. Unlike the Georgian leader, Yanukovich hesitated even when the Ukrainian protest turned Kiev into a battlefield. [1]

Moscow has no need of allies with weak stomachs. But it will withdraw the offer of $15 billion worth of Ukrainian debt purchases and subsidies for natural gas exports to Ukraine and leave the nearly bankrupt country to the ministrations of the West. Careful what you wish for, Russia is telling the West. 

Russian Finance Minister Anton Siluanov said that Ukraine should get money from the International Monetary Fund: “We consider that such a situation would meet the interests of Ukraine, would put the country on the path toward major structural reforms. We wish them success in this undertaking and in the rapid stabilization of the political and social situation.” 

Siluanov is being mischievous. Twice in the past six years, the IMF suspended promised loans to Ukraine after the country refused to cut salaries and pensions and raise energy prices. Russia had offered a loan without conditions; any money the West offers will require austerity measures that no Ukrainian government is capable of enforcing. 

I’ve argued for years that partition is the best solution for Ukraine, which never was a country but an almalgam of provinces left over from failed empires–Russian, Austrian, Lithuanian, Ottoman–cobbled together into a Soviet “republic” and cast adrift after the collapse of Communism. Lviv (Lemberg) was a German-speaking city, part of Silesia; before World War II a quarter of its people were Jews. Jews were two-fifths of the population of Odessa.

A fifth of the population, mainly in the East, are ethnic Russians; a tenth, mainly in the West, are Uniate Catholics, who have a special place in Catholic policy since the papacy of John Paul II. Ukrainian nationality is as dubious as Byelorussian nationality: neither of them had a dictionary of their language until 1918.

The country also is a basket case. At its present fertility rate (1.3 children per female), its 47 million people will shrink to only 15 million by the end of the century. There are presently 11 million Ukrainian women aged 15 to 49 (although a very large number are working abroad); by the end of the century this will fall to just 2.8 million. There were 52 million Ukrainian citizens when Communism fell in 1989. Its GDP at about $157 billion is a fifth of Turkey’s and half of Switzerland’s.  Ukrainians want to join the European Union rather than Russia so they can emigrate.  It is of no strategic, economic, or demographic importance to the West.

Assistant Secretary of State Victoria Nuland, whose “F*** the Europeans” remark earned her 15 minutes of fame recently, ought to be fired for being plain dumb. I am no admirer of European diplomacy, but Europe will have to pay a good part of the bill for Ukraine’s problems one way or the other. I don’t see Congress offering $15 billion to support Ukraine’s foreign debt as Russia did last month. The Russians won’t abandon Ukraine, which they consider part of their territory, and they certainly won’t abandon Russian-speakers “orphaned” by the collapse of the Soviet Union. What does Ms. Nuland propose: land paratroopers? Just what are we offering to the Ukrainian opposition? American policy has alternated between indifference and impotent posturing. The Nuland tape was painful to hear for its sheer stupidity.

We cannot ignore a humanitarian disaster in a European country. But the idea that we can influence matters by promoting one or another opposition leader, as in the Nuland tape, is ridiculous. There is something we can do, however: Propose a referendum in which the people of Ukraine can choose constitutional alternatives–partition, confederation, or status quo. And the person who should act for the West is German Chancellor Angela Merkel, for several reasons. First, she has credibility; second, she has guts (she came into politics through the democracy movement in East Germany); third, she speaks Russian and understands Vladimir Putin; fourth, she has more brains than anyone in Washington (a doctorate in quantum chemistry).

Russia never will permit the integration of Ukraine into NATO; were it to come to that, Russia would use force, and the West would stand by cursing. But Russia will settle for half a loaf, namely a Russian-allied Eastern Ukraine. Whatever we do, Ukraine will continue its slow, sad slide into oblivion. The diplomats have the dour duty of managing this decline with the minimum of friction.

