Tag: Russia

Can the United States, China and Russia Cooperate on Trade?

The 2016 G20 summit in Hangzhou is fast approaching and, similar to the pre-summit meetings hosted by China throughout the year, the focus will be the state of the global economy. Still contending with sluggish global economic growth, the summit’s theme of “Towards an Innovative, Invigorated, Interconnected and Inclusive World Economy” is especially timely. Under the umbrella of global economic growth, cultivating opportunities for trade and investment will become a major priority for G20 states, and three global powers—the United States, China, and Russia—are each developing their own multinational trade route projects. These major trade projects could serve as opportunities for cross-country cooperation and growth, but they could also become sources for future conflict.

China’s management of domestic markets, currency, and commitment to structural reforms was a cause for global concern at the first meeting of G20 Finance and Central Bank Governors in February. At next week’s summit, China’s President Xi Jinping will undoubtedly point out China’s efforts towards realizing supply-side structural reforms in the face of China’s “new normal” of slower economic growth. As part of these reforms aimed at rebalancing China’s economy, Beijing plans to cut industrial overcapacity, tackle overhanging debt, reform state-owned enterprises, and seek out new consumer markets. On the last point, Beijing is championing its New Silk Road Initiative (also known as “One Belt, One Road”), a major state project focused on opening up new markets. To accomplish this, Beijing is building vast trade networks spanning several countries and continents, by land and by sea. However, many countries are wary. The project, billed as purely an economic one, may evolve to include a political and/or military dimension as well.

Stop Treating NATO as a Social Club

Members of NATO are meeting in Warsaw. They are dragging the U.S. back into its traditional role of guaranteeing the security of Europe, even though the continent is well able to defend itself.

The North Atlantic Treaty Organization was a necessary part of Containment, preventing the Soviet Union from dominating or conquering Western Europe. But after recovering from World War II the Europeans remained dependent on America.

NATO lost its raison d’etre once the Warsaw Pact disbanded and Soviet Union collapsed. Alliance officials eventually added “out of area” activities, that is, wars of choice irrelevant to Europe’s defense (Balkans, Libya, Mideast, Afghanistan). Such conflicts have wasted lives and resources with no benefit to Europe and America.

NATO’s Warsaw Summit

At the end of this week, leaders from the United States and Europe will convene in Warsaw, Poland, for a NATO summit. The meeting – only the second summit since Russia’s 2014 invasion of Ukraine – will include high level strategic discussions, and will likely see the announcement of an increased NATO troop presence in the Baltic States to counter potential Russian aggression there.

The biggest question leaders intend to address in Warsaw is how to deter Russian aggression towards NATO members in Eastern Europe following its seizure of Crimea and involvement in the conflict in Eastern Ukraine. In effect, leaders will try to find a compromise solution which reassures NATO’s eastern members, provides additional deterrence, but does not provoke further military buildup and distrust from Russia. They will almost certainly fail in this endeavor.

In fact, the expected announcement of the deployment of 4 battalions of additional troops to the Baltics has already produced heated rhetoric from Russia. These deployments will likely lead to a Russian response, ratcheting up tensions and increasing the risk for inadvertent conflict in the region. In other words, they will contribute to a classic security spiral of mistrust and overreaction. The irony is that such deployments are largely symbolic, not strategic. Even four battalions will not change the fact that Russia could likely conquer the Baltics quickly if it so chose. And even though some would argue that their deterrent value is largely as a ‘tripwire,’ it isn’t clear why the existing Article V guarantee is insufficient for that purpose.

To be frank, in the focus on how to defend the Baltics, leaders have largely overlooked the low likelihood of a conflict in that region. For one thing, there is a qualitative difference between attacking Ukraine and attacking a NATO treaty member; Vladimir Putin certainly knows this. For another, Russia’s force posture simply doesn’t indicate that it has any intentions on the Baltics.

U.S. Must Stay Out of the Syrian War

A group of State Department officials recently sent a confidential cable chiding the administration for not adding another war to America’s very full agenda. The 51 diplomats called for “targeted military strikes” against the Syrian government and greater support for “moderate” forces fighting the regime.

One of the architects of current policy, presumptive Democratic presidential nominee Hillary Clinton, also has turned against the administration’s more disengaged approach. She urged creation of a no fly zone, an act of war, as well as greater support for insurgents.

The conflict is horrid, of course, but no one has explained how U.S. entry into Syria’s multi-sided civil war would actually end the murder and mayhem. Nor has anyone shown how America making another Middle Eastern conflict its own would serve Americans’ interests.

Despite the repeated failure of social engineering at home, Washington officials believe that they can transcend culture, history, religion, ethnicity, geography, and more and forcibly transform other peoples and nations. Those who resist America’s tender mercies via bombs, drones, infantry, and special operation forces are assumed to deserve their fate.

This interventionist impulse is particularly inappropriate for a devilishly complex conflict like Syria. Unfortunately, Washington’s early insistence on Bashar al-Assad’s overthrow thwarted hope for a negotiated settlement.

The claim that the U.S. could have provided just the right amount of assistance to just the right groups to yield just the right outcome is a fantasy, belied by America’s failure get much of anything in the Middle East right. Even when Washington seemingly enjoyed full control in Iraq the U.S. did just about everything wrong, triggering the sectarian conflict which spawned the Islamic State.

Military action would be even more dangerous today given Russia’s involvement. Syria matters much more to Russia, which has a long relationship with Damascus, enjoys access to the Mediterranean from a Syrian base, and has only limited influence elsewhere in the region.

No fly proponents blithely assume that Moscow would yield to U.S. dictates, but America would not surrender if the situation was reversed. A no fly zone would not bring peace to Syria but would risk a military incident with a nuclear-armed power.

