Here are two stories that I read in the international press recently.
The body of a 20-year-old Iraqi girl turned up recently in a small Sunni town south of Tikrit. Her own family had killed her.
She had been having an affair with her cousin, but that was not the problem: cousins often marry in this part of the world. But they had decided to have sex and he had persuaded her to let him film this "just for us".
Of course, he could not resist showing the tape to his friends, to boast.
The pictures started to circulate in this small town and her family found out the couple had been sleeping together.
Honour demanded that they murder her - not him, naturally.
The US army officer telling me this story said his soldiers had wanted to find the boy involved and give him a good beating.
The officer, too, was furious, but also resigned to the situation. After more than a year here, he knew only too well that Salahaddin province was never going to be Kansas.
Paul Wood BBC News
Afghanistan's appeal court sentenced an Afghan journalist to 20 years in jail, commuting an earlier death sentence, for distributing an Internet article that said the Prophet Mohammad had ignored the rights of women.
Perwiz Kambakhsh, 23, a reporter with the Jahan-e Now daily, was sentenced to death in January by a court in the northern city of Mazar-i-Sharif.
The arrest and sentencing of Kambakhsh, also a university student, drew criticism from a number of Western nations, the Afghan media and rights groups. Kambakhsh downloaded an Iranian article from the Internet and distributed it to friends.
Samar Zwak, Reuters
I refer to these stories not to make some statement about the superiority of one culture over another but rather because they emanate from two countries in which considerable British resources are committed to building a better society. The main thrust of Western foreign policy is to promote democracy and individual freedom and even those who oppose intervention in Afghanistan or Iraq generally support the extension of Western ideas of liberty and governance to these countries. Yet these two stories beg the question, where do we draw the line? If we believe in fighting for democracy should we not also fight for women’s’ rights and the right to free speech? Alternatively if we should not impose Western cultural beliefs then why should we fight for anything, why not leave foreign cultures to their own devices? What is the point in fighting for a Government that will imprison a man for raising questions about women’s rights?
Most of the world’s cultures and societies developed over the course of 10,000 years in complete isolation from each other and it is inevitable that different societies will have different interpretations of what is wrong and right. That is not to say that humans are any different at a biological level or that there are any differences in intelligence, general behaviour or urges. However people are inevitably influenced by the dominant memes of their own culture. If Albert Einstein had been born to a Yammamo tribe he would have been just as intelligent but he would not have produced the General Theory of Relativity. Likewise if Iain Paisley had been to a Catholic family in Belfast then he would most probably be a Roman Catholic priest and an ardent Irish nationalist. Of course not everyone conforms to their society’s inherent cultural memes but the process of altering dominant cultural beliefs is generally slow and gradual. The process of change can only come from within and it is difficult to enforce from the outside. There are some interesting historical examples of attempts at rapid cultural change, for example the attempted reforms of Turkish society by Kemal Attaturk, the British attempts to stop the practice of suttee in India and the recent mass conversions of low-caste Indians to Christianity.
The BBC report alluded to the fact that the Americans have re-evaluated their idea of what they are trying to achieve in Iraq. The Americans hope to be able to contain the insurgency to the extent that the Iraqi Army can take over responsibility for protecting a reasonably stable Iraq. A relatively transparent and democratic Iraqi Government presiding over a stable Iraq would now represent Mission Accomplished. I don’t believe the West has truly worked out what it wants to achieve in Afghanistan; again the goal of a democratic Government and a contained insurgency is difficult but, perhaps attainable. Western intervention in Afghanistan has helped to improve life for many Afghans, but it is debatable whether the often miserable lives of girls in the isolated villages of rural Afghanistan will ever change.
The establishment of democracy in Afghanistan and Iraq remain achievements, whether democracy should be imposed ‘by force’ is a difficult question to answer but it is clear that there are Americans, Brits, Iraqis and Afghans believe democracy is worth dying for. It is difficult to erase ingrained cultural norms, although MacArthur had some success in post-war Japan and perhaps democracy provides breathing space for cultural change to take place. Personally I believe there are certain unalienable rights which are available to very few across the world, how these rights should be spread is difficult to answer.
I’ve never really written about domestic politics because, frankly, it doesn’t really interest me. Cabinet re-shuffles, party conferences, scandals, who said what to whom, I just couldn’t care less. Politics for me should be about ideas and principles but too often it descends into mud-slinging and defending the indefensible for the sake of the party. Partly this is because the three major British parties coalesced around the same small piece of ground after the self-destruction of old Labour in 1992. Tony Blair became a master at winning elections but he did not attempt change the status quo, for the quite sensible reason that it would have made him unelectable. I’m not sure what historians will make of Blair, he presided over a time of great prosperity and investment in public services but it is unclear what he personally did to change British society. Under Blair’s tenure Labour did not offer anything radical or alternative, rather they portrayed themselves as the most efficient managers of public services and the economy. Outmanoeuvred and outgunned by a centrist Government the Tories lurched towards the abyss of xenophobia and Eurosceptism. Interestingly the one area where Blair had the courage to stick to his principles was in foreign policy and it is there that his legacy may be made or broken depending on the judgement of history.
