Saturday, March 1, 2014

The Problematic Nature of Geopolitics – Part II


Since a nation has both a geographic and a political dimension, it has “geopolitical” interests. These geopolitical interests are the interests that a nation has in maintaining or acquiring positions that would, caeteris paribus, increase its power relative to other nations. These interests are defined and limited by the physical and human geography of the nation, and are therefore mostly static. When they change, they change only very slowly, when certain geographic conditions vary (e.g. climatic, demographic or economic changes). Each nation, therefore, has its own specific and unique geopolitical interests, which can be determined independently from other considerations. 

Geopolitical interests are such a fundamental part of a nation's political culture that they are often instinctively taken for granted, even by civilian and military leaders.[1] Even the language of geopolitics becomes biased as a result; certain words receive their meanings according to which nationals use them. Words that have such varying geopolitical meanings are: “nation”, “security”, “defence”, “international community”, etc. Part of the mistrust and misunderstanding that currently exist between nations is probably due to the common assumption that such political terms are neutral when in reality they are subjective. This is yet another obstacle that prevents nations from realising their geopolitical interests in a consensual way.

This question of the realisation of geopolitical interests requires a different approach compared to the analysis of geopolitical interests as such. Whatever geopolitical interests a nation has, whether or not these geopolitical interests can or will be realised is an entirely different matter, which depends on the political, economic and administrative situation of the nation in question, with all the day-to-day uncertainties that this implies.[2] It is also important to remember that geopolitical interests are only one of many aspects that drive a nation's foreign policy. Other aspects include, for instance, ideology, purely economic interests, domestic politics, and even sometimes the influence of erroneous estimations and the sway of emotions. Geopolitical interests are generally a substantial and underlying part of nation's foreign policy – indeed, they inform it. But they can sometimes be overshadowed by more short-term and pressing interests that take over foreign policy, temporarily at least. 

Another reason for the necessary distinction between geopolitical interests and their realisation is that there is a natural order of priority to the realisation of geopolitical interests; like a Maslow's hierarchy of human needs but for nations.[3] A nation's most fundamental geopolitical interests are those of a lower order; they are the most basic interests related to the integrity of its territory, the protection of its people, and the defence of borders. These interests must be fulfilled before the realisation of interests of a higher order can be contemplated.[4] There cannot be sufficient political attention or resources available for the realisation of more advanced geopolitical interests, if primary ones have not first been addressed. The Roman Empire did not set out to conquer the Mediterranean before the Republic controlled the Italian peninsula. Great Britain did not manage to control the world's sea lanes before it had secured the waters near its coast. Sweden did not succeed in dominating, briefly, the Baltic sea before the yoke of the Danish crown had been cast off. The realisation of geopolitical interests is a long process for a nation, involving gains and setbacks. Nations can spend centuries painstakingly trying to fulfil their geopolitical dreams, though few ever realise them all. 

Indeed, there are often barriers to realising geopolitical interests. Nations eventually become constrained by resource limitations that come from military or economic over-expansion, if they have not been stopped by others nations.[5] The United States is quite exceptional in this sense, since it is one of only a handful of nations in History that has come close to realising the majority of its geopolitical interests for a short period of time.[6] It was certainly helpful that the early US leaders gradually took control of a land with a very favourable geography, whose political borders now largely correspond to natural borders. Yet, even the most powerful nations can generally not realise all their geopolitical interests, at least not indefinitely, as is evident from some recent US setbacks.[7] It is unlikely that the United States will be able to realise its highest geopolitical interest of global hegemony, as US power in the world has arguably been in slow decline in the last decades.

Geopolitics is, therefore, not primarily the study of geopolitical interests, but the study of their realisation. Geopolitics is mainly about tactics, not as much about strategy. Nations are usually well aware of their geopolitical interests, but generally not so certain how (to try) to realise them, since there are myriad ways to do so, and many uncertainties in doing so, in a constantly shifting political landscape. To solve such problems is the main goal of geopolitics. It is the study of the obstacles to realising geopolitical interests, and in assessing how these obstacles could be overcome, using the means at disposal. 

