The Free Thinker

"The New Job-Creation Nonsense" (RealClearMarkets):

In a follow-on to the president's jobs summit, Congress is cooking up a jobs bill for a vote next week. It's the same tired recipe to expand government at the expense of the private sector. Call it a jobs kill.

Last week, we watched as 130 Big Labor bosses, community organizers, left-wing think tanks and a few token CEOs supposedly put their heads together to come up with a way to create jobs in the worst U.S. recession since 1929.

It was window dressing. Instead of looking to proven solutions to create jobs, like tax cuts and free trade, Big Labor's agenda ruled.

The summit's three recommendations - Cash for Caulkers, bailouts for city and state governments, and tax holidays for small businesses - all not coincidentally amounted to gravy for unions.

Unions used to just be a conspiracy against business. Now they're a conspiracy against the taxpayer, too.

The Road to Serfdom

The chart below shows the real federal debt held by the public per capita US population.  The data are drawn from the Office of Management and Budget (federal debt) and the Census Bureau (population), with historical info up to 2008 and projections thereafter.  The CPI as published by the Bureau of Labor Statistics is used to control for inflation (for future years I assumed that the CPI will follow its present trajectory).

 

So if present trends continue-- and I believe the OMB is if anything rather optimistic-- real federal debt per capita will double during Obama's first term in office.  Each American's share of this debt burden will be roughly equal to one year's per capita GDP.  Much of this is owned by foreigners, especially the Chinese, so assuming we keep paying and don't inflate our way out of it America will be channeling a large annual tribute to China.  Much of the debt, of course, is owned by Americans, so the common taxpayer will be compelled to make annual payments to a rentier class of T-bill owners.

There's an ominous precedent here.  The French Revolution began as a fiscal crisis.

The Wages of Appeasement

"India's China Obsession":

On June 21, two Chinese military helicopters swooped low over Demchok, a tiny Indian hamlet high in the Hima-layas along the northwestern border with China. The helicopters dropped canned food over a barren expanse and then returned to bases in China. India's military scrambled helicopters to the scene but did not seem unduly alarmed. This sort of Cold War cat-and-mouse game has played out on the 4,057-kilometer India-China border for decades. But the incident fed a media frenzy about "the Chinese dragon." Beginning in August, stories about new Chinese incursions into India have dominated the 24-hour TV news networks and the newspaper headlines.

China claims some 90,000 square kilometers of Indian territory. And most of those claims are tangled up with Tibet. Large swaths of India's northern mountains were once part of Tibet. Other stretches belonged to semi-independent kingdoms that paid fealty to Lhasa. Because Beijing now claims Tibet as part of China, it has by extension sought to claim parts of India that it sees as historically Tibetan, a claim that has become increasingly flammable in recent months.

Ever since the anti-Chinese unrest in Tibet last year, progress toward settling the border dispute has stalled, and the situation has taken a dangerous turn. The emergence of videos showing Tibetans beating up Han Chinese shopkeepers in Lhasa and other Tibetan cities created immense domestic pressure on Beijing to crack down. The Communist Party leadership worries that agitation by Tibetans will only encourage unrest by the country's other ethnic minorities, such as Uighurs in Xinjiang or ethnic Mongolians in Inner Mongolia, threatening China's integrity as a nation. Susan Shirk, a former Clinton-administration official and expert on China, says that "in the past, Taiwan was the 'core issue of sovereignty,' as they call it, and Tibet was not very salient to the public." Now, says Shirk, Tibet is considered a "core issue of national sovereignty" on par with Taiwan.

When Russia got away with naked aggression in the Caucasus, it showed bad guys everywhere what's possible. If this catastrophe happens, the West will be to blame for, as McCain put it in the last great statement of American purpose we're likely to hear for years, his brilliant Republican National Convention speech, "turning a blind eye to aggression."  Meanwhile, Russia's delusional insolence is accelerating:

"Let Medvedev Share Nobel with Obama":

It is a pity that President Dmitry Medvedev will not share the 2009 Nobel Peace Prize with U.S. President Barack Obama. In my view, he deserves it no less than Obama, whose principal accomplishments are still in the future.

Together with Obama and French President Nicolas Sarkozy, Medvedev is responsible for changing the tone and direction of international politics to craft a better world.

Not unlike Obama, Medvedev inherited a foreign policy plate that was driving his country into isolationism and debilitating self-pity.

In fits and starts in less than two years, he has managed to transform Russia’s international role from that of an estranged spoiler to that of a constructive problem-solver with a stake in a functional world order. Medvedev has gradually steered Russia away from the unilateralist initiatives taken by his predecessor.

He shares Obama’s penchant for multilateral diplomacy and has worked to make international institutions — from the United Nations to the nascent Group of 20 — stronger and more efficient.  His more pragmatic position on Iran is likely to make global efforts to stop Tehran’s secretive nuclear program more effective.

