Tales of Transformation From Hungary, Romania, and Moldova

Judy Dempsey - February 26, 2015


EU support and membership can help post-Communist countries become modern democracies, but it is citizens who have the power to complete - or reverse - those transformations.

When Viktor Orbán was elected prime minister of Hungary in 2010, he promised that his conservative Fidesz party would complete the transformation from a Socialist country to a modern democratic society. In Orbán's view, the system he inherited was riddled with corruption. Remnants of the old Communist system were still intact. There was little transparency in how economic decisions were made.

But since 2010, Fidesz, which has twice won a two-thirds parliamentary majority, has not completed Hungary's transition. If anything, the democratic gains made by the country during the 1990s are being undermined in a way that shows that the transformation of a post-Communist country is not irreversible.

The experiences of Hungary and of other Central and Eastern European countries also show that it is the citizens who can make or undo the transformation of their societies. That is regardless of which party is in power, and of whether or not a country is a member of the EU.

Fighting Repression with the Rule of Law in Russia

William Pomeranz & Kathleen Smith - February 26, 2015


Any battle between the Russian state and its political opponents has always been an unequal contest, since the state brings an overwhelming superiority to such confrontations. This disparity is as true today as it was during the Soviet Union's fight against dissidents and imperial Russia's struggle against diverse revolutionary movements.

Yet in each period, some challengers to the system have used existing law - underdeveloped as it may be - to demand that the Russian state live up to the principles of the rule of law.

Any legal triumph that the Russian human rights community makes in its ongoing struggle against the state is therefore noteworthy. And in the past month, the Russian Memorial Society has had two significant victories that preserved its institutional integrity and imposed legal limits on the government's investigative powers.

Memorial has served as the conscience of Russia for more than two decades. An umbrella organization uniting groups across the territory of Russia, "Memorial: An International Historical, Educational, Human Rights and Charitable Society" has persistently pursued a dual mission of uncovering and publicizing past political abuses and protesting new violations of human rights.

Why Ukraine Was No Game Changer - So Far

Jan Techau - February 25, 2015

Far from altering Europe's geopolitical landscape, the Ukraine crisis has only reconfirmed the continent's old order.

Has the Ukraine crisis changed the geopolitical landscape of Europe? Instinctively, most people would answer yes, given the grave nature of Russia's breach of rules, its annexation of another country's territory, and its continued attack on Ukrainian sovereignty in the eastern regions of Donetsk and Luhansk.

But has the continent's geopolitical landscape really changed, in the sense that a new order or a new power balance has emerged that was not already in existence beforehand? My feeling is that the answer is no. In reality, it is the old order that has been brutally reconfirmed. Western pain comes from the fact that many in Europe and the United States believed that the old order had been obsolete for a while, when in fact it was not.

That old order was established after the Eastern enlargements of NATO and the EU had come to an end, and when Russia made clear that it was unwilling to accept countries in its immediate neighborhood slipping too far toward the West. Georgia, Moldova, and Azerbaijan had to learn the hard way that for Russia, keeping its neighborhood under control was more important than Russian closeness to the West. Moscow created frozen conflicts on its neighbors' territories to grant it a maximum of political influence with a minimum of power projection.

Fate of Kidnapped Christians in Syria Unclear

Associated Press - February 25, 2015

BEIRUT (AP) -- Kurdish and Christian militiamen battled Islamic State militants on Wednesday in northeastern Syria, where the extremist group recently abducted at least 70 Christians after overrunning a cluster of villages.

Hassakeh province which borders Turkey and Iraq has become the latest battleground for the fight against IS. It is predominantly Kurdish but also has populations of Arabs and predominantly Christian Assyrians and Armenians

In pre-dawn attacks, the group on Monday attacked communities nestled along the Khabur River, seizing dozens of people, many of them women and children. Thousands of others fled to safer areas.

The fate of those kidnapped, almost all of them Assyrian Christians, remained unclear on Wednesday two days after they were seized. The abduction added to fears among religious minorities in both Syria and Iraq, who have been repeatedly targeted by the Islamic State group. During the group's bloody campaign in both countries, where it has declared a self-styled caliphate, minorities have been repeatedly targeted and killed, driven from their homes, had their women enslaved and places of worship destroyed.

The Intersection of Three Crises

Reva Bhalla - February 25, 2015

Within the past two weeks, a temporary deal to keep Greece in the eurozone was reached in Brussels, a cease-fire roadmap was agreed to in Minsk and Iranian negotiators advanced a potential nuclear deal in Geneva. Squadrons of diplomats have forestalled one geopolitical crisis after another. Yet it would be premature, even reckless, to assume that the fault lines defining these issues are effectively stable. Understanding how these crises are inextricably linked is the first step toward assessing when and where the next flare-up is likely to occur.

