Category: Uncategorized

Posted on

Familiarity becomes Contempt.

Johns Key’s answers to the “mystery” of the US Air Force executive jet parked at Wellington during Hobbit mania gives us a good indication of his attitude towards the public and the press. Although the plane was misidentified several times by reporters as a private plane, it is in fact part of a fleet of US Air Force transport aircraft that are used regularly to fly high level politicians and bureaucrats to foreign meetings. The make, model, livery, insignia and identification number would have been readily recognizable to plane spotters, so Mr. Key was correct in saying that there was no secret to its visit. It was how he answered the question of who the visitors on the plane were that gives an indication of his current mindset.

His initial response is that he did not know who was on the plane or the purpose of its visit. He said he may have seen the name of a visitor on a piece of paper but could not recall it. As Minister of Intelligence and Security that would seem to be an odd thing to say, especially since it played (now apparently purposefully) on the “brain fade” impression he developed as a result of his forgetfulness about the Dotcom/GCSB illegal espionage case.

What is puzzling is that he could have said any number of things: that he did not discuss intelligence and security matters in principle; did not discuss “quiet” visits by foreign (US) officials as a matter of policy; did not discuss the visits of foreign intelligence officials; or that he could not confirm or deny the presence of any such on NZ soil. It would be the same if he refused to comment on military matters citing operational security (but where again, he obfuscates and prevaricates rather than just offer a straight answer or refusal to comment). He could have said any of these things and the story would have died.

Under a second day of questioning he admitted that the plane carried a high-ranking US intelligence official to meetings with NZ intelligence officials and that the meetings involved counterparts from other foreign intelligence agencies. He denied these were meetings of the Echelon/5 Eyes partners even while saying that they hold regular meetings in NZ, the latest in July or February (depending on which version of his recollection one chooses to believe).

This comes at a time when the 5 Eyes community have been rocked by a major spy scandal in Canada, where a naval intelligence officer sold highly sensitive tactical and strategic signals intelligence data to the Russians for five years before his arrest in early 2012 (which would require the adoption of a number of sanitizing and preventative counter-measures throughout the network). It comes after the obfuscations and weirdness surrounding the GCSB involvement in the Dotcom case (which may well have started before Dotcom arrived in NZ because the NSA–the lead agency in the Echelon network–was already monitoring Dotcom prior to his arrival and would have likely asked that the GCSB continue the surveillance after he crossed the border). It also comes at a time when Huwaei is under scrutiny by the Echelon partners for its possible involvement in Chinese signals intelligence collection efforts, which are focused on the West in general and 5 Eyes countries in particular.

Under the circumstances  a visit by senior 5 Eyes counterparts to discuss matters of common concern would not be unusual or untoward, if nothing else as an information-sharing exercise or so that they could get their ducks in a row on matters of institutional or public interest.

Thus the question begs as to why Mr. Key did not just refuse to comment citing matters of national security but instead opted to play dumb and incompetent, thereby heightening initial interest in the story?

My belief is that he has general contempt for the public’s intelligence on matters of foreign affairs and security, and that he believes the masses are not interested in the subject anyway. But his focused contempt is of the press or at least non-submissive members of it. His brain fade act is more than simply lying. It is the deliberate winding up of the press over matters that, while not inconsequential, are relatively routine or non-controversial but which he can successfully cover up so that press inquires are frustrated needlessly. In other words, he is taking the piss out of the media.

He has similar contempt for those who oppose or question his policies. He recently said that anti-TPP activists should be ignored (even though these include a large number of distinguished subject experts, academicians, politicians and former and current trade specialists). This adds to his list of those that should be ignored, including mining safety experts, environmental scientists, Maori rights activists and asset sales opponents.

The point is that as Minister of Intelligence and Security Mr. Key could respond to questions about  intelligence and security in an authoritative manner that does not compromise either while demonstrating his command of the portfolio. That he choose not to do so and instead pleads memory loss and disinterest in these two vital components of national security suggests that he is doing so either because he really is clueless and out of his depth on intelligence and security or, more likely to my mind, he is deliberately doing so just to wind up his “enemies” in the press while dismissing detractors in civil society against a larger backdrop of public disinterest.

He is also being contemptuous of those who serve under him in critical national security roles because his feigned ignorance leaves those leading intelligence and security agencies hanging out to dry in the event that something in their purview but under his ministerial watch goes sour. Truth be told, by the terms of his ministerial portfolio he is briefed regularly and exactly on all matters of intelligence and security. Either that, or the institutional edifice of security in NZ is praetorian, something that I doubt its security partners would accept, much less agree to.

If Mr. Key is not clueless on intelligence and security matters, then the “spy” plane response and his other actions show that along with being contemptuous of those who may seek to hold him to account, he is arrogant, irresponsible, disloyal, mean-spirited and vindictive as well. To which can be added one more trait that has emerged in Mr. Key as of late: callous narcissism.

When asked recently what he was the most sorry for over the last year, he answered that it was the failure to convince the public of the benefits of the mixed ownership model. He was not as sorry about the deaths of five NZDF troops in Afghanistan, or the needless deaths and continuing failure to retrieve the bodies of the Pike River miners, or the ongoing debacle that is the Christchurch reconstruction process, nor about the leaks of private information by government agencies or the unhappy disputes with Maori over treaty settlement issues (in fact, he made no mention of these). Instead, he most laments the failure of a pet economic project to gain public traction in 2012.

That may not be surprising, but it sure is contemptible.

 

Posted on

Drones in our future.

Although I have no technical expertise in the field of unmanned aerial vehicles (UAVs), I have discussed in various fora the military, intelligence, domestic security and political implications of their use now and in the future. The hard fact is that, bad press notwithstanding, UAVs (aka “drones”) are here to stay and will dominate the air space in the years to come. Already the US air force is training more drone pilots than fighter and bomber pilots combined. Ninety percent of what drones do is non-lethal: reconnaissance; surveillance; search and rescue; maritime patrol; signal, thermal, optic and other forms of technical intelligence gathering; geological exploration and terrain mapping–the applications of these types of platform are many and will continue to grow in the years ahead.

The utility of drones is due to a simple calculation: the three “Ds.” They do jobs that are dangerous and/or dirty, and they do them dispassionately. To this can be added the fact that their operational costs of drones are less than those of manned aircraft and they do not expose pilots to the physical risks of flying. That combination guarantees that policy-makers will look to UAVs as the future of military and law enforcement aviation even if manned aircraft remain the bulk of commercial and private aviation for the foreseeable future.

Lethal drones such as the infamous Predators are constantly being refined so that their acceptable Circular Error Probable (CEP)–the chances that a missile fired from the UAV will fall within 100 feet of the target crosshair center–is now greatly increased. Since they loiter at 15,000 feet for up to 36 hours, US drone pilots (who work in 12 hour shifts and who must have experience flying manned aircraft prior to their assignment as drone pilots) spend hours and days watching a potential target before pulling the trigger. The protocols governing the kill shot are quite tight (for example, no shots at family compounds or while the targeted individual(s) is or are in the vicinity of innocents), which contrary to popular opinion has greatly reduced the collateral damage occasioned by drone strikes when compared to the early days of their use.

In fact, manned aircraft continue to cause the bulk of unintended civilian deaths in Central Asia, which most often is the fault of faulty or misleading tactical intelligence on the ground (the use of misinformation by local informants acting for their own purposes has been a major contributor to the unintended civilian deaths caused by air strikes). As a remedy, special forces teams are increasingly being used to track, spot and verify legitimate targets in conflict zones (to include Pakistan, Yemen and Somalia as well as Afghanistan).

Although there have been many protestations about the use of lethal drones (so far the US is the only country to use them in anger), it is interesting to note that Pakistan has never attempted to intercept US drones operating in Pakistani air space even though the latter are slow, not particularly maneuverable and relatively easy to spot by electronic means (the recent downing by Israeli forces of an Iranian drone operated by Hezbollah demonstrates the case).  This is not to say that drone incursions into the sovereign air space of foreign countries are always or even generally  acceptable. What the different responses suggest is that the Pakistanis may not be aggrieved by US drone operations as they claim to be.