Medvedev commanded a successful war that was forced upon him. Like Obama in Afghanistan, he did not go wobbly in Georgia and proved his resolve to defend Russia’s interests and citizens. Medvedev’s toughest foreign policy decision has been to unilaterally recognize Abkhazia and South Ossetia.

Despite broad international criticism, Medvedev’s perseverance on this issue casts him as a world leader with a strong set of values. He does not crave popularity, just respect for his country.

I think it's true that Russians crave respect. That's why rolling back Russia could be so cheap: merely to send a loud signal that the world despised the cowardly, lying, thieving thugs and bullies of the Putin-Medvedev regime-- merely to, for example, announce a boycott of the 2014 Olympics-- while stating a justifiable high regard for the country's historic cultural and scientific achievements which contemporary Russia's aggression is sadly eclipsing, just might do the trick. But that would require a degree of geostrategic insight not seen since... well, the Bush administration.

"What Do You Want to Be When You Grow Up?"

The question that is the title of this post may seem an innocent one.  To some extent it is, and some hostile reflections on it which occurred to me today may seem, may be, eccentric and exaggerated.  And yet I think the question expresses a way that our culture indoctrinates youth, which is false, and has a high cost.  In Plato's Republic, he proposes that the citizens of his ideal state be taught to believe a "noble lie."  Is our society based on a "noble lie," too?  The lie I have in mind is difficult to express, but the words you can be anything you want to be might capture it.

"What do you want to be when you grow up?"  The question implies (a) that a kid should have some idea, at an age of ten or eleven, of his future career, and (b) that his future career can and/or should depend on his wishes, his inclinations, his daydreams ("want").  The trouble with (a) is that the economy is so complex that a kid won't know a hundredth part of the careers that exist, and to encourage such early planning might lead to a surplus of aspirants to a handful of careers that kids know about, e.g., teachers, movie stars, soldiers, president of the United States.  But of course, kids aren't making any hard-and-fast commitments when they respond to grown-ups' small talk, and some careers do require long advance planning.  So (a) is all right.

No, my problem is with (b).  Suppose grown-ups asked a different question: "What do you think you might be useful for, when you're grown up?"  This is a more wholesome question because it doesn't invite a kid to project his self-indulgent wishes and daydreams onto his plans for the future, but, instead, invites him to think of others, of service, of how he can help.  It doesn't suggest that the world owes him an interesting, exciting, or entertaining job, but that he'll owe the world valuable services in return for his room and board.  It encourages him to appraise, not his desires, but his capacities.

"What do you want to be when you grow up?"  The question suggests that it matters what one wants to be, that one can choose, that you can be anything you want to be.  The truth is that the career paths that will open up to a person are a tiny fraction of those he can imagine.  It depends partly on aptitude: that is relatively easy to understand.  A tone-deaf person can't be a musician; a stupid person can't be an MIT professor.  More subtly, it depends on a thousand accidents of social connections and circumstances and which resume strikes whose fancy and whether one happened to have a good day on this or that test or interview.  Try your utmost to realize your childhood dreams, and you'll probably fail; you may waste much effort and sacrifice personal ties and innocent pleasures in the process; and, worse, you may be corrupted.  There are a thousand subtle moral compromises to which the path to success may tempt you.

And yet, for all that, for boys, it might still be right to encourage the pursuit of dreams.  It's in men's nature to take risks.  Courage is stereotypically a masculine virtue, and while the stereotype is partly false-- marriage and childbirth may require as much courage from women as battle does from men-- the occasions that call for courage in women tend to be more a matter of accepting one's lot and less a matter of going out to seek adventure.  Risk-taking has a basis in masculine biology-- in nature, males are more expendable than females-- and this biological factor is etherealized in men into cultural manifestations of honor and bravado.  And from a rational point of view, too, men can better afford to take risks, for the simple reason that a man has more time: men usually marry younger women, and they can beget children for much longer than women can bear them.  A man can pursue his dreams and fail and pick himself up and be richer for the experience.

It is in girls that I think the attitude you can be what you want to be causes the greatest unhappiness.  Our society seems to be engaged in a conspiracy not to tell girls when they are young that they may have to choose between marriage and career, or if not that, at least between the dream career that strikes their fancy, with all the complex and urgent demands it will make on them, and the settled life and strong responsibilities of motherhood.  Political correctness can prevent grown-ups from talking to kids about this but it can't change the stubborn facts that female desirability as a marriage partner tends to peak in the 20s, well before investments in high-powered careers have had time to pay off, and that there aren't enough hours in the day to spend 50 hours a week in the office and pick one's kids up after school.

