Thursday, September 18, 2014

The Scottish Referendum: Two Images of the State

Tomorrow, Scotland votes on whether to become a state independent of the United Kingdom of Great Britain and Northern Ireland. What is most interesting to me about the campaign is the underlying clash between two different images of the future of the European state implicitly supported by the two sides. This clash, although masked by practical questions (e.g. currency, debt, treaty accession/succession) that have captured the most media attention, gives rise to those very questions, as they are little more than tension points where the two images don't match up.

What do I mean by this?

The two images offered by the opposing sides are each conceptualizations of the role of the nation-state in the European regional system of states. On the side of the nationalists, the promise of continuity in some areas (economics, (im)migration, currency) and change in others (sovereign status) is an implicit blueprint of a minimalist, entangled, semi-sovereign state. On the side of the unionists, the concerns about economic disruption, the threat to withdraw access to the pound, and the prospect of EU accession ab initio reflect a more traditional view of the state.

To a largely unacknowledged degree, both sides are arguing about an independence cost/benefit equation that is inherently unsolvable. It cannot be solved because it is dependent on the image adopted by the analyst. When the nationalists argue that an independent Scotland is viable, what they are actually saying is that the cost/benefit equation produces a net benefit if their image of the state is true. The unionists are arguing that independence would be a net loss if their image of the state is true. 

Which image is reality? The correct answer is that either image could be true if relevant actors (London, Edinburgh, Brussels, and the other EU capitals) willed it to be true. The nationalists are correct if the actors agree to negotiate on good faith, amend treaties quickly, and proactively welcome Scotland into the European family. The unionists are correct if the actors decide to make Scotland into a warning against further secession within the European Union. If Madrid makes EU accession difficult, if Westminster makes access to the pound difficult, if Scottish industry moves across the border, then independence will come with a high price tag.

But what is important to realize is that the nationalists are promising a bright future conditioned on a social reality that is beyond their ability to create unilaterally, and the unionists are threatening dire consequences which they have every ability to mitigate.

While outsiders like myself have no vote in the referendum, we will definitely be affected by the result. As such, I have an opinion on which outcome would be best: independence. This is for two reasons.

First, the weak image of the state is more conducive to further European integration and the consolidation of the supranational project. The more states within the union, the better the argument for qualified majority voting and the weaker the voice of individual states. I do not realistically see an option for Madrid to block Scotland's accession indefinitely because the moral opprobrium would be enormous. This is not the same thing as Greece blocking Macedonian accession -- Scotland's importance is central, not peripheral. And if what remained of the United Kingdom were to leave the EU, that might actually spur greater integration through the removal of a perennial spoiler in the club.

Second, the European family of nations needs to accept a fundamental reality of international politics: any system that cannot change will be rife with either conflict or injustice. Without means for peaceful change, any status quo grows vulnerable over time to its accumulated tensions. In the UN-era, the means for peaceful change were vested in the International Court of Justice, in Security Council responsibilities, and in now-outdated entities such as the Trusteeship Council. To an important extent, the failure of states to accept the jurisdiction of the ICJ and constant gridlock in the Security Council have contributed to an inability to manage and legitimize peaceful change.

The European regional system has always prided itself for pioneering more progressive norms than the global system at large. If it continues in this project, it must be willing to talk openly about peaceful change and how it is to be brought about. Further, with the EU's deep commitment to human rights, it has a moral responsibility to ensure that Scotland's individual citizens are not economically and socially disadvantaged despite wishing to remain part of the European community. The fundamental problem is that the legitimacy of state action now has two arbiters - the sovereign will of the people on one hand, and the responsibilities of international law and the expectations of peer states on the other. Finding a balance between the requirements of these two arbiters is the individual responsibility of each state, but also a multilateral problem that is systemic in nature. Reconciling the will of the Scottish nation with the existing framework of the European community must be a give and take, not a simple rejection.

That's all. Let's see how tomorrow goes down. My strong suspicion is that the "No" vote will win based on past polls, barring a strong enthusiasm gap leading to higher turnout for "Yes".

Thursday, August 28, 2014

Comment on Starrs' 'American Economic Power Hasn't Declined'

I was linked to this Dec. 2013 International Studies Quarterly article by Sean Starrs of City University HK earlier today:

Sean Starrs, 'American Economic Power Hasn't Declined—It Globalized! Summoning the Data and Taking Globalization Seriously', International Studies Quarterly, Vol. 57, Issue 4, (Dec. 2013), pp 817-830.
This paper argues that a fundamental failing in the debate on the decline of American economic power is not taking globalization seriously. With the rise of transnational corporations (TNCs), transnational modular production networks, and the globalization of corporate ownership, we can no longer give the same relevance to national accounts such as balance of trade and GDP in the twenty-first century as we did in the mid-twentieth. Rather, we must summon data on the TNCs themselves to encompass their transnational operations. This will reveal, for example, that despite the declining global share of United States GDP from 40% in 1960 to below a quarter from 2008 onward, American corporations continue to dominate sector after sector. In fact, in certain advanced sectors such as aerospace and software—even in financial services—American dominance has increased since 2008. There are no serious contenders, including China. By looking at the wrong data, many have failed to see that American economic power has not declined—it has globalized.
Starrs first justifies looking at the profits of transnational corporations (TNCs) as a lens for estimating national power by arguing that:

"[C]orporate profit-making is inherently a power process, not only because of class struggle (the more profit for owners, the less wages for workers, and vice versa) but also because accumulation is differential vis-a-vis competing corporations. Thus, as profit is both means and end of accumulation, it indicates both potential and actual power." (p 18)

His argument against using old measures such as GDP relies heavily on the growth in intra-TNC transactions and how this masks a growing divide between where economic activity occurs and where profits accrue to. His examples include the dominance of Coca-Cola and Pepsi in the Chinese beverage market despite being American-own, and the fact that while Chinese workers assemble Apple's electronic products, the profits flow back to the United States through IP licensing.

