Tuesday, February 15, 2011


Robert Kagan: Why No Love For Colombia?

Before Egyptian protests initially began on Jan 25th, Robert Kagan had an Op-Ed in the Jan 23rd Washington Post which stated the following:

But sometimes American policy is as incomprehensible as it is regrettable, as damaging to our interests as to our ideals. Consider the case of two countries: Colombia and Egypt. They're both important to American interests. Colombia is on the front lines in the war against narcotics traffickers and narcoterrorists in Latin America. It is a staunch pro-American ally in a region threatened by Venezuela's tyrannical Hugo Chavez and his various cronies in Bolivia, Ecuador and Nicaragua. Egypt has been an important player in the Arab world; it maintains a cold but durable peace with Israel and is an ally against Iran and in the fight against radical Islamic terrorism. Both Colombia and Egypt have received billions of dollars in U.S. aid over the years.

Now for the differences. Colombia is a democratic success story. Once plagued by guerrilla insurgencies and murderous paramilitaries, with wealthy drug lords controlling major cities, Colombia is in the midst of a political and economic renaissance. Under the brilliant and enlightened democratic leadership of Alvaro Uribe for eight years, the narcoterrorist FARC was beaten back, the drug cartels of Cali and Medellin were all but destroyed, and a poor human rights record began to improve. Last summer Colombia held free and fair presidential elections, and already, Juan Manuel Santos has demonstrated a remarkably open and liberal approach to governing. As The Post's Juan Forero recently reported, Santos has pushed legislation to compensate victims of Colombia's long guerrilla war, including those who suffered at the hands of security forces. He is trying to return millions of acres stolen from campesinos by corrupt politicians. In a world where democracy is retreating and authoritarianism is advancing, Colombia stands out brightly against the trend.
For now, the amazing the timing of Kagan's comments -- in effect having history confirm his analysis in a matter of days -- is overshadowing the 2nd country in his analysis. Why the hostility towards Colombia by the Obama Administration? Why would an Administration struggling to 'appear' more amenable to free-market solutions oppose a free-trade agreement negotiated and signed five years ago with a strong ally? I think the answer is tied to the reasons the Administration supported former President Zelaya's efforts to replicate a Chavez-stlye subversion of democracy in Honduras.

Here's my shot at why. His political roots are with the Left. While he has shown the discipline to do what is necessary to get and stay in power [i.e. Afghanistan], at some point a person's early influences and psychological allegiances matter. Maybe because a part of them resents that Colombia defeated the FARC guerrillas. Why would they have any allegiance towards the narcoterrorist FARC? Who knows, maybe they grew up rooting for so-called Latin American revolutionaries and resented Reagan's support of the Contras in Nicaragua. Proxy payback anyone?

The Kagan article referenced is copied in full at end of post.

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The Egypt-Colombia dichotomy - By Robert Kagan
Sunday, January 23, 2011;

American foreign policy, like any nation's, can be hypocritical, selfish, riddled with contradictions and double standards. A president may proclaim his commitment to democracy in soaring rhetoric one day and in the next turn a blind eye to repressive behavior by some government deemed important to U.S. interests. Squaring ideals with more tangible interests is a tricky business.

But sometimes American policy is as incomprehensible as it is regrettable, as damaging to our interests as to our ideals. Consider the case of two countries: Colombia and Egypt. They're both important to American interests. Colombia is on the front lines in the war against narcotics traffickers and narcoterrorists in Latin America. It is a staunch pro-American ally in a region threatened by Venezuela's tyrannical Hugo Chavez and his various cronies in Bolivia, Ecuador and Nicaragua. Egypt has been an important player in the Arab world; it maintains a cold but durable peace with Israel and is an ally against Iran and in the fight against radical Islamic terrorism. Both Colombia and Egypt have received billions of dollars in U.S. aid over the years.

Now for the differences. Colombia is a democratic success story. Once plagued by guerrilla insurgencies and murderous paramilitaries, with wealthy drug lords controlling major cities, Colombia is in the midst of a political and economic renaissance. Under the brilliant and enlightened democratic leadership of Alvaro Uribe for eight years, the narcoterrorist FARC was beaten back, the drug cartels of Cali and Medellin were all but destroyed, and a poor human rights record began to improve. Last summer Colombia held free and fair presidential elections, and already, Juan Manuel Santos has demonstrated a remarkably open and liberal approach to governing. As The Post's Juan Forero recently reported, Santos has pushed legislation to compensate victims of Colombia's long guerrilla war, including those who suffered at the hands of security forces. He is trying to return millions of acres stolen from campesinos by corrupt politicians. In a world where democracy is retreating and authoritarianism is advancing, Colombia stands out brightly against the trend.

