Sunday, March 15, 2009

Is China sending warning signals to the US government? If so, about what?

Josh Marshall at TPM (among others) asks some interesting questions about how to interpret some recent Chinese moves. These question may be overly speculative, in a neo-Kremlinological way ... or maybe not.
If you remember, not long after President Bush became president, we had that incident with the US spy plane hugging Chinese airspace, which was bumped by a Chinese jet intercepter and forced to make an emergency landing on Chinese territory. Then just days ago we had a strangely similar incident at sea. Again, just a few months into the tenure of a new president.

Now we have Chinese Prime Minister Wen Jiabao publicly worrying about the safety of the almost $1 trillion of US Treasuries China owns. That they'd have some concern isn't surprising. But having the head of government sound the warning bell is hardly the best approach to preserving confidence in US debt.

This strikes me as all of a piece, pretty unsubtle signaling of a shifting balance of power.

Certainly, it is worth noting that China's export driven economy and massive build up of capital reserves were the fuel behind the US housing bubble. And China's own continued growth is dependent at least for now and for some time into the future on a very receptive US market for its goods. We're in a toxic but mutual embrace.
Dan Drezner's take on the matter left out the naval bluffing, focused on the "verbal shot across the bow of U.S. asset markets," but emphasized that neither side can really afford to let go of that mutual embrace.
Chinese premier Wen Jiabao, in his annual press conference, fired a verbal shot across the bow of U.S. asset markets:
Speaking at a news conference at the end of the Chinese parliament’s annual session, Mr. Wen said he was “worried” about China’s holdings of Treasury bonds and other debt, and that China was watching United States economic developments closely.

"President Obama and his new government have adopted a series of measures to deal with the financial crisis. We have expectations as to the effects of these measures,” Mr. Wen said. “We have lent a huge amount of money to the U.S. Of course we are concerned about the safety of our assets. To be honest, I am definitely a little worried.”

He called on the United States to “maintain its good credit, to honor its promises and to guarantee the safety of China’s assets.”
When a country that owns $1 trillion of your debt starts making these noises, it's time to fidget a little.

Or is it? I'll have more to say about this later, but for now it's worth pointing out that China's financial leverage over the United States might not be as great as people think. The Wall Street Journal's Andrew Peaple explains why:
Rhetoric aside, it bears repeating that China will find it hard to make a meaningful shift out of Treasurys, the prime current channel for investment of its $1.95 trillion foreign exchange reserves.

Some say China could switch holdings into gold -- but that market's highly volatile, and not large enough to absorb more than a small proportion of China's reserves. It's not clear, meanwhile, that euro, or yen-denominated debt is any safer, more liquid, or profitable than U.S. debt -- key criteria for China's leadership.

Most pertinent of all, even if China decided to sell off some of its U.S. Treasury holdings, it would scarcely be able to dump that in large blocks. And a partial selloff would surely lead to a slump in the Treasury market, eroding the remaining value of China's portfolio.

It seems safe to conclude that the Chinese government is feeling jittery about the state of the US economy, which is not surprising, and no doubt concerned about China's economic prospects, too. But if this was an attempt to send a warning to the US government, it's not clear just what they might be warning the Obama administration that it should or shouldn't do.

And--a question no one seems to have quite asked explicitly--about what? Economic policy? Could be, but that's not self-evident. Tibet? Taiwan?

I guess we'll see. This may or may not come to nothing, but it seems intriguing and worth noting.

--Jeff Weintraub

How financial markets work - Jon Stewart eviscerates Jim Cramer

Following up my previous post on John Stewart's exposé series about the fraudulence and corruption of allegedly serious financial journalism emanating from sources like CNBC ...

... here is Jon Stewart's now-famous interview with Jim Cramer of the CNBC show "Mad Money". (Cramer is not even the worst of the lot at CNBC, but he's the one who agreed--perhaps unwisely--to come on the "Daily Show" to be interviewed.)

This is genuinely illuminating, so I recommend watching the whole thing--but especially Part 2 and Part 3, where Stewart goes into full prosecutorial mode, and offers a lot of acute analysis along with his increasingly visible indignation.