The lack of a credible opposition was all fine and dandy when we enjoyed a booming economy and global stability but we now live in a time of great challenges and threats. We need a political party that can provide new ideas to tackle Global Warming, terrorism, nuclear proliferation, failed states, global disease and poverty, the economy, energy security and a multitude of other issues. And it is as we debate these important issues that, for the first time since 1992, the Tories have turned away from ugly populism and appear to be an electable proposition. The recent resurgence of the Tories has more to do with the popular image Brown as an incompetent manager rather than any great philosophical pronouncements by Dvid Cameron; yet the enormity of the global challenges faced by our Government have allowed each party to land blows on the other and we are now starting to see some clear policy emerging between right and left.
First of all one has to feel a little sympathetic for the Tories following Brown's sudden emergence into the global limelight with his banking recapitalisation plan. Never mind the fact that fiscal decisions made by Brown were party responsible for the problem or that Alistair Darling was reported to have worked out many of the details of the plan; I clearly remember the Tories talking about recapitalising the banks at least a week or two before Brown unveiled his grand scheme. At least both sides agreed to put aside their differences until the banking crisis was over but now it has subsided we have seen the first jabs and punches from two parties gearing up for a 2009 election.
The big question is will either party unveil a grand new idea or will they again rely on simple tricks and cheap spin? The first swipe in the debate came from Brown, and it was not so much a giant haymaker with a clunking fist but rather a predatory jab leaving him open to an easy counter-attack. Fresh from his success on the global stage Brown wasted no time in stating that Labour intended to spend its way out of a recession through major investment projects. It soon emerged, however, that all these projects had already been planned long ago and most of the money was earmarked for the building of two new aircraft carriers and the new Trident nuclear weapons programme, which are of dubious use to the country. I do believe that pre-planned Government projects in infrastructure, health, education, housing and energy security should be maintained and even brought forward, that is the role of the Government after all, but Brown’s announcement appears to be less a grand new vision, more a recycled trick. For a start much of the growth in the Blair-Brown years was fuelled by current account debt and cheap credit, now that bubble has burst Brown appears to want to try the same trick using the Government’s credit card and the taxpayers’ overdraft, with a blind eye turned to the consequences. Keynes recommended saving during the boom years so the Government could spend safely during the downturn, if it so chose. Brown wasn’t able to do that and all that public spending may have to come through higher taxes or a reduction in public spending in the future to pay off the now massive public debt. And although capital investment can help to lessen a downturn and revitalise the construction industry, it’s a very blunt instrument for helping the complex modern economy. For instance imagine a girl in Nottingham looses her call centre job, is she expected to move to Barrow and work as a welder on a nuclear submarine? Furthermore European and American Governments have been borrowing at record levels without being able to stave off a recession. The Iraq War may not seem like a Keynesian scheme, but when you think about it the American Government has poured hundreds of billions of dollars into the manufacturing and armaments industries over seven years with little effect on macro-economic growth.
So for the first time in a fortnight the Tories were able to stop biting their tongues and start outlining their own ideas. So far, so insipid. Cameron rightly raised the spectre of higher taxes, inflation and sluggish growth as a result of increased Government debt but he also seemed unsure about what he would do with public spending now tax revenues from the financial sector have gone into hibernation. His major axis of attack seemed to be a VAT holiday for small businesses, and while this may be desirable given the current lack of liquidity, it is hardly likely to kick-start the economy before a natural recovery takes place.
What neither party has done yet is to convincinlgy address the future challenges facing the British economy. It remains to be seen whether New Labour or the Tories can suggest a solution to Britain’s current account deficit or implement a plan to diversify the economy and reduce its reliance on financial services and consumer spending in a competitive, free market world. So far we haven’t seen a new Thatcher or a new Atlee emerging into the spotlight, perhaps this should not be surprising, the situation does not yet demand such a figure and for the last 16 years free markets and public spending have taken care of everything allowing the political parties to use focus groups and cheap tricks to win elections. Focus group politics may have sustained New Labour but with economic challenges, failed states, energy security, public spending, terrorism, immigration, public services, nuclear proliferation and global warming and other issues now on the horizon, cheap tricks and tired clichés may sill get a party into power but they will quickly outlive their usefulness once the Prime Minister opens his in-tray.