Starrs goes on to look at the dominance of U.S. companies based on the "national distribution of profit across the twenty-five broad sectors of the top 2000 corporations in the world" (p 820). His conclusion is that the U.S. is still dominant across 18 out of 25 sectors, and has in fact grown in relative dominance between 2006 and 2012 in six sectors.

Then, Starrs does something interesting and important: he examines who owns the corporations in his previous analysis. So, instead of just rolling profits up to the tax domicile of each TNC, he attempts to assign nationality with one further level of granularity--by shareholder. First, he looks at cross-border TNC-to-TNC acquisitions, finding that American corporations owned 46% of the listed shares of the world's top 500 corporations, despite only accounting for 167 of the top 500. Then, he examines the share ownership pattern of the top 20 firms in four regions: the United States, the EU, Japan, and China (HK-listed H shares). The data shows that U.S. shareholders owned 86% of shares in the US, 24% in the EU, 20% in Japan, and 31% in China/HK. Starrs acknowledges that his exercise in assigning nationality to shareholders is limited by the fact that many shareholders are large investment firms that aggregate funds from individuals of all nationalities. However, he makes an assumption, relying on the proportion of millionaires that are American (76%) as a proxy for nationality distribution of managed funds, that most of these individuals are Americans.

Starrs conclusion is that the United States is still dominant. In fact, in some respects, it is more dominant because it owns and derives profits from more of the world in comparison to its GDP and other traditional measures than it did before.

I like this article a lot. It recognizes important implications of widely accepted but misunderstood patterns. However, I think Starrs overlooked a couple factors that I've come across recently in my day job that I'll explore below.

Starrs explanation of how profits relate to power (^^look  up there^^) is not wholly convincing. He cites several theorists on how the United States has power because of structural factors, resources, or a large market. Then he puts forward his "profit is both means and end of accumulation" argument and moves on to discussing why old measures fail. It is, I think, deceptively attractive to think that simply because Americans are making the most profits, then Americans must be the most powerful state. Part of power is the ability to maintain a standard of living, as much as simply have a standard of living. Power is forward looking; accumulation today does not mean accumulation tomorrow, and changes in profits can lag behind changes in power. The capability to maintain future profits matters.

If we take a very simple line of critique (I haven't thought this through too hard) and argue that profits are power because, ultimately, they can be taxed and grant states greater politico-military capabilities, then I think Starrs' argument runs into trouble. While greater profit would imply greater state revenue ceteris paribus, we live in a world where taxation policy, particularly corporate income tax, is strongly warped by nearly century-old structures that maintain a distribution of power that has long passed the world by.

The short of it is that the soft laws on corporate tax, constituted by the OECD model tax treaty and transfer-pricing rules that spell out how companies can value intra-TNC transactions, were established in the 1920s and strongly favor investors over 'source' countries (territories where resources and labour were located). One reason is because those soft law principles were written by the former colonial powers, who invested at roughly reciprocal levels between each other, but on severely non-reciprocal levels with their colonies.

Double taxation treaties have extended this principle around the world, leading to a situation where investor (more frequently referred to as 'residence') countries get first dibs on a TNCs profits, while source countries agree to lower withholding taxes and recognize high thresholds to local TNC activity before a right to tax emerges.

Exacerbating the problem are increasing problems with transfer-pricing brought about by the very growth in intra-TNC trade that Starrs discusses in his article. The arm's-length principle, which is the basic rule by which transfer-pricing must be done, stipulates that a TNC treat its subsidiaries as separate business entities. When making a transaction (say, a sale of iron ore from South Africa to Switzerland), the price of the transaction as documented by each legal entity must reflect market prices. The profits of each local subsidiary is calculated using those prices and taxed accordingly. This rule may have made sense in the 1920s, when communications and transportation limitations meant that subsidiaries of a single firm effectively operated independently. But with the spread of activities across borders, the situation has changed. Supply-chains now stretch across continents because of central design; in fact, TNCs arose in part because cross-national supply-chain management allows these firms to create products at lower cost than if the local subsidiaries were independent companies. That is, there is no comparable market price for many transactions within TNCs. Thus, the arm's length principle has become a central vector for profit stripping, whereby TNCs attempt to decrease prices within firms so that source country subsidiaries book lower profits while residence country parent companies, often located in low-tax jurisdictions, book higher profits. This is referred to as transfer-mispricing and fits in the gray area between tax evasion and tax avoidance/planning.

Similarly, profit stripping also functions through IP, intra-TNC services, and debt. A parent firm can charge a manufacturing subsidiary substantial royalty fees that cancel out any local profits the subsidiary would otherwise report. Alternatively, a parent firm could charge a local subsidiary inexplicably high management fees that likewise strip away the sub of its profits (the NGO ActionAid argues that Associated British Foods has been doing this to its sugar-manufacturing subsidiary in Zambia via a management subsidiary in the tax haven of Ireland). Finally, a parent firm can choose to finance a subsidiary's operations through debt and demand back large interest payments that nullify the sub's profits and can be used to obtain a residence country tax credit in some cases.

There are many other forms of intra-corporate tax shenanigans. I won't go into them. The debate on the scale at which these activities occur is heavily debated, but concern about them has increased to the point that the OECD has launched a project on what it and the G20 refer to as 'Base Erosion and Profit Shifting'. While driven by very specific U.S. and European concerns about their ability to tax corporates, the project's overarching goal is to align profits with value - that is, remove incentives to shift reported profits around the globe and alienate it from the economic activity that created it. 'Value', throughout the life of this project, has been hard to define. But the ol' "you-know-it-when-you-see-it" test for obscenity applies, particularly as there exists an entire industry--and industry whistleblowers--focused on innovative tax planning.