(Yes, as I noted in the earlier post, it's a sad situation when we have to go to comedy shows to get serious and illuminating analysis of the financial markets ... but that's where we are now.)

Jon Stewart Interview With Jim Cramer

--Jeff Weintraub

P.S. For a few afterthoughts: James Fallows assesses "the Stewart/Cramer slaughter" ("It's true: Jon Stewart has become Edward R. Murrow") ... Robert Schlesinger of U.S. News & World Report concludes that "the Jon Stewart-Jim Cramer interview from Thursday night was actually worth the hype" ... Jim Cramer explains ruefully that he felt "blindsided by Stewart’s hostile approach" ... and the Washington Post's Howard Kurtz points out that CNBC was far from the only culprit.

How financial markets work - John Stewart eviscerates CNBC

CNBC Gives Financial Advice

John Stewart's "Daily Show" runs on Comedy Central and presents itself as offering political comedy and satire. On the other hand, CNBC presents itself as a serious operation offering news and analysis about finance and business.

However, it's clear by now that in this area the serious analysis is much more likely to come from John Stewart, and people who have been watching CNBC to get it there have been getting played for suckers. Instead, as Stewart makes clear in the clip below and in some subsequent broadcasts, what the shows on CNBC actually do (with the exception of a few serious reporters whose role is relatively peripheral) involves irresponsibly hyping the stock market, purveying right-wing economic and political propaganda, and serving as uncritical mouthpieces and boosters for dishonest CEO's ... while pretending to do serious journalism.

This was the opening shot in a series that Stewart wound up doing on the fraudulence and chicanery of CNBC and its pernicious consequences. As he explained more explicitly in a later instalment, the problem is not just that they committed sins of omission by failing to see the oncoming financial catastrophe and warning anyone about it, largely because they failed to actually do serious or critical analysis, but that they're guilty of positive sins of commission by aiding and abetting the whole scam, pushing for the policies that allowed the big swindlers to operate with impunity and undermined necessary safeguards and stabilizers in the system, and promoting the whole something-for-nothing financial-craze culture that helped suck investors and home-buyers into the casino where they eventually got fleeced.

This is definitely quite funny (in a dark-humor mode), but what it says is also on-target and illuminating. As Jon Stewart has remarked from time to time lately, it's a bit weird when we have to go to Comedy Central to get serious financial analysis, because we can't get it from sources like CNBC ... but so it goes.

Watch the video here: CNBC Gives Financial Advice.

(My main regret about this clip is that the rogues' gallery portrayed there includes only a brief shot of one of the most poisonous characters on CNBC, the pompous right-wing economic charlatan Lawrence Kudlow.)

=> This exposé series by Jon Stewart was followed up by an illuminating interview with the New York Times business writer Joe Nocera ...

... and was followed up by a devastating interview with Jim Cramer of the CNBC show "Mad Money." I will post the Cramer interview separately, and I recommend watching it after watching the video clips linked to above.

--Jeff Weintraub

Saturday, March 14, 2009

Democracy in North Korea

Some random reflections occasioned by a New York Times story on the recent elections in North Korea:
North Korea elected its rubber-stamp Parliament on Sunday in an election that outside observers monitored closely for signs of a shift in the isolated Communist government’s power structure.

With the election of delegates to the Supreme People’s Assembly, North Korea laid the groundwork for a new five-year term for its leader, Kim Jong-il. The new Assembly’s first task when it convenes in the coming weeks will be to re-elect Mr. Kim as chairman of the National Defense Commission, an event that analysts in the region say the North will most likely celebrate by test-launching its longest-range missile, the Taepodong-2. [....]

Soldiers in uniform and civilians in fine dress, dancing and singing, lined up at polling places across the country, the North’s state-run media said. They voted under the portraits of Mr. Kim and slogans avowing loyalty to his leadership.

In the previous election in 2003, the country reported a 99.9 percent voter turnout and total support for the single candidate running in each of the 687 constituencies, all hand-picked by Mr. Kim. [....]
Not exactly a cliff-hanger.