All in all, though, I think we would do better not to encourage self-indulgent personal ambition in men or women.  America is indeed a land of opportunity, but the best opportunities usually come as surprises.  We should be alert for opportunities to be of use, and able to appreciate the chances that time tosses in our path.  Meanwhile, the question we should focus on is not what we want to be, but what we ought to be.

Obama's Nobel

In a twisted way, there's something edifying about the Nobel committee's decision to award Obama the Nobel Peace Prize.  They must have known they would make themselves a laughingstock, but they sacrificed their honor in hopes of influencing US policy by appealing to Obama's famous vanity.  It might work.  Why not?  This is an opportunity for Obama to re-brand his presidency as unproblematically lefty-peacenik, and as far as I'm concerned, I'd be happy to see him do it.  I think there are a lot of places in the world where an assertion of US power could be useful, but only under a leader with a moral compass.  On Honduras, on Iran, on Russia/eastern Europe/Georgia, Obama again and again has seemed wilfully to take the cynical position in order to distance himself from the ideals of democracy and freedom which are now indelibly associated with the Bush administration.  Even a cynical exercise of US power is better than the alternative in many parts of the world, so I would not wish a full retreat into isolationism.  But a partial retreat into isolationism would probably be better than the incompetent and unprincipled interventionism which is the likely alternative.  The other good thing about this is that it debases Jimmy Carter's 2002 Nobel Peace Prize by making it clear that the Prize is sometimes awarded on grounds unrelated to the merits of the recipient in order to try to influence US politics.

The looming question now is how much damage will have been done to the US and the world by the time the Obama interregnum is over.  How many man-years of unemployment will we have suffered, and what will be its long-term financial and psychic costs?  How far will America's alliances have frayed due to acts of petty neglect, cynicism, and betrayal?  What new totalitarian ideologies will have been incubated in the friendly climate of American weakness?  How many hostile regimes will have gone nuclear?  How much land will Russia and other aggressors have grabbed?  How much will the national debt have risen?  How will the institutions of American economic governance have been degraded?  For now, though, we're not thinking about those things.  Escapism is triumphant.

"Warning: The deficits are coming!" (John Fund, WSJ):

David Walker sounds like a modern-day Paul Revere as he warns about the country's perilous future. "We suffer from a fiscal cancer," he tells a meeting of the National Taxpayers Union, the nation's oldest anti-tax lobby. "Our off balance sheet obligations associated with Social Security and Medicare put us in a $56 trillion financial hole—and that's before the recession was officially declared last year. America now owes more than Americans are worth—and the gap is growing!"

His audience sits in rapt attention. A few years ago these antitax activists would have been polite but a tad restless listening to the former head of the Government Accountability Office, the nation's auditor-in-chief. Higher taxes is what hikes their blood pressure the most, but the profligate spending of the Bush and Obama administrations has put them in a mood to listen to this green-eyeshade Cassandra. "He's so unlike most politicians," says Sharron Angle, a former state legislator from Nevada, "his message is clear, detailed and with no varnish."

This historical analogy is crazy in most ways, but in two respects America today bears a weird resemblance to France before the 1789 Revolution: (a) it is being paralyzed by an unmanageable debt burden, and (b) status-seeking. In pre-Revolutionary France, the status symbol du jour was public office, and I've read that people would buy offices for more than the value of the bribes they would recover, just for the prestige. Today, the status symbol du jour is education. My hunch is that what the country really needs is for less people to go to lots of school and for more people to start businesses. (I realize the irony of my saying this.) And I actually suspect people might even learn more (more about life, more building of character) that way.

UPDATE: It occurs to me that the deficit and the status-seeking problems may be related. Why start a business if a mind-bogglingly indebted government seems likely, sooner or later, to confiscate whatever wealth you create if you succeed? Even if an education is worth less than the money and foregone income you spend to get it, at least the government can't take it away!

How Keynesianism Survives

"Why the Stimulus is Helping the Economy, But Not Obama" (Time)

Proving a negative is always a challenge, but there's mounting evidence that the controversial $787 billion stimulus bill is achieving one of its major goals: shortening the recession. Economists at Goldman Sachs say that the bill, officially called the American Recovery and Reconstruction Act, has resulted in a 2%-3% boost to annual GDP in the second and third quarters of this year, turning what could have been a worsening recession into potential growth. For President Barack Obama, whose poll numbers have dropped precipitously from around 65% to around 50% as Americans have become worried about government spending and health-care reform, that should be good news: he fought hard against Republican opposition to push the bill through Congress as one of his first legislative acts, and the fact that it's working should be a vindication.

But it's not that easy. Recent polls show widespread disapproval of the stimulus bill: 51% of Americans polled last month by USA Today and Gallup said they thought the government should be spending less under the plan, while 44% said they thought the government was spending the right amount, or should be spending more. If anything, it seems, the stimulus plan is hurting the President even as it helps the country.