Germany and the Eurozone Crisis

Germany has once again become the victim of its own power. As Europe's largest creditor, it has considerable political leverage over debtor nations such as Greece, whose entire livelihood now depends on whether German Chancellor Angela Merkel is willing to sign another bailout check. Lest we forget, Germany is exporting more than half of its GDP, and most of those exports are consumed within Europe. Thus, the institutions Germany relies on to protect its export markets are the very institutions Berlin must battle to protect Germany's national wealth.

Many have characterized the recent Brussels deal as a victory for Berlin over Athens as eurozone finance ministers, including the Portuguese, Spanish and French, stood behind Germany in refusing Greece the right to circumvent its debt obligations. But Merkel is also not about to gamble an unlimited amount of German taxpayer funds on flimsy Greek pledges to cut costs and impose structural reforms on a population that, for now, still views the ruling Syriza party as its savior from austerity. Within four months, Greece and Germany will be at loggerheads again, and Greece will likely still lack the austerity credentials that Berlin needs to convince its own Euroskeptics that it has the institutional heft and credibility to impose Germanic thriftiness on the rest of Europe. The more time Germany buys, the more inflexible the German and Greek negotiating positions become, and the more seriously traders, businessmen and politicians alike will have to take the threat of a so-called Grexit, the first in a chain of events that could shatter the eurozone.

NATO Should Build Permanent Bases in the Baltics

Randy Scheunemann - February 24, 2015


Eighteen years ago, NATO and Russia negotiated a "Founding Act" to govern relations as NATO extended its security umbrella to include the Czech Republic, Hungary, and Poland. At the time, U.S. President Bill Clinton's team reassured President Boris Yeltsin's Russia that NATO enlargement posed no threat to Russia, and that NATO had no intention of expanding its military presence to the alliance's eastern frontier. Some supporters of enlargement believed the 1997 NATO-Russia Founding Act went too far in assuaging Russian concerns, which were based on Russian psychology more than they were grounded in reality.  Nonetheless, the Founding Act was signed and continues to shape NATO - as a political and policy document, not as a legally binding commitment.    

Two provisions within the Founding Act are relevant to today's dramatically changed strategic environment. First, to reassure Yeltsin's Russia, the "Three No's" were given form: NATO had "no intention, no plan, and no reason to deploy nuclear weapons on the territory of new members ... and do not foresee any future need to do so."  Second, NATO committed to carrying out collective defense by "ensuring the necessary interoperability, integration, and capability for reinforcement rather than by additional permanent stationing of substantial combat forces." Put simply, NATO promised to place neither nukes nor bases on its new eastern border. The alliance hoped thus to soothe a diminished Russia. 

When the Founding Act was signed, key features of the European security environment included: Russia's adherence to the Conventional Forces in Europe Treaty (CFE), limiting conventional arms deployments and containing numerous confidence-building measures; Russia's commitment to updating CFE in a modernized or adapted form; Russia's adherence to the 1987 U.S.-Russia Intermediate-Range Nuclear Forces Treaty (INF) banning certain missiles; Russia's adherence to the 1994 Budapest Memorandum guaranteeing Ukraine's sovereignty and territorial integrity in exchange for Ukraine giving up its nuclear weapons; Russia's adherence to the Helsinki Final Act of 1977 ensuring, among other things, the right of European countries to select their own alliances; and, tacitly, no formal recognition of Russian-supported separatist enclaves in Abkhazia, South Ossetia, and Transdniestria. While the West disagreed with Russia on security matters repeatedly in the ensuing years, the issues were manageable, usually subject to reasonable negotiation, and Russia for the most part complied with its post-Cold War legal and treaty obligations.   

NATO's agreement not to deploy nuclear weapons or station permanent bases in the new member-states seemed a fair tradeoff given the security environment, and it ended the age-old security dilemma faced by the leaders and populations of Central and Eastern Europe. 

How Israel Could Be Drawn into Syria's War

Tony Badran - February 23, 2015

President Barack Obama and Israeli Prime Minister Benjamin Netanyahu are at loggerheads. Why? Following the White House's lead, many observers have focused on the personal enmity between the two. Some commentators go further and analyze the growing strategic rift over how best to handle Iran's nuclear program. In truth, however, the rift is far larger still.

In addition to all of the other issues, Obama and Netanyahu entertain contradictory views of Iran's role in region, and Syria stands at the heart of their disagreement. Whereas Obama is comfortable with the rise of Iranian power in Syria, Netanyahu and, to be sure, the Israeli security elite are deeply discomfited by it.