Of course, election results like that (along with the process that produces them) make the whole exercise a grotesque parody of a real election. In that respect, these elections fall in the same category as a lot of other elections, referenda, and plebiscites conducted by various dictatorial regimes over the past century or so. They're not always quite as blatant as the North Korean version (though I gather that Saddam Hussein got 100% of the votes in his 2002 re-election referendum), but these kinds of events have been a recurrent feature of political ritual in modern despotic regimes, especially those with totalitarian aspirations.

It is tempting to dismiss these charades as simply laughable (in the sense of gallows humor), and at one level they are. But they're sociologically interesting, too. Why do these regimes, even when they make no bones about being closed and repressive dictatorships, feel the need to stage these transparently bogus rituals at all? Do they think anyone is fooled by them?

Well, yes and no. Some people actually are fooled, especially foreign sympathizers. But that's not really the central point.

I'm not really sure we know the full answer to those questions. But I think at least part of the answer is hinted at by the old saying that hypocrisy is the homage that vice pays to virtue. We should add that sometimes such hypocrisy doesn't even have to be plausible--one goes through the motions purely for form's sake, or to keep up appearances. What have changed historically are the appearances that have to be kept up. What's going on here is a ritualized assertion and enactment of the myth of popular sovereignty. And the need to appeal to that myth is something fairly new. In their own way, these bogus elections, referenda, and plebiscites, with their stage-managed and unbelievably lopsided voting results, are distinctive expressions of the democratic age.

So why don't all authoritarian and repressive regimes stage these 99% elections? Again, I'm not sure of the full answer, but I think a few of the bits and pieces are clear enough. Some regimes, like the Saudi theocracy, can still appeal to other effective bases of legitimacy. Pure gangster regimes can pretty much dispense with worrying about legitimacy at all. And a number of authoritarian regimes would probably like to stage political spectacles like this, but don't have the capacity to do so effectively, so they put their energy and resources into other priorities. In fact, most of the time most despotic regimes, even in the modern world, are content with passive obedience and everyday consent, without demanding active and explicit enthusiasm. But the elements I've just mentioned add up to only part of the whole picture.

=> Of course, (more or less) genuine elections are also a distinctively important feature of modern politics. Aside from their straightforwardly practical functions, real elections are important forms of political ritual, too (as any student of Durkheim knows, "ritual" is not simply equivalent to either "routine" or "fake")--and sometimes, as I've noted in the past, elections can be genuine moments of revelation, with powerful and unexpected effects. Even in their mundane versions, with all their imperfections and distortions and limitations, democratic elections that happen on a regular basis and actually make things happen are a significant achievement--as we ought to remind ourselves occasionally, especially when we're tempted to feel cynical about them or take them for granted..

--Jeff Weintraub

More economic nonsense from the Republicans (Senator Demented this time)

Just one of many examples picked at random ... except that it's not quite random, because when it comes to economic issues, Sen. Jim DeMint (R-SC) happens to be especially demented.

--Jeff Weintraub

Matt Yglesias
February 25th, 2009
DeMint: The Richest 0.7 Percent of the Population is “Lots of People”

The right-wing is flinging smokescreen rhetoric about income taxes and small businesses so quickly that it’s difficult to keep track of what they’re saying. But the important things to recall are that very few people find themselves in the top two tax brackets, and that though some of these people are small businessmen they’re paying taxes on net income. These are brackets for a small number of unusually prosperous people. For example, here’s Jim Demint:
It looks like he’s gonna try to get a lot of that revenue from raising payroll taxes on upper income and that sounds good but basically that affects small businesses and their ability to hire people. So I just think it shows a lack of understanding of the private sector. A lot of people make — who are reporting a quarter million dollars — you know, I’ve done that before in my small business, and I was actually taking home like 50 or 40.
[Video here]

In fact, about 0.7 percent of households file in the top two brackets:

Meanwhile, I don’t know why DeMint thinks people who are only taking home $40k or $50k would be filing as people who earn $250,000. I think he wants people to think that the government is taxing gross business receipts, so that if I spend $230,000 on my business to earn $300,000 in revenue, that I’m taxed on all $300,000. But that’s not how it works at all. You deduct business expenses and pay taxes on your net income. Any small businessman who’s earning a middle class income isn’t paying in the top two brackets, just as any salaried employee who’s earning a middle class income isn’t paying in the top two brackets.