The most obvious reason for that disconnect is jobs: despite the signs of a turnaround, unemployment remains stubbornly high at 9.7%, with employers cutting 216,000 jobs in August. While jobs always trail economic rebounds, the unemployment number is higher than economists thought it would be, even in the worst case scenario forecast by the Treasury department's "stress tests" last spring. The point is not lost on Republicans, some of whom have argued lately that no more of the stimulus money should even be spent. "The metric of this bill was job creation," says Don Stewart, spokesman for the Senate's top Republican, Mitch McConnell, "and it hasn't done that."

Still, one would think that the mere infusion in six months of $88 billion into the economy — that's how much the government has spent so far...

Journalists, it goes without saying, are not very smart (maybe they suppress it because it impedes their ability to slice a complex world into neat stories) but a cruder, more flagrant example of the post hoc ergo propter hoc fallacy would be hard to find than the above.  It seems quixotic, or Sisyphean, to remind people of the truism of economic history that it's normal for the economy to recover, that it always does so, even-- nay, especially-- when the government does nothing.  The last time the US government did nothing in a recovery-- in the recession of 1920-21-- the recovery was especially robust.  Again, in 1997-8, when the IMF forced East Asia to adopt austerity measures in the midst of recession, it earned itself the contempt of East Asians but rapidly restored growth to its former booming rates for another decade.  By contrast, Keynesian policies failed in the US in the 1930s, in Japan in the 1990s, and dragged post-WWII Britain down from being the world's economic leader to a desperate, stagflation-ridden basketcase in the generation after the British economics profession surrendered to Keynes, before it was rescued by Thatcher.

So how does Keynesianism survive?  Because of articles like the above, because of journalists committing the post hoc ergo propter hoc fallacy, while economists like Brad DeLong and Paul Krugman, who want bigger government because their values are different from the mainstream and want to use their technocratic credentials to sell big government to people who would not support it if they understood its true effects, back them up.  Keynesian economics is like fortune-telling: shrewdly vague, it exploits a perennial fallacy, namely people's chronic inability to understand that the economy can recover on its own.

In this case, the journalist provides the key fact that makes the "stimulus worked" case implausible: only $88 billion has been spent, just over 10% of the whole stimulus package, and only about 0.6% of GDP, and all of that after the worst of the crisis-- October 2008-- had already been mitigated.  By contrast, Ben Bernanke's Fed has bought hundreds of billions of dollars of private and federal debt, and the Bush administration "spent"-- albeit with a fair prospect of recovering-- $700 billion or so through the TARP program.  If any stimulus is working, it's that of Bernanke and Paulson, which was not mere Keynesian spending-for-spending's-sake but a timely intervention by highly competent technocrats (we won't see such expert competence from neophyte Obama, but fortunately, we might not need it) targeted to the specific problems at the heart of systemic failure.  That's not to give unqualified approval to Paulson.  He's a tragic hybrid of hero and anti-hero: he probably did save the US from a more shattering crisis, but the fallout from the Paulson Plan is likely to be a more politicized financial sector and hugely increased incentives and opportunities for rent-seeking for years or decades to come.  There's something to be said for the House GOP who voted against him, too.

For now, the American people seem to be displaying a sensible incredulity about the "stimulus is working" message.  But don't count on it to last.

Quagmire

The war in Afghanistan (The Economist)

General Stanley McChrystal, the overall American commander, said his force may soon assault Marja, a well defended stronghold of the Taliban and drug smugglers. The Taliban said their own response, Operation Foladi Jal (Iron Net), would avoid frontal battles but would teach the marines “a lesson” through roadside bombs and ambushes.

Thrust of the Sword is the first big move since President Barack Obama’s decision to shift forces from Iraq to Afghanistan. Oddly, perhaps, the assault is taking place before the marines are at full strength in Helmand, and before the recently appointed General McChrystal has completed his review of operations.

Theorists of counter-insurgency say that fighting guerrillas requires time and patience (and even more foreign and local soldiers than are available in Afghanistan). But General McChrystal is a man in a hurry. He needs to enable as many people as possible to vote in Afghanistan’s presidential election next month, and he needs to show he is turning the tide of war before America’s mid-term elections next year. So at the moment, he is using the plan devised by his abruptly sacked predecessor, General David McKiernan, who was criticised in the Pentagon for being, among other things, too cautious and unimaginative.

The biggest change under General McChrystal is the instruction to reduce civilian casualties. A “tactical directive”, issued at the start of Thrust of the Sword, says that winning the support of the Afghans overrides all else. “We must avoid the trap of winning tactical victories—but suffering strategic defeats—by causing civilian casualties or excessive damage and thus alienating the people,” he says. This may increase the danger to troops; but the greater risk is to push Afghans into the arms of the Taliban...

