Posted on 29-05-2014
Filed Under (Foreign Policy) by Rashtrakut

It is hard to overemphasize how the promise of the Arab Spring has turned into the depressing of an Arab Winter.  Other than Tunisia, the hopes of democratization in the region have fallen by the wayside.  Libya an artificial welding together of three Ottoman tribal vilayets under a flag has lapsed into chaos.  Yemen is a failed state rapidly running out of water.  Saudi Arabia has crushed the democracy movement in Bahrain (because it was Shiite).  At the same time it has projected itself as the patron of the Sunni rebels against the Alawite Baath regime in Syria.  Syria is in the midst of a brutal civil war and a rapid exodus of population.

And then there is Egypt, the most populous country in the Arab world which was once its cultural heart.  Hosni Mubarak, the deposed Pharoah President, was sentenced to jail for embezzlement last week along with his sons.  In the aftermath of Mubarak’s fall, Egypt actually had a free and fair election.  Unfortunately the Muslim Brotherhood which won the elections did not understand, that successful democracy requires the ability to respect institutions.  Mohamed Morsi showed some autocratic tendencies that aroused the ire of the secular portions of the country.  However, he was still the freely and fairly elected leader of Egypt.  Morsi’s incompetence paved the way for the thugs who backed the Mubarak regime to launch a coup.

For some reason, the corrupt, brutal and inefficient Egyptian Army is still popular in Egypt.  The Egyptian Army has not engaged in massacres like the Baath regimes of Syria and Egypt – but it is every bit as ruthless.  The fall of Morsi was followed by a ban on the Muslim Brotherhood and the brutal suppression of their street protests.  The Muslim Brotherhood is not a supporter of democracy.  However, they are quick to note that they won a democratic election and it was stolen from them by force.  The result will be the inevitable radicalization of its hard core supporters who see no reason to engage within the parameters of the Egyptian constitution.  For now, the Brotherhood is on the run.

Field Marshal Abdel-Fattah el-Sissi the head of the Egyptian army then anointed himself as the new man to save Egypt.  Spooked by the Muslim Brotherhood, much of Egypt’s secular element has allowed itself to being co-opted by the elements that used to support Hosni Mubarak – the very elements that had brought protesting mobs into Tahrir Square.

The election of el-Sissi was a foregone conclusion.  He faced no real rivals and the government was portraying him as Egypt’s only savior for the last 10 months.  There of course has been no real substance as to how the savior will work his miracles.

The result was the expected landslide for el-Sissi.  Yet the anointment turned into a farce.  The government wanted to show a turnout of 80% to demonstrate the deep reservoirs of support for the new Pharaoh.

The turnout ranged from 38-44% well below the 52% turnout in the election that elected Morsi.  The panicked government kept the polls open for two more days in a desperate effort to get more voters before announcing the results.

It did not help that the result was a foregone conclusions or that the Islamists who turned out to elect Morsi largely stayed at home.  The vote also probably reflects a deep ambivalence (his run for the presidency was greeted by a twitter hash tag that translates to “Vote for the Pimp“) about the self-proclaimed savior who has not identified any real program of reform (other than stomping the Brotherhood).  Egypt now faces the real possibility of reversion to the malaise of the Hosni Mubarak era for the sake of “security.”  The current government is essentially old wine in new bottles.

Hosni Mubarak may be headed to jail, but his clone has now ascended as the new Pharaoh.  What a waste.

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Posted on 26-05-2014
Filed Under (Foreign Policy) by Rashtrakut

The European project has brought an unprecedented era of peace and prosperity to Western Europe.  When it was conceived in the ash heaps of World War II, the extent of its success could hardly be imagined.  After 1,000 years of hostility France and Germany would work to build a new Europe.  Yet over the past 20 years it is hard to avoid the impression that Europes elites are losing the argument with their own people.

