Tag: Assad

Syria’s Annual Inflation Hits 200%

In an attempt to beat Western sanctions and halt the fall in the Syrian pound, the Assad regime – with the help of Iran, Russia, and China – has begun conducting all of its business in rials, roubles, and renminbi. This decision supplements other existing arrangements between Syria and its allies that are keeping the Syrian economy on life-support. These include transfers of $500 million per month in oil and an unlimited credit line with Tehran for food and oil-product imports.

According to Kadri Jamil, Syria’s prime minister for the economy, this life support is necessary because Syria’s devastated economy is the target of an elaborate plot, hatched by the U.S. and Britain, to “sink the Syrian pound.”

So, what about the sinking pound? As the accompanying chart shows, the Syrian pound has lost 66.2% of its value in the last twelve months.

The rout of the Syrian pound has been widely reported in the press.  But, Syria’s inflation problems that have accompanied the collapse of the pound have gone largely unreported.  That’s because, beyond the occasional bits of anecdotal evidence, there has been nothing to report by way of reliable economic data.

To fill that void, I employ standard techniques to estimate Syrian’s current inflation. Currently, Syria is experiencing an annual inflation rate of 200% (see the accompanying chart).

Indeed, Syria is experiencing a monthly inflation rate of 34%. To facilitate the monitoring of the quickly deteriorating situation in Syria, I am creating a resource which will allow readers to view up-to-date data on the Syrian pound and the country’s inflation problems. Soon, black-market exchange-rate data and ­inflation estimates for countries with troubled currencies like Syria will be made available via the “Troubled Currencies Project” – a joint Cato Institute-Johns Hopkins collaboration under my direction. In consequence, the days of Syria’s plunging pound and raging inflation being covered in a shroud of secrecy are soon coming to an end.

Washington Foolishly Tilts Towards War in Syria

The bitterest fights tend to be civil wars. Today, Syria is going through such a brutal bloodletting. 

The administration reportedly has decided to provide arms to Syria’s insurgents. It’s a mistake.

This kind of messy conflict is precisely the sort in which Washington should avoid. Despite the end of the Cold War, the U.S. armed services have spent much of the last quarter century engaged in combat. At the very moment Washington should be pursuing a policy of peace, policymakers are preparing to join a civil war in which America’s security is not involved, other nations have much more at stake, many of the “good” guys in fact are bad, and there would be no easy exit.

Military action should not be a matter of choice, just another policy option. Americans should have something fundamental at stake before their government calls them to arms.

No such interest exists in Syria.

Intervention against Damascus means war. Some activists imagine that Washington need only wave its hand and President Bashar Assad would depart. However, weapons shipments are not going to oust a regime which has survived two years of combat. Intervening ineffectively could cost lives and credibility while ensuring heavier future involvement.

There is no serious security rationale for war. Damascus has not attacked or threatened to attack America or an American ally. America’s nearby friends, Israel and Turkey, are capable of defending themselves.

Another concern is the conflict spilling over Syria’s borders. But this does not warrant U.S. intervention. Maintaining geopolitical stability rarely approaches a vital interest justifying war.

Moreover, intervening would not yield stability. Washington foolishly attempted to sort out Lebanon’s civil war three decades ago and was forced into an embarrassing retreat. There’s no reason to believe joining the Syrian killfest today would yield a better result.

Another claim is that ousting the Assad dictatorship, allied with Tehran, would weaken Iran. Likely so, but then Iran would have a greater incentive to emphasize ties with Shia-dominated Iraq, which also has been aiding Assad.

Moreover, a chaotic, fragmented, sectarian Syria likely would do more to unsettle Iraq, Israel, and Lebanon, allied or friendly to America, than Iran. Tehran’s divided elite also might close ranks in response to an increased feeling of encirclement.

Advocates of U.S. action point an accusing finger at Iran, Lebanon’s Hezbollah, and Russia for helping Damascus. However, Qatar and Saudi Arabia are providing money and weapons to the rebels. Turkey is offering sanctuary for insurgents. The international nature of the struggle is a good reason for Washington to stay out.

Syria’s chemical weapons stockpiles also argue against intervention. Chemical agents are the least effective and most geographically constrained of so-called weapons of mass destruction. Thus, “leakage” is more likely to threaten Syria’s neighbors than America.

Weakening or overthrowing the Assad regime is more likely to release chemical agents to potentially hostile governments or groups. Air strikes would loose chemicals against surrounding civilians. Boots on the ground would mean regime change, leaving Damascus no reason not to use chemical weapons as a last resort defense.

The most pressing concern is humanitarian. But Syria is not a case of genocide committed by an armed government against an unarmed people. There are two forces ready to kill. Defeating one does not mean peace. Rather, it means the other gets to rule, perhaps ruinously.

In both Kosovo and Rwanda the U.S.-backed victors committed atrocities. In Syria reprisals are certain whoever wins. Neither Afghanistan nor Iraq offer reasons for optimism—extended blood-letting, interminable involvement, disappointing outcome.

The result in Syria actually could be far worse, because of the rise of Islamic radicalism among insurgents. These fine folks recently executed a 15-year-old boy for blasphemy in front of his parents.

The final pitch for war is camouflaged as a call for American leadership. However, whether leader or follower, the U.S. would lose by attacking Assad.

Although diplomacy looks forlorn after two years of combat, it remains the best hope. Despite recent gains, Assad’s forces remain unlikely to reassert control over the northern half of the country. The opposition’s divisions and Assad’s outside assistance make a complete rebel victory unlikely. All of the surrounding states have much to lose from continuing war. A second best modus Vivendi might be possible.

Even if diplomacy fails, however, Washington should stay out of the war.

Syria is a tragedy. There is no reason to make it America’s tragedy. President Barack Obama should ask: does he want his administration to be defined by involvement in an unnecessary and unpopular no win war, as was that of his predecessor?