Egypt, meanwhile, is committing national suicide. The 82-year-old, infirm Hosni Mubarak is entering his fourth decade as dictator. He seems determined to have himself "reelected" in elections planned for September or to hand power to his son Gamel. He has cracked down brutally on domestic dissent, arresting, torturing and murdering bloggers. He has kept an "emergency" law in place throughout his reign. Recent parliamentary elections were so heavily rigged that opposition parties boycotted the runoffs and renounced the few seats they won. After the "Jasmine Revolution" in nearby Tunisia, the Egyptian pot is about to boil over. Yet Mubarak's response has been to turn a deaf ear to persistent calls to free the political system and end human rights abuses.

You might think that the Obama administration would respond accordingly to these situations. Last year, Deputy Secretary of State James Steinberg played a helpful role encouraging Uribe to forgo an unconstitutional third term in office. Today, you might expect the administration to be looking for ways to strengthen this Colombian success story. You would also expect it to be moving swiftly to get ahead of events in Egypt, to use its influence to press Mubarak and his government to open the political system and avert impending disaster.

Unfortunately, you would be mistaken. There is only one thing the United States needs to do for Colombia right now: Pass the free-trade agreement negotiated and signed five years ago. The agreement has economic benefits for both nations. Failure to ratify it this year would be a slap in the face to Colombia's new president and the Colombian people. Rewarding Colombians for their democratic progress would seem to be a no-brainer. But the administration shows no inclination to push the agreement forward, even with the new free-trade-oriented Republican House sure to pass it. Labor leaders, of course, oppose all free-trade agreements. And some human rights groups still want to punish Colombia for abuses committed years ago, and some in the administration agree.

In Egypt, the human rights abuses are not a decade old. They happen every day. Is the Obama administration exacting any price for this behavior? Have the president and secretary of state made clear to Mubarak that if he doesn't open up the political process to genuine competition, allow international election monitors to ensure the integrity of the electoral process, lift the state of emergency and put an end to torture and police brutality, he will not only destroy Egypt but also damage U.S.-Egyptian relations? Hillary Clinton gave a fine speech in Doha this month on the need for Arab governments to make room for civil society, but when she met with the Egyptian foreign minister right before the November elections she said not a word about Egyptian politics. President Obama has made fine statements about America's interest in supporting democracy around the world, but when he called Mubarak after the eruption in Tunisia, he said nothing about the dangers of a similar eruption in Egypt. The administration has made almost no change in a decades-old policy of clinging to Mubarak, despite the evidence that the man is steering his country toward disaster.

How to explain these two wrongheaded policies, both so at odds with American ideals and interests? Don't bother. Just hope the administration stumbles toward the right answers before it's too late.

Robert Kagan, a senior fellow at the Brookings Institution, writes a monthly column for The Post.
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Monday, February 14, 2011


Leaders Who Believe In Free-Markets

The WSJ's great Mary Anastasia O'Grady reports on one country's efforts to create free-market oriented cities. The country has leaders who make the type of statements noted below.

Leader 1 - What I love about the concept is two things. First, that we will employ the best practices from similar projects around the world that have been successful. Second that it is entirely voluntary for people to move in. They are the ones who will protect it.

Leader 2 - If we want to develop we have to find a way to counterbalance the populism that causes us so much harm. The model city is a way of decentralizing power and connecting people to their government.
Pop quiz: The above quotes come from one of the following [as in all multiple-choice questions, 2 of the possible answers are absurd]:
  1. Obama Administration officials
  2. Islamic Brotherhood
  3. Hong Kong
  4. Hounduras
The O'Grady article referenced is copied in full at end of post.

PS. In response to hundreds of reader comments, while they might be kindred spirits in some respects, answers #1 & #2 are not the same.

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Honduras's Experiment With Free-Market Cities - A poor country considers a new way to stimulate private investment.

By MARY ANASTASIA O'GRADY - Tegucigalpa, Honduras

What advocate of free markets hasn't, at one time or another, fantasized about running away to a desert island to start a country where economic liberty would be the law of the land? If things go according to plan, more than one such "island" may soon pop up here.

Honduras calls these visionary islands "model cities," and as the Journal's David Wessel reported from Washington 10 days ago, the Honduran Congress is expected to soon pass an amendment to the constitution that would clear the way to put the concept into action.

The idea is simple: A sizable piece of unpopulated government land is designated for use as a model city. A charter that will govern the city is drafted and the Congress approves it. A development authority is appointed by the national government. The authority signs contracts with the investors who will develop the infrastructure. The city opens for business under rules that act as a magnet for investment.

Sound fanciful? Perhaps, until the chief architect of the plan, 35-year-old Octavio Sánchez, points out that "model cities" are nothing new. "What I love about the concept," President Porfirio Lobo's chief of staff tells me in an interview, "is two things. First, that we will employ the best practices from similar projects around the world that have been successful. Second that it is entirely voluntary for people to move in. They are the ones who will protect it."