The State Department dissenters argued for limited strikes on Syria. What if such attacks failed? What if Damascus deployed Russian anti-aircraft systems? What if Moscow escalated against U.S.-supported insurgents? Would Washington concede or double down?

In fact, no one has a realistic scheme to put the Syrian Humpty-Dumpty back together again. Ousting Assad would effectively clear the way for the Islamic State and other radical factions.

So far supporting so-called moderate insurgents has done little more than end up indirectly supplying ISIL and al-Nusra, an al-Qaeda affiliate, with recruits and weapons. Turkey is at war with the same Kurdish fighters America supports.

While horror is the appropriate reaction to Syria’s civil war, the U.S. has no solution to offer. The U.S. should adopt a policy of first do no harm.

As I argue in National Interest: “Stay out of the conflict. Don’t add to the tragedy. Accept refugees fleeing for their lives. Provide humanitarian aid to those within reach. That would be an agenda of which Americans could be proud.”

Crimea after Two Years as Part of Russia: Time to Drop Sanctions

Two years ago Russia detached Crimea from Ukraine. Since then the Western allies have imposed economic sanctions, but to little effect. No one believes Crimea, Russian until six decades ago, is going back to Ukraine.

Yet the European Union called on other countries to join its ineffective boycott. However, most nations have avoided the controversy. They aren’t going to declare economic war on a faraway nation which has done nothing against them.

Although Washington, with less commerce at stake, remains among the most fervent advocates of sanctions, Europe is divided over the issue. Opposition has emerged to routine renewal in July of restrictions on Russia’s banking, energy, and military industries. Particularly skeptical of continued economic war are Cyprus, Greece, Hungary, and Italy.

Sanctions supporters insist that Russia more fully comply with the Minsk peace process and end support for the separatist campaign in Ukraine’s east. “Today Russia faces a choice between the continuation of economically damaging sanctions and fully meeting its obligations under Minsk,” contended Secretary of State John Kerry.

Russia and NATO Meet: Time for Allies to Call off Mini-Cold War with Moscow

The NATO-Russia Council met in Brussels for the first time in nearly two years. “We are not afraid of dialogue,” announced alliance Secretary-General Jens Stoltenberg. Alas, he explained: “it was reconfirmed that we disagree on the facts, on the narrative and the responsibilities in and around Ukraine.”

Of course, this should surprise no one. After all, Russia is in a mini-Cold War with the U.S. and Europe over Ukraine.

Only reassessing everyone’s respective national interests will change the existing relationship. Should the West maintain permanent confrontation with Russia over Ukraine?

None of the allies has made a security commitment to Kiev. Indeed, few if any of the 28 NATO members are willing to go to war with Russia over its neighbor.

Should the U.S. and Europe treat Kiev as if it was a member of NATO? There’s a reason the alliance has a membership process. One criterion is not to induct countries with a casus belli or two trailing behind.

More fundamentally, inclusion only makes sense if it makes the existing allies more secure. No one seemed to consider this issue during the madcap alliance expansion after the Cold War because the organization was treated as an international gentleman’s club.

Time for a Debate on Sanctions Policy

This morning, I attended an interesting speech by Jack Lew, Secretary of the Treasury, on the future of economic sanctions. The speech was notable in that Lew made not only a defense of the effectiveness of sanctions, but also highlighted their potential costs, a variable that is too often missing from debates over sanctions policy.

Some of the points Lew made – like the argument that multilateral sanctions are better than unilateral ones – were hardly novel. Yet others were more interesting, including the argument that sanctions implementation should be based on cost/benefit analysis and an assessment of whether they are likely to be successful. Though such an approach sounds like common sense, it has not always been the rule.

He also focused on the importance of lifting sanctions once they’ve achieved their ends. This is a rebuke to some, particularly in congress, who have argued for reintroducing the sanctions on Iran lifted by the nuclear deal through some other mechanism. As he pointed out, refusing to lift these sanctions now means that they will be less effective in the future: if states know sanctions will remain in place regardless of their behavior, what incentive do they have to change it?

Perhaps most interestingly, Lew argued for the ‘strategic and judicious’ use of sanctions and against their overuse. This is an interesting argument from an administration for whom sanctions have often been the ‘tool of first resort.’ In doing so, he referenced both growing concerns about the costs of sanctions from the business community, and the broader strategic concern that overuse of sanctions could weaken the U.S. financial system or dollar in the long-run.

I still disagree with the Secretary on several points. While he is correct that nuclear sanctions on Iran have broadly been a success, he dramatically overstates the effectiveness of sanctions in the more recent Russian case. Much of the economic damage in that case was the result of falling oil prices, and sanctions have produced little in the way of coherent policy change inside Russia.

He also overstates the extent to which today’s targeted sanctions avoid broad suffering among the population. In fact, evidence suggests that modern sanctions still suffer some of the same flaws as traditional comprehensive trade sanctions, allowing the powerful to deflect the impact of sanctions onto the population, and reinforcing, not undermining, authoritarian dictators.

Despite this, it is refreshing to hear concerns about the long-term implications of runaway sanctions policy expressed by policymakers. In alluding to these concerns – many of which have been noted for some time now by researchers – the Treasury Secretary may help to spark a broader policy discussion of the benefits and costs of sanctions. If we wish to retain sanctions as an effective tool of foreign policy moving forward, such discussion is vital.

For more on some of the big issues surrounding sanctions policy, you can read some of Cato’s recent work on sanctions policy here and here, or check out the video from our recent event on the promises and pitfalls of economic sanctions