Month: April 2003

Talking past each other

John Quiggin

Ken Parish has posted on the depressing blog debate over the war, saying

Apparently thoughtful, rational people on both sides interpret exactly the same facts in diametrically opposed ways to fit their preconceived and immovable viewpoints, or choose to believe only those press reports that suit their ingrained prejudices.

Kevin Drum at Calpundit discusses the same issue, linking to Arthur Silber who says

Since the war began two weeks ago, I have noticed the following (it began well before then, but has become much more noticeable recently): almost every strongly prowar blog that I read references many stories which support the rosiest scenarios about how this war will play out, and what will happen in a post-war Iraq (and beyond). Similarly, most antiwar blogs I read link to many stories raising questions about the positive scenarios, stories which may show serious troubles arising, both now and in the future.

While there is some truth in this, the basic problem is more fundamental – the two sides are no longer interested in each others’ arguments.

Roughly speaking the prowar bloggers are concerned to argue that Bush was right in asserting that the US could and would crush its enemies. Their main concerns are that the Coalition should win quickly and suffer minimal casualties.

Conversely, summarising drastically, the antiwar bloggers are concerned to argue that Blair was wrong in presenting the war as an emergency exercise in international law enforcement. Their main concern is that the war has been justified on the basis of legal and political arguments that have now been exposed as largely spurious and on the basis of promises about the conduct of the war that have now been abandoned.

For a brief period, the Iraqi attacks on Coalition supply lines and resistance to the occupation of Southern cities produced an intersection of these two sets of concerns. Prowar bloggers mostly saw the question in more strictly military terms – was the Rumsfeld strategy being proved wrong? Antiwar bloggers saw this as evidence that both the war and the subsequent occupation would be bloodier and crueller than had been claimed and some hoped that an enforced pause in the US advance might lead to some sort of reconsideration.

The picture of mutual incomprehension was completed with the US military successes of the last week. From the prowar viewpoint these represented proof that the critics had been wrong all along. From the antiwar viewpoint, the relevant facts were the escalation in the number of civilian casualties, the further relaxation of restrictions on targeting, the use of weapons like cluster bombs and the massive death toll among Iraqi troops most of whom are conscripts.

In these circumstances, it’s scarcely surprising that the same facts are interpreted in diametrically opposite ways.

Monday Message Board

John Quiggin

It’s time once again for your thoughts and comments on any topic (civilised discussion and no coarse language please). My suggested discussion starter – has the war killed blogging ?

All about oil?

John Quiggin

While we wait for the fall of Baghdad, and hope that it is as quick and bloodless as possible, it’s hard to think about much else but war. However, I have no idea what will happen next and no capacity to influence it, so I’m going to try to stick to economic aspects of the war for the moment.

Quite a few people have asked me to respond to various scenarios involving the role of the US and euro as competing reserve currencies. Since all these scenarios involve oil, I thought I’d try to clear the ground a bit by discussing the question “Is it all about oil?”.

The crudest (I use the term advisedly) version of a war for oil would be one in which the US seized Iraq’s oilfields and took the oil without paying for it. A more standard imperialist procedure would be to impose a highly unfavorable contract on the defeated government or a puppet government imposed by the conquerors. I don’t think the invasion of Iraq is a war for oil in this sense.

A more subtle idea is that the aim of the war is to expand Iraqi production and thereby drive down the price of oil. This kind of thinking is certainly present among those who pushed the war, but it must be remembered that high oil prices are good for the US oil industry which is obviously influential. So again, I don’t think a plan to drive down oil prices is a major motive for war.

There are however, several senses in which it is ‘all about oil’. First, the idea that the US (and to a lesser extent the UK) should have a big say in the way the Middle East is run is based on the assumption that oil reserves are crucial. There’s a nasty dictatorship in Burma, but don’t expect to see the Marines there any time soon.

Second, although the US oil industry as a whole has no interest in overthrowing Saddam, companies that supply oil industry services, like Halliburton and Brown and Root stand to do very well out of things, and have already grabbed the most lucrative jobs in the putative reconstruction.

Third, and most importantly, the logic of the postwar outcome ensures that it will be about oil to a large extent. It looks certain that the immediate outcome of the war will be US military rule which is illegal in terms of international law – having purportedly invaded to uphold UN resolutions, the US & UK have no grounds for resisting UN control of Iraq, but this is evidently unthinkable.

Hence, the only legal way to deal with the oil would be to leave all the earnings with the UN either to buy food and medicine or in trust for some democratically elected Iraqi government in the future. But that would leave the US footing the bill for reconstruction, and this is not going to happen – there is hardly money allocated for it and the US is deeply in deficit. Nor is there any serious prospect of internationally supervised democratic elections in the next year or two

Hence, sometime shortly after the war, either the US or a puppet government imposed by the US military will assert ownership of the oil by right of conquest and will use it to start paying the bills for reconstruction, most of which will go to US contractors. This isn’t exactly the same as pumping out the oil and shipping it back to the US without payment, but I don’t think that the difference will impress the rest of the world.