The OECD is not the only actor pushing back against the existing global tax regime. Brazil, India, and China have made ways by unilaterally introducing new deviations from OECD recommendations that allow them to claim more of a TNCs profits within their borders. Two common strategies involve hard-setting transfer prices for certain goods or services and lowering the threshold of activity a TNC needs to perform in a jurisdiction before the source country can tax it. Each of those three countries made contributions to the transfer pricing manual developed by the UN ECOSOC Committee of Experts on International Cooperation in Tax Matters spelling out their concerns about profit shifting and how they were modifying their corporate tax code in response.

So, if profit shifting is a fact, and emerging market states are pushing back against it, what does this mean for Starrs thesis? Taking a big leap, we could argue that it means the disproportionate accrual of profits to U.S. shareholders is 'artificial' and misaligned with real economic activity, however the latter is defined. In fact, this artificial accrual is an effect of the growth of TNCs, but not in the benign way that Starrs describes. Further, we could argue that other states are waking up this reality and pushing back to limit the profits that TNCs can take home to the United States. As a consequence, it is possible that over time the trend Starrs detects will be reversed and U.S. companies will become less dominant as compared to foreign competitors as they incur larger tax costs.

This is all a stretch, but I think it's something Starrs needs to take consideration of. A further point might be that, in fact, perhaps state capabilities are not ultimately derived from the ability to tax corporates, but from the ability to tax rich shareholders. Here again, Starrs would run into a problem. If U.S. corporates become less profitable in their home domicile due to more taxation abroad, then shareholders will also take back less in dividends. At the same time, because developing countries rely more on corporate tax than developed countries, they will strengthen in capabilities while the U.S. weakens.

I will readily admit that the above is half-baked. But, even if there may be problems with my little thought experiment, I think it illustrates well why I believe Starrs needs to explicit lay out a more detailed justification of how profits mean power.

Tuesday, July 29, 2014

Intermediate-Range Diplomacy

On July 28, the United States formally accused Russia of violating the 1987 Intermediate-Range Nuclear Forces Treaty (INF). Allegations of impropriety have been stewing for a few years now, with experts debating whether Russia had really crossed the line or not. (NB: the Russians also accuse the U.S. of pushing the limits of the treaty with its ABM systems and testing decoys.) Presumably, U.S.-Russian consultations on that issue have hit a dead-end. This raises the question: why did the United States choose to bring up INF now, in the midst of rising tensions over Ukraine?

The question is worth asking because the INF is one of the most important arms control treaties entered into by the United States and the Soviet Union/Russia. As such, it is also one of the most visible, tangible, and fundamental embodiments of the common security interest underlying the two countries' relationship. When concerns about treaty compliance arise, the sides typically address them in formal and informal consultations out of the glare of public attention -- which is exactly what was done over the past three years. Calling out the other side publicly is an abnormal step which can put real pressure on the treaty itself. So why is the United States doing that now?

There are a number of different answers, each tied to an expectation of how Russia will react to the accusation. First, Russian President Vladimir Putin could publicly back down by promising to address the compliance issues in good faith. That would preserve, for now, the common interest and indicate an underlying resilience in the nuclear understanding between the two countries despite the crises in other spheres of engagement. The administration of U.S. President Barack Obama might be under the belief that INF compliance would be an easy de-escalation option for Putin that would take some of the urgency out of the general political crisis over Ukraine, which has been exacerbated by the downing of  Malaysian Airlines flight MH17. In other words, INF compliance would be a signal of reassurance to the international community that the bad old days are not coming back.

However, this expectation might be a little optimistic (or worse, naive). Since the beginning of the Ukraine crisis, the Russian approach to relations with the United States has centered around making Washington play a guessing game as to whether those bad old days are, in fact, coming back. Throughout his career, Putin has repeatedly made comments suggesting that the pre-1989 world was actually preferable to the post-Cold War. While some of this may have just been bluff or noise for domestic consumption, it would be a tall order to expect the Russian president to perform a volte face and publicly embrace such a visible symbol of the new order as the INF.

Second, the United States may believe that publicly accusing Russia of violating the INF could result in a private breakthrough in bilateral consultations on the issues. In other words, Putin could say nothing in public, but signal a secret willingness to smooth things over. There are a few problems with this interpretation, mostly to do with signalling and audiences. Presumably, if Russia wants to trade compliance for some political benefit, this has to be done in the public eye. It is hard to see how the United States would manage the optics of a public carrot for a private trade-off. At the same time, Russia would not benefit from private compliance because signaling value would be lost compared with a public message.

Third, there is the possibility that Obama expects the Russians to renounce the INF. The possibility is hard to ignore, but gut instinct seems to suggest we are not in danger of such a radical move yet. I say "gut instinct" because it is difficult to second-guess why in the first place Russia was moving ahead with its alleged violations. And, I say "hard to ignore" because the political environment is now venomous enough--and nationalistic fervour in Russia heightened enough--that Putin might see few political costs to further escalation. If Russia genuinely feels that is threatened by the U.S. ABM systems in Europe in the same way as the Pershing IIs of the late-Cold War, perhaps it will choose such a path. But, if Moscow's griping about AEGIS on-shore and associated systems is really the fig-leaf that some analysts believe it to be, then preserving the INF would seem to be in its favour. However, within both the United States and Russia, there are calls for updating the INF to allows for deployments ex-Europe (and see NYT article on latest developments for old Russian proposals). While there is absolutely no evidence this view has moved into the mainstream of U.S. strategic thinking, it is possible that the Obama administration would see some upside to the end of INF in allowing flexibility in the Asia Pacific.