To be sure, the US military has tighter protocols governing lethal drones than does the para-military arm of the CIA. That has led to disagreements within the US security apparatus about who should be in control of lethal drones and under what circumstances are they to be used. The president currently has to authorize the CIA strikes, which are mostly directed at suspected jihadis operating in failed states. The military has a bit more latitude in targeting militants or insurgents in Afghanistan and the tribal areas of Pakistan, although all lethal strikes must be authorized by the chain of command. As of yet, that debate about unifying the command and control of lethal drones is unresolved and both the US military and the CIA continue to deploy armed and unarmed drones in foreign theaters using their own set of criteria (which if largely overlapped are not identical).

That is what brings me to the major point of this post: the fact that the legal apparatus governing the employment of drones in the international as well as the domestic arenas is very underdeveloped when compared with the technologies themselves. Already 60 countries employ drones, and domestic security agencies in a host of countries have explored their usage. The US uses them for border control and Coast Guard purposes, and true to form, some police department in Texas is reported to have expressed interest in a lethal version that could also dispense non-lethal crowd control justice from above.

Yet in no case are the legal protocols governing the use of drones in domestic arenas as well developed as are those used by the US military when engaged in foreign conflicts. This is worrying because the potential for abuse is great. UAV technology has outpaced the legislative framing of their fair use not only in undemocratic states but in liberal democracies as well.

New Zealand is not different in this regard. The Army and Navy are exploring drone technologies, as are other non-military government agencies. The Department of Conservation already has deployed a drone for geothermal and geographic research. The police are interested in UAV platforms as a substitute or complement to helicopters and terrestrial patrol vehicles. It is only a matter of time before drones are a regular presence in New Zealand skies, and the Civil Aviation Authority is already being tasked with drafting technical regulations governing their operations.

Even so, the legal structure governing the why, when, how and by who of UAV use in NZ is virtually nonexistent. Parliament appears disinterested in the subject and the agencies who would have the most use for drones have not been particularly proactive in drafting guidelines for their use. It is time that they did.

One reason is because the future of drones is not only in their greater use but in their increasingly varied configurations, to include miniaturization based on developments in nano technology. Consider this gem:

Sent to me by a friend borrowing from an unnamed source, the following blurb came with the photo.

“Is this a mosquito? No. It’s an insect spy drone for urban areas, already in production, funded by the US Government. It can be remotely controlled and is equipped with a camera and a microphone. It can land on you, and it may have the potential to take a DNA sample or leave RFID tracking nanotechnology on your skin. It can fly through an open window, or it can attach to your clothing until you take it in your home. Given their propensity to request macro-sized drones for surveillance, one is left with little doubt that police and military may look into these gadgets next.”

UPDATE: The source for the photo is this: http://www.snopes.com/photos/technology/insectdrone.asp

In light of the implications of developments in UAV technology and the growth in their employment, it seems appropriate that New Zealand confront the legal aspects of said use. New Zealand could, for example, be the first country to prohibit the use of lethal drones either in foreign conflicts or for domestic security (no other country has of yet discounted the use of drones for lethal purposes). Likewise, because there are no regional or international protocols governing their use, New Zealand could try to introduce resolutions in international and regional bodies that would lead to the regulation of UAVs on a broader level. At present the field of UAV operations is basically uncharted, much less regulated, so the opportunity now exists to try to match advances in UAV technology and deployment with advances in the legal architectures governing them.

Since New Zealand has in the past shown initiative and boldness in enacting policy with both domestic and international import, the field of UAV regulation might be another way in with it can demonstrate its fore-sightedness when it comes to areas of universal concern.

Posted on

A surfeit of services.

My yearly sojourns to the US provide a regular opportunity to garner a snapshot of the state of the union, at least from my limited perspective. This year I returned to my old stomping grounds in the desert southwest and to the home away from home in South Florida. After a wet monsoon season the desert was lush and the 360 degree skies saturated with cumulus, cirrus and stratus cloud. It was great to hear Norteno music and Spanglish spoken in the street.

My son joined my partner and I for a trip to the old mining town of Bisbee, where we stayed at the haunted Copper Queen (est. circa 1880) and had a long night on the town that ended up in some biker/metalhead dive bar. It was great. I highly recommend the Arizona desert to New Zealanders interested in a dramatic contrast in landscapes and Western cultures.

South Florida has been less pleasant. There is a palpable tension in the air marked by hostile attitudes and unbelievably aggressive, to the point of criminally reckless, driving. The region is known for its fast pace and shallow materialism, but in this trip there is something darker about it. Some of this can be attributed to the election campaign, in which some of the local attack ads are truly astounding in their ferocity and disregard for decency (the issue is large: one-third of the US Senate, the entire US House of Representatives, and most local offices are in play). There is a buffoon Republican named Alan West running for the US Senate, and his ads make the Swiftboat and Willie Horton attack ads look tame. He says nothing about what he proposes and spends most of his time defaming his Democrat opponent. Seeing that Romney is set to lose the presidential race, the right wing talkback and television outlets have ratcheted up the hysteria and vitriol to the point that even John Stewart or Stephen Colbert cannot parody them adequately. In a word, the place is nuts.

This condition of political anomie may be compounding the sense of frustration and anger felt by an increasingly divided–the word “polarized” does not do justice to the chasm between the US right and left–polity that more than anything else is diffident in its regard for politics. Both the Republican and Democratic conventions were not as well attended and not as widely viewed by TV audiences as in previous years, and it appears that the election abstention rate is going to be very high this year. People appear to be cynical, bitter and lacking in hope for the future regardless of who wins in November. All in all, this is the sorriest state of mind I have found the US to be in since my move to NZ fifteen years ago.

That is the backdrop to the subject of this post. As readers will know, the focus of the 2012 US election begins and ends with the economy. Platitudes are proffered and panaceas are prescribed. Words like “competitiveness” and “innovation” are bandied about like lollies. But there seems to be a fundamental misunderstanding of a root cause of the American economic malaise: its reliance on services.

The US is a country dominated by the service sector rather than true productive enterprise. Think of the variety of services now on offer: wealth and asset managers; financial advisors; PR and other “communications strategists;” personal trainers; life coaches (of which there are half a million in the US); pain management specialists (aka pill doctors); landscapers; floral designers; escorts; private alarm and security companies; fishing, hunting and tour guides; real estate agents; internet and in-store movie suppliers; credit card purveyors; nail and hair “artists;” wedding planners; a zillion types of mental health counselors and ambulance chasing lawyers; insurers; car, cat and dog groomers; dog walkers; bird, cat, dog and horse whisperers; DJs; car valets; (for-profit) drug and alcohol rehabbers; tennis instructors; beauty consultants; fashion stylists; liposuction specialists; motivational speakers; management and risk consultants; self-help gurus; personal assistants and agents, accountants; home delivery services; website designers–the list is as varied as it is endless. While one might argue that all retail sales are a service, my point is that in the US the extent of service provision is on its way to infinite, and this infinite progression dominates its economy.

The basic problem of reliance on services as the core of economic activity is that making money through facilitation is not equivalent to being productive. Nor is working hard synonymous with productivity. Americans work the longest hours and take the shortest vacations of all OECD countries. By that standard they should be light-years ahead of the democratic capitalist world in terms of real productivity. But they are not. That is because hard work and income earned in services does not, in the larger scheme of things, add real value to productivity. It may make the national quality of life better, but it does not advance the overall condition of the productive apparatus. It is the economic equivalent of silver–it is nice and attractive, very malleable, easy to buy, wear and replace, but is no substitute for the economic iron required to build and progress a nation.

What is noteworthy about the US service sector is that, at over 75 percent and growing, it is steadily occupying a bigger and bigger percentage of the national GDP (agriculture is less than 2 percent and manufacturing is at 20 percent). The creative genius involved in the proliferation of services is matched by its relentless rent-seeking: in South Florida television ads are dominated by ambulance chasers (who prefer the term “personal injury lawyers”), pill-pushers and geriatric care providers who offer relief and compensation for a myriad of ills previously unheard of or for which personal responsibility used to suffice.

