Word count on Obama's national security strategy

WPR piece by Miles E. Taylor that does the usual word count, but does it well.

First off:

More-astute observers have had a difficult time characterizing the strategy document, mainly because it is quite long compared to past national security policy declarations and, in many regards, appears similar to them in substance. But when you drill down into the text, word by word, it becomes clear that the NSS reveals a lot both in what it doesn't say on important subjects, as well as in what it does say on others.

Agreed.  Most such docs are gloriously collections of nouns and modifiers like "interests" and "vital."  This one has all the usual boilerplate in spades, to a mind-numbing degree really.  It has the lawyer's feel all over it.

Now for the what's up and what's down:  American values and democracy and terrorism and actual enemies are down, cyber and education and healthcare are up.

Predominate signal in my mind?  We are healing our nation.  The rest of you please go about your business.

Honest, I guess, but perhaps too much so.

The Obama mistake is choosing Pakistan over India

Reuters wire piece via Our Man in Kabul.

The gist:

The Obama administration is grappling with how to balance India's role in Afghanistan as arch-rival Pakistan also jostles for influence there ahead of Washington's planned troop withdrawal to start in mid-2011.

U.S. strategy in Afghanistan is set to be included on the agenda in U.S.-India talks this week in Washington -- with Delhi seeking clarity over rival Pakistan's role, particularly in reconciliation plans with the Taliban.

The Obama administration has so far sent mixed signals over the kind of role it wants India to play in Afghanistan, leaving an impression at times, say experts, that Pakistan's strategic interests could have more weight.

"I don't think this (U.S.) administration or the previous one knows how to balance our legitimate interests in both Pakistan and India effectively," said Christine Fair, assistant professor at Georgetown University and a South Asia expert.

While U.S. diplomats have praised the $1.3 billion India has pumped into reconstruction work in Afghanistan since 2001, military commanders have voiced concern that muscle-flexing by India could provoke Pakistan and stir up regional tensions.

"Increasing Indian influence in Afghanistan is likely to exacerbate regional tensions and encourage Pakistani countermeasures in Afghanistan or India," wrote U.S. General Stanley McChrystal, who is in charge of U.S. and NATO forces in Afghanistan, in a leaked assessment of the war last September.

The implication of McChrystal's view, said expert Lisa Curtis, was that India's approach was not viewed as helpful and Pakistan's strategic interests were more in play.

"That sent the wrong signal," said Curtis. "The U.S. should instead positively reinforce the political and economic activities of engagement by India (in Afghanistan)," added Curtis, who is with the Heritage Foundation.

"The idea that we would somehow ask India ... to draw back from Afghanistan to placate Pakistan which is still harboring Afghan Taliban leadership is very short-sighted and frankly makes no strategic sense," said Curtis.

Couldn't agree more with the Heritage Foundation:  our long-term bet has to be on India, because it will fuel globalization's advance and consolidation in South Asia--pure and simple.  You dance with them that brung ya.

Giving into Pakistan on the Taliban/Pashtun role in/control over Afghanistan is to buy yourself repeat visits. India represents a more dangerous path, no doubt, and a harder one.

But it's a permanent fix because it includes some solution on Kashmir.

We need India going forward.  Do not forget that under any circumstances.

Brazil targets Africa . . . with media!

Outgoing Brazilian president Lula da Silva announces that TV Brasil, a Portuguese-language network will target former Portuguese colonies in Africa (there are a bunch) via rebroadcast through Mozambique.  In all, 49 nations will be targeted (out of 55 on the continent or on neighboring islands).  

Lula presents this as a pure soft-power play:

I want a channel that speaks well of the country, that can show Brazil as it really is.

The biggest draws will be Brazilian soccer and soap operas, which already have a large following there. These two are big media draws in the Western hemisphere as well.

Greece learning from Turkey? Have pigs started flying?

Bloomberg BusinessWeek piece stating that when PM Recep Erdogan and the AKP took over Turkey in 2001, the "Turks were worse off than Greeks--and the IMF cure worked."

The logic?

Erdogan and Babacan [finance minister] used the IMF's tough regimen as an excuse for doing things that previous Turkish governments had avoided for decades.