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Sympathy for the European Devil

February 16th, 2014 - 7:24 am

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European Parliament President Martin Schulz provoked an uproar last week in a speech before Israel’s Knesset, citing in passing a Palestinian claim that Israelis get four times as much water as Arabs in Judea and Samaria. The Jewish Home party delegation (led by my favorite Israeli politician, Naftali Bennett) walked out on the German politician in protest; Intelligence Minister Yuval Steinitz called the protest “disproportionate.” In this case I think Steinitz is right: Schulz is not an anti-Semite. He’s the sort of German who loves Israel in a peculiarly German way. By and large, Germans do not hate Israel; on the contrary, they love to love the Israeli left. They really, truly, sincerely want to be philo-Semitic (that brings to mind the old definition of a philo-Semite: an anti-Semite who likes Jews). The Germans are post-Christian and post-nationalist. In more than forty years of traveling (and occasionally living) in Germany I have not met a single German who can abide religion, except for full-time clergy. Their experience of nationalism, like the experience of most Europeans, has been unrelentingly horrible. They cannot help but identify with the “post-Zionist,” existentially addled Angst of the Israeli Left.

Zeruya Shalev, the Israeli novelist who dissects the disordered lives of disappointed utopians, is a bestseller and a cultural icon in Germany. Her last book was the subject of a gushing review by Adam Kirsch, book critic for the Jewish webzine Tablet and a stalwart at The New Republic. Every major German news publication has profiled or interviewed Ms. Shalev. In 2011, the popular weekly Stern asked her whether the then-ongoing “social justice” protests portended a “New Israel,” that is, an Israel more to the liking of Stern and Ms. Shalev; the Israeli writer was hopeful. The German interviewer simply took for granted that Stern’s readers would identify with the lefty literati against the Netanyahu government. Shalev writes the sort of introspective fiction that I find less tolerable than gum surgery; the great Israeli novelist in my view was the Nobelist S.Y. Agnon, whose masterwork Only Yesterday is not available in German translation. It is a wrenching, difficult book first published in Hebrew in 1945, and I am not surprised that the German public would avoid it. Today’s Germans have sensibilities hardly distinguishable from those of Adam Kirsch and prefer the Freudian meanderings of Ms. Shalev. (Of course, I’m the wrong person to ask about such things. I don’t like fiction.)

The socialist utopians of the Israeli Left cling to a vision of Israel as a nation-state like any other, liberated from the notion that there is anything special about the Jews. Israel in this view should become a Levantine Belgium or Holland, dissolving into the postmodern cultural muck with its European peers. As Israel becomes more Jewish, and more religious, and its continued success draws an ever-sharper boundary against the failed states that surround it, the utopians go into panic. To salvage their position they propose to ally with the Europeans, the way that Antipater of Idumaea allied with Pompey the Great to establish the Herodian dynasty. For background on Pompey, I recommend Lucan.

Here, for example, is journalist Ben Caspit writing in Al-Monitor:

For 40 years, Israel has entrenched its hold on the West Bank, in a belief that the problem would resolve itself somehow. It hasn’t been resolved. We can’t continue to fool everyone, all of the time. At some point, we will have to make the difficult decision, and undo this Gordian knot, not to be dragged with it into the depths.

It seems that as time passes, our ability to reach this decision is diminishing. As time passes, it turns out that we might need someone, or something, that will force it on us. And so, I don’t think we need to call on the Europeans to boycott us, but if and when they do so, we will be able to understand their position.

Of course (as Caspit observes) Kerry is using the Europeans to threaten Israel with boycotts. Does that mean Kerry is an anti-Semite, a charge that his Jewish brother bitterly disputes? It brings to mind the old Viennese joke: “Anti-Semitism was getting nowhere until the Jews got behind it.” Suffice it to say that the Israeli Left hopes that Kerry and the Europeans will batter Israel into a peace deal. Anti-Semitism is not the issue, unless we want to call the Israeli left anti-Semitic.

