Monday, October 31, 2005

Moral failings

Forget the domestic distractions of the moment. Forget the hurricanes and the housing bubble. Forget the federal prosecutors and Judy Miller, Karl Rove and Scooter Libby. Forget the nominations of Harriet Miers and Bob Bernanke. Watch instead the unfolding of a moment of drama in the Middle East.

On October 20th, Detlev Mehlis presented his report to the United Nations. The long-time German prosecutor laid out the case that high-level Syrian officials conspired in the assassination of Lebanese opposition leader and former Prime Minister Rafik Hariri. Named in the report were the brother and brother-in-law of Syrian President Bashar al-Assad. Assad, apparently named in a draft of the report, was not directly implicated.

Assassinations of political leaders are not new to the history of the Middle East, much less to the history of Syrian intervention in Lebanese affairs. But the world is changing. Over the past thirty years, nations from Latin America to East Asia have migrated from authoritarianism to forms of popular democracy. The exception has been the Middle East, where Arab regimes installed to lead states whose borders were written principally by the British and the French in the wake of the collapse of the Ottoman Caliphate cling to power. 

Even as the language of democracy has crept in to the political lexicon of Jordan, Egypt and the Emirates, the Assad Bathist regime in Syria has held firm. The Assad regimea charter member of the axis-of-still-pretty-evilhas embarked on a media campaign to soften its image in the west. Bashar al-Assad and his wife Asma were featured in James Bennet's New York Times Magazine cover article, The Enigma of Damascus. Not since the Soviet Union successful spun the west on Yuri Andropov’s love of Johnnie Walker and Benny Goodman has a dictator used the western press with such √©lan. Though, as the Judy Miller story suggests, the New York Times may have become an easy mark. Mr. Bennet inscribes:

President Assad wore a black suit and a charcoal shirt without a tie; Mrs. Assad, a sea-foam green sweater over a sheer top and a white skirt. Her long, honeycolored hair was uncovered. Together they made a kind of visual rhyme with the building: tall, slender and young, they seemed the essence of secular Western-Arab fusion, the elegant doctor turned-president out on the town with his dazzling British-born Syrian wife, the former J.P. Morgan banker whom Syrians call their Princess Diana.

Wow. Could this really be the same Assad whose Bathist regime has a track record of murdering opponents and destroying and burying the entire city of Hama to break the back of an opposition group? Could this really be the same man who threatened with credibility to destroy Lebanon if the Parliament there did not change the constitution to assure that President Emile Lahoud remained in power?

This will be a defining moment for the United Nations. Syria has violated the law and the essence of the United Nations charter. This will as well be a defining moment for modernity and the community of Arab nations. Assad is a minority Alawite. His regime has assassinated a Sunni leader of another nation, while supporting its long-time ally, a Maronite Christian. But more to the point, the Syrian action led to demands that Syria leave Lebanon. And while Syria has claimed compliance, old habits die hard, as Assad’s words to Hariri suggest: "Lahoud is me… If you and [French President Jacques] Chirac want me out of Lebanon, I will break Lebanon.” So much for subtlety. So much for the essence of Western-Arab fusion.

But there will be no talk of actions against Assad for his crimes. And that is one great legacy of the war in Iraq, and the failure of the ambitions of the Neoconservatives in the Bush administration. The Neocons’ goal was to discard the amoral expediency of Realpolitik that has dominated American foreign policy for decades and to build in its place a foreign policy based upon principles of liberty, democracy and the imperative of confronting oppressive regimes. 

Iraq was to be their test case. Regime change in Iraq was intended to be the great moment of American redemption. For the decades that Realpolitik dominated our foreign policy, as America supported authoritarian regimes that oppressed their own people but who created regional stability and supported American interests. The Neoconservatives sought to change all of that. In the post-holocaust world, to get rid of the regime was a moral imperative. He is a committer of genocide, and he was likely to do it again. He was a starter of serial regional wars that killed hundreds of thousands of people. He was a source of instability and suffering. 