The majority of US college graduates, be they from two or four year colleges, receive degrees in areas other than science or engineering (business, education and liberal arts degrees are the majority of those granted in the US). Since the bulk of undergraduates do not go on to graduate school, this leaves a labor pool full of people who cannot actually produce or add value to anything other than by virtue of their slick talk and quick uptake on the job. Since most people coming out of US universities and colleges are neither particularly articulate or quick on the uptake, their default option is to join the legion of personal service providers.

No that all services are of the silver variety. Some of these are important, such as electricians, plumbers, carpenters, doctors, firefighters, police and lifeguards (I shall defer from elaborating on the public versus private aspects of the service sector, but note that what are considered public services are basically considered to be core functions of government, many of which are being privatized and downsized in the current fiscal environment). Many services are linked via supply chains to the manufacturing and research sectors. Others, such as the information technology services that spawned Google, Facebook and Twitter, create wealth but do not always really produce anything tangible or contributory to the value-added project (which in part explains the lukewarm stock market reaction to the Facebook public stock float). The vast majority of US services are, needless to say, even less contributory to the national productive apparatus.

The critical and deleterious aspect of the services domination of the US economy is that it is moving the country away from the production of real value added assets, much of which is increasingly monopolized in terms of ownership anyway. Add to that the overwhelming influence of the financial service sector, and what is left is a country that buys more than it makes (and what it makes are increasingly capital goods as much as consumer durables and non-durables), and in which people increasingly use services rather than do things or rely on themselves.

The social division of labor created by service sector dominance in the US appears to produce two distinct cultural characteristics. First–and this is very evident in South Florida and a subject that I have addressed in previous posts–is a culture of blame-assignment and responsibility-shifting where nobody is personally accountable for the consequences of their actions. Even hardened criminals commonly use the excuse that their teachers, counselors and psychiatrists failed them in the lead-up to their crimes, and in many instances this suffices to mitigate their culpability and reduce their sentences. They are not alone in this. In fact, there is an entire service industry comprised of counselors, insurers and lawyers that profits from shifting blame and responsibility, criminal or not.

The second aspect is the increasing compartmentalization and personalization of service work, which in turn produces an erosion of horizontal solidarities brought about by common insertion in the productive process. Much of the service sector is characterized by individual entrepreneurial or material pursuits. The individualization of service work, often aided by stay-at-home technologies that facilitate the rendering of such services, removes the associational and emotive ties that are part of the working experience in mass productive enterprise. This atomizes and alienates individuals as social subjects, as their material fortunes no longer depend on common identifications and sense of purpose (which occurs whether the workforce is organized or not precisely because it is a collective enterprise).

Social group associations, service group size and individual immersion in non-work related collective undertakings such as sports and churches mitigate against a complete return to survivalist alienation, but they do not fully overcome the dissociative effects of the nature of service provision. The effect of this is to reduce the ties that bind people together, which helps explain the turn to shifting blame and responsibility onto others.

Needless to say, I am only extrapolating from what I am seeing in the US during my limited time here. I recognize that generalizations are fraught and speculation based on fraught and fragmentary generalizations are to be suspected. So take this appraisal as an opinion, nothing more. Moreover, the US remains the largest national economy in the world, the largest trading nation, and the largest manufacturing economy. Its information technology, robotics, telecommunications and aerospace industries are world leaders. Its automobile and construction sectors are on the rebound. It is by no means weak in spite of what I have outlined above.

Even so, the trend is disturbing (at least for those with an interest in the US). For small countries not intent on projecting power or devoid of natural and human resources, reliance on services as the mainstay of the economy is acceptable if not advisable. Competitive advantage in services may counterweight a lack of comparative advantage in productive resources.

However, it seems to me that if a large, militarily aggressive country with a global reach relies on services as its engine of economic growth rather than on value-added production, than it will find it increasingly difficult to hold the its position over time. I might be wrong and, like (but better than) the USSR, the US can continue to ride on the production associated with an immense military-industrial corporate complex that spins off technological innovation and civilian applications as a matter of course even as the overall presence of value-added manufacturing as a component of GDP decreases. But if that is the case, it seems a risky proposition for sustained growth and global prominence given that an increasing percentage of the inputs to that type of production are derived from external rather than internal sources.

Meanwhile the life coaches continue to facilitate personal self-realization, realtors hustle properties, lawyers litigate and asset managers channel money made from services into other services. Wall Street and Washington both believe that ongoing reliance on services for economic growth is sustainable and desirable. In broad economic terms, that is like equating a merry-go-round with a wheel. It is that merry-go-round that Obama, Romney and other US politicians are trying to fix.

Posted on

My kid is more important than your kid.

John Key will not attend the funerals of the NZDF troopers killed in action in Bamiyan because he has a prior commitment to attend his high school aged son’s baseball tournament in the US. He says that his son has sacrificed a lot for his dad to be PM and he needs to return the favor.

I do not know what to say. Check that: actually, I do.

Is he elevating his son’s supposed sacrifice above that of the dead troopers he sent into a forlorn war? Is he serious or are the funerals a scheduling inconvenience? Does he not comprehend the gravity of the situation to which he has committed other people’s sons, who have died for the cause he supposedly champions (whatever that is)? Can he possibly not understand that his son’s penchant for a US sport may not be, in the large scheme of things, more important than the loss of life of courageous New Zealanders fighting in a hopeless conflict already abandoned by most Western allies?

Sure, Barack Obama and Julia Gillard do not attend every military funeral for their fallen soldiers in Afghanistan. But the military commitment of both countries far exceeds that of New Zealand and has an explicitly combat role. They both acknowledge that death comes with the commitment. John Key denies that New Zealand has a combat role and is still involved in peaceful reconstruction even though the security situation has “worsened.”

This is a disgrace of the first order.

John Key seems to believe that being a CEO is equivalent to being a statesman and prime minister. He seems to think that other peoples deadly sacrifices are just part of doing business. His bottom line needs no genuflections to the niceties of grief or reconsideration of the rationale of deploying NZ’s sons and daughters in conflict zones. It is all about his “big picture”, except of course when he can use an official visit to watch a high school game in an American sport.

He may claim that family matters most. He has already said as if it was somehow better, that the dead soldiers either had little family or were childless. So perhaps he feels he does not have to front to the funerals of soldiers killed in the worst military incident in forty years because his family priorities exceed his official obligations.

I find his attitude to be despicable and proof that he simply does not understand the full scope of the responsibilities and obligations that come with being Prime Minister, beyond whatever he thinks that being CEO of Kiwi, Inc. entails

This is a spit in the face of the NZDF. It is a dishonor to the fallen soldiers. It shows utter contempt for all the families who grieve.

Note to General Rhys-Jones and the rest of the NZDF brass: he just owned you in a very bad way.

 

Posted on

Some questions about the ambush.

It may seem insensitive to ask questions about the ambush that killed two and wounded six NZDF troops in Bamiyan, but I do not trust the government or NZDF brass to come clean on what really happened. They have spent too much time lying about the real security situation in Bamiyan and the real nature of what NZDF troops are doing there and elsewhere, such as during the SAS deployment.

The official story is that Afghan National Directorate of Security (NDS) personnel were ambushed in a village when they went to arrest a suspect, suffered losses, and called for reinforcement from the NZDF. The village is located in a narrow high mountain valley. Four NZDF patrols were in the area and at least two responded, although it took 2 hours for the convoy to slowly climb up to the village. The original story was that after laying down suppressing fire, an NZDF armored vehicle was hit by an “anti-tank rocket,” resulting in one NZDF death, and when the troops dismounted to secure the area another was killed and the others were wounded by  a separate group of insurgents hiding in the surrounding terrain (it is unclear if some of the wounded were injured in the missile attack on the armored vehicle). A subsequent official version states that both soldiers were killed by rifle fire from a distance of 50-100 meters after they dismounted from the armored vehicle. A number of insurgents are claimed to have been killed, and 17 were seen withdrawing from the area carrying their dead and wounded. No enemy bodies were recovered although two insurgents were captured.

