Talking with USAID's boss Andrew Natsios

Dateline: Holiday Inn, Arlington VA, 9 May 2005

Up this morning early to pontificate on the Pope, then a workout on the treadmill that sees me finish "American Splendor" and start "Goodfellas." Then quick dash to airport for flight to BWI. Coming in to DC today to speak tomorrow at Association for Electronic Integration's annual conference tomorrow at Ronald Reagan. Late this afternoon I put in an appearance at the end of their roundtable exercise of senior industry execs at the National Press Club, where I got a quasi meal of finger food and bottled beer before checking in at my favorite Crystal City hotel.

But while I was at the Press Club, I did manage to get a really cool insignia key chain for son Kevin. He collects them and arrays them on his school backpack, so I pick one up every time I go on a trip, trying to get unique ones. For $5, this was a stylish addition I'm sure he'll like.

But highlight of the day was stopping in at Reagan for a one-hour sit-down with Andrew Natsios, the administrator of the U.S. Agency for International Development, along with the head of USAID's policy planning bureau and Natsios' senior policy advisor. Natsios told me his office had sent out a paragraph from my book to everyone in the agency when PNM came out last year-the bit about the best long-range planning for success that I've ever encountered in the US Government being in USAID. It had really made their day, apparently.

But other than passing along that neat story, the real purpose of the meeting was to exchange ideas on what I call the SysAdmin force and what USAID calls their "fragile states strategy." It was a great exchange, which was a pleasant surprise. Not in the sense that I don't like USAID people or anything-just the opposite. But rather that, whenever I hear that someone "just can't wait to get me together with So-and-So because I just know you two will get along," often the results of such effort fail to meet expectations. Here, the expectations were valid. Natsios and I do think alike and speak easily to one another.

Natsios asked me to let his office know the next time I was in town and that he wanted to meet again. Typical USAID, loving to get you to work and share ideas for free, but how to say no to such a worthy cause? Or such an interesting player?

Natsios has four portraits in his office: George Marshall, Winston Churchill (which senior Bush appointee doesn't have a bust or portrait of Churchill in his or her office?), Abraham Lincoln and Teddy Roosevelt. Hard to argue with the choices, despite the Republican/Conservative bent. I look forward to future interactions.

Here's the catch from over the weekend:

■ Big Pieces on the Big Pieces

■ Let's Focus on Danger at its Source

■ Send Out the Cotton, Send in the Slaves

■ New Core = New Coverage

■ Afghanistan Says, We Want Our SysAdmin!

■ Paging Dr. De Soto!

Big Pieces on the Big Pieces

■"China Braces for a More Valuable Yuan," by Keith Bradsher, New York Times, 7 May 2005, p. B1.

■"China Syndrome: Demands that the yuan be revalued are misguided at best," op-ed by Steve H. Hanke and Michael Connolly, Wall Street Journal, 9 May 2005, p. A22.

■"Issue in China: Labor Camps But No Trials," by Jim Yardley, New York Times, 9 May 2005, p. A1.

■"Bush Tells Putin Not to Interfere With Democracy in Former Soviet Republics: A pointed speech by the president seemed certain to irritate the Russian leader," by Elisabeth Bumiller, New York Times, 8 May 2005, p. A11.

■"Russia's Billionaires Club Now Totals 27 Members," by Erin E. Arvedlund, New York Times, 7 May 2005, p. B3.

■"War Takes Higher Toll on Blair Than Bush: Another sign of the gulf between the U.S. and Europe on Iraq," by Adam Nagourney, New York Times, 8 May 2005, p. A6.

A swing through on the big pieces of the Core.

Talk continues to build on the inevitable revaluation of the yuan, to the point where speculators across the region have begun betting on it. That expectation alone is more powerful than all the entreaties from the U.S. and other trade partners.

But more and more experts are saying this revaluation won't bring the great relief that many are expecting. Here's the reason why: roughly half the imports China takes in are materials and parts that are reassembled for export, so in truth the only benefit the world will get will be on the Chinese labor, only a small part of the entire value chain.

