Monday, August 11, 2008

Georgia and Iraq

Reuters on the Russian invasion of Georgia:


Putin mocked the support given by the West to Saakashvili, comparing him to former Iraqi leader Saddam Hussein, who was hanged in 2006 for executing Shiites.

"They (the Americans) of course had to hang Saddam Hussein for destroying several Shiite villages," Putin said.

"But the current Georgian rulers who in one hour simply wiped 10 Ossetian villages from the face of the earth, the Georgian rulers which used tanks to run over children and the elderly, which threw civilians into cellars and burnt them -- they (Georgian leaders) are players that have to be protected."


This is a good example of how the oil grab in Iraq has cost us credibility in the international community. Besides the damage to our military, Bush damaged our moral authority with the Iraq oil grab. It will be much harder to lead a substantive international coalition when most of the countries involved are still ticked off at us.

I don't think that it is any secret that the Russians are aiming at "regime change" of a foreign government they don't like. Perhaps they feel that they are engaged in a "preemptive war." I just heard the Russian ambassador explaining that Russian operations were aimed at "supporting the peacekeepers." None of this sounds familiar, does it?

Every American single combat brigade is busy because of the Iraq oil grab. (Every combat brigade is either returning from deployment, preparing to be deployed, or deployed.)

Well, we can try to rattle our empty scabbard. If we ask nicely, the French may back us up by treating some Russian tourists rudely. (Never mind, they were planning on doing that anyway.)

Ok, that was mean. At least the French are actively involved. I hope Bush is enjoying the Olympics.

--SCC

Sunday, August 10, 2008

Georgia and the Candidates

Politico had an interesting bit of commentary comparing the approaches of McCain and Obama in the early hours of the Georgia invasion. There are definitely distinct style differences between the two.

A McCain adviser suggested that Obama’s statement constituted appeasement, while Obama’s camp suggested that McCain was being needlessly belligerent and dangerously quick to judge a complicated situation.

At least neither of them is W.

--SCC

Saturday, August 9, 2008

One Potential Energy Compromise

Paris Hilton and the "Gang of Ten" have hinted at it. There is a fairly obvious compromise to be reached on energy, but it is going to require flexibility on both sides of the aisle.

As I see it, the compromise would take the form of something like:
Allow drilling under the following conditions:

  1. Royalty payments in line with what other countries get for similar resources. This includes hiring auditors and checking oil company books for cheating, which is currently costing taxpayers billions of dollars.

  2. Strict enforcement of environmental regulations. (The current framework is a joke, as BP demonstrated in Alaska.)

  3. Use it or lose it. Strict timelines to explore and develop, or the lease goes back in the pot. If you want to push it, companies who want to play in the new playground need to convert their existing leases to a similar framework.



Promote alternative energy:

  1. Restore favorable tax treatment for solar, wind, and geothermal. The period of restoration should be the same as the length of the above-mentioned leases. Funding for this tax treatment should come from the above-mentioned royalties.

  2. Government subsidies for research into improved battery, fuel cell, and other energy storage technologies. Researchers who accept this funding must cut the taxpayer in for a share of the licensing fees on any patents arising from this research. Again, funding to come from those royalties.



Incentives for fission plants:
Create a standard-plan plant (or several standard designs) which would have a fast-track approval, since a lot of the pre-approval studies would be the same between plants. (This isn't as hard as it sounds, since such plans already exist.)

As a practical matter, some incentives may need to be included for "clean coal" and natural gas, though I don't think either is actually necessary or particularly desirable. (Coal because it is a dying technology; natural gas because it doesn't need the incentives to take an increasing share of the energy market.)

I don't like all the parts of this "compromise," for reasons that are probably clear to people who have read my other posts. On the other hand, this is the sort of compromise that could get enough support to pass, and could actually make a difference in preparing the country for the coming changes in the energy marketplace.

(No, this is not the same as the Republican proposal. While they claim that they are "all of the above," they have structured their incentives to benefit the oil companies while providing minimal assistance to people who are deploying and installing the technology. The McCain proposal includes incentives for R&D, but none for installation or deployment.)

The allowance for drilling is not because I believe that drilling ANWR or OCS (Outer Continental Shelf) will have much of an impact on our energy future. It won't. What it gives us is a dedicated funding source to move us to sources of energy that will actually improve our future competitiveness.

--SCC

Wednesday, August 6, 2008

The Politics of Energy

Here are some more postings on the Gang of Ten proposal from different viewpoints:

A Democratic view
A Republican view

Both Republicans and Democrats seem to see the energy issue strictly as an electoral issue rather than as an issue that is important to the health of the country as a whole.

--SCC

The Iraq Obsession

Credible evidence from several sources demonstrates that Iraq was in Bush's crosshairs from day one.