Imagine the confusion in the Arab mind. For the better part of a century the western powers worked their Realpolitik magic in the Middle East. From the wreckage of the Ottoman Caliphate, the French and British cobbled together nations of disparate tribes and clans, and Kings, Shahs and other strongmen were installed to lead them. As the new millennium dawned, the language and motivations of Washingtonnow the center of the new unipolar political worldappeared to be changing. Realpolitik was dying and the young Bush administration seemed to be in thrall of high-brow Neocon aspirations that suggested a new day might be dawning for an Arab world that had lagged behind the democratic wave that has swept East Asia, South America and much of Africa.

But it was not to be. As Paul Wolfowitz suggested in Vanity Fair magazine, the administration set aside the principled arguments for regime change that focused on Saddam’s support for terrorism in the region, on his criminal treatment of the Iraqi people and on his instigation of a number of wars with his neighbors in the region, and instead relied on the WMD argument. In their impatience to get boots on the ground, they fell prey to the Rumsfeld-Cheney arguments that the United States must act with “a little unilateralism” and eschew the views of France and Germany that in their view were compromised by commercial interests and moral weakness.

The failure to make the moral argument was theirs. The problemas Wolfowitz concedes in Vanity Fairwas that the real issues were not discussed, the fulsomeness and moral reach of the Neocon agenda was not debated, and the indigenous mechanisms for change that would become essential were not developed. Instead, the administration fell prey to the Washington disease of selling policy through the path of least resistancewith half-truths and dissembling if necessary—and in so doing lost the mandate sought by some in the Neocon movement that it is time for America to change her stance in the world. 

And the consequences of that failure will play out in Syria. We will not discuss the predations of Bashir Assad with any seriousness of purpose. Instead we will applaud his casual strength of purpose and infer an alignment with our values. And that Asma, she does look lovely in green.

Saturday, October 29, 2005

The long weekend

It must be a long weekend up at Camp David.

It has been a brutal week on the home front, but not as bad as it could have been. Harriet Miers withdrew, so the bleating has ceased from that travesty of a nomination. Scooter Libby has been indicted, but Karl Rove has dodged a bullet. The Atlantic hurricane season is winding down, the price of oil and the price of gasoline have waned, and the market was up sharply to close the week.

All in all, it could have been worse.

This is a moment of truth for the President. He will shortly announce his new nomination for Associate Justice of the Supreme Court, and that nomination will set the tone of his administration through the mid-term elections next November.

The Miers nomination cost the President dearly with his base––who have followed him patiently through war and deficit spending in search of the promised land of a transformed high court––and there will be no messing around this time. Michael Luttig, Michael McConnell, Sam Alito, or better yet, one of the judges appointed during the nomination battle this year, Priscilla Owen or Janice Rogers Brown.

Trust is now in short supply and the President is on a very short leash. “The days of the blank check have ended,” suggested American Conservative Union Chairman David Keane. Long-time conservative leader Paul Weyrich added, “We are up for a fight. We are ready for a fight. And if we get a good nominee, all will be forgiven as far as Harriet Miers.”

All will be forgiven. Sitting in Camp David, that statement has to burn, and burn deeply. President Bush submitted a nominee that he trusted, and they chewed her up and spat her out. And now they feel entitled to lay down the law? Who the hell is Paul Weyrich, and who elected him to anything?

For George W. Bush, this weekend is about his legacy. It is about how he is going to spend the balance of his term in office, and it is about his capacity to lead the nation and the world.

Karl Rove will be there, and he will be arguing for the base as he always has. But Karl Rove is the one who almost got indicted and brought down the house of cards because of his arrogance and his recklessness. Rove may be calling the shots, or maybe Andy Card, the soon-to-depart chief of staff. Perhaps, five years into his term, it is time to call his father for counsel. This is about the legacy of the family after all.

The problem of this nomination transcends the Court. If he cedes the nomination to the demands of the right, the fight––which Weyrich and his minions are itching for––will be a millennial one. Conservative leader Senator Sam Brownback has encouraged this outcome by suggesting that it is time for the nation to engage in a “great debate” about the future of the courts and “the kind of country we want to live in." But there will be no “great debate,” it will simply be a cataclysmic clash of saturation media and anger and ads and screaming. Like the sound of one hand clapping, it will all be fury but no one will be listening.