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I should like to advance a conjecture which I lack the qualifications to adequately develop: The global Left, and the Israeli Left most of all, perceives that the clock is running out, and has worked itself up into a froth of hysteria against Israel. The world of John Lennon’s “Imagine,” where there are no countries and no religions, is about to dissipate like last night’s marijuana fumes. The demographic time bomb that worries the Left is not the relative increase of Arab vs. Jewish populations between the Mediterranean and the Jordan River, speciously cited by John Kerry and a host of other errant utopians: it is the growth of the Jewish population itself, and Israel’s transformation into the world’s most religious country.

Israel now has a religious majority, as Times of Israel blogger Yoseif Bloch observes:

According to our Central Bureau of Statistics, 43% of Israeli Jews are secular, 9% are haredi, and the remaining 48% are somewhere between masorti (traditional) and dati (religious)23% the former, 10% the latter, and 15% smack in the middle. These five groups do not parallel the five groups identified by Pew, e.g. Orthodox is a denomination, while dati is a declaration.”

So 57% of Israelis practice a form of Judaism that for the most part Americans would call “Orthodox,” in that it recognizes normative Judaism in the rabbinic tradition (the presence of the “progressive” Reform and Conservative movements is almost imperceptible and largely limited to transplanted Americans). Many Israelis who are dati are far from completely observant, but there is a great gulf fixed between a semi-observant Jew who knows what observance is, and a “progressive” who asserts the right to reinvent tradition according to personal taste.

This majority seems to be expanding fast. I spent the second half of December in Jerusalem promoting the Hebrew translation of my book How Civilizations Die and was struck by the increase in commitment to religious observance, including among people who were steadfastly secular. Almost half of Israel’s army officers are “national religious” and trained in pre-army academies that teach Judaism, Jewish history, as well as physical training and military subjects. The ultra-Orthodox are going to work rather than studying full time, little by little, but the little adds up to a lot. Naftali Bennett’s national-religious party “Jewish Home” has created a new political focus for the national-religious. Outreach organizations like Beit Hillel are bringing once-secular Israelis back to observance. Beit Hillel’s spiritual leader, Rabbi Ronen Neuwirth, was in New York recently lecturing about Israel’s religious revival.

Anecdotally, I see this in my own small circle of Israeli acquaintances. A musician friend told me that he attends a Talmud class every Shabbat — he can’t stand praying, but he is hungry for Torah. A journalist friend dresses her young boys in the tallit katan, the fringed undergarment of the very observant. It is becoming normal in Jerusalem restaurants to wash hands before bread and to recite the Grace after Meals.

This is a crucial, counterintuitive story: Israel is swimming against the secular current, becoming more observant as the rest of the world becomes more secular. Perhaps the explanation lies in the observation of the Catholic sociologist Mary Eberstadt, who argued in a brilliant 2007 essay that it is our children who bring us to faith. Last year Mary expanded the essay into a book which I had the honor to discuss in Claremont Review of Books. It is a commonplace of demographers’ correlation that people of faith have more children: Mary argues that the causality goes both ways, that having children reinforces our faith. Israeli is a standpoint in the modern world with a fertility rate of 3.0 children per woman (the closest second is the U.S. with just 1.9). Excluding the ultra-Orthodox the number is 2.6 children per woman, still outside the range of the rest of the industrial world. Secular Israelis are having three children. Not only does that defuse the much-touted “demographic time bomb.” It ultimately changes the character of the country. It validates the hundred-year-old argument of Rabbi Isaac Kook, one of the founders of religious Zionism, that identification with the Jewish people eventually will lead Jews back to Judaism.

This national religious revival is not occurring at the expense of Israeli or West Bank Arabs. On the contrary, the Arab population between the River and the Sea is flourishing as no modern Arab population ever did. A fifth of Israel’s medical students are Arab, as are a third of the students at the University of Haifa. Ariel University across the “Green Line” in Samaria, the “settler’s university,” is educating a whole generation of West Bank Arabs. The campus is full of young Arab women in headscarves, and the local Jewish leadership reaches out to Arab villages to recruit talented students. Israel’s expanding economy has a bottomless demand for young people of ability and ambition. The Left calls Israel an “apartheid state” the way it used to call America a “fascist state” back in the 1960s.