Richard Clarke was the head of the US government's anti-terrorism efforts leading up to 9/11. His book revealed some disturbing facts about the Bush administration's monomania regarding Iraq:

Clarke says that as early as the day after the attacks, Secretary of Defense Donald Rumsfeld was pushing for retaliatory strikes on Iraq, even though al Qaeda was based in Afghanistan.

After the president returned to the White House on Sept. 11, he and his top advisers, including Clarke, began holding meetings about how to respond and retaliate. As Clarke writes in his book, he expected the administration to focus its military response on Osama bin Laden and al Qaeda. He says he was surprised that the talk quickly turned to Iraq.

"Rumsfeld was saying that we needed to bomb Iraq," Clarke said to Stahl. "And we all said ... no, no. Al-Qaeda is in Afghanistan. We need to bomb Afghanistan. And Rumsfeld said there aren't any good targets in Afghanistan. And there are lots of good targets in Iraq. I said, 'Well, there are lots of good targets in lots of places, but Iraq had nothing to do with it.

"I think they wanted to believe that there was a connection, but the CIA was sitting there, the FBI was sitting there, I was sitting there saying we've looked at this issue for years. For years we've looked and there's just no connection."

"The president dragged me into a room with a couple of other people, shut the door, and said, 'I want you to find whether Iraq did this.' Now he never said, 'Make it up.' But the entire conversation left me in absolutely no doubt that George Bush wanted me to come back with a report that said Iraq did this.

"I said, 'Mr. President. We've done this before. We have been looking at this. We looked at it with an open mind. There's no connection.'

"He came back at me and said, "Iraq! Saddam! Find out if there's a connection.' And in a very intimidating way. I mean that we should come back with that answer. We wrote a report."

Clarke continued, "It was a serious look. We got together all the FBI experts, all the CIA experts. We wrote the report. We sent the report out to CIA and found FBI and said, 'Will you sign this report?' They all cleared the report. And we sent it up to the president and it got bounced by the National Security Advisor or Deputy. It got bounced and sent back saying, 'Wrong answer. ... Do it again.'

"So what did we do after 9/11? We invade an oil-rich and occupy an oil-rich Arab country which was doing nothing to threaten us. In other words, we stepped right into bin Laden's propaganda. And the result of that is that al Qaeda and organizations like it, offshoots of it, second-generation al Qaeda have been greatly strengthened."

Sounds like Mr Clarke also thinks it was an oil grab. Of course, what does he know? He's just the guy who ran the black helicopters.

Paul O'Neill, Bush's Treasury Secretary tells some interesting stories about the early days of the Bush administration.

At cabinet meetings, he says the president was "like a blind man in a roomful of deaf people. There is no discernible connection," forcing top officials to act "on little more than hunches about what the president might think."

“From the very beginning, there was a conviction, that Saddam Hussein was a bad person and that he needed to go,” says O’Neill, who adds that going after Saddam was topic "A" 10 days after the inauguration - eight months before Sept. 11.

“From the very first instance, it was about Iraq. It was about what we can do to change this regime,” says Suskind. “Day one, these things were laid and sealed.”


The result of Bush's Iraq obsession has been to radicalize a generation of young Muslims, according to Rohan Gunartna. American security has been reduced as a result of Bush's refusal to let facts dictate the direction foreign policy should take.

Since the September 11 attacks, Al Qaeda’s strength shrank from about 4,000 members
to a few hundred members, and nearly 80 percent of Al Qaeda’s operational leadership
and membership in 102 countries has been killed or captured. Al Qaeda adapted, however, instilling its mission and vision in associated groups and transferring its capabilities to them. The U.S. focus on Iraq, Al Qaeda, and eliminating the Al Qaeda leadership limited the ability for U.S. officials to understand and respond better to the changing threat.
...
the U.S. invasion of Iraq increased the worldwide threat of terrorism many times over. Even moderate Muslims are angry about the invasion and postinvasion developments. This animosity toward the United States makes it easier for terrorist and extremist groups to continue to generate recruits and support from the suffering
and grieving Muslims of Iraq. Because of perceived injustices attributed to the West in general, particularly in Pakistan and Iraq, there will be significant support for the new generation of mujahideen in Iraq. Groups that were dying are making a comeback, and several new groups have emerged in Iraq, Indonesia, Pakistan, and even in Europe.
...
Although the U.S.-led invasion of Iraq was a fatal mistake, withdrawing from Iraq would be an even greater one. U.S. withdrawal from Iraq and turning responsibility over to the United Nations would only strengthen terrorist capabilities in general and Al Qaeda more specifically.

(And here's the part that I think gets forgotten in the red-meat rhetoric of the right.)