All nations' geopolitical interests cannot be realised simultaneously; therefore, some of them will be realised at the expense of others. Geopolitics is thus based on the premise that nations are engaged in a subtle, or sometimes not so subtle, competition with each other, at many different levels: diplomatically, economically, militarily and even culturally. The history of modern nations is largely a history of never-ending conflicts of interests. As a nation succeeds in realising geopolitical interests of an ever-higher order, further and further away from its primary, lower-order interests, at some point there will be a clash with the interests of other nations. A nation's expansion of what it calls its “defence perimeter” is often perceived by another nation as the adoption of a “threatening” or “aggressive position.”[8] Again, it is a question of semantics and of geopolitical world-view. 

When two nations' geopolitical interests conflict, the stronger nation can realise its interests by persuading or forcing the weaker nation to yield. This can be done in a number of different ways; by promising economic advantages, by economic pressure such as the threat or actual use of sanctions, by acts of subversion, by threat of force, and ultimately by military force. It is of course tempting for the most powerful nations of the world to use such methods; indeed, they often do so. For instance, most of US foreign policy is based on such tactics. The coercive realisation of geopolitical interests is, still today, the standard way in which the international system works. 

It is possible, however, for geopolitical interests to be realised without the use of such coercive means. Nations can realise geopolitical interests consensually, to the satisfaction of all involved parties, if the following two conditions are fulfilled. First, the geopolitical interests of all parties should generally complement each other. Of course, some negotiations concerning details would still take place, but between equal parties. Second, no third party should prevent the realisation of the interests in question. Most likely, such external involvement can come from another nation or from an international organisation. Though these two conditions seem reasonable enough, in reality, they are not so often fulfilled. 

A final point can be mentioned with regard to the realisation of geopolitical interests. In the last decades, geopolitics has become somewhat less important, because nations have seen their power and sovereignty slowly erode, as globalist, internationalist developments have taken place. Globalisation has made the role that national governments play in international business far less important than it was.[9] Thanks to IT technology and cheap transport, even small and medium sized companies – usually the backbone of healthy economies – have become far less dependent on domestic markets and on the political and material support from their government when investing and selling abroad. Further, the emergence of international organisations with supranational jurisdiction (e.g. UN, Bank of International Settlements, EU, IMF, World Bank, WTO, etc.)[10], and their increasing influence over the affairs of the world, has also drained sovereignty from national governments.[11]

The result of this evolution in global politics is that geopolitical interests are becoming more difficult, but also less important, for nations to realise.[12] Economic and political interests are becoming less tied to geography than before, because they are less tied to nations.[13] The realisation of geopolitical interests give nations less rewards than in the past; they will thus dedicate less resources towards efforts to realise them. However, the underlying reason why geopolitical interests are becoming less important in this new international context is because geopolitics is based on an incorrect assumption; namely, that the interests of the government and the interests of the people are the same. The next part, therefore, looks at the distinction between State and people, which must be taken into account in order for geopolitical analysis to be complete.



Notes: 

[1] For instance, George Friedman wrote, correctly, that: “A country’s grand strategy is so deeply embedded in that nation’s DNA, and appears so natural and obvious, that politicians and generals are not always aware of it. Their logic is so constrained by it that it is an almost un­conscious reality. But from a geopolitical perspective, both the grand strategy of a country and the logic driving a country’s leaders become obvious.” George Friedman, in his book “The Next 100 Years”, from p39 (Doubleday). Source: www.fd.unl.pt/docentes_docs/ma/amg_MA_11180.pdf 

[2] There may be many reasons why the government and bureaucracy may not be able, at a given moment, to adequately pursue the realisation of a nation's geopolitical interests. Certain people or organisations may for instance not be competent enough, or may have serious distractions (e.g. bad economic figures, upcoming re-elections, etc.), or not enough resources, experience or guidelines.