A biggie?  The gov stepped up tax collection from under-reporters, something you just know is a huge problem in Greece.

Point being, the Turks could have defaulted then, just like Greece considers now.  But that would have been dealing only with the most painful symptom of the moment.

Canada takes its economic cues from China now?

Bloomberg BusinessWeek piece.

The "China club" of countries whose economies are increasingly driven by China's demand for raw materials are Australia, Brazil, Malaysia and Peru.  All have been forced to raise interest rates to tamp down hot growth caused by China.

Now experts expect Canada to join that club and raise rates instead of doing the usual, which is to follow our Fed's lead.  Canada feels forced to because of the growth created by China, India, Korea and other Asian economies' demand for minerals and energy and food.

Scary for some to think Canada no longer takes it cues from us, but great for anybody who wanted pillars of demand outside of the US consumer, because while that worked wonders for two decades following the fall of the Berlin Wall--fueling the rise of hundreds of millions of people out of poverty in Asia, now it's Asia's turn to help out.

So this is good, but new and therefore disturbing to many.

Chart of the day: Obama and the oil spill

From the Economist.

Approval/disapproval poll on Obama WRT the oil spill.

Does Obama really have much to do with that?  Not really, but the perceived passiveness has hurt.

About a quarter see no connection.

About 30% say he's doing a decent job.

About 45% say otherwise.

Maureen Dowd, quoted in the piece, sees this as part of a "pattern of passivity, detachment, acquiescence and compromise."

You get this sense of the defendant yelling at his counsel, "You're my lawyer, damn it, do something!" 

WPR's The New Rules: Obama's Strategic Patience

A lot of national security experts would like a lot more fire -- and firepower -- from our president. Op-ed columnists across America worry that our friends no longer trust us and that our enemies no longer fear us. President Barack Obama's quest for more-equitable burden-sharing among great powers seems to be getting us nowhere, so why bother with more-equitable benefit-sharing?

Read the column in full at World Politics Review.

Afghanistan's minerals deposits now super-sized by U.S. geologists

Beneath the sheep be lithium

NYT story via Michael Smith and David Damast and HuskerInLA.

I know the temptation for crowing here is intense, but I would suggest going very easy on the cascading assumptions.  There are a lot of reasons why this news has remained unknown this deep into globalization's expansion.

The "shocker" here is that U.S. geologists have confirmed what has been long suspected: Afghanistan's mineral riches are significant. Just like with Iraq, once outside experts got some free range, a lot more reserves were found.  Frankly, that'd be true for any Gap nation that's remained largely cut-off from the outside world for reasons of too much dictatorship or not enough law. Hell, it was true for Russia on oil.

This is being presented as a game-changer, but I think the overselling is premature.

First off, understand that the mining world doesn't exactly get turned upside down on this basis.  This is great news and potentially game-changing for Afghanistan if a lot of things go right--for a long time, but it will not alter any larger realities in the global marketplace (where China is the demand center of the global mining industry), except to end this nonsense notion that somehow Bolivia controls the bulk of the world's lithium (Whew! Dodged that would-be superpower!).  There is lithium being found in plenty of places, trust me.  The same discounting can now be applied to China's alleged cornering of the entire rare earth market--also a vastly oversold fear.

Mineral riches in the range of $1T certainly shove Afghanistan into the big-boy category (past estimates said Afghanistan was Syria-sized in oil and had just enough minerals to qualify as resource-cursed--a line I've used to very ho-hum effect in the brief for two years now, suggesting that no American audience I've ever come across would suddenly jump and say, "Yeah baby, this changes everything!") , but the primary reason why the place has never been sufficiently checked out before now has been the security situation/lack of governance, and that doesn't exactly change overnight on the basis of this information. Nor will it change--I suspect--the Obama administration's unwillingness to sign up for a significant combat presence that drags into the next election at anywhere near the level to maintain enough security to get balls seriously rolling.  "Blood for lithium" doesn't exactly ring the average American citizen's bell.  It also won't likely make the Taliban any less fierce in their fighting--anything but.  If you don't believe me, then please remember that the Naxalite Maoists in India do best in areas where mining deals strikes the local as inequitable.