In recent days, the Iranian Revolutionary Guards (IRGC) and Hezbollah launched an integrated assault in the Quneitra and Daraa countrysides in southern Syria. Importantly, they are advertising their lead role; underscoring that southern Syria is now an operations theater for Tehran. Thus, they are also confirming what has long been obvious: the Assad regime and its forces are wholly-owned subsidiaries of Iran.

These developments are impossible for Israel to ignore. Indeed, Iran and Hezbollah are calling their joint campaign "Operation Martyrs of Quneitra" - a direct reference to the Iranian-Hezbollah convoy that Israel destroyed on 18 January. The appearance of the Iranians in force in the Golan foists difficult choices on Israel, not just regarding its posture in Syria, but also about how to manage the growing chasm with the Obama administration.

Not Another Iron Curtain

Judy Dempsey - February 23, 2015


The EU urgently needs to tie Ukraine and the rest of Eastern Europe as close as possible to the bloc and prevent the continent from becoming divided again.

European leaders and the European Union face a stark choice. They can either fully commit to helping complete Ukraine's revolution or collude with Russia into making Ukraine a failed state.

A year since tens of thousands of Ukrainians took to the streets in Kiev and ousted the then-president Viktor Yanukovych from power, Ukraine and Eastern Europe remain highly vulnerable, to put it mildly.

Russia's invasion of eastern Ukraine is surely enough for European governments to unequivocally make the choice in favor of supporting Kiev.

Is this the Century of the Dragon?

Pepe Escobar - February 23, 2015

BEIJING -- Seen from the Chinese capital as the Year of the Sheep starts, the malaise affecting the West seems like a mirage in a galaxy far, far away. On the other hand, the China that surrounds you looks all too solid and nothing like the embattled nation you hear about in the Western media, with its falling industrial figures, its real estate bubble, and its looming environmental disasters. Prophecies of doom notwithstanding, as the dogs of austerity and war bark madly in the distance, the Chinese caravan passes by in what President Xi Jinping calls "new normal" mode.

"Slower" economic activity still means a staggeringly impressive annual growth rate of 7% in what is now the globe's leading economy. Internally, an immensely complex economic restructuring is underway as consumption overtakes investment as the main driver of economic development. At 46.7% of the gross domestic product (GDP), the service economy has pulled ahead of manufacturing, which stands at 44%.

Geopolitically, Russia, India, and China have just sent a powerful message westward: they are busy fine-tuning a complex trilateral strategy for setting up a network of economic corridors the Chinese call "new silk roads" across Eurasia. Beijing is also organizing a maritime version of the same, modeled on the feats of Admiral Zheng He who, in the Ming dynasty, sailed the "western seas" seven times, commanding fleets of more than 200 vessels.

Meanwhile, Moscow and Beijing are at work planning a new high-speed rail remix of the fabled Trans-Siberian Railroad. And Beijing is committed to translating its growing strategic partnership with Russia into crucial financial and economic help, if a sanctions-besieged Moscow, facing a disastrous oil price war, asks for it.

Can We Stop the Islamist Army of Terror?

Kevin Sullivan - February 20, 2015


On Nov. 16, 2014, the terrorist organization known as the Islamic State released a graphic video depicting a masked jihadist standing over the severed head of U.S. citizen Peter Kassig. The filmed execution of Kassig, who had been captured the previous year in Syria, was just the latest in a growing collection of horrific videos uploaded and disseminated around the Internet by the group. 

His Islamic State captors cared little that Kassig had dedicated the final years of his life to humanitarian work in Lebanon and Syria, or that he had converted to Islam during his time in captivity. What mattered most to his killers was that Kassig had served as a U.S. Army Ranger in Iraq, and thus his death not only represented a blow to the "infidel" army of the West, but a step toward the fulfillment of a prophecy.

"Here we are, burying the first American Crusader in Dabiq, eagerly waiting for the remainder of your armies to arrive," recited Kassig's anglophone executioner.

Beheadings, burnings, and systematic executions have become commonplace since this jihadist organization seized control of the northern Iraqi city of Mosul in the summer of 2014. The rapidity of its advance and the savagery of its practices have left many outside observers aghast and grasping at any available explanation for why such barbarity exists in the 21st Century. But to stop the Islamic State, it is important first to understand and explain the method to its unconscionable madness.

The Geopolitics of Metal Supply

Daniel McGroarty - February 20, 2015


Look out, Ford, General Motors, and Tesla: In a secret facility somewhere in Silicon Valley, Apple is reportedly building an iCar. It makes sense, in an Apple-centric sort of way: If Apple wants all of us to be able to safely use our iPhones while driving, why not just build a compatible car? The entire automotive industry becomes an Apple app.