Meanwhile, the world badly needs an America that leads. In the uni-polar world that has emerged since the end of the Cold War, the nations of the world depend on America. Not as a military power, but more as an umpire. While nations verbally attack America for their own political purposes, they nonetheless depend on its stability as a point of reference for international conduct.

Today, America’s capacity to lead has been diminished, and that is one of the great losses of the Iraq war. Our contempt for international institutions has damaged our credibility, but the nations of the world know well that there is no alternative.

Now, as our domestic turmoil continues, nations have felt Bush’s weakness. While domestic events have dominated our news, Condi Rice is flying solo and international affairs have slowly been spinning out of control.

First there is Iran, who with soaring energy revenues and revitalized leadership is moving to assume leadership in the region. Riding a wave of growing confidence as it has resumed its nuclear development program, Iranian President Ahmadinejad this week called for the destruction of the State of Israel.

Then there is Syria, which was accused in a report to the United Nations Security Council last week of complicity in the assassination of Rafik Hariri, the opposition leader and former Prime Minister of Lebanon. Recognizing America’s diminished credibility and capacity to respond, Syria eschewed its prior stance of keeling to Washington’s wind, haughtily denied the substance of the report and staged large public demonstrations in support of its leader Bashar al-Assad, Saddam Hussein’s political cousin.

Then yesterday came the Russians. Faced with a report authored by former Fed Chairman Paul Volker––a man of impeccable credentials––on the United Nations Oil-for-Food program that accused them of paying kickbacks to Saddam Hussein, the Russian government denounce the report as based on fabricated documents.

Finally, in Israel, where prospects for anything positive seemed to be unraveling even more than usual, both the Israelis and Palestinians dismissed American calls for restraint, suggesting that they would look after their own interests.

And, of course, there are other matters. An Al Quaeda attack in New Dehli has opened up a new front, and there is always the back burner, with North Korea on a slow boil.

So George Bush faces hard decisions this weekend. And with him will be Harriet Miers, his lawyer and devoted friend. But while the pundits bray and the conservatives pray, there is more at stake than just the Court. This is a moment for reflection and sage advice, and the hope that those are not in short supply.

Saturday, October 22, 2005

A Culture of Corruption

In the six weeks since the Katrina debacle, the wheels have come off the bus of the Bush administration and the Republican Party’s iron grip on national politics would appear to be at risk.

Tom DeLay has been indicted and has stepped down as House Majority Leader. Senate Majority Leader Bill Frist is under investigation by the SEC. White House procurement official David Safavian has been indicted in the Jack Abramoff lobbyist-corruption probe. Karl Rove and Scooter Libby are now acknowledged by their attorneys to be in “serious legal jeopardy.”

Then there is the cronyism. First there was Michael Brown, the politically-connected but administratively-challenged FEMA director. Then came the Harriet Miers nomination, which was indefensible on any grounds other than personal affection.

For a Democratic Party firmly ensconced in the psyche of the opposition party, the wave of Republican missteps and legal problems have visions of taking back Congress in 2006. The emerging theme of running against the Culture of Corruption evokes the 1974 Watergate Class that dominated Congress for a decade.

But the Culture of Corruption theme is a trap for the Democratic Party. Consider for a moment the results of recent polls. In the wake of unrelenting bad news and bad press, the President’s job approval numbers have fallen to 40% or below across a number of polls. In a similar vein, 60-65% of those polled believe the country is moving in the wrong direction.

However, the Democratic Party has not been the beneficiary of this broad-based disaffection. An October 10th Pew Research poll placed the job approval ratings of Democratic and Republican Congressional leaders at an identical 32%, while a contemporaneous NBC/Wall Street Journal poll gave favorable ratings to the Democratic and Republican Parties of 35% and 36%, respectively.

As a theme for the nationalization of the 2006 congressional races, the Culture of Corruption is a losing bet for several reasons. First, and foremost, the Democrats are no virgins at the political corruption game. Lest the Party leaders succumb to a form of collective Alzheimer’s, the Republican Revolution spearheaded by Newt Gingrich was built upon an anti-corruption platform––names such as Jim Wright and Dan Rostenkowsky come to mind––and the repeated efforts at campaign finance reform reflect national disgust at a corrupt network of contributions, lobbyists and favors endemic to both parties.