Second big reason: while the U.S. trade deficit has doubled over the past five years, China, as the single biggest source, accounts for only 25%.

Now here's what to worry about, according to a Nobel prize-winner and expert on China's economy: a big revaluation would cut foreign direct investment into China, cut China's growth rate, delay convertibility, increase the number and amount of bad loans there, increase unemployment, and stress out the rural countryside a whole helluva lot.

The reality, of course, will lie somewhere in between: smart money says China will slowly revalue the yuan over the next year or more, just like the U.S. arranged with other big economies to let the dollar slide slowly over the long haul.

The fact that China needs to do it this way and is allowed to do it this way shows how inside the Core's club it already is.

And those that say we shouldn't get into bed financially with China until they end things like their political re-education camp system have it backwards: they'll end that system as a result of that connectivity. This is a war we win without ever firing a shot-and that's very good.

Not so in the club is poor Russia, which is trying to celebrate, probably for the last time, the Great Patriotic War, which Putin and Co. want to sell to the world strictly in terms of the Soviet Union's defeat of fascism, when so many countries that later fell into its political grasp want to highlight the decades of virtual imprisonment behind the Iron Curtain. A tough sell for Russia, but the reality is that it is a defeated military power, just like a Germany or Japan after World War II. This is not a reality that can be celebrated or paraded away. It's an historical millstone that will hang around Moscow's neck for decades.

What both Germany and Japan did was channel their energies into becoming model citizens of the world and serious economic players. Russia, on the other hand, under Putin seems to be acting closer to a Third World commodity provider than the economic talent it could become if it did a better job of mobilizing its well-educated population. Clinging to the crude (pun intended) definition of development and wealth and power is a sort of historical escapism that retards Russia's inevitable historical rehabilitation. To get better connected to the global economy in a broadband sense is to see the rise of legal rule sets that attract those necessary levels of trade and investment, but such a development would likewise empower the population to increasingly take the government to task for past sins in a sort of slow-motion truth commission. So to develop Russia is to exorcise the Soviet Union. That is the essential yin and yang. Putin doesn't get it, for now. But the Putin-after-next will need to, if Russia is to remain Core-worthy. Membership can be revoked, and it won't be a U.S. president that does it, but Wall Street.

Moving to poor Tony Blair, who wins a third term but somehow seems so wounded in the process that his own party is attacking him, with some calling for his downfall. Amazing system the Brits have there. Every unpopular war needs a fall guy, and you have to wonder if Blair is essentially Bush's fall guy. How weird would that be?

But there is an underlying reality here: Bush is far more admired in the New Core than people in America realize, and far more disliked in the Old Core than we realize. That isn't just a Bush thing, it's a 21st century reality that's only going to grow with the global economy. This is a big theme of Blueprint for Action.

Let's Focus on Danger at its Source

■"Who Scares the Rest? (See Bottom Left)," by David E. Sanger, New York Times, 8 May 2005, p. WK4.

■"U.S. to spend Billions More To Alter Security Systems: Concerns About the Cost and Reliability of Equipment Bought After 9/11," by Eric Lipton, New York Times, 8 May 2005, p. A1.

■"North Korea's Neighbors Resist U.S. Calls for a Harder Line," by Gordon Fairclough, Wall Street Journal, 9 May 2005, p. A20.

Great graphic in the NYT showing a little colored dot for every know nuclear weapon in the world. Russia has 7,200 good warheads and 8,800 "dormant" ones that are no longer in the active mix. U.S. has 5,200 active and 5,150 dormant. Both the U.S. and Russia plan to get the active numbers down to about 2,200 each by 2012.

The rest of the Core gang is China at 400 warheads (ooh! Real "near peer"), France at 350, Britain at 200, Israel somewhere around 100, Pakistan maybe 50 and India roughly the same.

All those nukes, and save for Pakistan v. India, there's hardly any worry in the system about any of them, save for the specter of Russia losing track of the dormant ones.

No, all the worry in the system right now is the high likelihood that North Korea has six warheads.

All those nukes and one country stands between the Core feeling basically okay and feeling basically very scared.