Judging by the breathless reporting, there's no telling where it will stop. Perhaps Apple has opened its own SkunkWorks and will dazzle all of us one day with the iStealth - the first zero-emission, 3D-printed personal bomber.    Apple may not be ready to morph into a nation-state, but this is all heady stuff for a company that just powered past the $700 billion market cap mark and is touted by otherwise hard-boiled analysts as the odds-on favorite to be the world's first trillion-dollar company. Yet we should marvel at the lack of attention paid to the company's Achilles' heel: The minerals and metals with which Apple makes its magic.   The more Apple rules the world, the more its fortunes rest on the weakest link in its material supply chains. iGadgets are metals-intensive. Take the typical smart phone. (Apple hasn't open-sourced its iPhone recipe just yet.) In the screen, you'll find indium, aluminum, and tin, in addition to 7 of the 17 rare earths. The battery holds lithium, graphite, manganese, and cobalt. For the electronics, you'll need copper, gold, silver, tantalum, tin, lead, arsenic, antimony, nickel, gallium, and again, a handful of rare earths. Finally, the case includes nickel, bromine, and magnesium. In all, the average smartphone contains as many as 40 elements on the Periodic Table - nearly half of the 90 elements found in nature.   It may be gram-flakes in each phone, but it all adds up: Last year, new smartphones consumed more than $2.5 billion-worth of gold and silver alone.

Apple has made heroic efforts to find out where the metals it uses come from. The company's newly released Supplier Responsibility Report, with a standalone Conflict Metals SEC filing, shows the pains Apple takes to source conflict-free metals. The company discloses a long list of its supply chain smelters and refiners, and it cuts off suppliers that don't meet conflict-free standards. But the conflict metals legislation tucked away in the 2010 Dodd-Frank omnibus act focuses on just four metals - tantalum, tin, tungsten, and gold - from one country, the Democratic Republic of the Congo. Apple knows precious little about the remainder of the 40 metals and minerals found in smartphones - how they're mined and where they come from - and no one else knows much more. Some of them come from recycled e-waste, which sounds virtuous. After all, Jane Jacobs, the late urban activist, rhapsodized that "cities are the mines of the future" - chock full of metals and minerals we can reclaim to build the next stage of technological progress. She was right, and even now, innovative companies are showing it is possible to extract rare metals from spent electronics, coal ash, and red mud waste dumps - and to do so by environmentally benign means.    Urban mining may be the wave of the future, but the cities that are the mines of the present should be the ones that concern us. Take Guiyu, on the South China Sea coast, known as the electronic wastebasket of the world. Children as young as 3 scrabble through metal mountains of shattered flip phones, motherboards, and other assorted electronic innards. Sharply increased lead levels make their way into the food supply, and the air, dense with the chemical stew used to tease metals out of trash, literally burns visitors' nostrils. While it is illegal to export e-waste, truckloads of it somehow keep rolling into Guiyu. Not far from Guiyu, subsistence farmers trade their health for a family fortune, mucking out heavy rare earths from the local ionic clay using toxic chemicals and plastic buckets. The supply chain leads through criminal gangs past corrupt Chinese generals - Beijing regularly cracks down on illegal mining, but it persists all the same - onto the docks and ultimately into an unknown number of our smartphones. By some accounts, more than 30,000 metric tons of heavy rare earths are being smuggled out of China each year.   

So what do we really know about the metals in our tech gadgets? Okay, they don't come from the conflict regions of the DRC. But are they "sourced" from the children of Guiyu? Or in pails full of heavy rare earth concentrate from poor Chinese farmers? Is the antimony in our phones fed into the global supply chain via Burmese rebels over the mountains of Myanmar? We don't know, because no one is asking. And to some extent, perhaps no one wants to know: Just make sure there's a new phone out when I'm ready for my upgrade. Our policy amounts to Don't Ask, Can't Tell. It doesn't have to be this way. Many of the metals we need could come from new mines in the United States, where supply chains could be easily certified, and labor, environmental, and safety practices would be among the most scrutinized in the world. But the political and regulatory climate in the United States has grown more and more inhospitable for mining over the past two decades, even though the time it takes to permit a new U.S. mine already ranks near the worst in the world. And little wonder, as many of the very groups that depend on metal-laden tech-gadgets to spread their message and plan their protests are the loudest objectors to new U.S. mines of any kind.    So now we have reached the resource equivalent of the spinning "beach ball of death" that sometimes seizes our display screens. Apple and its tech-wizard wannabees hunger for row upon row of the Periodic Table, which is mostly mined or recovered anywhere but in Am

Brazil Aims to Boost Economic Ties with U.S.