What I'm reading

John Quiggin

I’m doing a review of Remaking New Zealand and Australian Economic Policy: Ideas, Institutions and Policy Communities by Shaun Goldfinch. In essence, the core purpose of the book is to ‘compare and contrast’ to help work out why the NZ free-market reformers got things so badly wrong. Wrinting in 2000, he observes:

Despite policymakers in New Zealand being able to achieve their policy aims to a remarkable extent and notwithstanding claims that New Zealand provides an exemplar of economic reform, the New Zealand economy has generally not performed well since 1984 as measured by commonly-used economic indicators.

Goldfinch gives a lot of evidence to support the standard critical view, that the New Zealand system with a unitary & unicameral government and a relatively small elite was open to capture by a small group of ideologues, what Brian Easton calls ‘market Leninists’, who then bypassed or over-rode any critical views. As Goldfinch says

there are good reasons to suppose that better policy can be made through compromise and negotiation

Since the election of a Labour government which raised the top rate of income tax and partially reversed the 1991 labour market ‘reforms’, there has been some recovery. A few hardy defenders of the reforms outside NZ have had the chutzpah to suggest that the credit is due to Roger Douglas and the Business Roundtable but within NZ, Rogernomics is discredited beyond all hope of revival. It’s been dumped by the Nationals and even the free-market ACT party relies mostly on law-and-order populism for its modest electoral appeal.

There they go again

John Quiggin

Of course, truth is the first casualty in war. But the frequency with which good news has been reported by the Coalition, only to be retracted a day or two later is unparalleled in my memory. [At least on our side of wars – perhaps Saddam lies more than the Coalition, but does anyone really want that to be the test].

The latest and potentially the most serious case, relates to the fatwa (judgement) supposedly issued by Grand Ayatollah Sistani calling for non-resistance to the Coalition forces. This was announced on Thursday by the the US Central Command, a rather strange medium for Shi’ite fatwas. Today, the BBC is reporting that nobody associated with Sistani knows anything about the supposed fatwa. If it turns out to be a fabrication, the chances of a successful peace, already slim, will dwindle even further.

A war of absences

John Quiggin

In response to my posting about Salam Pax, various people have pointed out implausibilities in the story, not to mention the fact that it’s fourth-hand news at best by the time I reported it. It struck me that this is becoming a war made up almost entirely of mysterious absences. In some ways Bin Laden set the pattern, but it has been amplified in the war on Iraq. There’s Saddam himself (dead, alive and in command, or already on the run?), the welcoming crowds of liberated Iraqis (hostile nationalists or still scared of Saddam’s secret police ?), the Republican Guard (demolished or run away to fight another day ?).

Most of all, there are the Weapons of Mass Destruction. As I pointed out before the shooting started, this was an issue which, for all practical purposes would be resolved on the first day. If Saddam had weapons and was not amenable to containment, the militarily effective time to use them was while US forces were still concentrated in Kuwait. When this didn’t happen, it was widely reported that Saddam’s weapons were concentrated in a ‘Red Zone’ and that Republican Guard units had orders to use them when Coalition troops entered the zone. Clearly if this had been true, weapons would have been used or found by now. Now perhaps, they are being stored for a final siege of Baghdad.

Some on the Coalition side are preparing a backup case, in which thecasus belli will remain intact indefinitely, even if no weapons are found. According to this story, it may take as much as eight months to manufacture find the evidence. (link via Tim Dunlop).

As with so many others, I find this war confusing as well as deeply depressing. I don’t know what to hope for now except that the people of Iraq will soon enjoy the peace Salam Pax took for his name and that he (?) will be among those who survive to enjoy it.

Update Jim Henley reports that Al Jazeera’s English-language site is up here, and there is no mention of salam. So I guess something got confused along the way as happens with rumours of war. I hope so, anyway.

Winning hearts and minds

John Quiggin

From todays SMH, attributed to the Telegraph

British forces say they have “turned” a number of Ba’ath party members against the regime, who have inflitrated Iraqi military groups hidden in schools and hospitals.

At a smart housing complex outside Basra, untouched by looting from militia groups, British officers approached an Iraqi man at his makeshift stall.

“Do you know,” said one officer, “that unless Ba’ath party members start working for us, we’ll take it that they are working against us and we’ll have them shot?”

As the translator put the message across, the officer explained: “I didn’t really mean that. I’m here to offer him and his family safe passage but with these sorts of punters it’s best to play hard.”

“I see,” said the Iraqi, dragging on his cigarette. “Now I think about it, I do remember something.”