Second, while the Republicans may control the levers of power nationally and are therefore the visible players in the corruption game, the political parties play at the local level as well, and there is enough graft going on within the states to taint candidates of every stripe.

A quick look at the New Jersey gubernatorial race should be enough to make the point. In a race whose political ads have sullied the airways in at least three states, Democratic Senator Jon Corzine is having no luck pinning the Culture of Corruption rap on his opponent, Doug Forrester, as Forrester is in turn tying Corzine to the cronyism and corruption of the former Democratic Governor, Jim McCreevey, who resigned after disclosing that he had appointed his gay lover to head the state office of homeland security.

While Corzine remains the odds on favorite––a 90-10 bet at––by the tenor of the ads, you would think that he was a long-time inside pol in the corrupt New Jersey Democratic machine, rather than a former leader of the heady intergalactic investment banking firm of Goldman Sachs.

And New Jersey is not an aberration. A quick look at a few other states suggests how unlikely the Culture of Corruption gambit is to work for the Democrats. Across the river in Pennsylvania, State Senator Vincent Fumo (D), minority chair of the powerful Appropriations Committee, is under federal investigation for a novel influence peddling scheme wherein he allegedly solicited and received a $17 million gift to a tax-exempt organization that he controlled in exchange for supporting a utility merger.

Across the country in New Mexico, the state Democratic Party is struggling with the recent indictments of the current and prior State Treasurers, both elected Democrats, who are accused of the more conventional charges of taking kickbacks in exchange for state contracts, both in the form of large wire transfers and small bills in white envelopes.

The problem is simple. Since the founding of the nation, politicians with power have sold favors for funds. Not all of them, and not most of them, but many of them nonetheless. Corruption in Washington, DC, did not start five years ago, and neither did political favoritism in high-level appointments. Just ask Bobby Kennedy, Abe Fortas, Bert Lance and Mack McLarty. Oh, yes, and Hillary Clinton.

The American people understand the American political system. Politicians across the political spectrum appoint their friends for two reasons: first, because they trust them, and second, because they can. And quite often the appointees are qualified for the job. If the voters are disgusted, they are going to stay home, not vote for the other party. After all, they have long memories, and despite what people in DC might think, they are not stupid

No, if the Democrats want to win, they would do well to have a better candidate, a better organization, and a better message. Forget the Culture of Corruption. How about dealing with the steady erosion in the middle class at home, and American credibility and leadership abroad. Someone who could fix those problems might be worth voting for.

Tuesday, October 18, 2005

Questions for Michael Chertoff

Thanksgiving Day, 2005.

A terrorist group announces that it has placed a nuclear device in downtown Philadelphia and that they will detonate it in seven days.

They have no demands. Their goal is simply to create mayhem. And terror.

How would we respond? Who would take charge of the situation? Who would speak for the government? How would individuals and families know how to respond? Whose directions should we listen to? If we should evacuate, where should we go?

Would a threat of an emergency would be sufficient to destabilize a region and undermine our economy? Katrina was an emergency. Rita was just a threat. They both laid bare problems in our preparedness and our response. And the responsibility for addressing these problems lies squarely at Michael Chertoff’s feet as he heads to Capitol Hill.

Secretary of Homeland Security Michael Chertoff goes to Capitol Hill tomorrow for the first time to testify about the performance of FEMA in the wake of Hurricane Katrina. Without doubt the questioning will focus on the myriad mistakes that were made in the run-up to and in the wake of that storm. Buses that were or were not there. Hospitals that were not evacuated. Food and water. Looting. Ice trucks wandering the countryside. The Blame Game. Enough for some good television, but none of it touches on the important questions.

What has the Department of Homeland Security been doing? Three years and $100 billion later, the most basic aspects of dealing with a significant disaster do not appear to have been addressed.

First, the federal-state-local relationship. FEMA Director Michael Brown, whom Chertoff demoted and then fired in the wake of the Katrina debacle, hung his hat on issues of jurisdiction in defense of his agency’s performance. Who was responsible and for what in the wake of an emergency situation seemed not to have been considered in advance of the storm.

In the pre-9/11 world, one could chalk this up to just one more example of inter-governmental, bureaucratic failure, but no longer. The first duty of the Department of Homeland Security was to coordinate the agencies involved in homeland protection and response. Clearly, this has not been attended to, and that responsibility falls at the DHS level, not the FEMA level.