Much damage has already been done by inconclusive operations. British forces often fought their way into insurgent areas, only to withdraw and let the Taliban return, exposing residents to retribution. British commanders now think this was worse than leaving the Taliban in control. “Before the British came, everyone was happy they were coming to bring security and reconstruction,” says Haji Mahboob Khan, a senator from Garmser district. “But all the British brought was chaos.”

Nad Ali illustrates much of what has gone wrong. The district had been one of the few loyal to the government. But the Afghan police there, as elsewhere, are corrupt, often predatory and driven by local tribal interests. The force is dominated by the Noorzai tribe which controls the lucrative drugs trade. Attempts to reform the force by giving it a crash course in policing and installing Western mentors have produced few improvements. Worse, the eradication of poppy fields in Nad Ali pushed the population into supporting the Taliban. Such errors explain why America wants to change the focus of counter-narcotics from eradication of farmers’ fields to targeting middlemen.

General Nicholson says NATO will change its ways: “Where we go, we will stay; and where we stay we will hold, build and work toward transition of all security responsibilities to Afghan forces.” The problem for the marines, as for other NATO forces, is that there are nowhere near enough Afghans. Thrust of the Sword involved just 650 Afghan soldiers alongside 4,000 marines. General Nicholson wants as many Afghans as Americans.

Moreover, America needs not just Afghan soldiers but Afghan government—and Afghanistan has little in the way of working government institutions. Without them, the marines are operating in a vacuum. “The Helmand people just want peace; not reconstruction even, just peace,” says Haji Mahboob Khan. “But if NATO sent another 100,000 troops to Helmand, without a good government that is free of all these thieves, they won’t be able to bring security.”

Does this sound like a promising situation?

Iraq had a degree of literacy and urbanization that made stable democracy with plausible party competition a plausible, if sanguine, outcome of US intervention. The totalitarian regime preceding the US intervention made Iraq a parallel case to Germany and Japan after WWII, where imposing democracy worked. To change the regime and establish democracy there was ambitious, but not impossible.

Afghanistan is much poorer, much less literate, much more tribal, much less accessible. It's hard to see how democracy is even possible under such circumstances. We might succeed in establishing it; but the odds are surely far worse than even. Suppose McChrystal can protect the population; who will rule the country? Will elections lead to some tribal confederation or what's the idea? You need to know what your objective is in order to make consistent decisions. If your goal is to establish democracy, that in a way leaves the key question-- who will rule the country?-- unanswered ex ante, but there are still a lot of definite criteria of success in terms of constitutional arrangements and political processes. I don't think we have that kind of template in Afghanistan, and we can't: there isn't a political model we believe in that is applicable there. 

I wish General McChrystal luck. But it seems to me we're hopelessly confused about our objectives and our mission and there's little hope of anything good coming out of it. Is there some honorable way to just exit that theater of war?

"Obama Needs to Change Stance on Iran: 'No comment' is not an option" (Paul Wolfowitz)

President Obama's first response to the protests in Iran was silence, followed by a cautious, almost neutral stance designed to avoid "meddling" in Iranian affairs. I am reminded of Ronald Reagan's initially neutral response to the crisis following the Philippine election of 1986, and of George H.W. Bush's initially neutral response to the attempted coup against Mikhail Gorbachev in 1991. Both Reagan and Bush were able to abandon their mistaken neutrality in time to make a difference. It's not too late for Obama to do the same.

In 1986, Philippine President Ferdinand Marcos had called a snap election, calculating that a divided opposition would hand him a clear victory that would undercut pressure from the Reagan administration for broad-based reform. Instead, the opposition parties united behind Corazon Aquino, and only massive fraud could produce a "victory" for Marcos.

On Feb. 11, as the votes were still being counted, Reagan announced a neutral position, reminding Americans that it was a "Philippine election" and praising "the extraordinary enthusiasm of Filipinos for the democratic process." Rather than blame Marcos for the fraud, which he called "disturbing," Reagan said that there may have been fraud "on both sides."

At the time, I was working for Secretary of State George Shultz as assistant secretary of state for East Asian and Pacific affairs, and I shared Shultz's dismay at the president's comments. For more than two years, with the president's support, we had carefully pressed Marcos for reform. Reagan himself once cited Lord Acton's famous dictum, that "power corrupts, and absolute power corrupts absolutely," while speaking of Marcos. Nevertheless Reagan's unfortunate comment about fraud on "both sides" threatened to put the United States on the wrong side at a critical moment.

Fortunately, Shultz managed to convince the president that he had made a serious mistake. On Feb. 15, the White House issued a new statement: "The elections were marred by widespread fraud and violence perpetrated largely by the ruling party." The following day, Marcos and Aquino each claimed victory. On Feb. 22, when Marcos ordered the arrest of two key reformers, as many as a million Filipinos poured into EDSA Square in Manila to block the arrests in a dramatic demonstration of "people power."