[3] See for instance, en.wikipedia.org/wiki/Maslow%27s_hierarchy_of_needs 

[4] See for instance, the description of the five major geostrategic goals of the United States, by George Friedman, in his book “The Next 100 Years”, Doubleday. From p58. Source: www.fd.unl.pt/docentes_docs/ma/amg_MA_11180.pdf 

[5] For instance, George Friedman wrote: “All nations have grand strategies, though this does not mean all nations can achieve their strategic goals. Lithuania’s goal is to be free of foreign occupation. But its economy, demography, and geography make it unlikely that Lithuania will ever achieve its goal more than occasionally and temporarily. The United States, unlike most other countries in the world, has achieved most of its strategic goals, which I will outline in a moment. Its economy and society are both geared toward this effort.” George Friedman, in his book “The Next 100 Years”, from p39 (Doubleday). Source: www.fd.unl.pt/docentes_docs/ma/amg_MA_11180.pdf 

[6] Generally it never lasts more than a couple of centuries at most: It is possible to mention the Persian empire and the Roman Empire for little more than a century, China during the 15th and 16th centuries, Britain during most of the 19th century, and the USA from 1945.

[7] For instance, the continuous rise of China, and the political and commercial gains of China in Africa. The progressive shift in the power balance with China due to the huge US current account deficit with China and China's substantial ownership of US Treasury bonds. Also can be mentioned the relative failure in Iraq, Libya, Afghanistan, and on-going hesitations of the US concerning Syria. The inability of the US to bring Russia to heel. Etc, etc. 

[8] There are countless examples of this, from the US/Japan conflict of the 30s and 40s, to the current clash between China and Japan over a group of islands, as China is slowly expanding its naval presence. 

[9] Their control of capital has decreased, and tariffs and subsidies have been reduced in many parts of the world (these confer power to those who apply them – the national governments). Further, embassies and chambers of commerce do not have the same importance as before. Despite the constant attempts by national governments to limit, tax, or at least monitor, the movement of people, goods and capital, they are undoubtedly being undermined by such developments. 
Though there has been a resurgence of national authority after the 2007-2009 financial crisis, (completely unwarranted, of course, since national governments were largely responsible for the crisis in the first place), this is likely only temporary.

[10] See, for instance, en.wikipedia.org/wiki/Supranational_aspects_of_international_organizations 

[11] Regarding international organisations, it is true that most of them are financed by the most powerful nations of the world, in order to help them realise their geopolitical interests under a veil of legitimacy. Yet, at the same time, the power of these organisations, not so much militarily but economically and legally, has grown over time, at the expense of these nations. This factor also contributes to the decline in the importance of geopolitics.

[12] This development could initially benefit mostly the smaller and the weaker nations of the world; those nations whose many interests have never been realised because of the existence of a handful overbearing powers. The most powerful nations are naturally most impacted by these globalist changes (since their range of interests is wider and more global). The US's interests in the Middle East and Asia, and France's interests in Africa come to mind.

[13] Natural comparative advantages between nations matter far less than they did in the 19th century. See for instance, “Global Trade and Conflicting National Interests”, by Professors R. E. Gomory and W. J. Baumol. MIT Press, 2000.


Friday, February 14, 2014

The Problematic Nature of Geopolitics – Part I

Of the many activities of the modern State, geopolitics lies perhaps furthest away from the interests of the general public. The reasons for this have to do with the problematic nature of geopolitics. It might not have escaped those with a keen interest in the subject, that geopolitical discourse usually conflates considerations that should really be kept apart. There are two ways this happens: first, in the lack of distinction between means and ends, and second, in the lack of distinction between State and people. As a result of these two all-too-common amalgamations, geopolitical analysis often lacks the right perspective. 

The first point - means and ends - relates to the fact that geopolitics is concerned not only with the strategic interests of nations but also with the ways in which these interests can be tactically achieved. There is seldom enough appreciation in geopolitical thinking, for the fundamental differences between strategy and tactics; that is, between geopolitical interests and the realisation of these geopolitical interests. Questions related to “what?” and questions related to “how?” require two different approaches in geopolitics; not least since the latter, not the former, can lead to government action. Though it is true that to some extent ends and means cannot be entirely separated from each other because they influence one another, this distinction between the interests themselves and their realisation should still be made in geopolitics. Semantics are of course very important in this regard. For instance, the use of the terms “goals” and “objectives” in connection with a geopolitical strategy should perhaps be avoided because these terms already contain a certain idea of execution. A better term to use is “interests,” which has a more passive connotation; it does not imply any form of action.