Saturday, March 07, 2009

And you thought Herbert Hoover was dead?

OK, both the Obama administration and the Congressional Democrats are open to various sorts of criticism in terms of their response to the current economic crisis. (The criticisms come from different directions, and many of them are mutually contradictory, but some of them hit home.) But they are in a different league from the Congressional Republicans, whose response to the crisis has combined ideological delusion, empty rhetoric, and fundamental unseriousness to a degree that that is still sinking in.

(Some of the Republican governors are responding in a more serious and pragmatic way--but only some of them.)

The AP story below--"Top House Republican calls for spending freeze"--is not a spoof or a satire. What makes it especially astonishing is that this lunatic, antediluvian proposal to freeze US government spending in the face of a downward economic spiral toward depression (a view that was, admittedly, economically orthodox three-quarters of a century ago, but that sounds like a bad joke now) did not come from some talk-show crank, but from the leader of the House Republican Caucus.

Some readers may think that my use of the adjective "lunatic" is a bit overstated. Well, this was also the reaction of conservative columnist/pundit Devid Brooks: "A lot of Republicans up in Capitol Hill right now are calling for a spending freeze in a middle of a recession/depression. That is insane." You can listen to the video HERE, and Brooks spelled out his point in a New York Times column (HERE) that begins:
The Democratic response to the economic crisis has its problems, but let’s face it, the current Republican response is totally misguided. The House minority leader, John Boehner, has called for a federal spending freeze for the rest of the year. In other words, after a decade of profligacy, the Republicans have decided to demand a rigid fiscal straitjacket at the one moment in the past 70 years when it is completely inappropriate.
The rest of Brooks's column goes on to fantasize hopefully about what a constructive Republican response might look like. But whether or not you agree with his proposals, what is most telling is the simple fact that the spirit of Brooks's discussion bears no resemblance to the approach actually adopted by the Congressional Republicans, who have rallied (with just a few peripheral exceptions) to a combination of economic flat-earthism, irresponsible demagoguery, and straightforward obstructionism.

(Perhaps some readers will find that characterization a bit exaggerated, too. Well, consider this. Senator James DeMint [R-SC] proposed an amendment that would have scrapped the entire stimulus package and replaced it with permanent tax cuts--slanted, or course, toward the wealthiest taxpayers. No, I'm not making that up. OK, you'll say, that's just one isolated wacko. Actually, 36 out of the 41 Republican Senators voted for it, and one more abstained. And that's in the Senate, where the Republicans are supposed to be less extremist than in the House.)

Frankly, it's hard to disagree with Josh Marshall on this one:
Let's just stipulate DC Republicans are simply not part of the discussion when it comes to repairing the US economy or arresting our slide into deep economic misery. And any reporters who aren't clear about this are just lying to their readers or viewers. The latest Republican plan, in the face of today's new spike in unemployment, is a freeze on federal spending. I'm not even sure it's fair to say that this is a replay of the disastrous decisions the magnified the Great Depression between 1929 and 1933. It's more a parody of it. When the crisis is a rapid and catastrophic drop off in demand, you handcuff the one force that can create demand (i.e., the federal government) in the throes of the contraction. That's insane. Levels of stimulus are a decent question. Intensifying the contraction is just insane and frankly a joke. It's time to recognize that the only debate here is happening among Democrats and sundry non-affiliated sane people. The leaders of the GOP are simply not part of the conversation.
=> By the way, we should be fair to Herbert Hoover. As Brad DeLong carefully explains, Hoover was definitely not a bad or heartless man, just economically misinformed. But, to repeat, that was three-quarters of a century ago, the world had not yet gone through the experience of the Great Depression and its aftermath, John Maynard Keynes's insight about the role of counter-cyclical fiscal policy in helping to avert crashes had not yet sunk in, and so on. What is John Boehner's excuse?