There have been very few wars in human history that were clearly morally justifiable; NATO’s 2001 intervention in Afghanistan was undoubtedly one of them. In the 1990s America had watched as the Taliban supported Al Qaeda and allowed it to use Afghanistan as a base from which to train, equip and support terrorist operations against American citizens. These operations included the African embassy bombings, the 1999 plots in Jordan and America, the bombing of the USS Cole and 9/11. Over the course of five years America had restricted its response to the bombardment of a few terrorist training camps. Several operations to capture or kill bin Laden were cancelled due to doubts over the legality of such actions. So in 2001, after the attacks on its own mainland, the political leadership of America had no choice but to take action; it could not continue to allow Afghanistan to be used as an operating base from which to attack the country. America and NATO had to intervene to destroy a terrorist organisation and its political backers in order to prevent further attacks on innocent civilians. Once this aim had been achieved America could not abandon the country to poverty and civil war as it had done in 1989, it had to help to build a relatively stable and democratic state.
Nothing that has happened over the last seven years has acted to change my mind about this, but having watched several programmes about British troops in Afghanistan I have started to wonder what we are achieving in Afghanistan and whether a change in tactics, if not strategy, is needed. The above video shows the type of engagements faced by British soldiers, these battles may kill a lot of Taliban but they also take their toll on British troops and alienate locals without achieving any strategic success. With British forces enduring some of the heaviest combat seen since WWII it is tempting to ask what can be done to prevent Operation Enduring Freedom from descending into Operation Enduring Stalemate.
The mistakes in Afghanistan were made from day one. President Bush showed initial unease in sacrificing US blood in a foreign country and relied on Special Forces and the Mujahideen to depose the Taliban. But while this may have been an appropriate tactic for overthrowing the Taliban; Bush, under the influence of the woeful Rumsfeld, failed to deploy enough combat troops to destroy the Al Qaeda leadership. In December 2001 as bin Laden and his fighters were trapped in Tora Bora under a terrible aerial bombardment, CIA agent Gary Berntsen could hear the Al Qaeda leader apologising to his followers on the radio for bringing such destruction upon them. Special Forces were perhaps 20 minutes away from capturing bin Laden when he was able to bribe a Northern Alliance leader and escape over the border to Pakistan. Berntsen has testified that with adequate forces the US could have captured bin Laden at Tora Bora in 2001. Western efforts never fully recovered from that early missed opportunity and a lack of manpower and resources allowed Mullah Omar and Ayman al Zawahirri to escape and hampered the prosecution of Operation Anaconda which aimed to destroy the remnants of Al Qaeda in Afghanistan.
By 2002, of course, Bush had his sights firmly set on Iraq. A democratic Government was elected in Afghanistan and re-development (or more accurately ‘development’) programmes began for the first time in 30 years. But alas the years 2002-2006 represented a great opportunity lost. The enormous resources poured into Iraq could have been spent in Afghanistan while the country enjoyed some small measure of security and stability. The NATO mission in the south of Afghanistan could have been implemented in 2002 instead of 2006, meaning that Nato forces would likely have had a four year cushion of relative peace in which to implement their reconstruction projects. Instead by the time the West turned its attention from Iraq back to Afghanistan the Taliban had had time to re-group and re-arm and Afghanistan was still light years from being able to guarantee its own security.
Life has improved for most Afghans since the fall of the Taliban in 2001. Since then there has been a 25% decline in infant mortality, the number of rural health clinics has tripled, mass-vaccination schemes have been established, 5 million refugees have returned to the country, the economy has grown markedly, 4.2 million children (including 1.9 million girls) have been enrolled in primary schools, a democratic Government has been established and about $15 billion of international aid has been invested in the country. On the downside the country is still one of the worst performing states in virtually all measures. Afghanistan is still dirt poor with at least 40% unemployment, 49% of men and 86% of women are wholly illiterate, the economy is dominated by narcotics, the Government is one of the most corrupt in the world, the police and army barely function, infrastructure is outdated or non existent and parasitic diseases and malnutrition are endemic. Most damagingly of all the Taliban has returned with a vengeance, placing a severe strain on the Nato alliance and asserting de-facto control in many parts of the south
As the situation in Iraq has slowly improved, security in Afghanistan has steadily spiralled out of control. The Taliban has mounted a fierce insurgency campaign aimed at bleeding coalition forces dry. This has included sophisticated IED attacks learnt in Iraq as well as large scale ambushes, on one occasion the Taliban were able to overrun a US base and execute the soldiers they captured inside. Just last week the Taliban tried to overrun the British base in Lashkar Ghar but coalition airpower decimated the group before they could start the attack and at least 100 Taliban fighters were believed to have died. Indeed the Taliban are often given a hiding in large scale confrontations but body counts invariably count for nothing in an insurgency campaign. There is an almost unlimited supply of recruits to the Taliban cause in the Madrassas of the Pakistani tribal belt to replace those already martyred and in any case the sheer intensity of the fighting means that the British are in danger of alienating the very Afghan civilians they are there to help.