The second point - State and people - is that geopolitics often conflates the interests of the government with the interests of the population. In reality, there is fundamental difference between the two, even in the so-called “liberal democracies.” Experts in geopolitics and specialists in international relations, whether they are public servants, whether they belong to think tanks, or whether they are members of academia, either fail to recognise, or tend to disregard, this divergence of interests between the State and the people. Geopolitical analysis is usually based on the assumption that the interests of the “nation” are the interests of the country's political and financial decision-makers. This is not only a problem of semantics; such a position is problematic, to say the least, in a political system that calls itself representative.

It is necessary to develop these points; this will be done in the next posts. First, both geopolitical interests and their realisation will be reviewed in detail. After that, the distinction between the interests of the State and the interests of the people will be discussed in more depth in another post. It will then be possible to draw a general conclusion about the problematic nature of geopolitics, and finally, the example of “Eurasia” will be looked at through the methodological lens that has thus been constructed.

Friday, November 1, 2013

The Corrupting Influence of Philosophy


At the risk of sounding redundant, I will repeat an old question: What is the use of philosophy? Seen from the point of view of another species, if one may be allowed such an absurd position, philosophy must seem like one of the more peculiar human activities.

Reflection is somewhat contrived and artificial when practised by the human being. It does not come naturally in man; significant efforts are required and the result is often far from impressive. As George Santayana said, it is difficult to overcome “the present with its instant joys in order laboriously to conceive the absent and the hypothetical.”[1] It is not surprising, therefore, that the spiritual foundations of modern civilisation were laid only relatively recently.[2] In the last two or three millennia, philosophy has spread slowly, indirectly influencing values and changing modes of thinking across society.

For the individual, this diffusion of philosophy cannot be said to have a positive influence, from either a physical or a spiritual point of view. Physically, the highest objective of life, besides mere survival, is the reproduction of the species and the accumulation of material wealth. Philosophy is not helpful in reaching these goals; on the contrary. As Rousseau famously said, reflection turns a man inward and philosophy isolates him.[3] This explains why many of the best thinkers never had children and were thus unable to fulfil the main biological duty of any living being: to beget an offspring.[4] The same principle can be seen at work in the general population, which is generally only indirectly exposed to philosophy. In the modern world, the influence of philosophy is at least partially responsible for the fact that the fertility rate in women is inversely correlated with their level of education.[5] There is also the movement of “voluntary childlessness”, which is followed mostly by highly educated men and women.[6] It would seem, therefore, that the more the human population engages in speculative and rational thinking, the less its members are inclined to procreate. Regarding material wealth, it is hardly necessary to comment on philosophy's poor capability in this respect. Reflection is hardly the most important factor for financial success.

From a spiritual point of view, the highest objective in life is peace and happiness. Here too, philosophy tends to make things more rather than less difficult. A thoughtful life is rarely a harmonious life. The best way to stay happy is to stay ignorant, like children. As Russian poet Alexander Griboedov said, there is "woe from wit."[7] Philosophy often troubles the soul; it has a disturbing tendency of stirring things up and stripping reality of its veneer. Reflection requires serious moments of solitude, “away from the market-place”, as Nietzsche said.[8]

It would seem, therefore, that philosophy is unnecessary and even counter-productive to the fulfilment of the most important physical and spiritual objectives of the human life. Philosophy is at best a useless activity, and at worse a harmful one for successful living.

Philosophy leads to a certain abnormality or ailment in the human soul when the individual is exposed to it directly. This spiritual sickness expresses itself as a morbid questioning of the world, destroying that innocent confidence that is so useful in life. Sometimes doubt is good, of course, because it increases the chances of survival. A healthy dose of natural scepticism is the basis for both individual and social development. But philosophy often generates a level of doubt that goes far beyond what the human mind generally is able to handle.