My questions are these:

Knowing that the valley was narrow with much high ground cover above the village in question, and given the time it took to reach the scene, why did the reinforcements not dismount, spread out and walk into the fire zone rather than drive all the way in? I say this because a standard guerrilla tactic, which has many variations, is the “sucker ploy” whereby a small ambush is staged on local forces so that the call for reinforcements is made. A second, larger ambush is staged using better cover and heavier weapons on the reinforcements, which in Afghanistan are inevitably foreign. The real target is the reinforcing forces, and faulty intelligence feeds are often used to lure the initial responders to the scene. The idea is to hit the reinforcements hard and disengage as rapidly as possible.

One way of preventing losses to such a sucker ploy is to have infantry dismount away from the point of contact and walk in from a range of 300-500 meters in a spread formation so as to minimize the risk of mass casualties and to provide better coverage of the tactical battle space. This is especially true for theaters in which the enemy uses remotely triggered IEDs as a tactical weapon against armored columns. Such a counter-move is taught as a basic defensive measure in most infantry courses.

One alternative that conventional armies rely on is to have an armored column carrying infantry move in tight on the enemy position, although this is usually an urban rather than rural tactic given tight space constraints and the limited lines of sight involved. It also assumes that the armor in question can withstand small arms fire, to include RPGs, at relatively close range. My question is therefore two-fold: why did the NZDF troops move in so close before dismounting, and what was the “armored” vehicle that was hit (and in fact, was any vehicle hit by “rocket” fire)? If one of the convoy vehicles was hit, what was it? An armored Humvee? An up-armoured Hilux? A LAV? If it was the latter (and I have seen video of NZDF LAVs being used in Bamiyan), what was the nature of the “anti-tank” munition used against it? Or was it hit by an RPG? I say this because one of the biggest flaws of the LAV, should it not be up-armored, is a relatively thin skin which is vulnerable to both RPGs and 50 caliber rounds. That flaw was the focus of much criticism during the debates about the LAV purchase, but the government and NZDF have consistently discounted the apparent vulnerabilities of the platform. Both the Humvee and Hilux, even if armored, are vulnerable to RPGs and large caliber rounds, to say nothing of IEDs.

>>Update: The NZDF have now reported that LAVs were involved and that one soldier was shot while sitting in the roof well position. The other was shot on the ground. There is no updated reports on whether the LAV took incoming small arms or RPG fire. Sanctuary and I discuss the issue of LAV vulnerability to such fire in the first two comments below.<<

Another question is about the report that 17 insurgents were seen leaving the scene, moving towards an area “not under the control of coalition forces” carrying their dead and wounded. First of all, the Taliban do not carry their dead, as that would be suicidal given that it would slow them down and make them vulnerable to pursuing forces or air strikes. Although they do at times carry their wounded, that also slows them down and makes them vulnerable to hot pursuit, particularly if they are climbing away from the battle zone. So why the claim that Taliban dead and wounded were being carried away and why no pursuit?  What does “area not under control of coalition forces” mean? Given that the fire fight was supposedly over in 2-3 minutes according to the NZDF, how were the enemy forces able to escape in full sight of the patrol? Were they fired upon while retreating?

Why was no air cover called in before or after the initial ambush? Since the dead and wounded were evacuated by chopper in a relatively short period of time once the call for help went out, that means that air assets were in the vicinity (there is an airfield at the Bamiyan PRT). Were they otherwise occupied?

From what I gather in the press, this looks like a classic sucker ploy double ambush in which the NZDF was specifically targeted. That no enemy bodies or wounded were recovered, and that no pursuit of the fleeing insurgents was undertaken, suggests that this was a significant tactical victory for the “bad guys” (I presume that no pursuit was launched because the priority was to stabilize the wounded and secure a landing zone for the rescue choppers). It also suggests that there may be some issues with the patrol and response tactics used by the NZDF, particularly if these had been used before and established a pattern of behavior that the Taliban/insurgents could observe and learn from. The patrol in question was in its third month of deployment (the 19th PRT rotation), so questions of experience and local familiarity on the part of the troops involved are fair to raise.

I do not mean to question the actions or valor of the NZDF troops, nor do I claim any superior military expertise. I certainly do not have all of the facts on the ground. I can only speculate on what has been reported by the mainstream press so far. However, I do know a little about irregular warfare and about the tactical nature of that warfare in the Afghan theater. It is for that reason that I ask these questions, which I hope someone in the mainstream press will be courageous enough to ask of the government and NZDF. After all, there is still at least another year to go before the NZDF withdraws from Bamiyan, and whoever conducted this attack is clearly signaling what is in store in the months ahead.

Postscript: In his latest press conference held today Gen. Rhys-Jones stated that the NZDF troops were not specifically targeted, but were fired upon by insurgents protecting a valuable bomb-maker who was the object of the initial NSD search. He claimed that both soldiers killed as well as those that were wounded were dismounted when struck by small arms fire, and that the insurgents engaged in a fighting retreat before air strikes were called in. He asserted that the insurgents “took a battering” even though no bodies are found. This raises more questions even as it answers some of those outlined above. I shall leave it for readers to decide whether to take the General at his good word.

Posted on

Gaming Gay Marriage

I have never quite understood the argument that gay sex is “unnatural.” Unless one believes that the only natural sex is that which reproduces the species, then how one chooses to express sexuality is as natural as differences in hair or skin color. If we admit that sex can be a means of expressing love, affection and physical pleasure rather than purely a reproductive act, then how one goes about doing that is as natural as variations in climate or on a theme. It does not matter if sexual preference is by “choice” or genetics or some combination thereof. Once the reproductive imperative is removed as the sole reason for having sex, then how one chooses to partake is almost limitless (I say “almost” because I adhere to convention that sex should be between consenting adults, or in the case of teenagers, between those of similar age, and that no coercion or exploitation can be involved).

I introduce the subject of gay marriage this way because I simply fail to understand why it is an issue. When I hear opponents argue against it I am reminded of the old Argentine saying about Catholic clergy opposed to divorce: if they do  not like divorce they should not marry. Or the more recent retort: if one does not like gay marriage then one should not marry a gay.

One thing is clear. The reproductive imperative does not apply to the legal recognition of straight marriages. Many heterosexual couples are childless by choice or circumstance. Some fulfill their parental instinct via adoption or with the help of surrogates, but others do not. In all cases they are legally free to marry.

Having thought about it a bit in light of recent arguments arising out a parliamentary bid to legalize gay marriage, it strikes me that the debate can be seen in simple game theoretic fashion.

Those opposed to gay marriage see the outcome if it is legalized in zero or negative sum terms. Awarding the right to marry to homosexuals will directly and negatively impact on heterosexual marriage. The belief is that awarding gays the right to marry comes at the immediate expense of heterosexual marriages, and that something will be directly lost or detracted from the latter if the former is permitted. Worst yet, the situation could become collectively negative sum if gays are allowed to marry: both gays and straights will suffer losses as a result (this is usually seen in the “children need hetero parents” argument, but extends to the costs of awarding full rights to married gay couples when it comes to family-oriented taxation, insurance and health benefits). The bottom line is that awarding equal marriage rights to gays (as a sexual minority) will impose costs or losses on the sexual majority, and therefore should not allowed under the lesser evil principle because collectively it is a lose-lose proposition.

Those in favor of gay marriage see the issue in even or positive sum terms. They see gay marriage as taking nothing from nor adding to hetero marriage, or in the most optimistic view, enhancing the value of marriage as an institution by extending the franchise to those of same-sex persuasion who wish to monogamously commit to each other in the eyes of the state (I will leave aside issues about non-monogomous unions and plural marriages in order to make the first-order point). In this view gay marriage should be encouraged as it deepens the familial bases of social stability and is therefore a greater good for society as a whole. It is a win-win solution.