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Cross-posted from Asia Times Online

More than coincidence accounts for the visit to Iran by Turkish Prime Minister Recep Tayyip Erdogan on January 28, the same day that his economic policy collapsed in a most humiliating way.

As the Turkish lira collapsed to levels that threatened to bankrupt many Turkish companies, the country’s central bank raised interest rates, ignoring Erdogan’s longstanding pledge to keep interest rates low and his almost-daily denunciation of an “interest rate lobby” that sought to bring down the Turkish economy. Erdogan’s prestige was founded on Turkey’s supposed economic miracle.

Hailed as”the next superpower” by John Feffer of the Institute for Policy Studies, and as “Europe’s BRIC” by The Economist, Turkey has become the Sick Man of the Middle East. It now appears as a stock character in the comic-opera of Third World economics: a corrupt dictatorship that bought popularity through debt accumulation and cronyism, and now is suffering the same kind of economic hangover that hit Latin America during the 1980s.

That is not how Erdogan sees the matter, to be sure: for months he has denounced the “interest rate lobby”. Writes the Hurriyet Daily News columnist Emre Deliveli, “He did not specify who the members of this lobby were, so I had to resort to pro-government newspapers. According to articles in a daily owned by the conglomerate where the PM’s son-in-law is CEO, the lobby is a coalition of Jewish financiers associated with both Opus Dei and Illuminati. It seems the two sworn enemies have put aside their differences to ruin Turkey.”

US President Barack Obama told an interviewer in 2012 that Erdogan was one of his five closest overseas friends, on par with the leaders of Britain, Germany, South Korea and India. Full disclosure: as the Jewish banker who has been most aggressive in forecasting Turkey’s crisis during the past two years, I have had no contact with Opus Dei on this matter, much less the mythical Illuminati.

Erdogan was always a loose cannon. Now he has become unmoored. Paranoia is endemic in Turkish politics because so much of it is founded on conspiracy. The expression “paranoid Turk” is a pleonasm. Islamist followers of the self-styled prophet Fetullah Gulen infiltrated the security services and helped Erdogan jail some of the country’s top military commanders on dubious allegations of a coup plot. Last August a Turkish court sentenced some 275 alleged members of the “Ergenekon” coup plot, including dozens of military officers, journalists, and secular leaders of civil society.

Now Gulen has broken with Erdogan and his security apparatus has uncovered massive documentation of corruption in the Erdogan administration. Erdogan is firing police and security officials as fast as they arrest his cronies.

There is a world difference, though, between a prosperous paranoid and an impecunious one. Turkey cannot fund its enormous current borrowing needs without offering interest rates so high that they will pop the construction-and-consumer bubble that masqueraded for a Turkish economic miracle during the past few years.

The conspiracy of international bankers, Opus Dei and Illuminati that rages in Erdogan’s Anatolian imagination has triumphed, and the aggrieved prime minister will not go quietly. As Erdogan abhors old allies who in his imagined betrayed him and seeks new ones, the situation will get worse.

One of the worst ideas that ever occurred to Western planners was the hope that Turkey would provide a pillar of stability in an otherwise chaotic region, a prosperous Muslim democracy that would set an example to anti-authoritarian movements. The opposite has occurred: Erdogan’s Turkey is not a source of stability but a spoiler allied to the most destructive and anti-Western forces in the region.

It seems unlikely that the central bank’s belated rate increase will forestall further devaluation of the lira. With inflation at 7.4% and rising, the central bank’s 10% reference rate offers only a modest premium above the inflation rate. About two-fifths of Turkey’s corporate debt is denominated in foreign currency, and the lira’s decline translates into higher debt service costs. Turkey is likely to get the worst of both worlds, namely higher local interest rate and a weaker currency.


Source: Turkish Central Bank

Now Erdogan’s Cave of Wonders has sunk back into the sand. Few analysts asked how Turkey managed to sustain a current account deficit that ranged between 8% and 10% of gross domestic product during the past three years, as bad as the Greek deficit during the years before its financial collapse in 2011.

