Uniting North America, Blurrily

Dual Citizenship Alert,” by Mark Krikorian, The Corner, http://www.nationalreview.com/thecorner/05_02_20_corner-archive.asp#056976, 24 February 2005.

Mark Krikorian is alarmed that Mexico is recognizing a new class of Mexican citizens — Mexicans who are also American

The lower house of Mexico’s congress overwhelmingly approved a measure that would allow Mexicans in the United States to vote in the 2006 presidential election, and the Senate is expected to follow suit soon. Ordinarily, this would be irrelevant to us, since there are plenty of other countries that permit this. But because of the massive immigrant presence here, this measure will promote the president’s implicit goal of blurring the distinction between the United States and Mexico: there will be extensive campaigning on this side of the border, with mass rallies and ads in print, radio, and even TV; hundreds of thousands of people are likely to line up at consulates to vote, with employers pressured not to punish absent workers and the Border Patrol prohibited from enforcing immigration laws, which would have a “chilling effect” on turnout; and thousands of dual citizens will make a mockery of their oaths of allegiance to the United States by voting in a foreign election.

Blurring distinctions within North America? Unifying North America?

Exactly.

The Hard Road and the Easy Road

China cautions India, US over Patriot missile dea,” India Times, http://economictimes.indiatimes.com/articleshow/1031468.cms, 24 February 2005 (from Democratic Underground).

Taiwan Won’t Rule Out China Unification,” by Stephen Grauwels, Associated Press, http://www.newsday.com/news/nationworld/wire/sns-ap-taiwan-china,0,3316376.story?coll=sns-ap-nationworld-headlines, 24 February 2005 (from Democratic Underground).

Clinton to meet Taiwan’s Chen during visit,” Reuters, http://in.news.yahoo.com/050224/137/2jsxf.html, 24 February 2005 (from Democratic Underground)

Given what no security guarantee means, Barnett’s suggestion of revoking our promises to Taipei would be a disaster. Yet everyone wants a more connected China and a more peaceful Greater East Asia. How do we build it?

Washington is laying out two paths to Beijing: the hard road and the easy road.

The Middle Kingdom can chose the path of harsh rocks and stones and slings and arrows

In an indirect reference to the possible sale of Patriot Missile defence systems to India by the US, China today hoped that the activities of “relevant countries” will be conducive for the maintenance of peace and stability in South Asia.

“We have taken note of reports that a certain country plans to sell anti-missile weapon systems to India,” Chinese foreign ministry spokesman Kong Quan said, without naming the United States.

“We hope that the activities of relevant countries will be conducive for the maintenance of peace and stability in south Asia,” he told reporters.

Asked whether the sale of patriot anti-missiles to India would result in a new arms race in south Asia, the spokesman said that a nuclear arms race in the region is not conducive to any party.

Chinese media reports have noted that the US shares the patriot missile technology with Israel, Japan, Germany, Saudi Arabia and Taiwan.

Or of peace and happiness

Taiwan’s president pledged Thursday he would not shut the door on eventual unification with rival China if Beijing expressed goodwill _one of his most specific pronouncements on the issue.

Taiwanese President Chen Shui-bian, long viewed as rejecting the possibility of unification, clarified his position at a meeting with James Soong, leader of the opposition People First Party. They signed a joint declaration afterward.

The two have held widely diverging views on handling communist China, which claims this self-ruled, democratic island is part of its territory and threatens war if Taipei declares formal independence. China and Taiwan split amid civil war in 1949.

Unification is a passionate top priority for China’s leaders, who have routinely berated Chen as a traitor to Beijing.

These stories aren’t coincidence. Former President, and husband of a hawkish Senator, Bill Clinton will be visited the island-bound Republic of China

Former U.S. president Bill Clinton will meet Taiwan President Chen Shui-bian during a whirlwind visit to the island on Sunday that could annoy China, Taiwan’s arch rival.

China views Taiwan as a renegade province to be reunited by force if necessary and objects to any participation by the island in international affairs, including visits by senior government officials from most countries.

Clinton will arrive in Taipei on Sunday at the invitation of the Taiwan government and deliver a speech on democracy and security, said Michel Lu, foreign ministry spokesman.