In 2006 John Reid infamously declared that he hoped that the British Army would be able to leave Helmand without having fired a shot; yet just one battalion of the Royal Anglians fired over one million rounds of ammunition and lost 9 dead and 135 wounded in its recent 6 month tour. Reid has been misquoted in the press, his point was that Britain was in Afghanistan to rebuild the country, not to fight a war; yet the question remains, if our troops are spending all their time locked in brutal combat with the Taliban how are they supposed to achieve their objective of rebuilding the country?
For the coalition in Afghanistan the cavalry has arrived in the form of General David Petraeus. The feted general has recently taken up his post as commander of CENTCOM with overall responsibility for the wars in Afghanistan and Iraq. Petraeus has wasted no time in setting up an Afghan brains trust in order to review US strategy. Briefing reporters the general stated "The effort in Afghanistan is going to be the longest campaign of the long war. The biggest lesson of counterinsurgency is that every situation is unique. You have to be very careful to have that nuanced understanding . . . of the circumstances on the ground," What is clear is that Petraeus will call for an Iraq style ‘surge’ to target the leadership of the Taliban and indeed both McCain and Obama have committed extra troops to Afghanistan should they be elected. However Petraeus will be well aware that no insurgent group has been defeated by military means alone, and the Taliban are no exception to this trend. Indeed it appears that one major thrust of Petraeus’ new strategy may be an attempt to reconcile more moderate members of the Taliban to the cause of the Afghan Government. "In Afghanistan, or in any country where society is dominated by tribes, reconciliation really needs to be a focus," Petraeus said, "I do think you have to talk to enemies. Clearly you want to try to reconcile with as many as possible. . . . The key there is making sure all of that is done in complete coordination and with the complete support of the Afghan government and President [Hamid] Karzai."
Now I happen to believe that talking to the Taliban is desirable, indeed the British have already done it to some effect in Helmand. In essence the problem is that the warfare in Afghanistan and Iraq is caused by a difference in perceptions between East and West. In Iraq nationalists fought US forces because they initially thought that the US was acting as imperialist power. In 2007, however, they began to realise that the US was actually trying to setup a free democratic state and transferred their loyalty to US forces with beneficial effects for Iraq. I have seen interviews with captured Taliban fighters in Afghanistan and several things struck me. Firstly they are generally products of the Pakistani Madrassa systemn, they are also usually extremely young, extremely unworldly and effectively brainwashed by a Wahhabi interpretation of Islam. They want to die as martyrs by killing coalition troops simply because they are infidels or non-believers. Geo-politics does not come into their rationale, they simply want to kill foreign troops because they are non-Muslims in a Muslim land. What these young Taliban are simply incapable of comprehending is that these foreign troops are actually in Afghanistan to rebuild the country and that religion is not something that plays a significant role in their worldview. Essentially we are seeing two worlds collide with the insane result that the situation in Afghanistan amounts to the Taliban trying to kill coalition troops and coalition troops trying to kill the Taliban. Effectively we are at stalemate, both intellectually and militarily.
The question is can moderate elements of the Taliban be persuaded to work with the national Government and coalition forces as happened with Sunni nationalists in Iraq? There are certainly elements within the Taliban that will not be turned; for we should not forget that the Taliban murders teachers and students, prominent females, Government workers, foreign aid workers and those that do not follow their particular interpretation of Islam. However there are certainly members of the Taliban who could be persuaded to accept a foreign presence in a Muslim country and give up their violent struggle. Indeed the Taliban recently held talks with Saudi Royals, claiming that they had split from Al Qaeda and they wished to discuss reconciliation in Afghanistan. It remains to be seen whether these claims can be taken at face value, but certainly the represent an encouraging step. The Pakistani Taliban were also reported to have requested unconditional talks with the Pakistani Government and it is possible the pressure of military operations in Afghanistan and Pakistan is taking its toll on the group. Certainly the coalition and its allies must attempt to capitalise on this development. The Taliban are currently banned from politics in Afghanistan, however if some members are persuaded to drop their violent views than there may be little to differentiate them from legitimate, if repulsive, organisations such as the Muslim Brotherhood. I would not see this as a betrayal of the war’s aims rather it is simply one of the features of democracy that repulsive parties can come to power. However the majority of Afghans and their Government hate the Taliban and may never allow the Taliban to return to politics, President Karzai is reluctant to even talk to members of the Taliban. It is also unclear what Pakistan’s role would be in shaping Afghanistan's future. The ISI, Pakistan’s fearsome secret intelligence organisation, is known to have extensive links with the Taliban. British troops have discovered the bodies of ISI officers in Taliban compounds and the ISI is widely believed to have been behind the recent bombing of the Indian embassy in Kabul. Western political leaders will need to encourage Pakistan to increase the pressure on the Taliban and make sure that it is fully committed to rebuilding the country. This is, of course, easier said than done.