Finally, it is possible that Russia does nothing and says nothing. An equivalent outcome would be for Moscow to simply state that it does not consider itself to be in violation of the INF. If this is the likely outcome, then the only gain the United States would see from pointing a public finger at Putin would be rhetorical shaming. Piling on the blame and pressure may well be an integral part of the U.S. strategy for maintaining momentum on sanctions and ostracizing Russia. The question then becomes: how much does the world care about INF?

Chances are, the Obama administration has considered all of these outcomes and decided that any of them would be acceptable. At this point, a decision on Russian withdrawal from INF could be seen as not quite the crisis it would have been in 2011 when Clinton, McFaul, and others were still pursuing a reset in relations. As a study in escalatory tactics, the effects of the U.S. decision to go public on the issue should be monitored closely.

Friday, June 27, 2014

Sometimes I Read - Vol. I

I previously mentioned that I read too much and write too little. As far as problems with my intellectual habits go, this is just the tip of the iceberg. In addition to reading too much, too much of my reading has been internet fluff.

But out of the actually 'substantive' material I've been going through, one book sticks out in my mind:

Andrew A. Latham, Theorizing Medieval Geopolitics: War and World Order in the Age of the Crusades (Routledge, 2011).

Here's an interview from late last year with Prof. Latham explaining his motivations behind writing this little tome.
"The prevailing common sense (in IR at least) is that this was an era of non-statist “feudal heteronomy”, radically distinct from the early modern international system that superceded it sometime between the mid-sixteenth and mid-seventeenth centuries.  According to this view, the late medieval translocal order was not an international system, properly understood, for the simple reason that it did not comprise sovereign states interacting under conditions of anarchy.


My objective in writing this book, however, was to demonstrate that this is a deeply flawed characterization of late medieval world order, one largely without warrant in the contemporary historiographical literature.  By the mid-thirteenth century, the convergence of new or revived discourses of sovereignty, territoriality, public authority, the “crown” and political community had given rise to a new “global cultural script” of sovereign statehood that was being enacted on various scales, around various social forces and through various institutional formations in every corner of Latin Christendom


Expressed in the language of IR theory, the various forms of state that were crystallizing during this era may have been structurally differentiated, but they were functionally isomorphic (in terms of their common constitutive ideal and its practical expression).   Ultimately, they were all states – distinctively late medieval states to be sure, but states nonetheless."
The first few chapters of Latham's book are a penetrating critique of the realist-liberal-constructivist orthodoxy in treating the pre-modern era as either not worth studying, or not amenable to analysis. In one section, he compiles a list of sins that international relations scholars commit in working with historical material, returning time and again to John Gerard Ruggie's 1983 article 'Continuity and Transformation in the World Polity'. I don't have the book with me anymore and didn't take very good notes, but off the top of my head I can remember these points:
  • Cherrypicking historical examples to match an agenda
  • Treating one side in a contentious scholarly debate as settled fact
  • Failing to use the latest in historical research and sticking to important, but outdated authorities
Incidentally, he mentions, the first in a positive light and the second in a negative one, two recent works I enjoyed immensely:
  • Andreas Osiander, Before the State: Systemic Political Change in the West from the Greeks (Oxford University Press, 2008)
  • Daniel H. Nexon, The Struggle for Power in Early Modern Europe: Religious Conflict, Dynastic Empires, and International Change (Princeton University Press, 2009)
As well as, in passing, one I'm still trying to finish:
  • Thomas N. Bisson's The Crisis of the Twelfth Century: Power, Lordship, and the Origins of European Government (Princeton University Press, 2009).
For anyone curious as to why I like to read pre-modern history, the rationale goes something like this:

Everyone claims that we live in an era of great social and political change, with the international system shifting and transforming on multiple levels - every area of high or low politics. The most profound transformations in system are those that change its very nature, those that change what sort of games the actors are playing, or even who the actors are. In order to understand, anticipate, and prepare for these sorts of changes, we need to know more and think more about the last times systemic changes of this magnitude have occurred. That's not 1991, or 1945, or 1914, or 1848, or 1814, or 1789, or even 1648. We need to look back further, past the veil of Westphalia and into an unstructured and unanalyzed history that has been far too often glossed over in theory.

Monday, June 23, 2014

On Crimea, Where is the Intervention Debate?

 ***Note: This post got a little out of hand. Also, between drafting and publishing, a little out of date.***

For a few months now, I've been meaning to write a short piece to summarize my thoughts on the Ukraine crisis. The drag of real commitments has prevented that from happening, but the fortunate upside has been that my thoughts have had more time to stew, as the crisis, moving much more slowly than I had originally foreseen, unfolded.

A recent opinion piece published by the NYT argued for the deployment of NATO troops in strength to the borders of Poland and the Baltics as a deterrent and show of force. At least that's what I surmise the purpose of such a deployment would be, as the article is unconvincing in the extreme. What would reaffirming the alliance's commitment to Article 5 do to resolve the current crisis? (Don't get me started on calls for boosting missile defence). Humorously, the New York Times published the piece with a rather major misprint, attributing to the author a call for NATO troops to be deployed in Ukraine itself rather than its neighbours.

The correction appended by the Times ran:
Correction: Due to an editing error, James Jeffrey’s op-ed said that a ground deployment of U.S. troops “to Ukraine today could change perceptions on all sides.” The writer was referring to areas along Ukraine’s borders, and the column should have said that “a ground deployment in the current crisis with Russia could change perceptions on all sides.”
It is possible to imagine the alarm with which Mr. Jeffrey read his modified piece as originally published. The panicked, indignant call to the editors of the Times would write itself as a comic skit. But all bumbling aside, the uniform reluctance among the Western punditry to cross that final bridge -- boots on the ground in Ukraine itself -- betrays a stifling orthodoxy in strategic thought that is symptomatic of the inability of NATO, the EU, and the United States to match the initiative of Russian President Vladimir Putin.