Most importantly (and this is what Enterra learned in our Development-in-a-Box work in Kurdish Iraq), the discovery doesn't change but only reveals the lack of counterparty capacity in Afghanistan--as in, plenty of outside parties willing to engage in the transaction, but Afghanistan's government is nowhere near capable of playing the counterparty.  And yeah, it takes two to tango.  Remember the first thing Jed Clampett did after he moved to Beverly Hills:  he got himself a Mr. Drysdale.  There will be a lot of entities vying for that role in Afghanistan, and in many ways, it would be better if that role wasn't hogged by the Americans.

Finally, don't assume any of this is a big surprise to the Chinese, whose overly-generous 30-year deal on the Anyak copper mine now looks like the start of a beautiful and logically far larger relationship.  China, after all, has a border with Afghanistan (76 clicks long); we don't.  The basic pattern long cited here of Americans doing the Leviathan heavy-lifting while the Chinese reap the SysAdmin winnings isn't exactly snapped by this news--anything but.

So as before, I think the key remains getting a whole lot more rising great powers deeply--and I mean DEEPLY--interested in helping secure Afghanistan for the long haul.  Mining isn't a slam-dunk but years upon years upon years of stability required for the riches to flow, and then they have to flow with some transparency and positive popular impact, otherwise you can find yourself in an endemic conflict situation that's just Afghanistan-the-failed-state-as-we've-known-it now supercharged by a fungible source of funding for any side willing to kill enough to control its resulting wealth.

Before anybody gets the idea that somehow the West is the winner here, understand that we're not the big draw on most of these minerals--that would be Asia and China in particular.  What no one should expect is that the discovery suddenly makes it imperative that NATO do whatever it takes to stay and win and somehow control the mineral outcomes, because--again--that's now how it works in most Gap situations like Africa.  We can talk all we want about China not "dominating" the situation, but their demand will drive the process either directly or indirectly.  There is no one in the world of mining that's looking to make an enemy out of China over this, and one way or another, most of this stuff ends up going East--not West.

If anything, this news should be used to leverage more of a security contribution out of regional great powers--to include China.  So less of a game changer than perhaps a very welcome game accelerator--as in, China is a lot better positioned to reap the mineral rewards that is Afghanistan, with the question being, "How long does it take for China to step up security-wise and stop low-balling its effort there?"  Certainly, the notion that we turn Afghanistan and all its minerals over to Karzai's cronies, Pakistan's ISI and the Taliban strikes me as truly cracked, but the truth remains:  we and our Western allies aren't enough to make the security situation happen on our own--not for the long timelines required.  If it were that easy, these discoveries would have been made decades ago.

I'm not trying to diminish the importance of the findings here (although, again, whenever an isolated place like this finally gets checked over, the "stunning" surprise is the same--as in, there's lots more than anybody knew previously); I'm just saying the macro dynamics aren't all that altered.

So again, less a game-changer than potentially a tremendous game-accelerator.  China is now that much more incentivized to accelerate its penetration, and it would be nice to see that happen on a timetable that helps us while effectively drawing Beijing into more explicit partnership.

Or we can pretend this is going to remain a NATO-dominated show that somehow achieves Afghanistan's potential as a long-term supplier of important minerals to the global economy.

If I've said once in the brief, I've said it a thousand times (literally!):  Americans cannot integrate a nation-state on the other side of the planet into the global economy all on our own.  Our Leviathan can rule any battlespace, but the SysAdmin's victory is necessarily a multilateral one.

Here's the simplest reality test I can offer you:  if we're just at the initial discovery phase now, we're talking upwards of a decade before there will be mature mines.  Fast-forward a decade in your mind and try to imagine the US having a bigger presence in Afghanistan than China.  I myself cannot.

Start with that realization and move backward, because exploring any other pathway will likely expose you to a whole lotta hype.

McChrystal hinting at a more realistic timeline

AP story by way of Our Man in Kabul that reminds us that two timelines are out of synch:

The commander of NATO and U.S. forces stressed Sunday that progress toward real stability in Afghanistan will be slow as international troops painstakingly try to win over a population that includes its enemies and has little trust in the government.