--Jeff Weintraub

Associated Press
March 6, 2009
Top House Republican calls for spending freeze

WASHINGTON (AP) — The top Republican in the House is seizing on the latest spike in unemployment to call for a freeze on government spending and to urge President Barack Obama to veto a $410 billion spending bill.

Rep. John Boehner, R-Ohio, said the jump in unemployment to 8.1 percent and the loss of 651,000 jobs in February is a sign of a worsening recession that demands better solutions from both parties.

Boehner criticized the spending bill as chocked full of wasteful, pork-barrel projects. The Senate postponed a vote on the bill until Monday amid the criticism.

Boehner said he hoped Obama would veto the bill. He urged the president to work with House Republicans to impose a spending freeze until the end of this fiscal year.

Wednesday, March 04, 2009

How financial markets work

This British comedy bit from the summer of 2008 is supposed to be a parody, but the analysis all sounds pretty accurate and illuminating to me. Hilarious, too. (Via Andrew Sullivan)

Click HERE.

--Jeff Weintraub

Sunday, March 01, 2009

Thinking seriously about "centralism" and "federalism" in Iraq – Brendan O'Leary makes the case for pluralist federalism

[Also cross-posted at Normblog.]

As the dust begins to settle from the January 2009 provincial elections in Iraq, much remains uncertain, but one thing that does seem clear is that the results included some significant shifts in support for different Iraqi political tendencies, particularly in the balance between the main Shiite Arab political parties.

I will put off discussing most of the competing assessments and speculations that are currently floating around. For the moment I just want to highlight one issue that has attracted a fair amount of attention but (I think) not enough careful thought and consideration:  What kind of political future for Iraq should people of good will be hoping for (and trying to help facilitate)?

Here is a typical formulation of the point in question by Juan Cole (back on February 2, as the unofficial election results were just starting to come in):
The big news out of the leaks from Iraq's vote counters is that parties seeking a strong central government appear to have won big in the elections for provincial governments. There had been a split last fall. Some parties, such as the Kurdistan Alliance and the Islamic Supreme Council of Iraq, wanted Iraq to have a very weak central government, which would cede a great deal of Federal power to provincial confederacies such as the Kurdistan Regional Government. In contrast, the centralizers in the Da'wa (Islamic Mission Party) and among the Sunni Arabs, want a strong central state. It is the latter that appear to be coming out on top ...
Is that an accurate reading of the political implications of these election results? Maybe--although, as I will explain below, I suspect that putting it this way overlooks some important complications (and even contradictions) inherent in the centralizing agenda allegedly shared by Sunni Arabs and some Shiite parties.

And if "the centralizers" really are getting stronger, would that be a good thing? Not necessarily. Actually, there are good reasons to see it as a potential recipe for disaster.

=> That may sound odd to some readers, since a taken-for-granted preference for political re-centralization in Iraq seems to be so widespread in the conventional foreign-policy wisdom that its problematic aspects rarely get adequate attention. And, to approach this from the other direction, there is also a serious case to be made for the viability and desirability of a more pluralist and federalist alternative. That deserves more of a hearing than it gets.

In the interests of making the discussion a little less one-sided, later in this post I will recommend a careful consideration of the case for pluralist federalism in Iraq by someone who has been one of its most prominent and effective advocates, Brendan O'Leary. O'Leary recently summed up his case in a book on How to Leave Iraq with Integrity. (Yes, he thinks the moment has arrived when that’s a hypothetically possible outcome, if the whole thing is done intelligently and responsibly.) If you want a quick introductory overview of his argument, you can get a good foretaste by listening to a brief on-line interview with him HERE.

But first, some background and elaboration ...

=> One of the key features of the constitutional settlement that emerged from negotiations between Iraqi political forces in 2005, and was then overwhelmingly approved in a national referendum on October 2005, was that it set out to replace the highly centralized state structure of pre-2003 Iraq (dominated, of course, by the Sunni Arab minority) with a more decentralized federal system that also recognized Iraq's multi-national character.

(According to approximate estimates, about 20% of Iraq's population are Kurds, some 55-60% are Shiite Arabs, some 15-20% are Sunni Arabs ... and various other ethnic and sectarian minorities add up to about 5%.)