A quarter century ago, the world offered the same choice to Argentina. You can make the Falkanders want to join you, and you will be a functioning part of the international system. Or you can be a threat to others and be treated as such.

We will not abandon Taiwan. It is a violation of both the Bush Doctrine and long-standing U.S. policy to abandon Taiwan. Instead, we are encouraging Beijing to become attractive to the Taiwanese.

Let’s hope Beijing choses the easy road.

The Dollar and American Hegemony

The Overstretch Myth,” by David H Levey and Stuard S. Brown, Foreign Affairs, http://www.foreignaffairs.org/20050301facomment84201/david-h-levey-stuart-s-brown/the-overstretch-myth.html, March/April 2005 (from Free Republic).

The article is so well written that few comments are possible

Summary: The United States’ current account deficit and foreign debt are not dire threats to its global position, as would-be Cassandras warn. U.S. power is firmly grounded on economic superiority and financial stability that will not end soon.

Despite the persistence and pervasiveness of this doomsday prophecy, U.S. hegemony is in reality solidly grounded: it rests on an economy that is continually extending its lead in the innovation and application of new technology, ensuring its continued appeal for foreign central banks and private investors. The dollar’s role as the global monetary standard is not threatened, and the risk to U.S. financial stability posed by large foreign liabilities has been exaggerated. To be sure, the economy will at some point have to adjust to a decline in the dollar and a rise in interest rates. But these trends will at worst slow the growth of U.S. consumers’ standard of living, not undermine the United States’ role as global pacesetter. If anything, the world’s appetite for U.S. assets bolsters U.S. predominance rather than undermines it.

The statistic at the center of the foreign debt debate is the net international investment position (NIIP), the value of foreign assets owned by U.S. residents minus the value of U.S. assets owned by nonresidents. Until 1989, the United States was a creditor to the rest of the world; the NIIP peaked at almost 13 percent of GDP in 1980. But chronic current account deficits ever since have given the United States the largest net liabilities in world history. Since foreign claims on the United States ($10.5 trillion) exceed U.S. claims abroad ($7.9 trillion), the NIIP is now negative: -$2.6 trillion at the start of 2004, or -24 percent of GDP.

Note that many savings vehicles, including corporate savings plans and home ownership, are excluded from domestic savings:

An alternative perspective takes as its point of departure the accounting identity that equates the current account deficit with the difference between total investment in the United States and U.S. domestic saving. Low domestic saving, according to this view, is to blame for deficits. The fear is that a sudden reluctance by foreigners to continue exporting their excess savings to the United States would choke off the investment needed to sustain economic growth, sending the U.S. economy into crisis.

This explanation becomes less alarming, however, when you consider that both savings and investment are seriously undervalued in U.S. economic accounts. Capital gains on equities, 401(k) plans, and home values are excluded from measurements of personal saving; when they are added, total U.S. domestic saving is around 20 percent of GDP–about the same rate as in other developed economies. The national account also excludes “intangible” investment: spending on knowledge-creating activities such as on-the-job training, new-product development and testing, design and blueprint experimentation, and managerial time spent on workplace organization. Economists at the National Bureau of Economic Research estimate that intangible investment grew rapidly during the 1990s and is now at least as large as physical investment in plant and equipment: more than $1 trillion per year, or 10 percent of GDP. Consequently, the size and growth rate of the U.S. economy have been seriously underestimated. In fact, when tangible and intangible investment are both counted, the apparent (and much decried) increase in consumer spending as a share of GDP turns out to be a statistical artifact.

The GreaterEast Asian states have a strong interest in maintaining the current system:

In a series of recent papers, economists Michael Dooley, David Folkerts-Landau, and Peter Garber maintain that Asian governments–pursuing a “mercantilist” development strategy of undervalued exchange rates to support export-led growth–must continue to finance U.S. imports of their manufactured goods, since the United States is their largest market and a major source of inward direct investment. Only a fundamental transformation in Asia’s growth strategy could undermine this mutually advantageous interdependence–an unlikely prospect at least until China absorbs the 300 million peasants expected to move into its industrial and service sectors over the next generation. Even the widely anticipated loosening of China’s exchange-rate peg would not alter the imperatives of this overriding structural transformation. Ronald McKinnon of Stanford argues that Asian governments will continue to prevent their currencies from depreciating too much in order to maintain competitiveness, avoid imposing capital losses on domestic holders of dollar assets, and reduce the risk of an economic slowdown that could lead to a deflationary spiral. According to both theories, there should be no breakdown of the current dollar-based regime.