Afghanistan is one of the poorest countries in the world, it may always be so, yet I believe the coalition can achieve its aim of establishing a democratic and reasonable secure Afghan state. To my mind there are five crucial steps that need to be taken to achieve this. Firstly more international troops are needed in Afghanistan and military pressure must be increased on the leadership of the Taliban, this may include cross-border raids on targets inside Pakistani territory. Secondly the West must talk to moderate elements within the Taliban and pursuade them to lay down their arms and commit to reconciliation. Thirdly the coalition must ensure that reconstruction efforts are increased; they must also show much more initiative and resourcefulness in order to improve the lives of ordinary Afghans. Fourthly the Taliban must be cut off from the lucrative narcotics industry, it is possible that this could be done by buying opium from direct Afghan farmers at above market rates after which it could be destroyed or even used in the pharmecutical industry. This may well eleminate a large proportion of the Taliban's funding. Fifthly, and perhaps most difficult of all, the West must deal with Pakistan. The Pakistani Army has launched several offensives against the Taliban but at the same time the Pakistani state has supported, armed and even led the Taliban in Afghanistan. The West must remove the kid gloves when it deals with Pakistan and ensure that it ends its support for Taliban militants. If it does not then Pakistan, like Afghanistan, may succumb to a brutal low-level civil war; the Taliban, after all, commits atrocities in Pakistan as well. Whether the West breaks the deadlock remains to be seen. One thing that is clear is that the status quo cannot continue indefinitely, it is costing too much blood on all sides.
Edward Bernays, the nephew of Sigmund Freud, invented the profession of Public Relations in the 1920s and was listed as one of the most influential Americans of the 20th century by Life magazine. Like his uncle he believed that human beings did not act rationally and were instead subject to ancient emotions from our evolutionary past, such as lust, fear, anger and so forth.
Whether or not this is true, Edward Bernays is one of the fathers of consumerism and he learned how to sell a product, not on the basis of its practical use, but rather by pitching it towards our unconscious urges. Bernays' idea of promoting consumption based on desire rather than need has dominated Western society since the 1920s but he is responsible for some of the more cynical acts by political leaders in recent times. It is one thing to use sex to sell a car but Bernays taught American politicians to use peoples’ fear of the ‘Red Menace’ to manipulate public opinion during the Cold War, he called it ‘Engineering Consent’. More recently politicians sold the Iraq War on the scaremongering basis of WMDs and ’45 minute warnings’ rather than having a serious and genuine debate about regime change and the desirability of spreading democracy by force. With issues such as 42 days and the Iranian nuclear programme looming on the horizon it is hoped that both sides make their case without resorting to scaremongering, sleight of hand and innuendo.
It may not be self-evident but the turbulence we see in today’s stock markets is actually the price of progress and the peace dividend of the 1990s. In a sense Francis Fukayama was right to suggest that democratic capitalism represented the highest form of economic and political development. By 1989 the miracle growth seen in Europe, America and East Asia after 1945 was as clear to see as the economic and intellectual bankruptcy of the Soviet Empire. Hence when the Berlin Wall fell virtually every country, apart from the likes of Cuba and North Korea, adopted free market economics. As a result the last 20 years has seen the biggest rate of global economic growth in human history with literally hundreds of millions of people across the world pulled out of poverty.
This huge growth in global wealth meant that very suddenly there was a lot of money looking for a home. Arab oil states had so much money that even they couldn’t squander it all and Chinese workers began to deposit increasing amounts of money as their wages steadily increased. Arab and Asian states began to invest this money by lending it to Western Governments and banking institutions. As a result Western banks were suddenly able to lend to consumers like there was no tomorrow; loans to businesses and householders led to a consumer binge and inflated property prices. In short a dangerous bubble began to develop, but like all bubbles it seemed to many that it could expand forever. American and British consumers in particular began to rack up huge debit balances which were gambled against and infinite rise in property prices. It is also clear that the fiscal decisions by central banks and Governments acted to exacerbate the problem. Cheap Chinese goods helped to lessen the danger of inflation, for a short time at least, and traumatic events such as 9/11 and the dot com crash threatened to plunge the West into a recession. As a result interest rates were kept far too low for far too long and the West’s credit binge was allowed to expand indefinitely.
As happened in the 1920s, when consumerism really started to become established, the stock market became, to paraphrase Alan Greenspan, ‘irrationally exuberant’. Capitalism is not a utopian, perfect system, to be sure there can never be such a thing and the bubble had to burst. Such is the way of things.