Reagan's final message to Marcos was delivered two days later, when the president's close friend, Sen. Paul Laxalt, warned that Reagan opposed any use of force against the crowds and urged him "to cut and cut clean." The next day, Marcos left the Philippines.

As an undersecretary of defense in George H.W. Bush's administration, I witnessed a replay of the Philippine scenario on Aug. 19, 1991, when reactionary forces in the Soviet Union attempted a coup against Soviet President Gorbachev and Russian President Boris Yeltsin. Bush was initially very cautious: uncertain about the facts and reluctant to interfere or to alienate a possible successor to Gorbachev.

Responding early that morning, the president refused to condemn the coup, calling it merely "a disturbing development." He expressed only lukewarm support for Gorbachev and even less for Yeltsin, and neither was among the world leaders that he tried to contact about the crisis. He seemed focused on working with the new Soviet team, hoping that their leader, Gennady Yanayev, was committed to "reform."

Although Defense Secretary Dick Cheney had argued consistently for the United States to support the peaceful aspirations of the Russians, Ukrainians and other Soviet peoples, it was Yeltsin -- with a powerful personal letter -- who persuaded Bush to abandon equivocation and oppose the coup. By late afternoon, the White House had reversed course, condemning the coup attempt as "misguided and illegitimate." Bush then called Yeltsin to assure him of his support.

No two situations are identical. But the reform the Iranian demonstrators seek is something that we should be supporting. In such a situation, the United States does not have a "no comment" option. Coming from America, silence is itself a comment -- a comment in support of those holding power and against those protesting the status quo.

"Obama's Silence Worsens Iran Threat" (US News and World Report)

The Obama administration's unwillingness to speak frankly about the situation in Iran as peaceful protesters are shot dead in the streets by regime thugs is troubling. But even more concerning is the fact that recent events have not caused President Obama to rethink his strategy of engagement with Tehran.

As protests rage on the streets of Tehran and other Iranian cities, President Obama, desperate to preserve the engagement strategy he laid out during his campaign, has chosen to respond cautiously, stating that he is "deeply troubled" but that he intends to "pursue a tough, direct dialogue between our two countries."

It is worth reviewing how President Obama got himself into this conundrum.

After running a campaign in which he repeatedly promised to meet with and engage America's enemies, President Obama spent the first six months of his administration doing nothing of the sort with Iran.

Since assuming office, his administration's "engagement" has been limited to a taped message to the Iranian people for the Persian New Year, and other minor acts such as coffee bar conversations between U.S. and Iranian diplomats at international meetings and invites to Iranian diplomats to attend U.S. Fourth of July celebrations.

President Obama decided to put off any substantive engagement until after Iran's presidential election, either hoping that a more moderate president would be elected or fearing that overt engagement with Iran's leaders in the middle of a campaign would ensure the re-election of President Ahmadinejad.

There are multiple problems with this strategy of delayed engagement. First, and foremost: Iran's nuclear program. Each day spent engaging, or talking about engaging, represents one more day for the regime to master the technology required to build the bomb.

The second problem is that the Obama administration will have to deal with the supreme leader, Ayatollah Khamenei, not the Iranian president, if it is to prevent Iran from going nuclear.

And this is no easy task. By sanctioning the fraudulent re-election of Ahmadinejad and overseeing the brutal crackdown underway in its aftermath, Khamenei has revealed the true despotic nature of the regime he oversees.

Additionally, Khamenei oversees Iran's support for Hezbollah, Shiite militias in Iraq, and the Taliban in Afghanistan, which has resulted in thousands of deaths, including those of many Americans.

This man, now with the blood of his own people on his hands, is the person the Obama administration is attempting to curry favor with during this time of uncertainty in Iran.

One troubling possibility is that recent events might cause the ayatollah to decide that possession of nuclear weapons is the most effective way to consolidate his hold on power and ensure that external enemies, such as the United States and Israel, do not exploit Iran's moment of weakness. He might order a restart of Iran's military nuclear program, which the U.S. intelligence community believes was halted in 2003.

I didn't know that, about Iran stopping its military nuclear program in 2003.  Another salutary effect of the Iraq War?  Wow.  What happens in the world now that bad guys everywhere are seeing that Obama lacks the courage, not only to fight them militarily, but even to confront them verbally?

UPDATE: Meanwhile, The Economist continues in the same ignominious mode that made them endorse Barack Obama:

Iran is the fulcrum of an unstable region. If it behaved responsibly, the world would naturally look to it as the local power. Instead it meddles, often malevolently, with its neighbours.