This may be one reason questions of philosophy are never settled. The same questions lead to different answers after thousands of years of ruminations, because the proposed answers are never universally satisfactory. The human being will always be fundamentally unprepared to conclusively answer questions that are so much wider in scope than daily life. The tragedy is that the human being has the intellectual capability of asking philosophical questions, but not the capability of answering them.

Political philosophy is a good example of this dilemma. This area of philosophy only exists because of the endless disagreements among some members of the human species regarding how society could or should be organised. Less intelligent species never had to deal with this problem: their members live naturally together in an implicit and instinctive social compact. The extreme intelligence of the human species has driven it away from the natural life, almost to the point of self-annihilation.[9] The Homo Sapiens seems to have been a step too far in the evolution of the human being; the Homo Erectus did not live in such confusion.

Since the exposure to philosophy can threaten individual well-being and social harmony, it is possible to conclude that there is such a thing as over-education. This is what the accusers of Socrates had in mind when they put him on trial for, among other things, “corruption of the youth.”[10] In this vein, today's policy recommendation would consist in reducing the intellectual education of society, for instance by limiting higher education to the natural sciences, and removing funding for those subjects that stimulate reflection, namely most subjects belonging to the humanities.[11] This is the dream of many educators and pundits, since the humanities are generally considered a waste of time and money in the capitalist society.[12] After all, economic growth is driven primarily by developments in the natural sciences.

A certain restriction or discouragement of higher education also makes sense because most professions do not require any serious thinking capability. The post-industrial service society requires a work-force consisting of simple-minded executers and quick-witted specialists, not thinking generalists.[13] The exposure to philosophy threatens the political stability of modern society because it kills the natural joy and happy insouciance of the majority. Several countries apparently recognise this and are trying, perhaps unwittingly, to limit access to higher education, for instance, by dramatically raising their university tuition fees and by letting the educational scores of their teenagers remain poor.[14]

However, the limitation of education for the good of society may not actually be needed, since reflection is far less common than is generally supposed. Most people never practice philosophy or even engage in any kind of sustained thinking. They are not worse off for it, since philosophy is not recommended for a successful life. As Santayana said, “reason is indeed not indispensable to life, nor needful if living anyhow be the sole and indeterminate aim; as the existence of animals and of most men sufficiently proves.”[15] Fortunately, most members of the human species remain happily insulated from most of the corrupting influence of philosophy. 



Notes: 

[1] G. Santayana, The Life of Reason, p9. Prometheus Books, 1998.

[2] From Wikipedia : Karl Jaspers argued that during the Axial Age "the spiritual foundations of humanity were laid simultaneously and independently in China, India, Persia, Judea, and Greece. And these are the foundations upon which humanity still subsists today.” (en.wikipedia.org/wiki/Axial_Age)

[3] J-J. Rousseau, On the Origin of the Inequality Among Men.

[4] For instance: Plato, Spinoza, Locke, Kant, Nietzsche, Santayana, Wittgenstein, Sartre, Foucault, and many others.

[5] See the article from The Guardian, “Should we care that smart women aren't having kids?”, by Sadhbh Walshe. www.theguardian.com/commentisfree/2013/aug/07/smart-women-not-having-kids. And the relation between education and childbirth: www.pewsocialtrends.org/2010/06/25/childlessness-up-among-all-women-down-among-women-with-advanced-degrees/
   
[6] From wikipedia: “Childless persons tend to have higher educations than those that do have children. Due to their higher education these childless couples also tend to have professional and managerial positions.” http://en.wikipedia.org/wiki/Childlessness

[7] "Горе от ума", Грибоедов.

[8] F. Nietzsche, Thus Spake Zarathustra. “Away from the market-place and from fame taketh place all that is great...” Chapter XII, p49.