Who wants to start a war with Russia? Orthodoxy is not without its justifications--besides the obvious risks of uncontrollable escalation, even a contained, conventional conflict with Russia would lead to casualties on a scale not experienced by any belligerent in decades. A 'small war' would destroy the post-Cold War international order and introduce innumerable political uncertainties for all sides, landing a potentially intolerable blow on the still weak global economy. Nobody wants war.

The problem common to most analyses of the Ukraine crisis is a failure to realize that "nobody" includes Russia. The critical question to ask is not "Who wants to start a war with Russia?" but "Who wants to start a war with NATO?"

But let's back up a step. Why does Ukraine matter? And to whom?

What is at Stake, Take One: Why the World Should Care

Foreign Policy magazine collaborates with the Teaching, Research, and International Policy (TRIP) Project at the College of William & Mary to publish a series of articles sampling academic opinion on contemporary policy issues. A recent addition to this series asked professors and elites whether it would be wise for NATO to send troops to Ukraine. An overwhelming majority of international relations scholars said "No". Curiously, however, academics that focus on international law were divided equally on the question. Why the discrepancy?

The obvious answer comes in two flavours, depending on whether you are sympathetic with the lawyers or not. If you are, then the argument goes something like this: international lawyers give more credit to international law in preserving order in an anarchic system, and are therefore more disturbed when a foundational proscription in the UN Charter, the prohibition on the use of force in Article 2(4), is violated. Therefore, international lawyers are more likely to advocate for a direct, strong response to Russian aggression. If you are not sympathetic, the answer runs on these lines: students of law over-privilege international law and sacrifice the good on the altar of the perfect. Failing to grasp political reality, their rigidity is in effect advocacy of a policy that implies extreme moral hazard and stunning opportunity costs incurred through worsened relations with Russia. Throw a "chicken-hawk" or "armchair general" in for good measure.

The lawyers reach the right conclusions, but for the wrong reasons. It isn't the violation of Article 2(4) that matters, but rather the breach of international norms. These norms carry enormous benefits for all actors in the international system, and it is these that must be protected. Critically, the law against the use of force does not translate directly into an identical norm against the use of force. The relationship is more complicated.

A common 'defence' of the Russian intervention holds that the West, and in particular the United States, is in no position to criticize Putin after it hollowed out the importance of Article 2(4) over the last two decades, first under the banner of humanitarian intervention (Kosovo), and later under that of preventive self defence (Iraq). Drone strikes and special forces operations have, according to this critique, further nibbled away at limits on the use of force. If a shift in international norms of behaviour is underway, it is the West to blame for initiating the movement while Russia only follows suit in protecting its citizens in the near abroad.

The problem with this critique is two-fold. First, of course, because the United States and its various coalitions broke with acceptable state practice does not mean further law-breaking is to be condoned. Second, the norm violation committed by Russia is of a very different type than that committed by the United States.

This second point is absolutely critical. For the lawyer, a breach of the rules is a breach of the rules -- motivations and circumstances be damned. Decision-making actors in international society are not, however, as blind as justice. Put to one side, for now, what one's opinion of the wisdom of the wars in Kosovo or Iraq might be (legitimate, justified, or further innovations in wordplay). Regardless what one thinks of those acts, it needs to be stated as clearly as possible that Ukraine presents a more central, more threatening menace to the international order. It is qualitatively different, and glib comments about rising powers merely following the United States' example must be rebutted.

The evolution of state practice in the realm of high foreign policy in the wake of the adoption of the UN Charter could be summarized as a tale of adaptation to a straitjacket that arguably made sense in 1945 but which has proven insufficiently flexible to address modern dangers. Cold War bipolarity led to the emergence of various experiments for getting around the prohibition on the use of force, some of which were summarized by Thomas M. Franck in his 1970 article asking "Who killed Article 2(4)?" Two of the trends Franck identified were indirect interventions through proxies short of an "armed attack" (this was written before Nicaragua, of course) and regional approaches to security in parallel to the UN system (more on those later). Ultimately, a strong argument could be made that international society came to accept indirect subversions of sovereignty as a nasty but tolerable practice, while treating direct, militarized assaults on sovereignty as beyond the pale.

More recently, states have been keen to develop new justifications for violating Article 2(4) to better manage the problems of gross human rights violations (including genocide) and terrorism. There bloomed legitimate, critical, sincere, and difficult debates about how force should be used to handle issues which the UN Charter was never designed to manage. Even commentators who strongly opposed the further erosion of the norm against the use of force recognized that something had to be done in cases where standing aside was akin to complicity--the debate was about methods, and their costs and benefits for the stability of the international system (and increasingly, a cosmopolitan conception of human values).

The poorly disguised invasion of Crimea launched by Russia in February 2014 was of a very different character than the Western interventions. In fact, the invasion was exactly the sort of behaviour that the authors of the UN Charter were concerned about prohibiting. It is military conquest followed by self-aggrandizing annexation. Acquisition of territory through occupation and formal integration has declined precipitously in state practice over the course of the 20th century. It is simply not something that well-behaved members of international society do anymore (see Zacher 2001).

Yes, but isn't conquest merely the pursuit of state interests by another means? When the West dismembered Yugoslavia, invaded Afghanistan and Iraq, and justified drone strikes in the Pakistani hinterland, wasn't this equally self-aggrandizing and self-interested? And further, when it pours millions into opposition movements in anti-Western autocracies, isn't this a violation of self-determination? This is a cynical, deceptive, and frustratingly attractive argument. The fact remains: the practice of military conquest and annexation has a radically different goal, and tied to that goal is the potential for a radically different form of military conflict - a form which the UN Charter sought to consign to the annals of history. Russia invaded Crimea with no claim to legal title; it threatens eastern Ukraine with appeals to a historical concept, Novorossiya. This marks out its actions as relics - the militarized land-disputes of the post-WW2 era have generally involved some form of underlying legal claim.