The consequences of an American recession are to be feared by Brussels and Tokyo (not to mention Bejing and New Delhi!) more than Washington:

But even if such a sharp break occurs–which is less likely than a gradual adjustment of exchange rates and interest rates–market-based adjustments will mitigate the consequences. Responding to a relative price decline in U.S. assets and likely Federal Reserve action to raise interest rates, U.S. investors (arguably accompanied by bargain-hunting foreign investors) would repatriate some of their $4 trillion in foreign holdings in order to buy (now undervalued) assets, tempering the price decline for domestic stocks and bonds. A significant repatriation of funds would thus slow the pace of the dollar decline and the rise in rates. The ensuing recession, combined with the cheaper dollar, would eventually combine to improve the trade balance. Although the period of global rebalancing would be painful for U.S. consumers and workers, it would be even harder on the European and Japanese economies, with their propensity for deflation and stagnation. Such a transitory adjustment would be unpleasant, but it would not undermine the economic foundations of U.S. hegemony.

While Europe fades, and dies away, the Second American Century looks bright

For foreign central banks (as well as commercial financial institutions), U.S. Treasury bonds, government-supported agency bonds, and deposits in highly rated banks will remain, for the foreseeable future, the chief sources of liquid reserve assets. Many analysts have pointed to the euro as a threat to the dollar’s status as the world’s central reserve currency. But the continuing strength of the U.S. economy relative to the European Union’s and the structure of European capital markets make such a prospect highly unlikely. On the basis of likely demographic and productivity growth differentials, Adam Posen of the Institute for International Economics estimates that the U.S. economy will be at least 20 percent larger than that of the EU in 2020. The United States will maintain its 22 percent share of world output, but Europe’s share will, in the absence of serious structural reforms, shrink by 3 to 5 percent. Moreover, European government bond markets, although larger than the U.S. Treasury market, are divided among five large countries and a host of smaller ones, greatly reducing liquidity, and European corporate bond and equity markets are smaller than their U.S. counterparts. With Asian capital markets still in their infancy, it will be a very long time before the pre-eminence of the dollar and U.S. capital markets is challenged

Final thoughts: the greatest threat to American hegemony are threats to Natural Liberty

At the peak of its global power the United Kingdom was a net creditor, but as it entered the twentieth century, it started losing its economic dominance to Germany and the United States. In contrast, the United States is a large net debtor. But in its case, no plausible challenger to its economic leadership exists, and its share of the global economy will not decline. Focusing exclusively on the NIIP obscures the United States’ institutional, technological, and demographic advantages. Such advantages are further bolstered by the underlying complementarities between the U.S. economy and the economies of the developing world–especially those in Asia. The United States continues to reap major gains from what Charles de Gaulle called its “exorbitant privilege,” its unique role in providing global liquidity by running chronic external imbalances. The resulting inflow of productivity-enhancing capital has strengthened its underlying economic position. Only one development could upset this optimistic prognosis: an end to the technological dynamism, openness to trade, and flexibility that have powered the U.S. economy. The biggest threat to U.S. hegemony, accordingly, stems not from the sentiments of foreign investors, but from protectionism and isolationism at home.

Update: Tom Barnett agrees

The Chinese leadership also likes to point out that while reserve holdings have tripled since 2001 (amazing, given all our war-mongering, yes?), the price of oil has doubled, and China is importing oil in unprecedented amounts.

Hmmmm. Security, money, energy. Sounds like a complex relationship.

Prospering Democracy

India’s population ‘to outstrip China by 2030’,” by Mark Turner, Financial Times, http://news.ft.com/cms/s/360608e0-868d-11d9-8075-00000e2511c8.html, 24 February 2005 (from Roth Report).