As far as I can tell the state-backed mortgage lenders, Fannie Mae and Freddie Mac, used the massive increase in liquidity and subsequent property boom to lend to poor but aspirational Americans. Extending home ownership to the poor is a noble idea but Fannie and Freddie began to lend to people who patently could not afford to repay these loans. These toxic sub prime mortgages then began to contaminate the financial markets. As far as I can tell these debts became packaged up with derivatives and products sold by speculators in order to increase profits. These toxic debts should not have even been touched by supposedly responsible institutions and it was these greedy and irresponsible speculators who were mainly responsible for contaminating the market with Fannie and Freddies bad loans. Once banks began to realise that these toxic debts had contaminated the money markets, fear took hold and banks stopped lending to each other. Companies such as Northern Rock, which had expanded too quickly, could not raise capital to cover their liabilities became exposed and investors lost confidence. More recently we have seen institutions such as Lehman Bros again caught out when the liquidity demanded by their risky business models suddenly dried up.
It is impossible to tell what will happen to the banks over the coming weeks. It is clear that this is a global crisis which has affected the various strains of capitalism in America, Britain and Europe as well as the petro-markets of Russia and the Middle East. A temporary downturn in Europe and America was always on the cards as the housing boom began to subside and consumer demand dropped off. What is inevitable is that the real economy will begin to recover from its downturn, perhaps as early as late 2009. Capitalism has provided unprecedented economic growth for over two centuries and one should look at growth patterns over decades rather than months or years. What kind of banking system emerges from the turmoil remains to be seen although it is highly likely that banks and investors will follow much more cautious business models, which will inevitably result in slower economic growth. Financial services represent the engine room of the British Economy and are responsible for at least 10% of GDP; it is important that the industry recovers and continues to act as a world leader. If things go very well that the public may make a profit out of the bail-out plan; previous bail-outs such as the Swedish banking rescue plan and the US bail-out of Mexico and several private institutions in the 80s and 90s resulted in a profit for taxpayers and a quick sell-off. No-one can guess what precisely will happen next but there may well be big shocks to come, including potentia de-facto nationalisations of some of the big banks may be nationalised. This is not desirable but the only thing worse would be the break-up of one of our leading banks. Economist Thomas L Friedman put it succinctly when he said “This workout promises to be painful, complicated and protracted. Government will have to do its part. But it must regulate the excesses without smothering the underlying innovative, entrepreneurial and risk-taking attributes of our economy, which are what will ultimately bail us out — as they always have.”
For those with money to invest the crisis may also represent an opportunity, provided they can stomach the risk and look beyond time horizons of 6 months. Just as greed burst the bubble in the late noughties, irrational fear has now prolonged the current crisis. I consider it unlikely that the world will see a depression; on a purely anecdotal note the bars and cafes of London were packed to bursting when I visited the city this weekend. I simply cannot see the British economy succumbing to a depression rather than a recession. As a result of the panic gripping the markets however, shares can now be bought at rock bottom prices. Stock market supremo Warren Buffett has just invested a cool $8 billion in Goldman Sachs and General Electric.
“I have no idea what the stock market is going to do next month or six months from now,” Buffett told CNBC on Friday. “I do know that the American economy, over a period of time, will do very well, and people who own a piece of it will do well.”
You could do worse than to take advise from Warren Buffett, just be sure to sell-up before the next bubble bursts.
When George Orwell wrote about poverty in the 1930s he described the ordeal of scrambling for coal and difficulties for workers trying to saving up enough money to feed their families. Poverty in Orwell’s day, as it was for all human history up to 1945, meant being hungry. Today thanks to industrialisation and the Welfare State you can work in an unskilled job your whole life and, although you will be considered poor, you will still have enough money to buy some of modern life’s little luxuries. You don’t necessarily need to be a top wage earner to live a better quality of life than that of a medieval king, it is estimated that a salary of £13,000 is needed to enjoy a ‘decent’ standard of living in the UK.
Now I don’t mean to dismiss the existence of financial poverty in the UK, undoubtedly for a vulnerable minority, tight budgets and rising energy prices are sources of anxiety. Yet what is evident is that the twentieth century has been the first in human history when ordinary people have moved from a subsistence existence to having disposable incomes and leisure time to spend as they like.
But there is a new form of poverty that plagues British society; it is not financial poverty but rather a poverty of culture. And who is the man crusading against this poverty? It isn’t Brown or Cameron or a latter day Orwell but rather Jamie Oliver of TV show/advert/cookbook/numerous spin-offs fame. It is easy to mock Oliver and his mockney ways but he is an honest and enthusiastic man with a clear altruistic streak. He may not be George Orwell but he is extremely articulate when he talks about food and his love and enthusiasm for sharing his culinary knowledge is infectious. Now Jamie could have confined himself to vacuous, egocentric TV shows a la Gordon Ramsay, but instead he has used his fame to help improve the lives of disadvantaged teenagers and to expose the shocking standard of catering in our schools. Jamie has now pushed his crusade into Rotherham, which is the epitome of the northern industrial town, I know because I live in one. In the first episode of ‘Jamie’s Ministry of Food’ we saw people that had never cooked a fresh meal for their kids, people who did not know what water looked like when it boiled, people who owned six-burner cookers but didn’t know how to turn them on, a woman who ate ten packets of crisps a day and families sitting on the floor eating chips, cheese and doner meat out of a polystyrene box, with their hands. These people whether in work or on benefits had decent houses, widescreen TVs, satellites, playstations and enough money for cigarettes, tattoos, beer, sweets and other luxuries. No they were not financially well-off compared to many Brits but you do not necessarily need to have lots of money to be rich.