During the Cold War, Honduras was known mostly for its loyalty to the U.S. In 2009 it gained fame for deposing Manuel Zelaya because he was trying to extend his presidency in violation of the nation's constitution. Honduras refused to comply with international demands to restore Mr. Zelaya to power. Now the little country that stood up to the world to defend its democracy seems to be affirming a belief that it needs to change if it wants to ward off future assaults on freedom.

New York University economist Paul Romer is a global champion of the same concept by another name. Here's how Mr. Romer described his "charter cities" in a Jan. 25 interview with the Council on Foreign Relations' Sebastian Mallaby: "Some group of people who are willing to try something different say: Let's go off by ourselves. We'll develop both different laws, perhaps, but importantly, different norms about right and wrong. We'll reinforce that in our little culture that operates separately. And then, if these turn out to be a success . . . we'll not only demonstrate to others that there's something better, but we'll also provide a mechanism where people can move from the equilibrium where one set of rules and norms prevails to this other one."

The germination of model cities for Honduras started in Honduras. The reason is not hard to discern. Reformers have spent years trying to liberalize the economy only to be thwarted by special interests.

As Mr. Sánchez, who also worked in the government of President Ricardo Maduro (2002-06), puts it: "For me, for a very long time, it has been obvious that with the current system, we are going nowhere." The young lawyer says that almost a decade ago he began thinking about whether it would be possible to designate a small place where all the pro-market reforms would be law. He had no doubt that such a zone would grow fast and that the ideas behind it would spread.

Over time the concept evolved and the 2009 political crisis seems to have generated interest in new ideas. In an interview here last week President Lobo told me that his polling shows that among Hondurans familiar with the proposal, there is broad support.

The amendment is expected to pass Congress within the next three months. This week Mr. Sánchez and Mr. Lobo will travel to South Korea and Singapore, where they will analyze successful model cities to aid in drawing up the first charter. They will also be looking for investors. Mr. Sánchez says that it is important that more than one model city is launched so that rule designers will have to compete.
Can it work? The critics—who interestingly enough seem to be mostly failed planning or development "experts"—say it is unlikely because, well, this is Honduras. But Mr. Sánchez is not deterred. He points out that both Japan and Chile were once proclaimed culturally incapable of development. He also argues that history is on Honduras's side. Separate legal systems inside cities generated untold prosperity as far back as the 14th century in Northern Europe's Hanseatic League and more recently in places like the Chinese city of Shenzhen.

Former president Ricardo Maduro is also a fan. "If we want to develop we have to find a way to counterbalance the populism that causes us so much harm. The model city is a way of decentralizing power and connecting people to their government."

Write to O'Grady@wsj.com
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Saturday, February 12, 2011


Verizon iPhone an improvement?

Perception: Verizon is superior to AT&T, so their iPhone is the better buy.

Reality: Verizon voice calls are better, but their data network is inferior.

This according to the WSJ's Walt Mossberg:
What about the trade-offs? Chief among them is data speed. I performed scores of speed tests on the two phones, which I used primarily in Washington, and its Maryland and Virginia suburbs, and for part of one day at Chicago’s O’Hare Airport. In these many tests, despite a few Verizon victories here and there, AT&T’s network averaged 46% faster at download speeds and 24% faster at upload speeds. This speed difference was noticeable while doing tasks like downloading large numbers of emails, or waiting for complicated Web pages to load. AT&T’s speeds varied more while Verizon’s were more consistent, but overall, AT&T was more satisfying at cellular data.

Also, because Verizon’s iPhone—like most other Verizon phones—doesn’t work on the world-wide GSM mobile-phone standard, you can’t use it in most countries outside the U.S. AT&T’s iPhone does work on this standard, and can be used widely abroad, albeit at very high roaming rates. In the midst of my testing, I had to travel to Hong Kong, one of the few countries where the Verizon iPhone functions. But even there, it only worked for voice, not data, at least in the areas where I was working. The AT&T model handled both voice and data everywhere I tried it there.


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Friday, February 11, 2011


Milton Friedman on Hayek

Perception: Milton Friedman was a conservative.

Reality: Friedman, and Hayek, saw themselves as radical in attacking the root of the problem [socialism].

Tyler Cowen from Marginal Revolution recommended this C-SPAN Book TV video from 1994 featuring Milton Friedman being interviewed by Brian Lamb about the 50th anniversary release of Hayek's book The Road to Serfdom. At the 50:30 mark, when asked about Kenneth Galbraith, Friedman explains beautifully about the difference between socialism and freedom and why he is no conservative, as we now -- now being the latter half of the 20th century, hey the dude was born in 1912 -- define it. So while someone like Friedman would probably have issues with the particulars of specific Tea Party proposals, I believe he would have supported the movement itself.

How good was Milton Friedman? He's been dead for 5 years and the hyper-partisan Paul Krugman is still afraid to cross him.


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