The NATO push in Afghanistan has long been running on two timelines: one in which officials call for years of patience to establish peace in the war-wracked nation, and one in which President Barack Obama promises to begin drawing down troops in July 2011.

McChrystal hinting at the truth:  "Progress will be measured in months, rather than days."

Caldwell's assessment of, and efforts on, improving the training of the Afghan police forces

Readers will remember Army Lt. Gen. William B. Caldwell IV for his hosting of one of my visits to Leavenworth to address the student body of the Command and General Staff College (Petraeus hosted me the first time). Caldwell then asked to make a direct post to my site, which I was honored to accept and publish.

So when you're talking WAPO's Greg Jaffe covering Caldwell's recent review of police training, I'm all ears for any glass-half-full news.

The best bits culled:

A U.S. military review in Afghanistan has concluded that the addition of more than 1,000 new U.S. military and NATO troops focused on training has helped stabilize what had been a failing effort to build Afghanistan's security forces, but that persistent attrition problems could still hinder long-term success.

"We are finally getting the resources, the people and money," said Army Lt. Gen. William B. Caldwell IV, who heads the NATO training effort in Afghanistan and oversaw the review of his command's past 180 days. "We are moving in the right direction."

U.S. war plans depend on Afghan forces maintaining security in areas of southern and eastern Afghanistan, where the U.S. military is adding 30,000 troops this summer. More broadly, the Obama administration's counterinsurgency strategy places a heavy emphasis on an expansion of the Afghan security forces before the United States begins to withdraw troops in July 2011.

Caldwell's report card on the training effort, which The Washington Post obtained in advance and is expected to be released within the next couple of days, paints a mixed picture.

On the plus side, new money for pay raises has helped boost a recruiting situation that was so dire last fall the Afghan army was shrinking . . .

For the first time in years, the Afghan forces are "currently on path" to meet the ambitious growth targets, the assessment states. It isn't yet clear how well those forces will perform once they are in the field, which is the most important measure of success, Caldwell said . . . 

"In some areas last fall, we had one trainer for every 466 recruits," Caldwell said. "When you have that kind of ratio, it means that people aren't receiving any training."

The additional trainers have helped double the number of new Afghan soldiers who meet the minimum marksmanship standards by the end of basic training, the report states, although it is still lower than U.S. commanders would like . . . The number of police recruits enrolled in basic literacy programs has also more than doubled, to 28,000 from about 13,000 last fall.

Despite those improvements, police and army units are still struggling to retain personnel, especially in critical areas where fighting is heavy and the demand for forces the greatest . . .

The assessment found that the attrition rate in the Civil Order Police is about 70 percent. That's lower than it was at the end of 2009, the report states, but still "unacceptable and unsustainable" . . .

To fix the problem, U.S. and Afghan officials are weighing the possibility of increasing combat pay and giving soldiers a break from battle. "We are working real hard to set up a system to rotate units" out of areas where combat is heaviest, Caldwell said.

U.S. commanders have said the performance of Afghan police and army forces in Kandahar, the country's second-largest city, is essential to the military campaign planned for the area this summer. There are concerns that, as fighting with the Taliban increases, recruitment and retention could suffer . . .

"We're going to start seeing a more professional Afghan force in the field over the next eight to 12 months," Caldwell said.

Or else, I guess.

The ultimate in disconnectedness

Excellent reportage by Elisabeth Bumiller in the NYT.

Some Afghan women are so conditioned to fear outside males that it limits the ability of the US military to provide to their medical needs.

The killer (literally) quote:

Corporal Gardner, a helicopter mechanic who was working with the female Marines from Pendleton but had not trained with them, found herself as the lone woman dealing with five ailing Afghan women. There was no female interpreter or medical officer — there are chronic shortages of both — and the Afghans refused to leave their compound or let the male interpreter and medical officer come to them. Corporal Gardner devised a cumbersome solution. “Some of these women would rather die than be touched by a male,” she said. “So we’ll diagnose by proxy.”

The quote misleads a bit:  the women have been conditioned into accepting this restriction.  The people who would rather see them die before being touched by a male doctor are their husbands and fathers and brothers and sons.

Such is the level of gender control:  their health is sacrificed to the honor of their males.