Tim Ridout - February 19, 2015


(AP photo)

WASHINGTON - Fresh off a narrow victory in a contentious election, Brazilian President Dilma Rousseff has signaled an interest in restoring momentum in Brazil's ties with the United States as well as a renewed focus on the European Union. Brazil's growth is collapsing due to continuing infrastructure, regulatory, and fiscal problems, as well as tightening external credit and low global commodity prices. The cumulative impact of these factors is encouraging tighter fiscal and monetary policies at home, and a trade agenda that focuses on a Mercosur-EU free trade agreement with Brussels and trade facilitation and regulatory convergence with Washington.

These initiatives are being pursued in the context of negotiations over a Transatlantic Trade and Investment Partnership between the United States and EU, a mega-trade deal that Brazil worries will leave it outside global value chains. Given its similar fears regarding the Trans-Pacific Partnership, stagnant domestic economic growth, and a devalued currency, Brazil has turned its attention to exports - and to its northern Atlantic partners in particular.

Brazil-U.S. relations faltered amid Rousseff's reaction to revelations of U.S. National Security Agency data mining in Brazil and related issues. Rousseff postponed a planned October 2013 state visit to Washington and put on hold multiple policy dialogues with the United States. Recent announcements - including a rescheduled visit to Washington in September and the appointment of former Foreign Minister Luis Alberto Figueiredo as ambassador to the United States - suggest Brazil wants to rebuild bilateral bridges and put ties back on a more productive footing.

The Forecast for Ukraine

Tymofiy Mylovanov - February 18, 2015

A year after the Maidan revolution of 2014, Ukraine is at a critical juncture.

The conflict with Russia has been escalating. Estimates of casualties exceed 5,000, with some reports putting the number at 50,000. The cost of the war in the East is anywhere between US $5-10 million. And despite the ceasefire signed in Minsk February 12, fighting on the ground continues.

The Ukrainian currency Hryvna has lost two thirds of its value in a year and continues to fall.

So far, Ukraine has met its obligations to foreign creditors, but the reserves of the National Bank of Ukraine have been almost depleted. The issue of pervasive corruption has not been addressed. Unfortunately, the new government appointed in early December has little to show so far by way of successful structural reforms.

The Economics of Global Population Decline

George Friedman - February 18, 2015

In recent weeks, we have been focusing on Greece, Germany, Ukraine and Russia. All are still burning issues. But in every case, readers have called my attention to what they see as an underlying and even defining dimension of all these issues - if not right now, then soon. That dimension is declining population and the impact it will have on all of these countries. The argument was made that declining populations will generate crises in these and other countries, undermining their economies and national power. Sometimes we need to pause and move away from immediate crises to broader issues. Let me start with some thoughts from my book The Next 100 Years.

Reasons for the Population Decline

There is no question but that the populations of most European countries will decline in the next generation, and in the cases of Germany and Russia, the decline will be dramatic. In fact, the entire global population explosion is ending. In virtually all societies, from the poorest to the wealthiest, the birthrate among women has been declining. In order to maintain population stability, the birthrate must remain at 2.1 births per woman. Above that, and the population rises; below that, it falls. In the advanced industrial world, the birthrate is already substantially below 2.1. In middle-tier countries such as Mexico or Turkey, the birthrate is falling but will not reach 2.1 until between 2040 and 2050. In the poorest countries, such as Bangladesh or Bolivia, the birthrate is also falling, but it will take most of this century to reach 2.1.

The process is essentially irreversible. It is primarily a matter of urbanization. In agricultural and low-level industrial societies, children are a productive asset. Children can be put to work at the age of 6 doing agricultural work or simple workshop labor. Children become a source of income, and the more you have the better. Just as important, since there is no retirement plan other than family in such societies, a large family can more easily support parents in old age.

Exit America, Europe's Trust Engine?

Jan Techau - February 18, 2015


(AP photo)

The United States succeeded as Europe's benevolent hegemon because it was able to pacify rivaling European states and instill mutual trust in them. That role is still needed.

In my column here last week, I claimed that the real issue at stake in the Ukraine crisis was the future of America's role as Europe's security guarantor. I argued that the United States would inevitably have to reduce its footprint in Europe to attend to more urgent business in other strategic hotspots elsewhere, most importantly in Asia.

With the Europeans at the same time unwilling and unable to up their game on security, I wrote, a power vacuum would emerge that external players, most notably Russia, were only too eager to fill. Ukraine is just one example of the conflicts that could arise as competing actors seek to fill that vacuum.