[9] For instance with World War I and II (total 85M people), and later with the Cuban Missile Crisis in 1962, and the 1983 Soviet nuclear false alarm incident (see wikipedia: en.wikipedia.org/wiki/1983_Soviet_nuclear_false_alarm_incident
    
[10] Plato, The Apology of Socrates.

[11] Something along these lines has already been suggested, for instance, by Bill Gates. See for instance: www.insidehighered.com/news/2011/03/01/gates_tells_governors_they_might_determine_public_university_program_funding_based_on_job_creation

[12] This argument is not so outrageous as it seems apparently, since it has been seriously proposed, for instance, by Jonathan Last, a senior writer at The Weekly Standard, that: “Among the solutions he advocates is cutting back on higher education, thereby reducing its depressing influence on American fertility.” See the The New Yorker, Head Count, by Elizabeth Kolbert, October 2013. www.newyorker.com/arts/critics/books/2013/10/21/131021crbo_books_kolbert?currentPage=all

[13] This well-known trait of the modern society was pointed out almost a century ago by thinkers such as John Dewey, José Ortega y Gasset, J. K. Galbraith, and others. Today it has just become clearer than before. For instance, J.K Galbraith: “The real accomplishment of modern science and technology consists in taking ordinary men, informing them narrowly and deeply and then, through appropriate organization, arranging to have their knowledge combined with that of other specialized but equally ordinary men.” J.K. Galbraith, The New Industrial State, p62, Hamish Hamilton publishers, 1967. 
    More recently, see the study of managers and salaried workers by Professor Robert Jackall, Moral Mazes: The World of Corporate Managers, Oxford University Press.

[14] This is the case, for instance, in countries such as the UK, the US, and Canada. See: www.theguardian.com/education/2013/oct/16/number-part-time-students-perfect-storm. In the UK, fees have triples under the Cameron government. A similar situation has been seen in Canada in the last 20 years: www.cbc.ca/news/canada/university-tuition-rising-to-record-levels-in-canada-1.1699103. For the situation in the US, here is the official data: nces.ed.gov/fastfacts/display.asp?id=76.

    Regarding low educational scores, this trend is particularly clear in the US. See for instance, the following article which shows that education level of teenagers have not improved at all in 40 years: www.cato.org/blog/new-naep-scores-extend-dismal-trend-us-education-productivity and en.wikipedia.org/wiki/Programme_for_International_Student_Assessment#United_States
   
[15] G. Santayana, The Life of Reason, p51. Prometheus Books, 1998.

Thursday, October 10, 2013

Some Thoughts on Marketing


Marketing is usually seen from the point of view of its utility, but not always from the point of view of its scope. In almost any company, marketing clearly plays an important and useful role, but what is often less clear is that marketing is made up of a ragtag collection of disparate functions assembled under a common name. To do “marketing” can often mean doing at various times all or some of the following activities: sales, advertising, finance, planning, logistics, sociology, journalism, psychology and many others.

Marketing, therefore, can hardly be called a “science,” though many of its gurus do so all the time. There is hardly a better way to improve the brand image of marketing than to claim that marketing is a serious science, complete with its laws and theories. A lot of efforts are put into the marketing of marketing; the first subject of marketing is marketing itself. But perhaps marketing could be called science if sociology or anthropology can be called sciences. These subjects all deal with human affairs; they are therefore necessarily variable, imprecise and subjective. Marketing is empirical only in the popular sense that it slowly improves over time, as a response to external conditions. It is not empirical in the scientific sense.

Marketing can be more aptly described as a special mixture capable of boosting a company's sales. Its complex formula is often updated; the marketing mix is tweaked in order to improve its effect. The dream of the marketing executive is to find the magic potion that will work wonders on the customer.

Marketing was born as one of the modern corporation's many reactions to its market environment. It is therefore not a forward-looking activity by definition. The marketing method was not as developed half a century ago as is it today simply because today's sophistication was not needed at that time. Product offerings of the past satisfied the demands of those customers; competition in those days was not strong enough to stimulate any deeper thinking about pricing strategies; and corporate profits and shareholder returns were good enough for many innovative marketing proposals to be disregarded. Though some companies are better at it than others, marketing is always a product of its time. It seems reasonable to think then that in the future, as society evolves, marketing will continue its adaptation.