It does get any more backward than this:  my pride before your pain.

How goes the International Criminal Court?

Economist editorial and article.

As usual, the mag argues that the court, despite low expectations for effectiveness and high expectations for useless meddling in the superpower affairs of America, "has not done too badly."

The ICC has laid bare important facts about forgotten wars (all Gap).  It has issued 13 indictments (all Gap). No, it hasn't nabbed Sudan's Omar al-Bashir, but it has put him on notice, and yeah, that counts when you're trying to build up new rules.  111 countries have signed up, and most have signed some sort of immunity agreement with the U.S., in effect acknowledging our sheriff role and the credibility of US military justice.

America signed the treaty but did not ratify--a rare achievement.  Most non-members, like India, Indonesia and China, simply never signed.

The Economist laments an upcoming review of the ICC being held in Uganda, because on the agenda sits some promised exploration of the notion of punishing state-on-state aggression (the old League of Nations dream) instead of just remaining focused on the crimes against humanity.  If the notion should be explicitly expanded in any direction, it should be about terrorism, which is on the rise, instead of state-on-state wars, which are going the way of the dinosaur.

Pinning down a definition of all war as crime was denounced most elegantly, says the editorial, by Sir Austen Chamberlain in 1928 (Brit Foreign Secretary) when he said that such an effort would end up creating a "trap for the innocent and a signpost for the guilty."

In other words, by circumscribing the limits of criminal aggression, the world would seem to be permitting all that lay outside those limits.

In other words, the ICC would effectively undo everything it's done, which is highlight government crimes against their own peoples.

We live in a world of transnational terrorism and civil strife; the ICC should focus on both and not the past.

The V versus U versus W recoveries: the verdicts are in?

Economist editorial.

Remember the now dated analysis that predicted a V-shaped recovery for the New Core and more of a U for the Old Core?

With China in the lead, and risky a bursting of its real estate bubble, the New Core still seems to spell V for victory.

Now the latter diagnosis is broken down further to say the sovereign debt crisis triggers a W (double-dip) for the EU while the US doesn't seem--for now--to be in that danger zone.

Still, our U feels like a U--hence the temptation to consider more stimulus. 

But hard to complain about the global recovery:  a bit more than 5% growth currently.

Concluding thoughts:

The world is nervous for good reason. Although the fundamentals are reasonably good, the judgment of politicians is often unreasonably bad. Right now that is what poses the biggest risk to the world economy.

Same old, same old.

Taiwan: conquering the world--and China. They call it "Chaiwan"

Economist story.

Starts by saying the most important tech show in the world is arguably Computex in Taipei.

The numbers:

Taiwan is now the home of many of the world’s largest makers of computers and associated hardware. Its firms produce more than 50% of all chips, nearly 70% of computer displays and more than 90% of all portable computers. The most successful are no longer huge but little-known contract manufacturers, such as Quanta or Hon Hai, in the news this week because of workers’ suicides (see article). Acer, for example, surpassed Dell last year to become the world’s second-biggest maker of personal computers. HTC, which started out making smart-phones for big Western brands, is now launching prominent products of its own.

The weakness of this model:  Taiwan improves parts over time and manufactures them with great skill and speed, but it does not innovate on the leading edge, and increasingly, all that manufacturing moves to China.   In the info age, this is almost the equivalent of the "commodity trap":  your margin is always so razor thin that you cannot invest sufficiently in branding and R&D, argues one expert.

With China aspiring mightily to move up the chain, Taiwan's fate is ever-more intertwinned:  China recruits Taiwanese firms to help it set higher tech standards, and Taipei loosens restrictions on FDI and tech transfer into China.

Killer ending:

It is hard to see China dethroning Taiwan as manager of the world’s electronics factories soon, says Peter Sher of the National Chi Nan University. But the IT industry in the two countries will increasingly become intertwined, predicts Mr Ernst. “Especially in IT, Taiwan is becoming more and more part of the Chinese economy,” he says. Indeed, some tech types already fuse the pair into “Chaiwan”.

Say good-bye to this great power-war scenario.  The game has moved on.

Naxalism: killing it softly

Photo: PTI

Raghu Raman in a LiveMint opinion piece.