The big step in that direction, of course, was the acceptance of extensive autonomy for the Kurdish region in northern Iraq (with precise borders and other details to be worked out in time), along with the recognition of both Arabic and Kurdish as national languages. What was left open was whether this "asymmetric federalism" between Arab Iraq and Kurdish Iraq would be the final word, or whether the Arab part of Iraq might also be "regionalized." Mechanisms in the Constitution allow for either of these outcomes, or various options in between.

=> The US mediated those negotiations, but (some mythology to the contrary) did not produce or dictate this Constitution. In fact, the outcome was in many ways quite different from what the US government wanted. The US, for various reasons, has always pressed for a more centralized solution in Iraq. And they're not the only ones. Many of Iraq's regional neighbors, for their own reasons, have also been unhappy with the pluralist and federalist model embodied in the 2005 Constitution. (Actually, the Arab regimes would have preferred to see post-Saddam Iraq ruled by a Sunni Arab strongman who could continue to suppress the Shiites and Kurds. Turkey, for its part, is alarmed by the idea of an independent or even autonomous Iraqi Kurdistan, and believes that its concerns somehow give it the right to dictate Iraq's political organization. And so on.)

There have also been serious disagreements between Iraqi political forces over questions of centralization versus pluralist federalism. And this is most significantly true in terms of divergences within the politics of Iraq's Shiite majority.

The central fulcrum of Iraqi politics since 2003 has been a working alliance between the Kurdish parties and the Islamic Supreme Council for Iraq, or ISCI (formerly the Supreme Council for the Islamic Revolution in Iraq, or SCIRI), which emerged from the 2005 elections as by far the biggest Shiite party. Both the Kurdish parties and ISCI, for their own reasons, converged on support for a more federalist solution.

That remained the center of gravity in Iraqi politics even though, after the December 2005 national elections, complicated multi-party negotiations eventually produced a Prime Minister from a smaller Shiite Islamist party, Dawa. That was Nouri al-Maliki, who looked for a while like a relatively ineffective place-holder but has been looking a lot stronger lately. The other major force in Iraqi Shiite politics, the movement headed by Muqtada al-Sadr, has made its biggest impacts since 2003 through its Mahdi Army militia, but has also gone in and out of participation in electoral politics as the overall situation shifted. The Sadrists seem to be experiencing one of their periods of relative weakness and political marginalization--but, on past experience, one shouldn't be too quick to write them off. Both Dawa and the Sadrists, unlike SCIRI/ISCI, have favored political centralization.

That has also been true for Sunni Arab political forces in Iraq, mostly because of their hope--which always looked like a long shot, and is now looking increasingly delusional--that if the Americans got out of the way, they could crush the Shiites and Kurds, seize control of a centralized Iraqi government, and restore the political supremacy of the Sunni Arab minority. (The Sadrists, for their part, have always had a corresponding winner-take-all aspiration.) Some Sunni Arab political tendencies may be starting to wake up to the realities of the situation, and thus may re-think this approach, but so far it looks hard for them to break free from their reflexive anti-federalism.

=> One result of the Iraqi provincial elections in January 2009 was a shift in the balance between the two main Shiite parties, ISCI and Dawa. ISCI lost a lot of ground compared to its levels of support in 2005 (though not quite as much as the preliminary results had suggested), whereas Maliki and his Dawa party gained. Maliki ran a 'law-and-order' campaign based in no small part on his having successfully cracked down (with US support) on Sadrist militias and (partly overlapping) criminal gangs in Basra and in Baghdad's Sadr City during 2008. But in some places it looks as though his coalition may wind up getting local support from the Sadrists nevertheless.

Unsurprisingly, one conclusion drawn by a lot of the post-election commentary has been that supporters of a strong central government (and opponents of federalism and decentralization) have been strengthened politically by these elections. (For some of the standard talking points, see HERE & HERE.) That may or may not turn out to be the case, but it's not implausible. If so, how that works out in the long run remains to be seen.