Despite this reality, scholars of marketing often try to have the last word by proposing a final, universally applicable, "unifying theory" of marketing. This is not surprising since it is the best chance for them to be remembered after they are gone. The desire to seek general all-encompassing theories has always existed, in all fields; it might be called the "Newton obsession." It is also a practical strategy since it allows academics to respond to all possible questions with the same answer. Currently, the grand unifying model of marketing is based on the concept that all goods, whether “tangible” or “intangible,” should be seen as services. 

However, as the world becomes ever more complex and specialisation has long been essential for any real expertise, it is rather counter-intuitive to try to develop a general theory of marketing to cover the entire business world. Actually, the opposite approach seems more logical. Marketing in heterogeneous societies should also be heterogeneous. As business areas become more and more specialised and competitive, marketing should be tailor-made to each one of them. For instance, marketing for a social media company cannot possibly have much in common with marketing for a medical equipment manufacturer.

Any proposal for a universal theory of marketing can therefore only be an oversimplified truism, appropriate only as an introduction for undergraduate students. It is in human nature to try to unite and simplify, but sometimes this temptation must be resisted. All the more so in the area of marketing, since it is practised separately by all big players in each business area. Instead, universities with a marketing interest could best contribute by focusing on giving structure and guidance to some of these specific business initiatives.  

Monday, September 16, 2013

Why Russia Defends International Law


Russia's particular role in the Syrian conflict is interesting because it reveals the geopolitical reality in which Russia's foreign policy takes shape.

Despite occasional incendiary remarks by President Putin, Russia's official position in this conflict has been one of constancy and moderation, in sharp contrast with the volatile and aggressive positions of the US, France and others. In particular, Russia has clearly taken on the role of defending and “protecting international law,” as President Putin wrote in an unprecedented op-ed, “A Plea for Caution From Russia,” published on Sept. 11th in the New York Times. The word “law” was mentioned no less than seven times in the article; upholding international jurisprudence is obviously of high priority for Russia.

In answer to the United States and France's openly stated intention of bombing Syria, Russian officials have constantly repeated the importance of not violating Chapter VII of the UN Charter, concerning acts of aggression. President Putin also mentioned this point in his New York Times article: “Under current international law, force is permitted only in self-defense or by the decision of the Security Council. Anything else is unacceptable under the United Nations Charter and would constitute an act of aggression.” 

None of this should come as a surprise, since this was also Russia's position with regard to the illegal bombing of Serbia by NATO in 1999, as well as the illegal invasion of Iraq by a coalition led by the US and the UK in 2003.

It seems clear, therefore, that upholding international law is a fundamental principle of Russian foreign policy. Notwithstanding the flaws of current international law, such an unwavering and principled position would be admirable for a nation-state, were it not for the fact that Russia adopts this position not because of a high moral standard but out of necessity. There are two reasons for this.

On the one hand, Russia is one of only a handful of nations in the world to have a truly independent foreign policy. Apart from the United States, only China, India, Iran and Russia (and perhaps one or two others) are impervious to foreign pressure when acting on the international stage. This is certainly not the case of Western nations, as their timid and muted reactions even to the most egregious behaviour by the United States make clear (the Assange and the Snowden affairs are good recent indications of their subservience to Uncle Sam).

On the other hand, Russia cannot disregard international law; only the United States can do that (and, by extension, those nations which it decides can do that). Russia therefore has an interest in convincing the USA and its allies to follow international law, according to the principle that a weak nation benefits more than a strong one when commonly agreed rules are followed by all. The strongest nation, currently the United States, is naturally always tempted to violate international law, simply because it can generally do so with impunity. This explains why the United States constantly feels constrained by the international law to which it is bound, and why it does not recognise the jurisdiction of the International Criminal Court.

Russia's position on the Syrian conflict reflects these geopolitical realities. Russia's political independence gives it a freedom of action denied to all but a few countries in the world. However, Russia must use this freedom to insist on the importance of upholding international law, and to try to convince the US (and its allies) not to violate it. At this moment, Russia seems to have succeeded in doing this, but only time will tell if this success will last.