Whatever other issues are put forth pro and con, it seems to me that this is the real crux of the issue. The rantings of bigots and extremists are not addressed here simply because they do not matter. I include in this God-botherers and other repressed and closeted people who act out of irrational psychological fear. Nor do I care to indulge the arguments of some extremists who think anything goes and there should be no prohibitions on sexual contact (say, the Man-Boy Love Association crowd). Here I am simply trying to distill the rational arguments in favor and against.

For me the issue is certainly even sum and probably positive sum. If we accept that one major source of social decay is the decline of the “traditional” family defined by heterosexual marriage, then it seems to me that one good response is to encourage the rise of “non-traditional” families as a complement. After all, “traditional” gender roles have been altered over the years (I would say for the better) without killing off the majority notion of marriage and family as the pillars of society, so I do not see how non-traditional marriage and families will be any more harmful to social stability than allowing women the vote or non-whites to have equal civil rights.

With regard to marriage specifically, there are already precedents for taking what was non-traditional or even taboo and making it commonplace. For example, marriages of mixed race or inter-faith couples, or those with intellectual or physical disabilities, once were viewed as suspect or dangerous (often on reproductive grounds), and in some cases legally proscribed. Today they are additional and welcome threads that rather than harm have added to the vibrancy of the matrimonial fabric of complex societies.

Anyway, this may be obvious to KP readers given their ideological dispositions. The point I am trying to make is that marriage is not a pie with a finite number of slices, where giving one slice to gays will mean that there is not enough left for straights. To the contrary, marriage should be seen as an expanding pie in with we can all share regardless of sexual preference because we commonly appreciate the order and stability it helps bring to our individual and collective lives. I reckon that is a very traditional way of thinking.

Posted on

On Liminality.

For some time I have been pondering the issue of liminality. It is a term that appears in cultural studies and all sorts of post-modern rubbish posing as theory, but in this instance it resonates with me and seems to accurately depict a social condition that is increasingly evident in a multi-globalized world. “Liminality” refers to state of intermediacy or even indeterminacy. It is a condition of being caught in betwixt and in between, of being in two or more places at once but not being fully settled in any one of them. It is different from and more than hybridity, which is a combination rather than a condition, although hybridity can lead to liminality in some instances (say, a mixed race person moving between the different class and cultural backgrounds of parents).

In my frame of reference liminality is the condition where a person who has lived for significant periods of time in more than one country finds him/herself saddled with affections and aversions from each, leading to overlapping loyalties, and more importantly, a sense of relativism that destroys any notions of cultural absolutes or ideals. For example, the more the individual lives in different places, the more it seems to me that it is hard to get seriously nationalistic about any one of them. Even such small issues as sports loyalty can be a complicated matter. I, for example, follow Argentina in soccer because I grew up there. I root for Barcelona because it has a genius Argentine forward and a very Argentine style of play, but support Portugal as a national side in Europe because I lived in Lisbon for while and watched several of their players live as part of the experience. I support the ABs in rugby but switch allegiances to the Pumas when the play each other. I support the US in things like baseball and basketball, but then again tend to root for Greece in basketball because I lived in Athens for a while and the Greeks are crazy about b-ball, and cannot help but cheer for any small Latin American country when they play against the US in either sport (and truth be told, Cuba, the Dominican Republic and Venezuela have great baseball traditions and Argentina and Brazil have beaten the US in international basketball competition. Yay for them!).

Although I am not sure that they are sports rather than games, I have taken an interest in and support Singapore in table tennis and badminton because, well, I lived in Singapore for a few years and that is the only thing that they do well when it comes to international “athletic” competition (truth be told the national sport in Singapore is shopping, but they do not award medals for that). When not rooting for Argentina my default options are Chile (where my family lived for several years and where I subsequently conducted field research), Uruguay (where my family vacationed for extended periods during our time in Argentina and where I conducted field research in later years) and Brazil (where I lived episodically in the 1980s).

The sports angle is a minor one. The more serious issue is that as more and more people travel and settle across international borders, the more liminal they become. In many instances this occurs on top of an urban-rural disjuncture, whereby people transplanted from one to the other find themselves (at least initially) alienated and out of synch with the rhythm of life in their new locale. Think of a Laotian peasant or Somali refugee arriving and settling in Auckland. As with most new migrants, particularly those that are involuntarily re-settled, the pull of nostalgia for what was culturally lost very often overwhelms the urge to integrate and accept new values, mores and customs. It is only subsequent native-born generations that feel grounded in the new culture, but even they are often caught in betwixt and in between. One solution, particularly if the native population is hostile to new settlers, is to retreat in parochial defense of the “old” country or way of life. But even that eventually gives way to mixed feelings of loyalty and obligation to the old and the new.

Liminality occurs at the sub-national as well as the international level, both of which have been impacted by the revolution in transportation and telecommunications. There are consequently more and more people living in a liminal condition or state of mind. It therefore seems to me that “liminality” should be included in policy debates about things such as immigration, although to do that correctly we will have to wrestle the term away from the cultural relativists and other intellectual poseurs who think that trafficking in big words is equivalent to practicable and useful social research.

I am no expert on the topic so mention all of this merely as a subjective reflection. It is prompted by the July 4 celebrations in the US and comments by friends back there about how the US is the greatest country on earth etc. Yet most of these folk have never lived outside the States for an extended period of time, so how would they know? From my perspective it certainly has many merits and offers many opportunities, but in the end that is as much due to the its continental size and relative insulation as it is to the particularities of its people, politics and culture. Mind you, I feel certainly loyalty to the US as the country of my birth and whose government I once served, where my children and siblings reside, but that competes with my childhood loyalty to Argentina and current loyalty to NZ (which is where I expect to end my days. That raises an interesting sidebar: how many people actually think about the country or place that they would prefer to die in? I can say one thing for sure. Among other unhappy places, Afghanistan is not on the top of my list, with all due respect to the Afghans that I have known).

Who is to say that Canada, Costa Rica, Norway, Estonia, Turkey, Bhutan or–the goddess forbid–Australia is not the “greatest” country? How is universal “greatness” as a nation defined? One would have had to have lived in many places and have done many different things in order to make such a distinction (I do not mention Aotearoa simply because we all know that it is Godzone). And if one did in fact live in many places doing many different things, it is more likely that s/he would be at a loss to pick one single place as being above all of the rest in every respect. That is what liminality can do to a person–it makes it impossible to speak about culture or nationality in absolute or definitive terms. I say this even though I am fully aware of the canard that states that “there is no place like home,” whereby expats use the experience of living abroad to reaffirm their loyalty to their nation of origin (my parents did this for most of their lives). That may be true in some but not all instances, and I would argue that the more countries one lives in the less able s/he is to make such an assertion.

In any event, I write this as a person born in the US, raised and subsequently lived as an adult in Argentina and other Latin American as well as European and SE Asian countries, who resides permanently in NZ while continuing to travel to Australia, the US and elsewhere for professional and personal reasons. That pretty much defines my liminality, which I am not entirely sure is a bad thing.

Posted on

Partners not Allies: New Zealand and the US sign the Washington Declaration.

On June 20 New Zealand Defense Minister Jonathan Coleman and US Secretary of Defense Leon Panetta signed the Washington Declaration, which specifies priority areas of cooperation between the militaries of both countries. The Washington Declaration is a follow-up to the Wellington Declaration signed by New Zealand and the US in November 2010 (with Secretary of State Hillary Clinton and Foreign Minister Murray McCully doing the honors). The first was a general statement of principle with regard to New Zealand-US security cooperation and bilateral foreign relations. The follow-up provides more detail on the specific areas in which military cooperation will occur. These are counter-terrorism, maritime patrol, anti-piracy operations and humanitarian relief. The details of the logistics involved in those areas have not been finalized and/or made public, and in the case of counter-terrorism operations they are not likely to be divulged beyond a general statement. This has as much to do with New Zealand public sensitivities as it does with US public opinion or classified operational details (for example, the role of the NZSAS in joint counter-terrorism operations with US forces).