That is not surprising, for it has been the victim of much meddling. The country has been buffeted between imperial rivals—Russian, Turkish, British and American—for more than a century. The West once took Iran’s oil for itself. Britain and America sabotaged its brief experiment with democracy in 1953, as Barack Obama admitted in his admirable speech to Muslims in Cairo earlier this month. A generation ago Iran was assaulted by an Arab army headed by Iraq’s Saddam Hussein, leaving a million dead. Persian prickliness, even paranoia, is understandable. Iran feels ringed by the forces of what it sees as its main enemy—America. The eagerness of Iran’s rulers for a nuclear capability, which they swear is only for civilian use but which most outsiders reckon would lead inexorably to a bomb, is shared by nearly all Iranians, even those on the streets, as a national birthright in a hostile world.

And:

The West must tread carefully—as Mr Obama has done (see article)—in its response to Iran’s unfolding crisis. It should condemn abuses of human rights and electoral malpractice, but it should avoid taking sides. Given Iranians’ understandable hostility to outside interference, endorsing Mr Mousavi would only strengthen Mr Ahmadinejad. And whoever ends up running Iran, the West will have to talk to its leaders about its nuclear programme.

Morally speaking, Iran is in about the worst position in the world to complain about outsiders meddling in their affairs, after calling for the assassination of Salman Rushdie, backing Hezbollah, supporting insurgents in Iraq, etc.  Iranian xenophobia may be something policymakers should take into account, though I suspect those credulous people who think that America is helping the protestors by distancing from them so as to spare them the opprobrium of being foreign puppets have about as much grip on reality as those who believed in Stalin's show trials, or who accepted the Iraqi propaganda minister's reports during the 2003 war at face value.  But to endorse it, as The Economist does here, is degrading.

UPDATE II: "US House condemns Iran crackdown" (Al Jazeera)

The US House of Representatives has voted 405-1 to condemn Iran's crackdown on protests following its disputed presidential elections.

The vote on Friday came amid criticism of Barack Obama, the US president, for not saying more to criticise Tehran's handling of the protests against the victory of Mahmoud Ahmadinejad.

The policy statement expressed support for "all Iranian citizens who embrace the values of freedom, human rights, civil liberties and rule of law" and affirms "the importance of democratic and fair elections".

It also condemns "the ongoing violence" by the government and pro-government militias against demonstrators, as well as government "suppression of independent electronic communications through interference with the Internet and cell phones"...

Mike Pence, the Republican congressman who co-sponsored the resolution, said he believed the US should place more pressure on the Iranian government.

I hope Khamenei mentions this resolution in one of his denunciations of foreign interference.  It would really be too shameful for America to be left out of the roll call of the friends of freedom.

The Appeaser

"Obama, Siding with the Regime" (Robert Kagan):

The turmoil in Iran since last week's election has confused the foreign policy debate here in the United States in interesting ways. Supporters of President Obama, who until very recently had railed against the Bush administration's "freedom agenda" and who insisted on a new "realism," have suddenly found themselves rooting for freedom and democracy in Iran. And in their desire to attribute all good things to the work of President Obama, they have even suggested that the ferment in Iran is due to Obama's public appeals to Iranians and Muslims.

If so, this will be one of those great ironies of history. For, in fact, Obama never meant to spark political upheaval in Iran, much less encourage the Iranian people to take to the streets. That they are doing so is not good news for the president but, rather, an unwelcome complication in his strategy of engaging and seeking rapprochement with the Iranian government on nuclear issues.

One of the great innovations in the Obama administration's approach to Iran, after all, was supposed to be its deliberate embrace of the Tehran rulers' legitimacy. In his opening diplomatic gambit, his statement to Iran on the Persian new year in March, Obama went out of his way to speak directly to Iran's rulers, a notable departure from George W. Bush's habit of speaking to the Iranian people over their leaders' heads. As former Clinton official Martin Indyk put it at the time, the wording was carefully designed "to demonstrate acceptance of the government of Iran."

This approach had always been a key element of a "grand bargain" with Iran. The United States had to provide some guarantee to the regime that it would no longer support opposition forces or in any way seek its removal. The idea was that the United States could hardly expect the Iranian regime to negotiate on core issues of national security, such as its nuclear program, so long as Washington gave any encouragement to the government's opponents. Obama had to make a choice, and he made it. This was widely applauded as a "realist" departure from the Bush administration's quixotic and counterproductive idealism.

It would be surprising if Obama departed from this realist strategy now, and he hasn't. His extremely guarded response to the outburst of popular anger at the regime has been widely misinterpreted as reflecting concern that too overt an American embrace of the opposition will hurt it, or that he wants to avoid American "moralizing." (Obama himself claimed yesterday that he didn't want the United States to appear to be "meddling.")

But Obama's calculations are quite different. Whatever his personal sympathies may be, if he is intent on sticking to his original strategy, then he can have no interest in helping the opposition. His strategy toward Iran places him objectively on the side of the government's efforts to return to normalcy as quickly as possible, not in league with the opposition's efforts to prolong the crisis.