Saturday, June 8, 2013

Causes and Consequences of State Corruption


On the 19th of May 2013, the bill prohibiting Russian officials from holding bank accounts abroad or owning foreign-issued shares and bonds came into force. It would seem at first glance like a very useful law. However, though the Kremlin stated that this law will “raise efficiency of anti-corruption efforts,” one can be forgiven for being skeptical about such a promise. This law will probably only have a limited impact on capital outflow because public servants will simply use more discreet and ingenious ways than before of hiding assets abroad.
But at least this new law seems to indicate that the authorities understand how damaging the shockingly high level of state corruption is for the country. At the same time, however, this law is also precisely an example of that personal and non-consensual decision-making style that so permeates Russian business and political life. Indeed, like so often, it sprang from the populist reaction of one man – Vladimir Putin – to recent scandals concerning the ownership of foreign assets by senior public servants.
It is not surprising therefore, that this ban on foreign investment does not target the causes of state corruption, but only one of its visible and embarrassing consequences - asset flight. Why should not a senior official be able to hold assets abroad as long as they have been legitimately earned? He might of course be called “unpatriotic” for doing so, but it should be legally possible for him to take this risk. The underlying reason why this law now makes it illegal is, of course, that the huge wealth amassed by many Russian politicians and civil servants is suspected to be the proceeds of graft. It is worth keeping in mind that, at a minimum, 10% of the value of state tenders of around 10 trillion rubles ($350 billion) per year are lost in this way. It is sometimes said that leaders should lead by example; ironically, this is perhaps exactly what they are doing in Russia, albeit unintentionally. Thus, attempts to reduce state corruption should be made also because of the likely beneficial effect for the whole society.
But, if corruption at state level is now truly a concern for the authorities, they should start by upholding existing laws, rather than creating new ones. If this happened, then firstly, senior officials would not be able to get their hands on as much wealth as before, and secondly, they would feel less need to funnel money abroad because they would perceive Russia as a safer place in which to invest. That the most powerful and well-connected people in Russia – those who best know the system – must be prevented by law from transferring funds abroad is indeed a worrying sign of the difficulties facing Russia.
A more fundamental question is: Would such a law be necessary if the political system wasn’t pervaded by career politicians and life-long civil servants? Corruption feeds on permanent bureaucracies that allow close personal relationships and long lasting business ties to be established. Both in Russia and abroad, the wealth of a career politician should always be seen with suspicion, unless it comes from inheritance. If all political terms in office and public service mandates were limited to, say, a maximum of two reelections or reappointments, graft and cronyism in government would undoubtedly decline.
Such term limitations are sometimes discussed in the media but are obviously rarely implemented, since they disserve the very persons who can pass them into law. Naturally, public servants will resist all changes that are not in their interest, and it is therefore surely not a coincidence that the final version of the bill signed by Putin exempts ownership of foreign real estate. Indeed, houses on the Riviera and apartments in Miami have been the preferred type of foreign investments by wealthy Russian public servants, and this will likely be the case also in the future, if the recent drop in house prices are considered.
Term limitations is not of course not the only way of impacting the level of state corruption; there are other measures, though there is no time to review them in this article. What such measures have in common, though, is that they generally target the causes, not the consequences, of state corruption.
The new law limiting foreign investments of senior officials should, therefore, not be cheered too enthusiastically since it can metaphorically be described as only a bandage on the gunshot wound of state corruption from which Russia suffers.

Saturday, April 27, 2013

The Need for Public Complaint

Market competition benefits society by inciting companies to improve their products and lower their prices. In practice, of course, this process is never perfect, and Russia is a particularly good example of that. As should be clear to any objective observer, Russian products and services often suffer from bad quality.

As an example, it is possible to mention the mobile internet service in Moscow, which is patchy, congested and overloaded. I am paying 1500 rubles per month for Yota 4G that should provide at least a few megabits per second.