China may be peacefully rising, but its population lead will soon be overtaken by our friend Hindoostan

According to the UN’s latest World Population Prospects, released on Thursday in New York, there will be 1,395m people in India in 2025 and 1,593m in 2050. In China the population will grow to 1,441m by 2025, before dropping to 1,392m in 2050. Cheryl Sawyer, a UN demographer, said: “We’ve been saying for a while that India would cross over China before 2050. But the crossover has been getting earlier and earlier and we now say it will happen before 2030 (not including Hong Kong). This is five years earlier than we said two years ago.

“Based on analysis of the newest censuses, we’re estimating lower fertility for China, while India’s is slightly higher than we estimated in the past.”

There is real danger of China sharing Japan’s depopulating sadness soon

The UN’s population division said it did not doubt that India and China would exchange places, mainly because of differences in fertility. The only question was exactly when. China now has a fertility rate of 1.7 children per woman (though rising to 1.85), while India’s is just above three.

The useful if evil United Nations has a neat euphemism for the one child policy

Thomas Buettner, the chief of the UN division’s estimates and projection section, said China’s changing population was due to “modernisation and uprooting people from traditional lifestyles into the modern economy”, where “people have other opportunities that compete with having large families, like consumerism, travel and education”.

He said it was also due to a rigid population policy, although Chinese officials had started thinking about relaxing that policy because of concern about rapid ageing of the population. Europe’s population, which recently underwent a reversal in growth, is also on a downward trend. According to a medium variant, it will drop from 728m now to 653m in 2050. That figure (which incorporates Russia but not Turkey) includes falls in Italy and Germany, although France and the UK will grow.

medium_hindoostan_seasia_china.jpg

Lastly, while I mostly agree with Tom Barnett, India’s connectivity machine is and will be a more important ally than China — or even Europe or Japan.

Japan’s population declines from 128m to 112m, according to the same variant. “The population of developed countries as a whole is expected to remain virtually unchanged between 2005 and 2050, at about 1.2bn,” the report says. “In contrast, the population of the 50 least-developed countries is projected to more than double.”
The population of India will overtake that of China before 2030, five years earlier than expected, a United Nations population report predicts.

India’s Sphere of Connectivity

Three day tour: Karzai visits India, NDTV, http://www.ndtv.com/morenews/showmorestory.asp?slug=Three+day+tour%3A+Karzai+visits+India&id=68978, 23 February 2005 (from Free Republic).

More on India’s bridge building

Afghanistan President Hamid Karzai arrived in New Delhi today on a three-day ‘working’ visit for talks with Indian leaders.

The visit is also expected to explore the possibility of a $3.3 billion gas pipeline project from Turkmenistan via Afghanistan Pakistan and then India.

Karzai is leading a high-level delegation including eight Cabinet ministers.

The visit comes just a week after External Affairs Minister Natwar Singh pledged continuing assistance to the war torn country.

India has already pledged aid to the tune of $400 million to rebuild the country.

New Delhi is expected to sign a series of agreements in the areas of high tech, medical assistance and aid.

India has become a pillar in the globalization system. It is also a good neighbor, always encouraging its neighbors to accept more connectivity. I doubt any of these deals will change life much for the average Afghani, but it shows that India is propelling South Central Asia in the right direction.

Update: Brian sees this as tying India to Turkmenistan.

Fallujah Marine Cleared

Not enough evidence to charge marine in point-blank Fallujah shooting: report,” AFP, http://www.khaleejtimes.com/DisplayArticle.asp?xfile=data/focusoniraq/2005/February/focusoniraq_February173.xml&section=focusoniraq, 24 February 2005 (from Roth Report).

Great news. The Marine who helped retake Fallujah and, horror of horrors, killed an enemy who played possum, won’t be charged.

A US marine, captured on film killing a wounded Iraqi at point blank range during November’s assault on Fallujah, will not be formally charged due to lack of evidence, according to a report Wednesday on CBS News.

A Marine spokesman, Captain Dan McSweeney, told AFP, however, he had been informed by the Navy Criminal Investigative Services, which is investigating the killing, that “the case is still very much open.”

The November 13 shooting occurred during a search of a mosque in a widely broadcast incident that sparked worldwide outrage and was described by the International Committee of the Red Cross as a demonstration of “utter contempt for humanity.”