The realization sinks in:

The recent series of Naxal attacks highlight the paradox of the internal security in India. Unlike virtually any other country in the world, we face daunting security challenges while being presented with extraordinary economic development opportunities. Our globally acknowledged growth story is marred by a very real and present danger in the form of Naxal militancy and fundamentalist terrorism, which are two distinct show-stoppers if not dealt with a sense of determined and sustained urgency. The sheer scale of the challenge, however, poses the fundamental question of whether we should be thinking of incorporating new stakeholders into the campaign.

Taking a page from the US operations in Iraq—where an overwhelmingly powerful army crushed the existing regime, only to find itself struggling to manage the ensuing peace process—brings a realization that perhaps a transition phase is imperative between phases of conflict and prosperity. But managing a conflict and facilitating prosperity require very different skill sets.

Then almost a recitation of my slide that highlights the differences between the Leviathan and SysAdmin sides of the house:

As Thomas Barnett, adviser to the Pentagon, points out, the strategic purpose of security forces hinges on menacing and punitive response to events threatening national security. By their very nature, such a response is focused on rapid, and, if necessary, violent degradation of opposing forces. In our case, these would be operations against the Naxal militants. The emphasis is on speed of operations, often unilateral in nature, using a young force whose core training is in destructive operations.

Building prosperity, however, requires different mind and skill sets. This calls for non-threatening, long-term, continuous and economically self-sustaining operations. It focuses on capacity-building rather than capturing power centres. This has to be a deliberate, multilateral and inclusive set of activities carried out by a mature body of people. People who can spot growth opportunities and empower the affected districts to create an environment that is preventive to militancy, rather than punitive towards it.

Piece then explores the native skills that India already has with regard to entrepreneurship.

Then an argument that India's Core MUST integrate its Gap areas, for its own economic reasons:

The question for companies is not whether there is a return on investment in such projects. It is about whether they can afford not to get involved. There is clearly a limit to the growth potential in “secure” zones.  When one-third of India’s land mass is in the grip of some form of disturbance, it is only a matter of time before economic growth of the private sector starts hitting a ceiling. Moreover, it is also only a matter of time before militancy from the hinterland spills over into urban “secure” areas.

The challenge for the private sector is to reorganize its business paradigm to specifically target disturbed areas. The numbers work in its favour. Almost all such areas have only a fractional militant composition. Eventually majority of the local population will rally around income generating opportunities. Because militancy by itself cannot generate sustained income. Income brings access to communication facilities such as mobile phones and television, resulting in knowledge and aspiration. Militants focus on disrupting communication networks precisely for this reason.

Almost a perfect microcosm of my global arguments on a national basis.

Pakistan: pre-approved for retaliatory strikes.

Mohammad al-Corey Haim makes an appearance in court.  Add just a touch of success to his efforts and the plans currently being put together inside the Pentagon (would you expect anything less?) would have instantly morphed into operations that involve more than sending our incredibly flying machines to pick them off in onesies-twosies.

The gist:

The U.S. military is reviewing options for a unilateral strike in Pakistan in the event that a successful attack on American soil is traced to the country's tribal areas, according to senior military officials.

Ties between the alleged Times Square bomber, Faisal Shahzad, and elements of the Pakistani Taliban have sharpened the Obama administration's need for retaliatory options, the officials said. They stressed that a U.S. reprisal would be contemplated only under extreme circumstances, such as a catastrophic attack that leaves President Obama convinced that the ongoing campaign of CIA drone strikes is insufficient.

"Planning has been reinvigorated in the wake of Times Square," one of the officials said.

At the same time, the administration is trying to deepen ties to Pakistan's intelligence officials in a bid to head off any attack by militant groups. The United States and Pakistan have recently established a joint military intelligence center on the outskirts of the northwestern city of Peshawar, and are in negotiations to set up another one near Quetta, the Pakistani city where the Afghan Taliban is based, according to the U.S. military officials. They and other officials spoke on the condition of anonymity because of the sensitivity surrounding U.S. military and intelligence activities in Pakistan.