This is not bad behaviour. It is the worst behaviour. International society must recognize this fact and stop trivializing it. States must recognize that Russia's predatory behaviour is a blow against a different, and more fundamental, norm than those assaulted by the West in the last two decades.

Key distinguishing characteristics of an international system are the underlying institutions and norms that define what sort of 'game' the actors are playing. The distribution of power can tell us some things about how states will act, but it does not define all the rules. One of the most important sets of norms and institutions in any system is that which regulates the balance between order and justice. These norms regulate how states can legitimately effect a justifiable change (not always territorial) and thereby put order temporarily at risk. The post-1945 system is characterized, in part, by its prohibition of unilateral annexation. The Western interventions of recent memory do not undo this prohibition; rather, they advocate for a further evolution of the system that accepts the 1945 norms and treats them as a starting point. The Russian intervention represents a turning back of the clock, and a challenge to the security of all states that have benefited from the post-Charter consensus.

What's at Stake, Take Two: Why the United States Should Care

U.S. President Obama has proven himself to be a cautious foreign policy decision-maker, consistently attempting to justify his choices by appealing to a need to safeguard U.S. power while avoiding "stupid shit". Obama's team has argued that this approach tracks the preferences of the U.S. public, which is weary of international commitments and constant war.

If we accept this assumption, which may well have a grain of truth to it, then the onus is on the advocate of a Ukrainian intervention to show that the United States stands to lose if it does not meet Putin head-on over Crimea. It is not enough, anymore, to argue that the United States is missing an opportunity or that it is failing to fulfill some abstract leadership role and jeopardizing its reputation. In effect, a case has to be made that doing nothing is "stupid shit".

In the long tradition of Eastern Europe being treated as a toy-thing of great powers, no scene stands out as vividly in recent historical memory as the purported meeting between Winston Churchill and Josef Stalin where they agreed on percentage-of-influence figures for each country in the region. Among critics of a confrontational approach to the Ukrainian crisis, there appears to be a nostalgia for great-power accommodation and top-down imposition of geopolitical 'solutions' to local problems. Ukraine is not only in Russia's background; it plays a critical role in the history of the Russian nation and its present shape is the product of assimilation and structuring within the Russian empire in its traditional and Soviet forms. The West, dragged by the European Union and its mission of eastward creep, misstepped by imposing on Russian interests, and Putin's response is therefore legitimate in some respects. The world should take these interests into account in formulating a proportionate protest, this camp argues.

Essentially, it is the fate of a single country (and, really, one peninsula) at stake. The United States has no vital interests in Ukraine; indeed, neither does the EU. The NATO members bordering Ukraine certainly have an interest in not spotting Russian divisions stationed in Lviv from their porches, but that currently appears to be an unlikely possibility.

This 'no interests' view is a misrepresentation of the true stakes. To the contrary, the invasion of Ukraine could well have profound geopolitical implications that define future limits on U.S. action and security. For Russia, Ukraine is not simply a test-case for the willingness of the international community to stand up to aggression. Rather, it is a test-case of the world's willingness to accept Russia as a great power--an essential, embedded, and consistent part of the country's national identity.

From almost the very first days of the post-Cold War Russia, management of the near abroad has been a domestic test case for the legitimacy of each and every Russian leader (see Clunan 2009, p 111, and Allison 2013, p 123). Consistently, senior Russian officials have made the case that the country deserves special rights within its sphere of influence (see Allison 2013, 103, 125, 161, 216, Clunan 2009, 136, and Tsygankov 2012, 34-35). The logic operates as follows: Russia is a great power; great powers have spheres of influence; spheres of influence entail certain rights; the enforcement of great power rights in their backyard requires a modification of norms on the use of force. This is not an innovation--it is a relapse to a 19th century world of great power impunity.

The United States has (or, should have) a strong interest in insisting that rising states become peaceful great powers. It must make the case that in the post-Charter world, territorial aggrandizement is not an accepted marker of status and that spheres of interest must be maintained without the overt reliance on force. To a certain extent, the United States has led by example in the Americas, relying largely on subversion and diplomacy to maintain its preferences, the occasional invasion notwithstanding. Again, the case has to be made that these underhanded methods are not morally or normatively equivalent to overt conquest.

Far from Russia's near abroad, the United States should also be concerned that the other rising power in the global system--China--understands the precedent and the message. Given that the Asian juggernaut has adopted a provocative and dangerous approach to asserting its regional maritime claims, clear lines of behaviour are a necessity. As in East Asia, the same is true for the United States elsewhere. If it must balance great powers militarily, the international system's "indispensable nation" will incur larger costs than if it succeeds in channeling competition into more peaceful modes. Enforcing a universal norm against territorial aggrandizement will be cheaper in the long term than tolerating its fracturing and eventual regression.

A Tour of the Chocolate Factory

Upon his inauguration, new Ukrainian President Petro Poroshenko offered a mixed agenda: negotiations, a possible cease-fire, and limited amnesties one the one hand, rejection of the Crimean annexation, denouncement of Russian propaganda on the other. Whichever hand he offers first, Poroshenko knows both are tied by pervasive corruption, a debilitated military, a trust deficit, and, most importantly, the thread of Russian invasion.