It is therefore crucial to develop a truly multipronged strategy to fight the multidimensional character of violent Islamists. Instead of only tactically targeting identifiable terrorist cells, it is essential to prevent the creation of terrorists strategically. The bloc of nations with staying power in the West must work with the Muslim countries—their governments and nongovernmental organizations—to target the ideology that is producing the terrorist. It is necessary to send the message that Al Qaeda and its associated groups are not Koranic organizations and that they are presenting a corrupt version of Islam by misinterpreting and misrepresenting the Koran and other texts. Only by countering the belief that it is the duty of every good Muslim to wage jihad can the extant and emerging terrorist threat be reduced. As Al Qaeda is constantly adapting to the changing security environment and morphing its structure, the key to defeating Al Qaeda and reducing the terrorist threat is to develop a multi-agency, multijuristic, and multinational strategy to combat this ideology.

Where I disagree with the author of the article (and I'm not so sure we actually disagree) is that I think that we have to plan for a post-occupation Iraq. In order to plan for it, we have to visualize what it should look like and create a plan for getting there.

The whole debate about "benchmarks" has gotten a bit silly. I saw a speech by McCain where he was clearly talking about benchmarks, but was dancing around trying to avoid using the "b" word. The idea behind a benchmark is that you state what your intermediate goal looks like and when and how you hope to achieve it. I can understand his reluctance to get tied into a "withdrawal schedule" or something as inflexible as that, but if you don't have a plan for getting someplace, you'll never get there.

Of course you have to take actual conditions into account. Even Obama is starting to "refine" his policy (gotta love that word!), stating that he will take "conditions on the ground" into account. (I also think that he hasn't even begun to mine the "refinement" possibilities of his refusal to define the difference between "combat" and "non-combat" units.)

--SCC

The Great Oil Give-Away

The recent hysteria over drilling is a thinly veiled attempt to give the public's assets to private corporations.

Some of the oil companies' defenders have claimed that the royalties paid by the oil companies are fair compensation for the damage they do and the fortune they reap from the public lands. But the GAO reports that government giveaways to the oil companies have cost the taxpayers billions of dollars.

If we actually give the oil companies access to additional lands for exploitation, we need to ensure that:

  • Fair compensation is paid

  • Adequate environmental protections are enforced

  • Use it or lose it rules are in place


As the GAO report pointed out, the Dept of the Interior has broad latitude in writing those leases. I don't think it is much of a stretch to say that the oil companies are desperate to have their buddies in the lame duck Bush administration write exceedingly favorable terms into the leases for ANWR and OCS.

We have lost tons of money to outright fraud by the oil companies. The US government has screwed up lease contracts, giving away billions of dollars of royalties. Inadequate auditing has allowed sloppy paperwork to cheat taxpayers out of royalty payments. Lobbyists in the great Washington revolving door have arranged for subsidies and sweetheart deals for their corporate masters.

But last month, the Bush administration confirmed that it expected the government to waive about $7 billion in royalties over the next five years, even though the industry incentive was expressly conceived of for times when energy prices were low. And that number could quadruple to more than $28 billion if a lawsuit filed last week challenging one of the program's remaining restrictions proves successful.

"The big lie about this whole program is that it doesn't cost anything," said Representative Edward J. Markey, a Massachusetts Democrat who tried to block its expansion last July. "Taxpayers are being asked to provide huge subsidies to oil companies to produce oil — it's like subsidizing a fish to swim."


--SCC

Sunday, August 3, 2008

The Tax Cut Myth

Supply-side dogma holds that if taxes are cut, there will be enough economic benefit to more than make up for lost revenue. This assertion is not supported by the facts. Consider the words of two economists from Bush's team:


Edward Lazear, chairman of President Bush’s Council of Economic Advisers told Congress, “I certainly would not claim that tax cuts pay for themselves”

N. Gregory Mankiw, an earlier CEA chair in President Bush’s administration once compared an economist who says that tax cuts pay for themselves to a “snake oil salesman trying to sell a miracle cure”


The Center on Budget and Policy Priorites reports that the cost of borrowing money to pay for tax cuts far exceeds any benefit from it.


The CBO reported in 2007 that the budget might have been in surplus if not for the Bush tax cuts:



Orszag concluded that the tax cuts’ indirect impact on economic growth, investment and saving and could affect this year’s budget deficit anywhere from an increase of $3 billion to a reduction of $14 billion, depending on the assumptions used. That is separate from the direct boost to the deficit trhough lost revenue and the added interest on borrowing to cover the gap of $211 billion.

It currently expects this year’s deficit to be between $150 billion and $200 billion, implying that without the tax cuts, the budget would probably be in surplus this year.




--SCC