The "fusion centers" are meant to bolster Pakistani military operations by providing direct access to U.S. intelligence, including real-time video surveillance from drones controlled by the U.S. Special Operations Command, the officials said. But in an acknowledgment of the continuing mistrust between the two governments, the officials added that both sides also see the centers as a way to keep a closer eye on one another, as well as to monitor military operations and intelligence activities in insurgent areas.

Obama said during his campaign for the presidency that he would be willing to order strikes in Pakistan, and Secretary of State Hillary Rodham Clinton said in a television interview after the Times Square attempt that "if, heaven forbid, an attack like this that we can trace back to Pakistan were to have been successful, there would be very severe consequences."

I do love the way that woman speaks the truth without apology.

Honestly though, this possible dynamic makes me question the entire lets-choose-Pakistan-over-India logic of this administration.

We are letting others drive our strategy, others who have our worst outcomes in mind.

Chart of the day: BP's market capitalization drop

Economist story.

BP's share price plummets 13% by 1 June for a total decline of roughly one-quarter since the Deepwater Horizon disaster.

Concluding judgment:

Robert Reich, a former secretary of labour, has suggested that BP’s American operations should be put under temporary receivership to allow the government to take control of plugging the leak. This seems unlikely. But the idea that the company as a whole might be taken over has become significantly more likely as its share price has plummeted. BP’s market capitalisation is now less than that of its rival, Royal Dutch Shell (see chart), which has discussed a merger before and may now be contemplating one again. The scale of the stock’s fall makes it possible that the foreseeable losses, huge as they are, have not only been priced in, but even overpriced.

Reputational loss, and the possibility of losing further access to the gulf, where BP is a large player, are harder to calculate while the spill and its attendant inquiries continue. When the waters finally clear, though, there could be some interesting sharks swimming in them.

Don't cry for BP, Gulf of Mexico.  The truth is, she did not love you enough.

Private-public entrepreneurship in the digital age

Look councilman, a pothole that needs fixing!

Or graffiti to be cleaned up . . .

Or a dead animal to be picked up off the road .  . ..

You get the picture.

Bloomberg BusinessWeek article about how a lot of these new connectivity technologies have instant and neat uses for governments that aim to be more responsive to their citizenry.

"Gov 2.0" movement, as it is described: "An emerging field that some entrepreneurs call Government 2.0."  

The purpose goes in both directions:  encouraging the public to flow data to the government and encouraging citizens to take advantage of all the new data being made available by governments and participate more actively in public-sector actions.  That way, government innovation isn't left to the government alone.  Already, the Army has some "apps for the Army" effort that tries to enlist the brainpower of its troops, just like citizens crank apps for the iPhone or Google's Android system.

And the pothole app is called SeeClickFix.

Very heartening.

Education follows the flag

Bloomberg BusinessWeek profile of John Sexton, president of NY University, who, with the help of Abu Dhabi's Crown Prince Al Nahyan, is trying to franchise his institution in the Persian Gulf.

Sexton's dream:  a circulating experience for students that connects them to six world-class universities spread around the world, with NYU as the anchor.

Sexton's use of foreign money to fuel global expansion is considered a model.  NYU has only a $2.2B endowment, or $50k a student.  Harvard's numbers are more like $26B and $1.3m per student.

My takeaway:  A lot of US universities going into countries that are friendly with us militarily.  It's a huge investment for both sides, so you want to go with people whom you have long and strong relationships, and with whom you're pushing connectivity.

Deep Reads: The Moral Consequences of Economic Growth

Won’t offer a ton of commentary here.  The idea is pretty simple:  When America has seen rising per capita incomes, it’s a more generous and open and happy and thus inventive place.  But when incomes have stagnated or declined, America’s gets awfully nasty, awfully fast—especially toward immigrants.

A timely reminder for today.

Friedman writes well, but he’s an economist, so it can feel like a bit of a wading.  When he goes off to other countries, I got bored, but when he kept to American history, it was an eye-opening romp that made sense to me instinctively.

I advise people to read it simply to get that core thought deeply embedded in their thinking, because it reminds us all that we have a great democracy here because we have a great economy—less so the other way around.  Our democratic “civilization” is just a few years of stagnating income thick, meaning it does not take that much to strip it away.

Buy the book at Amazon.