The elitism has been on display since the Maastricht Treaty that created the European Union.  It took Denmark two referendums to approve the treaty.  The French approved it with the support of barely 51% of voters.  Yet the elites soldiered on.  Later treaties amending the Maastricht Treaty (the Treaty of Nice and the Treaty of Lisbon) were generally kept safe from the vagaries of the voting public, after the Irish voters rejected each treaty in their first referendums necessitating a second referendum to approve the treaty.

Rather than the voters, parliaments would approve the treaty.  This is not uncommon in representative democracies.  The problem is that other than the Conservative Party in the United Kingdom almost every mainstream party in Europe is pro-Europe.  This short circuited the debates over increasing tensions over the loss of national sovereignty, the effect of unrestricted immigration and the effect of binding together the continent in a currency union via the Euro without the fiscal and banking unions to make it work.

The great recession has laid bare the fundamental flaws in the half-assed approach to creating a United States of Europe without political and fiscal union.  Stuck in the Eurozone, Southern Europe no longer has the flexibility to devalue its currency.  Germany the primary creditor to Southern Europe caught up in its historical nightmares of hyperinflation (and also benefiting from a stronger Euro) will not let the Euro devalue.  Even worse, it has insisted on insane fiscal austerity that has turned recessions into depressions.

Economic malaise haunts the Eurozone.  Xenophobic parties are on the rise across Europe.  Last week came the first signs that political retribution may be at hand.

The United Kingdom Independence Party has long been dismissed as a bunch of racist kooks.  The UKIP won a surprising victory in local elections held across England, which will send a shiver down the spine of the main three political parties in the UK.  They followed that up by winning the most seats in the European Parliament elections. It must be noted that the British government has also reacted to the recession by double dip recession inducing austerity.

Likewise in France the xenophobic National Front beat the more established parties in the elections to the European Parliament. Far right parties also did well in Denmark, Austria and Hungary.

Europe’s elites ignore this resentment at their own peril.  It is troubling that the elites in Brussels are still in denial about the real pain their policies have caused outside their ivory towers and attribute it to a failure of “national will.”

While, the UKIP and the National Front still poll under 30% of the national vote and it is unlikely they will actually seize power in either country they have tapped into a rich vein of resentment at the way the European Project has been hurtling across to union without taking into account the sentiments of the countries involved.  The rise of economic immigration from Eastern Europe into countries that are not immigrant societies has aggravated ethnic tensions that allows xenophobes to flourish.  The debates between the UKIP’s Nigel Farrage and the Liberal Democrats Nick Clegg were a demonstration that the elites were losing the argument with the public. The election results have confirmed that.

It is time for Europe’s elites to engage in some introspection before economic turmoil puts the European project into jeopardy.

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Posted on 21-05-2014
Filed Under (Politics) by Rashtrakut

Rousseau’s Confessions refers to a “great princess” who when told that the peasants had no bread responded: “Let them eat brioche.”  The contempt for the modern iteration of the Republican party for the poor is ill concealed – from their last Presidential standard bearer tagging 47% of the country as moochers to Congressmen waxing nostalgically of property requirements to vote.

The brazen cynicism seems to know no limits.  The last few years Congressional Republicans have tried hard to cut food assistance to the poorest Americans.  Yesterday Talking Points Memo flagged a recent House Republican Bill that pared back a modest food assistance bill to exclude urban areas and limit it to rural areas only.  Rural areas of course tend to vote Republican.

Meanwhile in New Jersey alleged fiscal Chris Christie, having blown up his state budget to fund tax cuts for the rich is now trying to pay for the shortfall by raiding public employee pension funds thereby jeopardizing his own plan to fix public pensions.  Christie is not the only Republican governor seduced by the tax cut fairy to believe that tax cuts magically boost growth enough to make up for revenue shortfalls (which has not happened under Reagan or Bush or anywhere else since).

Kansas, home of the oligarchs Koch, adopted their tax cut wet dreams.  The result has been a state starved of revenue that lags the national growth rate whose schools and public services are being slashed.