=> What I find more puzzling is the widespread assumption (by analysts and commentators running the gamut from "progressive" opponents of the 2003 Iraq war to self-styled foreign-policy "realists") that this would necessarily be a good thing. There are arguments to be made in support of that assessment--though they need to be made, not assumed. But that conclusion is far from obvious.

In fact, there's an inescapable contradiction built into the whole "centralization" agenda in Iraq. To put it most simply and directly, a powerfully re-centralized government in Baghdad creates a winner-take-all game, and not all the players can win.

For example, both Sunni Arab political forces and some of the Shiite parties (e.g., Dawa and the Sadrists) support a more powerful central government, but that's because each of them hopes that they will be the ones to control it. (Yes, I know that in the case of the Sunni Arabs that sounds wildly unrealistic, but people in politics are often unrealistic--and the positions taken by many Sunni Arabs in Iraq since 2003 don't actually make sense unless this is their underlying premise.) Concretely, these forces have very different and opposing agendas. Among other things, the Sunni Arab parties all agree that de-Ba'athification went too far, whereas the Sadrists believe it didn't go nearly far enough. Even more to the point, it’s not too strong to say that these different "centralizing" factions fear and despise each other (the Sadrist militias, for example, played a central role in reprisal murders and ethnic cleansing of Sunni Arab civilians from 2006-2007), so in practice a move toward political re-centralization is likely to put them at each other's throats more, not less.

Of course, there are also a lot of other political factors at play here that further complicate the situation. But I'm struck by the extent to which foreign enthusiasts for a more powerful central government in Baghdad (including Juan Cole, the so-called Iraq Study Group, Sunni Arab governments, etc.) blithely ignore this obvious problem.

=> On the other hand, can a pluralist regional federalism work in Iraq?

(Again, that question has to be complicated by whether we're just talking about autonomy for Kurdistan, which at this point could be defeated only by large-scale violence--not to mention that selling out the Kurds once again would be politically unwise as well as morally despicable--or about “regionalizing” Arab Iraq as well.)

I'm not sure. But there is a strong case to be made that it's probably the least bad option ... and, as I mentioned, it happens to be a possibility that's authorized by the 2005 Iraqi Constitution (which traditional Arabists like the ones whose voices predominated in the so-called Iraq Study Group report recommend simply tearing up).

This case gets surprisingly little attention in US discussions, either within the government or outside it. As I noted at the beginning of this post, one of the strongest statements of this case has been made by Brendan O'Leary (whose practical background in such matters includes participation in the Northern Ireland "peace process" when that looked like a non-starter, too) in his well-informed and carefully argued just-released book, How to Leave Iraq with Integrity. I don't want to try to restate his case here, so read the book. As a start, you can listen to a brief but quite informative interview with O'Leary about his book HERE .

=> Incidentally ... the US government has pushed from the start for a strong central government in Iraq (the 2005 constitutional settlement represented a defeat for Bremer and the US in that respect). But as O'Leary argues (convincingly, I think), one ironic, and no doubt unintended, side-effect of the alliance of convenience between the US military and the Sunni Arab "Awakening" militias is that this has made it more conspicuously necessary for the Shiite-dominated parties in Baghdad to bargain with the Sunni Arab minority about the future shape of the country.

Whether the various socio-political forces in Arab Iraq are actually able to work out a plausible negotiated settlement (and a "power-sharing equilibrium," as O'Leary puts it), or slip back toward an all-or nothing winner-take-all inter-sectarian bloodbath as US troops withdraw ... is something we will have to wait and see to find out. One of the necessary requirements for a constructive settlement will have to be that the political forces representing the Sunni Arab minority will finally have to give up the dream that they can once again rule Iraq by themselves. But the Shia political forces would have to be willing to act constructively, too.

How these and other imponderables work out depends primarily on the Iraqis themselves. In the meantime, pluralist federalism in Iraq has to be recognized as a serious alternative to both partition and re-centralization, and I think we should all agree that for outsiders to try to force either of those alternatives on the Iraqis (including, let us not forget, that 20% Kurdish minority who are currently thriving in the northern provinces) would be a great mistake.

Yours for reality-based discourse,
Jeff Weintraub