Consistency and inconsistency

John Quiggin

Stephen Kirchner raises all sorts of issues in this post (no permalink) which I just found (interestingly enough, just after giving a talk to a leftish audience in which I criticized, among other ‘magic puddings’, the idea that expenditure could be funded by deficits in the long run). After talking in a rather waffly way about the US budget, Kirchner says:

Similarly, it has been amusing to watch many left-of-centre economists re-discover fiscal conservatism now that the government in the US is spending money on stuff they don’t like. John Quiggin characteristically overstates his case in referring to the rise of ‘banana republic populism’ in the US. There are many objections one could raise to the growth in non-defence discretionary outlays under the Bush Administration. But one can’t help but think that deficits of similar magnitude incurred by a Democratic Administration in the wake of a major recession would not occasion similarly alarmist predictions from the likes of Quiggin.

My first response is that it’s a bit annoying when you take the trouble to post almost your entire output on the Web and someone makes this kind of comment without reading what you’ve written. I’ve written many times, and in many different contexts, on the need for a ‘golden rule’ approach in which budgets are balanced (more precisely, public net worth is stable) over the course of the economic cycle. But Kirchner feels free to present me as a recent convert to fiscal conservatism motivated by political partisanship.

The second point is that the objection is not to the current relatively modest deficits, associated, as Kirchner says, with a major recession, but at the projection of deficits growing indefinitely into the future. Brad de Long gives the alarming details in numerous posts on his site.

The final point relates to Kirchner’s own inconsistency. He denies being a Keynesian, but seems to imply that running deficits in recessions isn’t such a bad idea (or maybe he’s just imputing this viewpoint to me). Or perhaps, like the US Republicans, he thinks that deficits are always good. I’ll leave it to him to clarify his position on all this.

To summarise, I don’t see anything wrong with the proposed US budget deficit for this year or next . But if a government of any political color put forward a long-term fiscal strategy as irresponsible as that put up by Bush, I would certainly be raising the alarm.

Update Following a discussion you can read in the comments thread, Stephen Kirchner has now graciously withdrawn the suggestion that my concern about fiscal sustainability is politically selective.

Word for Wednesday: Internationalism definition

John Quiggin

Internationalism is not a political movement like social democracy or neoliberalism, nor is it a central term in a body of argument, like globalisation. Rather, it is a general aspiration. So I’m going to offer my own definition, and try to tease out its relevance to our present problems. As opposed to globalism, internationalism accepts the reality and legitimacy of national governments. This legitimacy arises in part from acceptance of the idea of the nation-state, that particular groups of people (nations) are bound together by ties of common history and language, and are natural units of governments. But the legitimacy of the nation-state is provisional, dependent on both on the consent of the people who make up the nation and on adherence to evolving rules of international law. So, for internationalists, notions of sovereignty, derived from the idea that a king or emperor has the right to manage the affairs of his domain as he sees fit, are problematic.

From an internationalist viewpoint, the debate over the war between Iraq and the US-led coalition has been highly unsatisfactory. On the one hand, the anti-war idea that Iraq is a sovereign nation and that interference with its internal affairs is necessarily wrong cannot be accepted. Saddam’s lack of democratic legitimacy and numerous breaches of international law give the world community the right to protect itself. On the other hand, despite the figleaf of claiming to enforce UN resolutions (now virtually abandoned) the US-led coalition has relied essentially on nationalist arguments that the US has the right to do whatever it sees fit to promote its own national security and national interest. The commonly heard statement ‘S11 changed everything’ can be unpacked into a claim that, in a situation where the US has been subject to direct attack, it is not bound by any concept of international law.

The outcomes of the war so far give strong support to the internationalist view. In particular, the arguments for reliance on international organisations like the United Nations are, in large measure, the same as the arguments for liberal democracy within nations, for example, that no one nation (person) has the wisdom to make the decisions for everyone and that any nation (person) who is given a position of absolute power will ultimately abuse it. It is already clear that on the key issue that divided the US from the majority of members of the UNSC (the claim that Saddam’s weapons represented an immediate threat, and the claim that the calculus of costs and benefits favored immediate action over taking time to build an international consensus), the US was wrong and the majority was right.

15 minutes of fame

John Quiggin

The long-rumoured 7:30 Report segment on blogging went to air today. Other Ozbloggers covered were James Morrow, Gareth Parker and Gianna. I thought it was a pretty good introductory piece, with some cool montages. Gareth had a cool shot as a footy umpire (but his blog wasn’t given much of a run) and Gianna was shot with a very arty black background. I did my usual academic office thing, and James was shown at home. It seems like there’s a few visitors who are coming in because of the show, and I’d be interested in your thoughts (click on the “Comments” link, read others’ comments and add your own).

Sadly, Salam Pax, the Baghdad blogger who was featured in the opening of the segment has not posted for more than a week – maybe because Saddam’s police got to him or maybe because of the cutoff of Internet access, now complete since the Americans bombed the telephone network out of existence.

Update A colleague has emailed me to say that, according to Al Jazeera, salam pax is wounded in hospital. He seems to be in the city of Najaf. The doctor said that he was on his computer when his house was hit by a bomb.

Further update There’s a transcript of the 7:30 report segment here.

Further update 5 April Jim Henley reports that Al Jazeera’s English-language site is up here, and there is no mention of salam. So I guess something got confused along the way as happens with rumours of war. I hope so, anyway.