Second, evacuation planning. How many Americans have received instructions as to the evacuation route that they should take in the wake of an emergency situation? OK, if they haven’t received actual instructions, have they been told where to go to get instructions in the event of an emergency? No? OK, how about where to go for gasoline in an emergency in the event that something happens when their tank is empty?

Forty years ago, during the height of the Cold War, my mother kept cans of baked beans in the basement. We did not have enough to live on for more than a day or two, and we did not have a fallout shelter, but she had been instructed to store some food and to keep it in the safest place in the event of a nuclear attack.

And in school, there were duck-and-cover drills––and of course in true 1960s fashion there were the t-shirts that told you what to do: In the event of attack, place your head between your legs, and kiss your ass goodbye.

I am not advocating for duck-and-cover drills. But watching the traffic fleeing Houston in anticipation of Rita brought home the fact the two visible contributions to date from the Department of Homeland Security are Tom Ridge's color-coded threat alerts, and the suggestion that Americans buy duct tape.

I have no doubt that more is being done, and I imagine that deep in the bowels of the National Security Agency cyber-attacks are simulated and responses implemented, but the evidence from Katrina and Rita is that the more basic aspects of planning have not been attended to, and should be.

Issues of inter-governmental co-operation and evacuation planning are not sexy issues, like the security of our ports, transportation networks or the Internet. But in the wake of the hurricanes, it would appear that to wreck havoc on our nation, our psyche and our economy, one would not actually have to implement a plan attack, but just implement a well-conceived threat.

Michael Chertoff fired Michael Brown for not doing his job. Is he doing his?

Friday, October 07, 2005

Slow down and take a deep breath

There is a rush to rebuild.

Senators and contractors, Mayors and Presidents. Faced with the enormity of the challenge of rebuilding a destroyed city, the urge is to rebuild it now. $10 billion. $52 billion. $200 billion. $250 billion. Three brazillion. The numbers just keep on going up.

Insurance money. Federal spending. Give tax breaks for machinery. No, eliminate federal taxes. No, reduce wage taxes on low income people.

The utility system. The levees. The hospitals. Homes, buildings, casinos. $2,500 per house to put blue tarps on the roofs of damaged homes.

Bring the people home. No, wait, there are no services. Don’t let them back in.


Hurricane Katrina has wrecked devastation on a region and destroyed parts of a major American city. We need to take a deep breath. It happened. People fled. People died––though fortunately in far smaller numbers than originally feared.

Cities take years to build, and that growth evolves as communities evolve. Decisions are made through the rough and tumble process of local democracy. Planning and self-interest collide. Money is spent and money is made, and, over time, a city grows up as the heart of a community and of a region.

Look around the nation. Cities define so much of who we are, and the character of a city reflects the communities and politics and culture of a region and of a people. Even those cities whose great days have passed and are struggling remain central to the identity of a region. Detroit. St. Louis. Baltimore. Philadelphia. Surrounded by thriving suburbs that are increasingly independent of the urban core, these cities remain central to the identity of a region and its far flung communities.

New Orleans epitomized that centrality. The Cajun city. The Big Easy. Like the earth itself, it was not created in seven days or seven years, though seven decades can bring one closer to the scale. The urge to rebuild and rebuild now seems to hint at the modern real estate process of building gated communities. Make all of the decisions up front, raise the money, bring in the earth moving equipment. Bingo. Pleasant Acres South. Four hundred homes in the mid-300 range.

But cities are not gated communities and the process needs to slow down. We are watching the ultimate reality show. In the ring are the city, the state and the feds, each trying to take control, to win the hearts, make-up for the errors that were made, channel the money. Be the hero in a story that whose days of heroes are past.

Everyone needs to slow down. Most of the land is privately owned, and private owners need to make decisions. What to rebuild, when to rebuild. The urge to make decisions quickly, and even to throw money and tax credits at the problem, should be resisted. It is just going to take time, and it should take time.