Jamie Oliver hit the nail on the head when he commented on the fact that this situation was “true in London and in the big cities of the north. It is connected to the new poverty. England is one of the richest countries in the world. The people I'm talking about have enormous televisions - a lot bigger than my own - the latest in mobile phones, cars and they go and get drunk in pubs at the weekend. Their poverty shows in the way they feed themselves".
People may feel that it is snobbish to sneer at these poor people and their predilection for kebabs. But since when has it been snobbish to care? Whatever Jamie Oliver is he is clearly no snob. He didn’t have to go to Rotherham, he is a multi-millionaire with a beautiful family, he doesn’t need to show people how to boil water or turn on a gas hob. The point is that he clearly cares about these people and he wants to help them to live better. With heart disease one of Britain’s biggest killers and obesity rates soaring out of control he is simply trying to improve our society. Oliver taught a few simple skills to a mum who lived the despondent lifestyle of someone caught in the trap of dependency on welfare benefits; the subsequent improvement in her confidence and self-esteem was obvious.
Of course some populist local politicians have attacked Oliver’s crusade, one councillor said “The people he put on television were pretty down-market and he gave the impression that everyone here is living like that” The fact is that many people do indeed live like that and it should be the job of local politicians not Jamie Oliver to help people improve their lives. Policy-makers used to think that people who lived on low-incomes had bad diets because they lived in ‘food deserts’, housing estates where it was impossible to find healthy foods at a reasonable cost, if at all. Recent research has shown, however, that healthy foods can be bought almost as easily in poor areas as in affluent districts. Indeed healthy food is considerably cheaper than takeaway food not to mention alcohol and cigarettes. Colin Waine, chairman of the National Obesity Forum, said “I hope Jamie Oliver’s programme convinces people that you can make healthy choices without breaking the budget”. Indeed in an age when we have access to fresh produce from across the world at relatively cheap prices it shouldn’t be beyond the wit of politicians to help people improve their diets.
Jamie Oliver is not going to change Britain’s culture of unhealthy diets and heavy drinking overnight but at least he’s trying to do something, and that’s more than anyone else is doing at the moment.
Iraq today stands at a crossroads. People may argue about decisions taken in 2003, or earlier, but such arguments will not help the Iraqi people or shed light on Iraq’s future. What’s done is done. The question I am interested in is where does Iraq stand today and what do the future hold from the country?
The nightmarish violence of previous has abated but Iraq remains an exceptionally violent country. Yesterday the US Defence Department reported that Iraq remained locked into a communal struggle for power and resources. Indeed 572 Iraqi civilians were killed in September, 3% of these deaths were attributable to US forces, while the rest of the deaths were the result of Iraqi on Iraqi violence. In provinces handed over to Iraqi security forces low-level violence has continued between Sunni and Shia, Sunni and Sunni, as well as Shia and Shia. Although civillian deaths have been reduced by 50% since last year it is clear that Iraq remains a nation divided along religious and as militia lines.
Although the Iraq remains violent the civilian death rate has steadily declined since last year and Baghdad is now a largely peaceful city. The large suicide bombs and slaughter of Sunnis by the Mahdi Army has stopped almost completely. The violence now largely consists of shootings and roadside bombs aimed at Iraqi Army patrols. The surge has been hailed for its success in reducing the violence and undoubtedly General Petraeus’ tactics enabled US forces to take on the militants and work with ordinary Iraqis. Yet the two most critical factors were the establishment of Sunni Awakening Councils and the wholesale defeat of the Mahdi Army by the Iraqi Army. Furthermore the insane level of violence seen 2007 simply could not continue forever and was always going abate once Iraqis realised they were dragging themselves into the abyss.
Whatever the reason the containment of the insurgency gave Iraqi politicians breathing space to bury their differences and promote national reconciliation. US military leaders have consistently stressed that the security situation is fragile and reversible. Yet while the violence has been contained the US has been able to start the long term drawdown of its troops and transfer responsibility for security to Iraq. The Iraqi Government has grown markedly in stature and in recent weeks it has negotiated as an equal with the US over troop deployments, it has negotiated the first foreign oil deal since Saddam and signed a deal with foreign investors to rebuild its water supply infrastructure. In short Iraq stands ready to take its future into its own hands and while there is reason to be optimistic, the country still faces enormous challenges.