What is different in the Washington Declaration is that the military-to-military bilateral relationship is now taking concrete shape, whereas the Wellington Declaration was a diplomatic opening rather than a definitive outlining of military areas in which joint operations and exercises will occur.

Robert Ayson described the relationship as a defacto alliance between the US and New Zealand. Professor Ayson used the phrase because the US and New Zealand are not entering a formal alliance agreement but a “strategic partnership.” An alliance is essentially a contract with mutual obligations; a partnership is a looser arrangement in which obligations are voluntarily assumed but not contractually defined, binding or specified. Partnerships can be reviewed and modified on a case-by-case or temporal basis, whereas alliances commit the parties to treaty-strength obligations that require a major diplomatic rupture for them to be abrogated. This distinction theoretically gives the US and New Zealand a greater degree of flexibility in their relations with each other on military issues. That is diplomatically advantageous for New Zealand, which seeks to preserve its image and reputation for foreign policy independence, and also avoids domestic voter backlash to the resumption of something akin to the ANZUS alliance so spectacularly undone by New Zealand’s 1985 non-nuclear announcement. The Labour, Green and Mana parties, in particular, would have been very resistant to the restoration of a formal military alliance with the US, so on political grounds the strategic partnership agreement works out very well domestically as well as bilaterally.

In practice, the strategic partnership with the US aligns New Zealand with other “first tier” US security partners in the Western Pacific Rim such as Australia, Thailand, Singapore and the Philippines. This is important for the New Zealand Defense Force (NZDF) as it seeks to integrate more closely with Australian Defense Force operational doctrine, training and equipment (as was suggested by the NZDF 2010 Defense White Paper) at a time when Australia and the US are deepening their bilateral security ties (evident in the recently announced agreement to forward base a US Marine rapid response force in Darwin). Ayson is right in that the NZDF will now be working side by side with the US military on a regular and continuous basis in specified areas (such as the upcoming RIMPAC naval exercises that the Royal New Zealand Navy (RNZN) has joined for the first time in two decades), although NZ will have a little more leeway in refusing US requests to join in foreign conflicts than if it had signed a formal alliance agreement that required both parties to come to their respective defense.

The resumption of near-complete bilateral military ties between New Zealand and the US is not a surprise. The 5th Labour government (1999-2008) started the rapprochement with the US post 9/11, and the National governments that followed it have openly embraced the prospect of finally overcoming the post-ANZUS freeze in security relations (with the exception of intelligence-sharing, which never suffered the curtailment of ties seen in military relations). Labour was wary of being seen as getting too close to the US, since that could jeopardize its reputation for an “independent and autonomous” foreign policy stance, particularly amongst non-aligned and small states. National prefers to embrace the US more whole-heartedly, in part because of the belief that there will eventually be economic as well as military benefits in doing so (such as via the Transpacific Partnership trade agreements currently being negotiated by the US, New Zealand and seven other Pacific Rim states). The idea behind National’s approach appears to be to use the improved military ties with the US as a hedge against the rise of The People’s Republic of China (PRC) by countering or balancing increased economic dependence on the PRC with the strengthening of economic and military ties with the US and other pro-Western nations along the Pacific periphery. National seems to believe that this balancing act (or straddling of fences), continues the tradition, or at least appearance of independence in foreign affairs.

That may be a mistake because independence in foreign affairs is most often predicated on neutrality with regards to foreign conflicts or great power rivalries. In aligning itself more closely with the US on military matters, New Zealand loses that appearance of neutrality in international security affairs. The New Zealand Foreign Affairs and Defense ministries may believe that this is the best hedge against attempts by the PRC to exploit its economic relationship with New Zealand (since the PRC is clearly the dominant partner in the bilateral Free Trade Agreement (FTA) with New Zealand and has much leverage on New Zealand when it comes to Chinese market access as well as exports and investment from the PRC to New Zealand). Balancing economic dependence on China with strengthened security ties with the US (and its allies) may appear to National to be the best way of New Zealand having its cake and eating it.

Strengthening of political ties with the US is part of National’s larger policy of reaffirming diplomatic alignment with traditional partners. The belief is that New Zealand shares more in terms of core values with these traditional partners due to the Anglo-Saxon liberal democratic traditions that bind them together, rather than the mixed Confucian-Communist values that underpin the core beliefs of the Chinese political elite (or the Islamic beliefs of New Zealand’s Middle Eastern trading partners). Even if the PRC was to continue growing economically at a pace similar to the last decade (which now seems improbable), it seems prudent under this logic for National to reaffirm its Western heritage, joint vision and general orientation until such a time as China and other non-Western authoritarian states begin to open up politically. Reaffirming political ties to the US and other traditional allies does not undermine New Zealand’s position with Asian democracies like India, South Korea, Taiwan or Japan, or with Southeast Asian democracies (such as they are) like Malaysia, Indonesia and the Philippines. All of these countries, as well as Southeast Asian authoritarian states such as Singapore and Viet Nam, fear the rise of China as a military power and/or economic hegemon in the Western Pacific, and therefore welcome any counter-balancing efforts on the part of the US and its strategic partners and military allies.  The political alignment with the US also fits in line with the foreign policy approaches of Australia and the UK, and reasserts New Zealand’s position within that informal alliance structure (Canada is part of it as well).

There are benefits for both the US and New Zealand in this restored relationship. The benefits for New Zealand are that the NZDF will get to conduct exercises and operations with the most hardened, experienced and technologically advanced military in the world. That will expose it to the latest in US strategic doctrine and tactics. It may also result in the US providing military equipment to and training opportunities for New Zealand that it otherwise could not afford. It will reassure New Zealand of the implicit US defense guarantee in the event that New Zealand were to be threatened or attacked (to include economic coercion by the likes of the PRC). It may lead to closer economic ties, although that remains an open and much debated question (there is a large literature on security partners being preferential economic partners because of the mutual trust and dependence established between them. Most of that literature was written during the Cold War and things changed after it ended, but now with the emergence of the PRC and other powers some of those old assumptions are being resurrected and reviewed, especially in the US).

For the US the agreement is win-win. It gets an immediate benefit from securing another strong security partner in the South Pacific, one that has considerable “local knowledge” and relative influence in South Polynesia. This accords with the shift in US strategic emphasis to the Asia-Pacific, which is part of a long-term strategy of ring-fencing Chinese attempts at blue water expansion into the region. In signing New Zealand to a bilateral military partnership similar to those of other Western Pacific states, the US has moved to establish a security cordon in the region, something that also serves as a force multiplier in the measure that US strategic partners commit military assets to a common cause. New Zealand’s reputation as an honest broker in international affairs gives it diplomatic cover in this effort.

More importantly, after 25 years of estrangement and New Zealand foreign policy independence, at least with regard to international security affairs, the US has finally broken down New Zealand’s resolve and returned it to the fold. Post 1985 wooing of New Zealand began during the Clinton administration and continued with his successors. 9/11 accelerated the reconciliation (under a Labour government), and the Wellington Declaration codified it. In many respects, the US’s ability to re-gain New Zealand’s signature on a bilateral military-security agreement is a triumph of long-term great power diplomacy: after years of distance it secured junior military partnership from a small democratic state that prides itself on its modern history of foreign policy independence. To be sure, fluid global conditions since 1990 have contributed to the evolution in US-New Zealand bilateral relations, but at present it appears that the US has finally managed the contretemps of New Zealand non-nuclearism with diplomatic aplomb and to its ultimate benefit.

The negatives for New Zealand could be that the US will pressure it to increase its spending on defense, now below 1 percent of GDP, to something more in line with Australia’s two percent per annum. This would be on a par with other US strategic partners and around the NATO average, but will be politically unpalatable amongst New Zealand voters, who tend to under-appreciate defense when compared with education, health and welfare. Thus any such request will be politically thorny for a New Zealand government.  However, the US can leverage the fact that the NZDF is not “pulling its weight” in the strategic partnership (the Australians already say this).