The likely answer is that Turkey drew on vast amounts of credit from Saudi and other Gulf state banks, with strategic as well as financial motives. Data from the Bank for International Settlements show that Turkey financed a large part of its enormous deficit through the interbank market, that is, through short-term loans to Turkish banks from other banks.

Western banks report no such exposure to Turkey; the Gulf banks do not report regional exposure, and anecdotal evidence suggests that Sunni solidarity had something to do with the Gulf states’ willingness to take on Turkish exposure.

Relations between Turkey and the Gulf States are now in shambles. Saudi Arabia abhors the Muslim Brotherhood, which wants to replace the old Arab monarchies with Islamist regimes founded on modern totalitarian parties, while Erdogan embraced the Brotherhood. The Saudis are the main source of financial support for Egypt’s military government, while Ankara has denounced the military’s suppression of the Muslim Brotherhood.

Whether the Gulf States simply ran out of patience or resources to support Erdogan’s credit binge, or whether their displeasure at Turkey’s misbehavior persuaded them to withdraw support, is hard to discern. Both factors probably were at work. In either case, Erdogan’s rancor at Saudi Arabia has brought him closer to Teheran.

Turkey should have restricted credit growth and raised interest rates to reduce its current account deficit while it still had time. Erdogan, though, did the opposite: Turkish banks increased their rate of lending while reducing interest rates to businesses and consumers.

Given the country’s enormous current account deficit, this constituted irresponsibility in the extreme. Erdogan evidently thought that his mandate depended on cheap and abundant credit. The credit bubble fed construction, where employment nearly doubled between 2009 and 2013. Construction jobs increased through 2013, after manufacturing and retail employment already had begun to shrink.

Source: Central Bank of Turkey

I predicted the end of Erdogan’s supposed economic miracle in the Winter 2012 edition of Middle East Quarterly, comparing Erdogan’s boomlet to the Latin American blowouts of the 1990s:

In some respects, Erdogan’s bubble recalls the experiences of Argentina in 2000 and Mexico in 1994 where surging external debt produced short-lived bubbles of prosperity, followed by currency devaluations and deep slumps. Both Latin American governments bought popularity by providing cheap consumer credit as did Erdogan in the months leading up to the June 2011 national election. Argentina defaulted on its $132 billion public debt, and its economy contracted by 10 percent in real terms in 2002. Mexico ran a current account deficit equal to 8 percent of GDP in 1993, framing the 1994 peso devaluation and a subsequent 10 percent decline in consumption.


Source: BIS

In the meantime, Turkey has entered a perfect storm. As its currency plunges, import costs soar, which means that a current account of 8% of GDP will shortly turn into 10% to 12% of GDP – unless the country stops importing, which means a drastic fall in economic activity. As its currency falls, its cost of borrowing jumps, which means that the cost of servicing existing debt will compound its current financing requirements. The only cure for Erdogan’s debt addiction, to borrow a phrase, is cold turkey.

The vicious cycle will end when valuations are sufficiently low and the government is sufficiently cooperative to sell assets at low prices to foreign investors, and when Turkish workers accept lower wages to produce products for export.

One might envision a viable economic future for Turkey as the terminus on the “New Silk Road” that China proposes to build across Central Asia, with high-speed rail stretching from Beijing to Istanbul. Chinese manufacturers might ship container loads of components to Turkey for assembly and transshipment to the European and Middle Eastern markets, and European as well as Asian firms might build better factors in Turkey for export to China. Contrary to conventional wisdom, Turkey’s path to Europe lies not through Brussels but through Beijing.

That is Turkey’s future, but as the old joke goes, it can’t get there from here.

Turkey has a small but highly competent professional class trained at a handful of good universities, but the Erdogan regime – the so-called “Anatolian tigers” – have disenfranchised them in favor of Third World corruption and cronyism. The secular parties that bear the faded inheritance of Kemal Ataturk lack credibility. They are tainted by years of dirty war against the Kurds, of collusion with military repression, and their own proclivity towards a paranoid form of nationalism.