"Barack Obama sits on the fence by refusing to back Mousavi" (Evening Standard)

The American president is resisting pressure to side with the country's opposition, saying there might not be much difference between the policies of president Mahmoud Ahmadinejad and his rival Mirhossein Mousavi. Mr Obama said he believed Iranian voices should be heard, although he added that he did not want to be seen to be "meddling".

"It is not productive, given the history of US and Iranian relations, to be seen as meddling in Iranian elections," he said. But when I see violence directed at peaceful protesters, when I see peaceful dissent being suppressedit is of concern to me and it is of concern to the American people."

During a television interview, he also downplayed the importance to the world of the struggle for power in Iran. He said: "The difference between Ahmadinejad and Mousavi in terms of their actual policies may not be as great as has been advertised." Mr Obama has been under pressure from some Republican politicians to openly support the protesters, who claim Mr Ahmadinejad's re-election is the product of vote rigging. John McCain, Mr Obama's defeated 2008 election rival, said: "He should speak out that this is a corrupt, fraud, sham of an election."

What an idiot. 

I was initially willing to give Obama credit for objecting to violence against peaceful protesters.  It seemed like it might be shrewd, since it sounds innocuous, yet is enough to topple the regime, since the regime probably can't stand for long if it lets peaceful protests have their head.  I didn't actually think he was amoral-naive enough to fail to see that toppling Ahmadinejad must be the #1 US priority at this moment, both morally and (but this is secondary) from self-interest.

"The differences between Ahmadinejad and Mousavi in terms of their actual policies may not be as great as advertised?"  What an idiot.  As if that were the point.  It's the character of the regime that matters.  Democracies do not make war on each other, as history shows, ergo, if Iran becomes a democracy, we will not get into a war with them.  Anyway, even if Mousavi's policies were no better, even if they were worse, it is immoral to be indifferent to this fraud perpetrated on the Iranian people.

The worst thing about "realism" is its complete disregard for reality.  To be more specific, it is a deliberate and desperate blindness to the thing that matters in international affairs far more than anything else, namely, ideas, ideals, morality, legitimacy.  Morality in foreign affairs is not only moral but also efficient, since peace requires actors in international affairs to abide by rules, and the only hope of solving the coordination problem of getting people to abide by the same rules is for the rule to be some variation of "Do the right thing."  That's why realism invariably leads to disaster.  Real disaster, that is, like World Wars I and II, not successes painted as disasters for amusement by latte liberals, like the liberation of Iraq.  If Ahmadinejad holds power and we condone that, our ideals sustain a huge defeat, and the world becomes a more dangerous place.

If I am reading this right, this is big news.  It is a shock to the international system.  This is the moment where Obama is really breaking with the Bush administration.  It will change the calculations of leaders worldwide.  For example, if the Russians are thinking about further action in Georgia...

"Troublesome Signs of Pre-War August Events" (Moscow Times)

Just over a year ago, I wrote in this column about the rumors that were disturbing the carefree, early summer atmosphere in the Georgian capital: predictions of impending war fueled by inflammatory rhetoric and increasingly shrill propaganda, with talk of Georgian spy plane sorties and Russian troop movements. I remember an acquaintance visiting Tbilisi who said my article had almost convinced her to cancel her trip. "Will there really be a war here?" she asked.

"That's what some people say, but probably not," I responded, utterly incorrectly, although I noted rather more presciently in the column that "everyone says they don't want war, but that doesn't mean they're not ready to fight."

Now we are witnessing some of the same fearful murmurs and unsettling premonitions. A series of bomb blasts near Abkhazia; large-scale Russian military exercises not far from the Georgian border; allegations of Moscow-funded political machinations intended to destabilize its wounded neighbor; and the Kremlin dispatching border guards to police the disputed perimeters of Abkhazia and South Ossetia. None of these signs seem to point to an incident-free summer.

Two former U.S. ambassadors to Tbilisi recently warned that Moscow might still have "unfinished business" in Georgia: stopping the country from moving any closer to NATO membership and gaining control of energy supply routes in the Caucasus. The diplomats demanded preventive diplomacy to avert a "new tragedy." Russia has also made it clear that it wants Georgian President Mikheil Saakashvili out of office, although Prime Minister Vladimir Putin's desire to "hang Saakashvili by the balls" so far remains unfulfilled.

Some analysts have suggested that the threatened closure of the United Nations and OSCE monitoring missions in Georgia could allow tensions to escalate. Lawrence Sheets, the astute Caucasus project director of the International Crisis Group, has noted that the UN mission acted as a "moderating factor." "All sides should be ready to compromise in order to avoid a new outbreak of hostilities, which would be catastrophic," Sheets said.

... they should read this as a sign that Obama, the "realist," will regard a conquest of a (minor...) US ally with equanimity.