Then there are all the Republican governors who will cut off the nose of their poor to spite their face.  Obamacare derangement syndrome means that their states are rejecting federal money that for now covers 100% of expenses to expand Medicaid.  Instead of following the Arizona model where the state accepts the funds only so long as the federal government pays for it, they would rather have their poor clog medical emergency rooms instead of getting health care.

They truly have no shame.

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Posted on 18-05-2014
Filed Under (Current Affairs, Foreign Policy) by Rashtrakut

India’s month long election process finally came to an end last Friday.  Everyone expected the ruling coalition led by the Congress to lose and the Bharatiya Janata Party coalition to win or become the largest grouping in the new parliament.  The actual margin of victory was unclear.

After 10 years in power the Congress government was drifting aimlessly.  Corruption scandals had sapped its credibility.  Economic growth had slowed down, and the government was unable to offer up a meaningful economic program short of blatant populism.

Meanwhile, the BJP had anointed the Gujarat Chief Minister Narendra Modi as its standard bearer.  Even though he was tainted by the 2002 anti-Muslim pogrom in Gujarat, Modi was able to point to the stellar economic performance of Gujarat on his watch and his acumen as an administrator.  In contrast, all the Congress Party had to offer was a hapless bumbling dynastic scion, Rahul Gandhi.  As the Congress declined in the last few years, the BJP and regional parties had stepped into the void.

Then there was the newest player in the political scene, the anti-corruption Aam Aadmi Party.  The 2014 elections came too soon for the party to take advantage of a population tired of the coruption that permeates all parts of Indian life.  And as it turned out, the AAP would be a bit player in the emerging “Tsunamo”.

As the image below shows, the results were breathtaking.

2014 Indian Lok Sabha Election Results (Source: Wikipedia)

2014 Indian Lok Sabha Election Results (Source: Wikipedia)

The BJP won…and it won Big.  For the first time since 1984 a single party won a majority in Parliament.  For the first time since 1984, a pre-election coalition won over 300 seats.  The once mighty Congress party was reduced to less than 50 seats, which due to a constitutional quirk requiring 10% of seats to recognize a leader of the opposition means that the position will stay vacant for the first time since 1989.

The map shows how the BJP reached victory by winning close to 100% of the seats in its base states.  While it won relatively few seats along the eastern seaboard, the BJP made deep inroads in the vote count that should unsettle the ruling regional parties.

Yet the results in Punjab, show the potential pitfalls for the BJP if it fails to deliver.  Punjab is ruled by a coalition of the BJP and a Sikh party the Shiromani Akali Dal.  The incompetent Akalis are unpopular and so is the Congress.  As a result, the fledgling Akali Dal won its only 4 seats in Punjab – a sign for the AAP that should it gets its act together, there is political space to for the party to grow.

For the ruling Congress, the results could be a death knell.  Reliant on the Nehru-Gandhi dynasty, the party has been allergic to any other politicians with mass appeal.  Yet the unimpressive scions on offer leave them little hope but to pray for the BJP to stumble.

When he takes office this week (likely on Wednesday), Narendra Modi will become the first Prime Minister of India born after independence.  He will also be the first non-Septuagenarian/non-Octogenarian to hold the office in 18 years.  India’s youth bought into his promise of change and getting India working again and with a comfortable majority in Parliament he will have all the opportunity to succeed.  Yet, his party does not hold a majority in the Rajya Sabha, the upper house of parliament, whose consent is needed on certain legislation.  Many of the problems facing India also fall under the power of the states.  In Gujarat, Modi operated as a one man show.  He will now have to learn to play nice with others.

Modi brings with him a feeling of euphoria in the aftermath of a national election not seen in decades.  His personal story of rising to the top from an economically disadvantaged background makes his thumping of India’s most enduring dynasty even more compelling.  India’s stock markets have shown their excitement by jumping to new peaks.

Congratulations Mr. Modi.  Good luck as you get to work. Don’t eff it up.

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