In his inaugural speech, Poroshenko said that he will seek to guide Ukraine into the EU. Setting aside the rather important question of whether the EU will want Ukraine, it is rather unlikely that Poroshenko will be able to emerge from negotiations with that option intact. Russia's intervention in Ukraine was triggered by the threat of a westwards drift and it is likely that in ongoing negotiations to end the fighting, the pro-Russian militants will seek terms that give them a way to prevent that drift. This is, of course, a little bit of guesswork but it seems to me to be the most likely framing of Putin's end goal. The pro-Russian faction will always have the alternative to invite in more troops and create a de facto independent state in eastern Ukraine--another Transdniestra, Abkhazia, or South Ossetia. As long as the Russian military is poised to intervene, the Ukrainian army will not be able to secure the country's border and end the insurgency by force. Under these conditions, Poroshenko's negotiating position will remain extremely weak.

The presence of NATO troops in eastern Ukraine would radically alter this picture. As I argued at the outset, the Russian leadership should be as wary of the escalatory potential of a direct clash as the United States and its allies. There is a false equivalency implied in most knee-jerk reactions to the option: that sending troops to Ukraine would be the same thing as going to war with Russia. While a war could certainly break out, there are strong reasons, mutual nuclear-induced caution being foremost, to believe that possibility would be quite low.

Rather, the main risk would be of NATO troops being dragged into an anti-insurgency campaign, for which there is no popular appetite in the United States after the long wars in Iraq and Afghanistan. There are two ways this could be avoided: outsourcing of the front-line presence in eastern Ukraine to more willing NATO allies, with U.S. troops stationed in the center of the country, or a partition of labour with the Ukrainian army where large U.S. units take up temporary residence in strategic locations that are distant from population centers while the Ukrainian army fights the pro-Russian uprising.

Another common objection to a NATO presence in Ukraine is that the deployment would naturally become an extended commitment. Bringing Ukraine into the Western fold militarily would likely imply propping up the economy for the long term--it is possible that many policymakers would prefer a return to the status quo ante with a non-aligned Ukraine rather than paying Kiev's bills. A military deployment on Russia's borders would also change the strategic balance in Eastern Europe and cause Moscow to respond in unpredictable ways. However, this objection does not take into consideration the negotiating upside of a deployment: the withdrawal of NATO troops could be a powerful bargaining chip. Under current conditions, time is on the side of the pro-Russian separatists, who can continue to bring in troops while the Ukrainian army is immobilized for fear of an overt invasion. With NATO troops present, the calculus would be swapped with the Ukrainian army gaining in strength and increasingly capable of ending the fighting. At the negotiating table, a withdrawal timetable could serve as the clincher for a deal that Moscow would make sooner rather than later.

From Here to Where?

I am not making the case that a NATO troop deployment is the best option; I am making the case for an open and thorough discussion of the possibility. It has been extremely disconcerting that the starting point for most discussion on the Ukrainian issue has been that a troop deployment would be bad and should not even be considered. Instead, I would suggest that a troop deployment, if properly designed and executed, could be the best option for ending the Ukraine crisis with the territorial integrity and sovereignty of the country relatively intact. While I am not a military analyst and cannot begin to sketch out the feasibility of the suggestions above, it has been frustrating that more qualified individuals haven't stepped up to the plate.

A few parting thoughts:

1.) The primary conclusion I want to emphasize as an extension of the "Why?" argument outlined above is that the Ukrainian intervention is the most important militarized crisis of the last twenty-five years. This is a war worth mobilizing for, and it is a war worth fighting--more so than any of the humanitarian or terrorist crises since the end of the Cold War.

2.) The persistent threat of nuclear war means that direct conflicts between the great powers, such as Russia and the United States, will largely be settled by who is on the ground first. With the possibility of an actual ground conflict rather low, barring the ever-present risk of human error, NATO should make sure that its troops are in eastern Ukraine first, before Russian regulars deploy in force. Obviously, the opening stages of the Crimean infiltration would have been the best time for such an insertion. It is not clear anymore whether such an insertion would still be possible.

3.) Even if a low-risk deployment into eastern Ukraine would now be impossible, NATO troops in central and western Ukraine could still be a potent bargaining chip at the negotiating table.

Starting with "no" is the wrong way to go about troubleshooting the most important geostrategic problem of the new century. The lack of a debate on military options, and the inevitable conclusion one can thereby make about the world's priorities, has been almost as concerning to me as the crisis itself.

Wednesday, June 04, 2014

Inconsistencies at West Point

Here's a warm-up post.

Ameya Naik has written a critique of U.S. President Barack Obama's latest big foreign policy speech, delivered at the West Point commencement ceremony last week.

Read it; it's not too long. To summarize, Mr. Naik argues that inconsistencies between U.S. practice and the stated approach laid out by Obama are undermining the country's foreign policy and the international order in general. He picks out drone strikes and indefinite detention at Guantanamo as two key examples.

I have a few problems with the argument. The superficial ones are these:

First, Mr. Naik argues that targeted drone strikes do not meet one of the president's tests for viable tools of policy: “We must not create more enemies than we take off the battlefield.”
The President points to their use in decimating Al Qaeda’s leadership, and no doubt they have, but judging by the influence of the Taliban in Afghanistan, Tehreek-e-Taliban in Pakistan (TTP), or Al-Shabaab in the Horn of Africa today, the appeal of conducting terrorist activities against Western interests has grown nonetheless.
There are several problems with this argument, which is nonetheless a potentially valid one: there is no clear evidence (aside from the anecdotal type) that resentment against drone strikes directly drives recruitment into active terrorist organizations (as opposed to simply lowering opinions of the United States); there are a multitude of local factors that could be contributing to terrorist strength in Pakistan, Afghanistan, or the Horn that have little or nothing to do with U.S. actions; and the argument fails to take into account the possibility that drone strikes are deterring disaffected youths from joining militant groups. As I said, however, the argument is still a plausible one; my issue with it is solely that it remains unproven. (If anyone has published something on this, please point me in the right direction!)