For example, although the Washington Declaration speaks about closer bilateral military cooperation in the areas of maritime patrol and anti-piracy, New Zealand has very little in the way of long-range patrol and interdiction capabilities. Specifically, New Zealand only has two blue water ANZAC-class frigates, two off-shore patrol vessels and six long-range P-3 patrol aircraft, and its multi-purpose ship, the HMNZS Canterbury, spends more time in port being repaired than at sea, As for its logistical lift capability, not only is the HMNZS Canterbury unreliable, but the RNZAF C-130 fleet, at five aircraft, is also small and already stretched in terms of its operational readiness. Thus the US and Australia can pressure New Zealand governments to increase spending on defense so as to be able to perform the responsibilities and tasks that are expected of it as a strategic partner in the areas designated as joint priority.

There is the risk of being drawn into US conflicts that have nothing to do with New Zealand or an imminent threat to it. Even if New Zealand has leeway in terms of refusing a US request to get involved in a non-immediate foreign conflict, once bilateral military ties are established and consolidated they constitute a source of leverage on the part of the US since any retaliatory cancellation or disruption of the bilateral relationship will hurt the NZDF more than it will the US military. Moreover, the bilateral diplomatic backlash from a public refusal to work with the US in a foreign conflict theater could overcome any domestic and international support for the move.

There is also the more immediate issue of diplomatic fallout over the partnership. The more that New Zealand is seen as aligning itself with the US on security matters, the more US rivals such as Russia, the PRC, and various Latin American and Middle Eastern states will see it as a tool of US foreign policy and military strategy. Even other “independent” states like Uruguay, Finland, Costa Rica, Estonia and Turkey may begin to recast their view of New Zealand as an honest broker in international affairs. That is why National’s belief that its fence-straddling or hedging strategy will continue the image of independence may not work out to be the case, which could have adverse diplomatic consequences.

(The original version of this essay appears at 36th-Parallel.com)

 

Posted on

In Hellas, out with the new and in with the old.

The outcome of the latest Greek election is not surprising. When faced with uncertainty and dire predictions of collective and individual doom in the event that radical change occurs, voters often tend to go with the status quo or what is already in place. Confronted with the “valley of transition” to an unknown future, voters rationally calculate that their interests are best served by staying with what is known rather than leap into the unknown. Add to that the orchestrated litany of woes predicted by bankers, capitalist-oriented politicians, and lender nations, who pretty much predicted the end of the world as we know it if Greece were to default on its debts and withdraw from the Eurozone currency market, and it is easy to see why a plurality of Greeks decided to stay with the hand that they have been dealt with.

The trouble is that hand, in the form of a New Democracy/PASOK coalition (the so-called “bailout coalition”) is exactly the hand that got Greece into the debt crisis in the first place. It was first New Democracy, then PASOK governments that set new records of corruption, clientalism, patronage and nepotism while running up the public debt on state-centered labor absorption and entitlement projects that did nothing for productivity or the revitalization of the Greek private sector (which remains fragmented and dominated by oligarchic interests in the few globally viable Greek industries such as shipping). It is to this pro-Euro political cabal that the responsibility for “rescuing” Greece is entrusted. That is not going to happen.

True, the terms of the bailout will be relaxed even further now that a pro-Euro government can be formed. That much is clear given that Andrea Merkel has hinted that the repayment terms can be “softened.” The hard truth is that repayment can be softened because what is being repaid in Greece is the compound interest on the foreign loans. The logic is that of the credit card: the issuer of the card would prefer for users to not pay off their total debt on a monthly basis and instead accumulate interest-accruing cumulative debt while paying off less than the total owed. If the user reachers a credit limit with interest debt accruing, the limit is raised. If the user defaults on the debt after a series of credit limit raises, measures are taken to seize assets of worth comparable to the outstanding amount.

States are different than individual credit card users because as sovereign entities they can avoid asset seizure on home soil even while bankrupt. As Argentina proved in 2000, they can default and renegotiate the terms of debt repayment according to local conditions (after Argentina defaulted on its foreign debts it was eventually able to negotiate a repayment to creditors of US 36 cents on every dollar owed. The creditors took the deal, then began lending again, albeit more cautiously. The devalued Argentine peso sparked an export boom of agricultural commodities that led to post-default growth rates unseen for 50 years). The short-term impact of default can be painful (witness the run on Greek banks as people try to cash in and export Euros), but measures can be taken to curtail capital flight and to mitigate the deleterious effects of moving to a devalued currency (the Argentines did this by placing stringent limits on currency transfers abroad in the first months after they de-coupled the Argentine peso from the US dollar while at the same time issuing interest-bearing government bonds to dollar holders in the amount valid at the exchange rate of the day before the de-coupling). Greece has not adopted any of these measures as of yet, but that is because a pro-Euro caretaker government, as well as the PASOK government that preceded it, wanted to heighten the sense of doom should an anti-Euro coalition look to be winning majority support.

That scenario emerged in the form of Syriza. Although it is formally known as the Coalition of the Radical Left it is anything but “radical” (no matter how many times the corporate media tries to emphasize that point). Instead, it is a coalition of Socialists, Social Democrats, Greens, Trotskyites, Maoists and independents not associated with the Greek Communist Party (KKE). It has an agenda that includes a possible default, and will now be the largest opposition bloc in the Greek parliament. Contrary to the perception that it came out of nowhere in this year’s elections, Syriza has been steadily building a popular voting base since 2004, increasing its electoral percentage significantly in 2007, 2009 and May 2012. Although it has had splits and defections (which are endemic in Greek politics, particularly on the Left), Syriza was the second largest vote-getter in the May 2012 elections and its margin of loss to New Democracy in the second-round elections held last weekend is less than it was in May. The bailout coalition may have a narrow majority, but Syriza and other Left minority parties will prove to be a formidable parliamentary obstacle to the implementation of  its pro-Euro agenda.

That is why the new Greek “bailout” government will not be successful even if it renegotiates the terms of the bailout along more favorable lines than in previous iterations. It will be forced to deal with the combined pressures of Syriza opposition in parliament and the angry–and I reckon increasingly violent–opposition of the non-parliamentary Left in the street. Greece has a long tradition of student and union militancy and urban guerrilla warfare. Even during the best of times militant groups have used irregular violence to make their points about Greek capitalism and its ties to Western imperialism. They have burned and they have killed (including a CIA station chief, a British embassy official and various Greek security officers) during the decades after the Colonel’s dictatorship fell in 1973. These militant strands have not gone away and instead have been reinforced as the debt crisis drags on and the impact of austerity measures take their toll on the average (and increasingly unemployed) wage-earner. With unemployment at 20 percent and youth unemployment at 50 percent, the recruitment pool for Greek militants has grown exponentially.

Some of this has been siphoned off my neo-fascist parties like Golden Dawn. But the bulk of popular rage has been channeled by the Left, divided into the institutional vehicles of Syriza and the KKE (and various off-shoots), and the direct action, non-institutionalized vehicles comprised by the likes of Revolutionary Sect (who favor political assassinations) or Conspiracy of Fire Nuclei (who appropriately enough favor arson), that follow a long line of militant groups with a penchant for violence such as the N-17 and Revolutionary Struggle (and may in fact include former members of the latter), to say nothing of various anarchist cells.

These militant groups are not going stay quiet. Instead, I foresee a rising and relentless tide of irregular violence coupled with acts of passive resistance and civil disobedience so long as the political elite continues to play by the Euro rules of the  game. Every Greek knows that the solution to the crisis is political rather than economic because the bankers have made more than enough profit on their loans and it is now time for them to draw down or write off the remaining interest owed. A softened bailout package only goes halfway towards easing the collective burden of debt, and the continued imposition of fiscal austerity deepens the stresses on Greek society (urban crime has ramped up significantly this year, and it already was pretty bad when I lived in Athens in 2010). Instead of continuing to cater to banks, the political decision palatable to most (non-elite) Greeks is not a softened bailout package, now into its fourth iteration. It is a complete re-structuring, with or without default, of the economic apparatus so that national rather than foreign interests prevail on matters of employment, income and production. This may require a retrenchment and drop in standards of living over the short-term, but it at least gives Greeks a voice in the economic decisions that heretofore and presently are made by Euro-focused elites more attuned to the preferences and interests of European finance capital than they are to those of their own people.