The people who have been displaced need services to rebuild their livelihoods. Those who can return, can get jobs, will and should return. Many will find opportunities elsewhere, and should if it suits their inclination. The size of the city will be smaller, and that is how it should be. There are years of work to be done and decisions to be made. Communities need to be rebuilt, and many of those decisions cannot be made until there is a local decision-making infrastructure. Politics and planning serve the interest of communities, and it will take several election cycles for the will of the people––yes, the will of the people of New Orleans––to find its balance once again, and for long-term decisions to be made.

So, everyone, just slow down. Yes, there is money to be made. Yes, there are votes to be garnered. But this is going to be a marathon, not a sprint, and long after New Orleans leaves the news cycle, it will need attention and money and care.

Take a deep breath, and slow down.

Sunday, October 02, 2005

New Orleans truths

Richard grew up in Pontchartrain Park, where his grandmother’s house was flooded by Hurricane Betsy years ago and again by Katrina. Richard moved away, first to Howard University and then to Harvard Law School. After a stint in corporate law, he arrived at one of the great Wall Street banking houses where he achieved great success in trading and investment banking. When we worked together some twenty years ago––on a project in New Orleans ironically––he commented that he was living a life that was unimaginable to his grandmother, whose great fortune had been to marry a Pullman car conductor back in another era.

Richard does not believe that the levees in New Orleans were deliberately destroyed to flood black neighborhood during Hurricane Katrina. But he would not be surprised. I raised the question in response to reading David Remnick’s article this week in The New Yorker High Water which cited a history of suspicion in the New Orleans African American community that the levees had been intentionally breeched at times in the past to drive out portions of the black community and to create real estate opportunities.

Richard acknowledged that the black community was prone to conspiracy theories, but he was quick to note that one man’s conspiracy was another man’s revealed wisdom. After all, many of the injustices that were inflicted on black people in the past might have sounded like wild rumors before proven to be true. Brutal medical experiments. Officially sanctioned lynchings. Bank redlining.

The battles to come in the aftermath of Katrina will be the stuff of great works of history and journalism over the decades to come. Richard may not have bought the notion that the levees were breeched intentionally, but in terms of the outcomes that he envisions, they might as well have been. “Just watch the money, David, watch the money.” Richard insisted. “A lot of money will be made, and it will not be made by the people who have left and whose homes have been destroyed.”

The smart money will as surely come into the Crescent City in the coming months as it did into New York in the wake of 9/11, for as Richard noted in an offhand manner, “We both know that for the really smart investors, there are no disasters, just value opportunities.”

Within the political universe there is opportunity as well. The post-Katrina diaspora may enable the Republican Party to finally achieve the lock on the Louisiana Electoral College votes that has heretofore eluded it. Louisiana, alone among the states of the deep south, has resisted the efforts of the Republican Party––begun by Richard Nixon’s Southern Strategy and perfected in the neo-racialist code of Lee Atwater––and has to date been in play in the quadrennial presidential battles.

With memories of the Kingfish still resonant in the political DNA, and its unique cultural heritage, Louisiana continues to have a Democratic Governor and Senator. However, the local political establishment is keenly aware that the patterns of migration in the wake of the hurricane may well affect the state’s political future. After all, Senator Mary Landrieu won her last Senate race by just 40,000 votes, far fewer votes than there are seats in the Superdome. So it is not just money that is at stake in the reconstruction of Pontchartrain Park. If the people do not return, it may spell the doom of the statewide Democratic Party as well.

Richard is one of the smartest guys I ever worked with. Period. And he believes that the AIDs virus was created in a laboratory in North Carolina for the purpose of destroying the black race. While he acknowledges the black community susceptibility to rumors and conspiracy theories, he is more interested in understanding what people believe and how they are influenced by these beliefs than in arguments about what the truth might or might not be.

Richard’s career and fortune have been built on a sophisticated understanding of how markets work. He attributes a measure of his success to his ability to hear rumor and conjecture and not judge their veracity out of hand. “I have learned that it matters less what the truth is that what people believe the truth to be. After all, their behavior is ultimately based on belief, not truth. I really don’t care what the truth is, and in a lot of these things we are never going to know. I prefer to focus on what people believe. If I do that and can anticipate how they are going to act, I am going to make money.”

And as Richard learned from years on Wall Street, money and power are what motivate people. And power flows from money.

“Just watch the money,” He reiterated. “Watch the money.”