Erdogan’s AKP is a patronage organization that has run out of cash and credit, and its fate is unclear. The highly influential Gulen organization has a big voice, including the Zaman media chain, but no political network on the ground.

No replacement for Erdogan stands in the wings, and the embattled prime minister will flail in all directions until the local elections on March 30.

The last thing to expect from Erdogan is a coherent policy response. On the contrary, the former Anatolian villager thrives on contradiction, the better to keep his adversaries guessing.

Turkish policy has flailed in every direction during recent weeks. Erdogan’s Iran visit reportedly focused on Syria, where Turkey has been engaged in a proxy war with Iran’s ally Basher al-Assad. Ankara’s support for Syrian rebels dominated by al-Qaeda jihadists appears to have increased; in early January Turkish police stopped a Turkish truck headed for Syria, and Turkish intelligence agents seized it from the police. Allegedly the truck contained weapons sent by the IHH Foundation, the same group that sent the Mavi Marmara to Gaza in 2010. The Turkish opposition claims that the regime is backing al-Qaeda in Syria. One can only imagine what Erdogan discussed with his Iranian hosts.

Some 4,500 Turks reportedly are fighting alongside 14,000 Chechnyans and a total of 75,000 foreign fighters on the al-Qaeda side in Syria. Ankara’s generosity to the Syrian jihadists is a threat to Russia, which has to contend with terrorists from the Caucasus, as well as Azerbaijan, where terrorists are infiltrating through Turkish territory from Syria. Russia’s generally cordial relations with Turkey were premised on Turkish help in suppressing Muslim terrorism in the Caucasus. There is a substantial Chechnyan Diaspora in Turkey, aided by Turkish Islamists, and Moscow has remonstrated with Turkey on occasion about its tolerance or even encouragement of Caucasian terrorists.

I doubt that Erdogan has any grand plan in the back of his mind. On the contrary: having attempted to manipulate everyone in the region, he has no friends left. But he is in a tight spot, and in full paranoid fury about perceived plots against him. The likelihood is that he will lean increasingly on his own hard core, that is, the most extreme elements in his own movement.

Erdogan has been in what might be called a pre-apocalyptic mood for some time. The long term has looked grim for some time, on demographic grounds: a generation from now, half of all military-age men in Turkey will hail from homes where Kurdish is the first language. “If we continue the existing [fertility] trend, 2038 will mark disaster for us,” he warned in a May 10, 2010, speech reported by the Daily Zaman.

But disaster already has arrived. In some ways Turkey’s decline is more dangerous than the Syrian civil war, or the low-intensity civil conflict in Iraq or Egypt. Turkey held the North Atlantic Treaty Organization’s eastern flank for more than six decades, and all parties in the region – including Russia – counted on Turkey to help maintain regional stability. Turkey no longer contributes to crisis management. It is another crisis to be managed.

Spengler is channeled by David P Goldman. He is Senior Fellow at the London Center for Policy Research and Associate Fellow at the Middle East ForumHis book How Civilizations Die (and why Islam is Dying, Too) was published by Regnery Press in September 2011. A volume of his essays on culture, religion and economics, It’s Not the End of the World – It’s Just the End of You, also appeared that fall, from Van Praag Press.

(Copyright 2014 Asia Times Online (Holdings) Ltd. All rights reserved. Please contact us about sales, syndication and republishing.)

When employment hit an air pocket in December, most analysts brushed off the dreadful jobs number as an anomaly, or a function of the weather. They chose to believe Ben Bernanke rather than their lying eyes. It’s hard to ignore a second signal that the U.S. economy is dead in the water, though: on Monday the Institute for Supply Management reported the steepest drop in manufacturing orders since December 1980:

FRED Graph

In January, only 51% of manufacturers reported a rise in new orders, vs. 64% in December. Not only did the U.S. economy stop hiring in December, with just 74,000 workers added to payrolls; it stopped ordering new equipment. The drop in orders is something that only has occurred during recessions (denoted by the shaded blue portions of the chart). The Commerce Department earlier reported a sharp drop in December orders for durable goods. In current dollars, durable goods orders are unchanged from a year ago, which is to say they are lower after inflation.