In the incident, a trooper raised his rifle and shot point blank at an apparently unarmed, wounded Iraqi who was slumped against one of the mosque walls, in footage captured by an embedded camaraman working for the NBC network.

Although the insurgents were found to be unarmed, investigators said the one the Marine believed he had seen moving could have been reaching for a weapon.

The rifleman was withdrawn from combat pending the results of the investigation, but the graphic footage enraged many, months after the scandal over US troops’ abuse of inmates at the Abu Ghraib prison.

CBS News said Wednesday it had learned that military investigators had concluded insufficient evidence existed to formally charge the marine.

The raid on Fallujah, part of an attempt at reclaiming key lawless enclaves across the country ahead of January elections, has been the largest military operation in Iraq since the March 2003.

Of course, the news comes from CBS, so maybe it’s based on fake documents.

Defining Infants as Persons

Born Alive babies face first House hurdle in being defined as “persons”,” The Leader, http://www.illinoisleader.com/news/newsview.asp?c=23111, 22 February 2005 (from Free Republic).

Are infants persons? Is intentionally killing an innocent infant murder? At least manslaughter? A movement in Illinois thinks so

“This year, the legislation is identical to the federal language which passed the U.S. Senate unanimously, even with support from Barbara Boxer, Hillary Clinton, John Kerry and Ted Kennedy,” Jill Stanek, Concerned Women for America’s Pro-life coordinator and key volunteer lobbyist on the measure, said today.

The need for a so-called Born Alive Infant Protection Act became evident when Stanek, as an obstetrics nurse at Christ Hospital in Oak Lawn, made public how she witnessed babies, born alive as the result of induced abortion, being left to die on a shelf in obstetric floor’s soiled utility room. Stanek was on duty one night when the attending nurse was taking a baby to the soiled utility room because she was too busy to hold the baby until he died.

Stanek took the baby from the nurse and held the 22-week old baby until he breathed his last breath. The baby was afflicted with Downs Syndrome, and the mother had agreed to the induced abortion rather than carry the baby to term.

One other nurse corroborated Stanek’s testimony with her own similar personal experiences before the U.S. House in 2002.

After learning of this medical procedure being used in his own district, former State Senator Patrick O’Malley (R-Palos Park) introduced state level legislation which would have not only defined babies born alive as persons, but also included general guidelines for doctor assessment as well as groundwork for civil action if doctors did not follow the guidelines in their medical care.

I am not sure that infants are full persons, but they are more than animals. The baby’s death was hellish.

Colonel John Boyd and Affirmation

How Col. John Boyd Beat the Generals,” by Martin Edwin Andersen, Insight Magazine, http://www.d-n-i.net/fcs/comments/c455.htm, 11 August 2002.

I read about Boyd on ZenPundit, and Marks’ description made him sound fascinating. His career is even better than I thought. A great summary is available on the ever-handy DNI site. My knowledge is still too sketchy to summarize the article, but the last paragraph is definitely worth quoting

Col. John Boyd, his biographer Robert Coram reports in his well-written book, had a speech he often gave to those who, like the fighter pilot himself, found that doing right did not always mean doing well. Known as the “To Be or To Do” speech, Boyd used it to rally flagging spirits of apprentices who, until they became involved as one of his Acolytes, had appeared fated to climb the highest rungs of conventional success. The tenets of this speech reflected both his spirit and values:

“One day you will come to a fork in the road. And you’re going to have to make a decision about what direction you want to go.” [Boyd] raised his hand and pointed. “If you go that way you can be somebody. You will have to make compromises and you will have to turn your back on your friends. But you will be a member of the club and you will get promoted and you will get good assignments.” Then Boyd raised the other hand and pointed another direction. “Or you can go that way and you can do something – something for your country and for your Air Force and for yourself. If you decide to do something, you may not get promoted and you may not get the good assignments and you certainly will not be a favorite of your superiors. But you won’t have to compromise yourself. You will be true to your friends and to yourself. And your work might make a difference.” He paused and stared. “To be somebody or to do something. In life there is often a roll call. That’s when you will have to make a decision. To be or to do? Which way will you go?”