Today was the day that responsibility for the salaries for the Sunni Sons of Iraq was transferred from the beleaguered American taxpayer to the Iraqi National Government. If the Sons of Iraq cannot be integrated back into Iraqi society then frankly Iraq does not have a future. There 100,000 members of the Sons of Iraq and an estimated 95% of them had links to Al Qaeda in Iraq. The Shia led Government has proved to be suspicious about this assortment of ex-Ba’athists and insurgents and it is steadfastly refusing to integrated the militia into the Iraqi Army. The Iraqi Government has a $79 billion budget surplus and it could pay the wages of the Sons of Iraq many times over without making a dent in its coffers. Its reluctance to extend the hand of forgiveness to the Sunnis could be fatal for Iraq’s future and the Shia must bite the bullet for the sake of their country. Otherwise Iraq could slip inexorably back to civil war.
The Pentagon states that Iranian influence in the form of funding, training and arms supplies to Shia militias represents “the most significant long-term threat to stability in Iraq”. In the spring of this year Iraqi and US troops virtually destroyed the Mahdi Army as a fighting force and evicted it from Sadr City, Basra and Maysan Province. Meanwhile the increasingly self-assured Nouri al-Maliki out-manoeuvred the group’s political wing and al-Sadr himself was forced to flee to Iran. If the security situation in Iraq deteriorates, however, the firebrand cleric remains poised to re-impose his policies of ethnic cleansing and hard line Islamism.
Al Qaeda in Iraq the group that has murdered thousands of Iraqi civilians suffered a decisive defeat during 2007. Its insane policy of hard-line Islamism was emphatically rejected by Iraqi Sunnis and the group’s main area of operations now restricted to Mosul and the wild Diayala Province. The group retains the it’s deadly potential however, indeed it has used 15 teenage girls as suicide bombers with lethal effect this year alone. Al Qaeda has been defeated and although the group will never gain the power it had in 2006, no army in the world can stop a hard core of fanatics from fighting on. Iraq, like the rest of the world, will suffer suicide bombings for many years to come.
Provided the Shia-led Government swallows its pride and integrates the Sons of Iraq into its army then I do not believe the country will return to the madness of 2006. The most likely scenario is that a low level Columbian or Algerian style insurgency will continue for several more years to come at least. In recent months the Iraqi Army has grown in strength and proficiency and should be able to contain a low level efficiency with minimal foreign help. It has already routed the Mahdi Army and taken on responsibility for the once hopeless Anbar province. The recent slaughter of 35 Iraqi soldiers in an Al Qaeda ambush shows that it still has a lot to learn, however.
But let’s suppose that the insurgency is contained, what other challenges does Iraq face? The Pentagon states that “Security incidents are now at the lowest levels in over four-and-a-half years, instilling in the Iraqi people a sense of normalcy that permits them to engage in personal, religious, and civic life without an inordinate threat of violence,". Indeed the fact that many Iraqis can now lead lives free from the threat of violence is empirically clear to anyone who monitors reports from the country. For many Iraqis the main problems are not security but rather the country’s terrible infrastructure and its massive unemployment. The Iraqi Government is flush with oil money, it has a $79 billion budget surplus and billions more sitting in an American bank. In short it has more money than it can spend. The Government must act to improve the country’s water and electricity supply and its oil infrastructure. A major deal has been signed with a French company to improve water supplies but more must be done. Furthermore the Government must act to break the massive reliance on state sector employment which has cursed many Arab economies. Government grants for small businesses and entrepreneurs is one decidedly simple suggestion.
Another threat to Iraq is corruption; the country is listed as the third most corrupt in the world and many Government departments are run as private thiefdoms by Shia gangsters. Anyone who has read Paul Collier’s book ‘The Bottom Billion’ will recognise that Iraq’s massive oil wealth could act as a curse rather than a blessing. Corruption, Dutch disease, bad Governance, coups and civil wars often plague poor countries ‘blessed’ with natural resource wealth. But as well as ‘God gift’, Iraq has also been handed the secular gift if democracy which if pursued correctly may act to curb the most pernicious effects of corruption.
So let’s imagine that Iraq doesn’t alienate the Sons of Iraq, Shia and Sunni are reconciled and Al Qaeda and the Mahdi Militia remain isolated. If the Government acts to restore the country’s infrastructure and resist the traps that come with oil wealth then Iraq may have a bright future. In a sign of recent progress an Iraqi exile unveiled plans to build a multi-billion dollar honeymoon resort on Al A’arass Island in the middle of the Tigris in Baghdad. If, one day, the Al A’arass resort is built then it will surely be sign that Iraq has at last solved its many problems.