More critically, it is entirely possible that the White House understands well the blowback potential of drone strikes, but has calculated that most of that blowback will be locally contained. The United States could well be relying on local allies to both absorb most of the subsequent violent indignation and to suppress the spread in awareness of strikes. Time and time again, Obama has emphasized that he is most concerned by those actors which pose a direct threat to the U.S. homeland. By limiting strikes to those which target 'direct' threats, Obama may be calculating that the costs may be 'outsourced' enough, and the direct benefits for U.S. security great enough, to produce a net benefit for U.S. interests. If that is the case, then the drone policy may not be inconsistent with the West Point speech at all.

Second, Mr. Naik also argues that U.S. drone activity in violation of international laws against noninterference and the use of force could lead to copy-cat behavior and legal justifications by other states:
How will U.S. leaders respond when China, invoking this precedent, attacks a fishing vessel carrying, what they label “Philippines-based terrorists” and launch a military strike causing “minimal civilian casualties,” or if President Putin sees an “imminent threat” in Estonia?
As far as drones go, for a long time, this particular flavour of blowback has been limited by the U.S. dominance in technology and capabilities. That dominance is fast eroding and military analysts are now predicting an era of rapid drone capability proliferation. So, the copy-cat problem has become a real one. I would also venture to argue that it is an overstated one. Drones are vulnerable in a contested environment, and have only become a key U.S. instrument of choice because of the nature of the enemy (and the acquiescence of host authorities).

Moving beyond drones to aggressive actions in general, the potential 'bad behaviour' of other states, such as China or Russia, that would most concern the United States would be behaviour against other states. The nibblings around the edges of use force law that subsequent U.S. administrations have engaged in have all come in campaigns against conventionally weaker opponents. There are very obvious and very strong limitations on the ability of non-state adversaries to push back against U.S. legal arguments, and there are even stronger limitations on their ability to resist U.S. action. If copy-cats begin throwing their legal weight around, they would likely be resisted.

So, those are the superficial points of dissent. As far as Guantanamo goes, I have nothing to add - Mr. Naik is spot on.

But I have a deeper problem with his piece: it misconstrues the importance of international law in contributing to the international order. In areas of high politics, where the debate about the role of law is most spectacular, laws matter not because they bind states, but because they serve as guidelines for acceptable and expect-able behaviour. Laws center norms, which are what give any raw distribution of power a sense of order. The norms, not the laws, contribute to order. As Daniel Philpott once analogized, the international system is like a game of sandlot basketball - the rules might be broken often, but they are still recognizable as such.

What does this abstract point say about the inconsistencies in U.S. policy?

First, U.S. violations of international laws on the use of force (both jus ad bellum and in bello) and sovereignty do not necessarily undermine the underlying norms that motivate those laws: that states do not engage in military conflict with one another in the way that they used to. The problem of managing global terrorism is new and troubling, but the U.S. solution - covert operations and drone strikes, do not automatically challenge the underlying expectations of international society. This speaks directly to Mr. Naik's second point about copy-cat behaviour.

Second, the real problem with Obama's speech, and this administration's foreign policy in general, is that it fails spectacularly in articulating that distinction. Further, it did not take seriously the real threats to the normative underpinnings of the international system - the Russian invasion of Ukraine and the belligerent actions of China in its regional waters. The true inconsistency is the gap between the administration's claims of success in deterring Russia and building coalitions in Asia and the facts on the ground.

More on Ukraine later. For now, I am satisfied that I've sufficiently exposed the limitations of my fluency in counterterrorism law and policy, neither of which are issues I have examined closely.

Why write?

I confess that the reasons I have resurrected this blog are entirely selfish. I am taking another tilt at blogging because of three recent epiphanies:

1.) Due to my current lifestyle, I don't actually write very much. Ever so often, there is a surge in output as deadlines and projects coalesce, but during the day-to-day I spend a great deal of time reading, never enough time reflecting, and virtually no time putting thoughts down in text.

2.) While I have found work in the past as an editor, I've largely neglected the skill of drafting prose from scratch. To great consternation, I've found increasing difficulties in writing that are likely the direct cause of this neglect. For example, frequently I discover that I have written myself into an analytical roadblock halfway through a paragraph with a simple purpose; on occasion I have trouble remembering adjectives or adverbs; and too often I get caught up in phrasing to complete an idea that is relatively straightforward by itself.

3.) As with most other skills practice makes perfect, and writing should be no exception.

In addition to these factors, there is also a lot to write about nowadays. Much of what attracts my curiosity gets passed over professionally, so there are quite a few scraps that could end up on this medium.

Also, everyone else is doing it.

Belated Easter

In my last post, originally published on May 8, 2008 (Edit: Now deleted), I said that I "don’t even want to think about 2014".

Well, here we are. To kick off this unholy resurrection, let me jot down two things I learned in passing over the last few days:

1.) The term "iron curtain" was once used to refer to Vauban's chain of fortresses built to protect new French conquests in the Spanish Netherlands in the late 17th/early 18th century.

2.) During the Cold War, some pithy jokers decided that the Soviet, British, and French nuclear equivalents of the United States' "bang for the buck" should be "rubble for the ruble", "pounding for the pound", and "frappe for the franc".

By extension, I suppose the Chinese look for marginal benefits in "yowl for the yuan", the Pakistanis and Indians "ruination for the rupee", and the Israelis "sickle for the shekel". Naturally, the North Koreans get more "win for the won".

Hypothetically, if this year's P5+1 (or, if you're from Europe, EU3+3) talks with Iran were to fail, the rest of the world might have to face up to some "reality for the rial".