FRED Graph

This should be no surprise in retrospect, given two disastrous underlying trends. One is the decline of real median household income:

Graph of Real Median Household Income in the United States

The other is the collapse of the labor force participation rate, which is the flip side of the coin: if fewer adults are working, median household income will be lower.

Graph of Civilian Labor Force Participation Rate - Bachelor's Degree and Higher, 25 years and over

It’s even worse than it looks, because Americans who have jobs are working fewer hours.

FRED Graph

Average hours worked are down 1% from pre-recession levels. That doesn’t seem like a lot, but it’s the equivalent of 1.4 million jobs in a labor force of 140 million. The U.S. has restored 2.5 million jobs since the financial crash, but adjusted for hours worked, it’s the equivalent of just 1.1 million jobs.

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Danske Bank last week cut off banking business with Israel’s Bank Hapoalim on “legal and ethical grounds.”

What are Danske Bank’s ethics?

According to Wikileaks cables, Danske Bank helped finance Tanchon, a North Korean trading company that sold ballistic missiles to Iran:

Tanchon has been involved in financing ballistic missile sales from KOMID to Iran’s Shahid Hemmat Industrial Group (SHIG). SHIG is the Iranian organization charged with developing Iran’s liquid- fueled ballistic missile program and is designated under UNSCR 1737 for an asset freeze.

The same State Department cable adds:

We previously raised with you in March 2006 our concern (REF L) that Tanchon Commercial Bank maintained a correspondent account with Den Danske Bank AS- Copenhagen. According to April 2009 Bankers Almanac information, Tanchon still maintains that account.

The cable, dated May 12, 2009, has the ID 09STATE48525_a.

Danske Bank claimed to have stopped doing so business with Iran in 2010, which is an acknowledgement that it was doing so previously. It did not state that it was doing so on “legal and ethical grounds.”

soviet_guitar_big_1-29-14-1

I first heard Pete Seeger perform when I was five or six, when I was a red-diaper baby and he was blacklisted and drunk. What I recall most about the encounter was that the tip of his needle-nose glowed bright red. He was performing for a children’s group of some sort at a time when his Communist background kept him out of public venues. His records — not just the Weavers albums, but the early Asch 78′s of the Almanac Singers — were daily fare in my home, along with Woody Guthrie’s children’s songs. My parents knew Guthrie casually; my father once organized a concert for him at Brooklyn College, and my mother was Arlo Guthrie’s nursery-school teacher.

I was not just a Pete Seeger fan, but a to-the-hammer-born, born-and-bred cradle fan of Pete Seeger. With those credentials, permit me to take note of his passing with the observation that he was a fraud, a phony, a poseur, an imposter. The notion of folk music he espoused was a put-on from beginning to end.

There is no such thing as an American “folk.” We are a people summoned to these shores by an idea, not common ties of blood and culture. There is folk music in America where pockets of ethnicity resisted assimilation: African-American blues, for example, or the English songs frozen in amber in white Appalachia. That is why the best American popular music always came from black sources, performed either by black musicians or white emulators from George Gershwin on down.

Seeger’s (and Guthrie’s) notion of folk music had less to do with actual American sources than with a Communist-inspired Yankee version of Proletkult. The highly personalized style of a Robert Johnson and other Delta bluesmen didn’t belong in the organizing handbook of the “folk” exponents who grew up in the Communist Party’s failed efforts to control the trade union movement of the 1940s. The music of the American people grew out of their churches. Their instrument was the piano, not the guitar, and their style was harmonized singing of religious texts rather than the nasal wailing that Guthrie made famous. Seeger, the son of an academic musicologist and a classical violinist, was no mountain primitive, but a slick commercializer of “folk” themes with a nasty political agenda. His capacity to apologize for the brutalities of Communist regimes — including their repression of their own “folksingers” — remained undiminished with age, as David Graham reported in the Atlantic.

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