If there is a domino effect in other countries in the event that Greece eventually (I would say inevitably) defaults, then so be it simply because that is the risk that bankers and their host governments assumed when they lent to PASOK and New Democracy governments in the past. Perhaps it is time for bankers to pay the piper as well. After all, although their profit margins may fall as a result of the Greek default, they have already insured against the eventuality (the write-off of Greek debt by large financial institutions in the US, UK and Europe is the story that never gets mentioned by the corporate media). Moreover, and most importantly, the banks can accept the default and take their losses on projected interest as a means of keeping Greece in the Eurozone market, thereby avoiding the contagion effect so widely predicted at the moment. Default does not have to mean leaving the Euro currency market. Greece can default and stay in the Eurozone so long as the banks accept that it is in their long-term interest to shoulder the diminished profits (not real losses) that a default will bring.

Again, the economic decisions about Greece had already been made by the European banks, and they are now simply waiting, while claiming gloom and doom, for the political decision to terminate their interest-based revenue streams. The PASOK/New Democracy bailout coalition only delays that political inevitability, and Syriza and the militant Left will ensure that the next bailout is just another stopgap on the road to default and regeneration along more sustainable lines.

Whatever happens, it looks to be another long hot summer in the Peloponnese. Expect a lot of wildfires.

Posted on

Showing The Money versus Making Numbers Work.

That simple phrase “make the numbers work” catches John Key’s approach to the perennial tension between efficiency and transparency in a democracy. To simplify things, it can be said that the more democratic and transparent the policy process, the less efficient it becomes. That is because the more actors are involved in policy decisions, the more likely that additional decisional sites and veto points will be placed in front of policy choices. They key is to find an appropriate balance between efficient policy formulation and implementation and open participatory representation by all potential stakeholders. If forced to choose, democrats err on the side of representation. Authoritarians prefer efficiency.

The corporate world has no objective need for balance. What matters are balance sheets in the black. Firms are structured so that decision-making is hierarchical rathe than horizontal, with decisions flowing from the top rather than as a result of inputs from the bottom or from external parties. Managers rule, workers obey, and shareholders or owners reap profits. Given the sensitivity of any given project, public consultations might be invited and consideration might be given to mitigating factors that impinge on profitability, but the bottom line is that the numbers work in favor of owners, investors and share-holders.

John Key came from (and is likely to go back to) such a world. In fact, with a personal net worth of around $60 million he is a small time member of the “Masters of the Universe:” the network of financial elites (stock brokers, money managers, currency traders, hedge fund administrators and bankers) built up in the 1990s and headquartered in London, New York, Geneva, Hong Kong and Singapore who made the calls on how global liquid assets should be invested. Theirs is a world of numbers, not morality or ethics, and their worth to the network was and is their ability to make the numbers work when constructing investment deals. They answer to themselves and their clients without regard to the public interest because, quite frankly, they are interested in private gain rather than the public good.

With that in mind the self-styled CEO of NZ Inc., John Key, advised himself that changing gambling laws so that SkyCity can have another 500 slot machines in return for building a convention centre on adjacent land at no tax payer expense was a neat deal that was in both the private and public interest (the public presumably being interested in the tax revenues and ancillary benefits that will accrue from having the convention centre up and running, which is a whole different story). By that logic the numbers work.

In order to come to this conclusion, however, NZ’s self-styled CEO had to ignore the counsel of the Auckland City Council, local iwi, problem gambling-related mental health organizations, the Police, traffic authorities, tourism operators and a host of other potential stakeholders (I mention these because the proposed site of the convention centre involves a myriad of urban planning considerations and is only handy to the Casino and not to the Viaduct, Cloud, Winyard Quarter, Ponsoby, Newmarket or other entertainment districts that depend on tourists). When I say “ignore” I mean that he chose not to solicit advice from any of these parties rather than turn his back on advice already given. Mr. Key’s self-advice also told him to order an end to all other tenders once SkyCity got involved, some of which might have contained the input from non-investor interested parties such as those mentioned above. But as a minor Master of the Universe why should he bother with pretenders and outsiders when he could seal the deal with SkyCity for a small change in an industry-specific law? The Hobbit saga taught him that allowing non-investors to have a say could well kill the deal, so this time around he made sure that negotiations were kept quiet.

Clearly Mr. Key is a man who understands numbers and efficiency. But perhaps he spent a bit too much time in Singapore, where public input into policy decision-making is inconsequential to the point that it is not even considered even when it comes to large public works projects (such as the expansion of the MRT train lines currently underway, which have displaced thousands without any input from them and with compensation determined not by market value but by government fiat). In Mr. Key’s world he does not have to waste time and money listening to the blather of a host of obstructionists and self-interested losers (because, after all, he only deals with winners). He is there to crunch the numbers and do the deals. In the pokies-for-convention-centre trade he has done so, efficiently.

No wonder it is rumored that he is tiring of the job. Here he is, cutting deals and helping commercial players make serious money just like in his good old days in the private sector. But now he has to put up with ex-post whingers and other plebians who all want a voice without a full command of the power of numbers. Plus, he is surrounded by career politicians who for the most part could not make a buck even if they won lotto, and the opposition is nothing more than a bunch of special interest namby-pambies who would not get past the lobby of his former corporate headquarters. Why should he stick around and have to listen to their nonsense about addiction, traffic and other social costs?

You have to feel for Mr. Key. Once he was in the stratosphere, unaccountable to anyone but his corporate masters and the private interests that they served. He made money off of money without having to add value or increase production anywhere, and he got rich doing so in part because he made his name in an authoritarian country in which numbers, not people, matter most. Now he has to smile and wave to a bunch of provincial hicks self-absorbed in some weird Antipodean PC navel-gazing where everyone has a say and little gets done.

Then of course there is John Banks, and how he reads the numbers. For Mr. Banks the deal is not about making public and private numbers work. It is about private interests showing him the money in order to advance his political fortunes. Whereas Mr. Key was looking for a way to balance a specific private actor’s desire with a vague public interest (again, assuming that a convention centre adjacent to SkyCity is in the public interest), Mr. Banks was looking for campaign contributions. Presumably there was a quid pro quo involved with at least two known private parties, SkyCity and Kim Dotcom (there are plenty of others who donated “anonymously” to Mr. Banks but let’s focus just on these since they are in the news). What the expectations were for deliverables from Mr. Banks is as of yet unknown, although whatever they were it appears that Mr. Dotcom now feels that he was stiffed on the deal and is exacting his revenge by releasing details of his donations to Mr. Banks’ mayoral 2010 campaign. Whatever it was it was not in the public interest unless one thinks that granting Mr. Dotcom special favors is a collective good.

In the end, what Mr. Key did was not very democratic but it was legal and efficient as far as the tightly defined numbers behind the deal are concerned. Mr. Banks, on the other hand, had no public interest in mind when he solicited funds from Mr. Dotcom and accepted those from SkyCity, even if the latter’s donation was the same as the amount donated to Len Brown at the time (to his credit Mr. Brown reported the donation from SkyCity to his campaign, which mirrored that given to Mr. Banks “anonymously”). SkyCity was just papering both sides of the mayoral aisle with its symmetrical donations to the two leading candidates, and whatever favor was purchased was bound to be equally small given the amounts involved no matter who won the election. But Mr. Dotcom was an individual who papered only one candidate as far as we know, and he did so in excess of the corporate entity known as SkyCity. He was, in other words, trying to purchase individual favor by backing one candidate over another.

That is why there is a difference between the two men. Mr. Key is an authoritarian-minded money man who thinks he knows what is best for the country without regard to the naysayers and whiners, and who makes the numbers work in favor of his preferred vision. Mr. Banks is an egotistical “show me the money” weasel. With the possibility of more revelations about Mr. Banks forthcoming, it could well be the case that the weasel brings down the money man, or at least accelerates his departure from office.