That's why Kim Jong Il needs to go down.

No missile defense is going to cure that Il, nor will any make-believe rivalries with fellow Core powers like China. Kim's the problem and his removal from power is the solution.

We can spend bijillions trying to turn America into a fortress, or we can deal with the dangers at their source. Putting a Big Bang on the Middle East is dealing with the terrorism at its source, and getting rid of Kim is dealing with proliferation at its source (the difference with Iran).

For now we don't seem to be getting much support from possible allies in Asia on the subject of Kim. We can begin the drum beat, but we better start offering the carrots if we're going to be serious about success. Until we offer China something good, then Pyongyang's ability to consume our attention is a benefit Beijing will continue to find more attractive by default. Friends do things for friends, not to them.

Both China and the U.S. know what the other side wants and needs over the long haul. The mystery to me is why the deal-making is non-existent in this strategic environment. Why this administration continues to wait on this relationship to develop on its own by and large is beyond me.

New Core = New Coverage

■"Adventures in Opera: A 'Ring' in the Rain Forest," by Larry Rohter, New York Times, 9 May 2005, p. A1.

■"Fei Xiaotong, 94, a Pioneer In Chinese Anthropology," obituary by Wolfgang Saxon, New York Times, 9 May 2005, p. A21.

Story one is cool example # 2 of a New Core state getting the artistic attention it deserves as an audience. Broadway musicals in Shanghai? Bring on Wagner's "Ring" to the Amazon. I say, let the Fat Lady sing. Just keep her hydrated.

Second story is, to me, just a neat little example of how China joins our world: an obit of a guy we'd never even know about if China had remained locked away from the world in a never-ending series of Cultural Revolutions and "Dear Leaders" to worship like poor North Korea (quick, name a North Korean other than Kim or his old man or-maybe, if you're really good-one of his idiot sons). This guy was known in America before Communist China even came into being in 1949, and managed to outlive that nightmare to see China rejoin the world-and have his amazing life story recounted in the pages of the New York Times.

Send Out the Cotton, Send in the Slaves

■"Sri Lankan Maids' High Price for Foreign Jobs," by Amy Waldman, New York Times, 8 May 2005, p. A1.

■"No New Refineries in 29 Years, But Project Tries to Find a Way," by Jad Mouawad, New York Times, 9 May 2005, p. A1.

■"U.S. Maintains It Obeys U.N. Torture Rules: Draft Report Cites Probes of Abu Ghraib and Other Cases, but Doesn't Address Their Adequacy," by Jess Bravin, Wall Street Journal, 6 May 2005, p. A4.

One out of every 19 Sri Lankans works abroad today, which means the country is moving in the same historical direction of development as the Philippines has-the global commute. A big chunk of this global commute involves women traveling to the Middle East to serve as maids. The stories of their physical abuse at the hands of their employers is right out of the pre-Civil War South it's so digusting. I'm not inventing this terminology-the "slaverylike" conditions is a description offered by Human Rights Watch regarding foreign female workers in Saudi Arabia.

Send out the oil and send in the money and the slaves. We put up with this because we've totally outsourced the whole oil business for decades now, refusing to build a new oil refinery in the U.S. for 29 years and counting, fighting any and all efforts at new nuclear power, and often fighting wind power because the big fans will "ruin the view."

We make ourselves afraid of the House of Saud when we need not be.

And no, there is no moral relativism to be had here. We have an Abu Ghraib and break the story and investigate and prosecute it ourselves, with deliberate speed. With Saudi Arabia, none of this comes to light unless the outside world makes it come to light.

Paging Dr. De Soto!

■"A Paradox for Poor Nations: Inventions Face Big Barriers Where Entrepreneurs Are Most Needed," by James Hookway, Wall Street Journal, 9 May 2005, p. A20.

The Old Core average for the number of procedures required by law to get a new invention to market is roughly 6 steps. But enter the Gap and the number of steps begins to climb, as does the time involved and the costs. In the Philippines, for example, the average is 11 steps at twice the length of time (50 days) and twice the costs (20% of per capita GDP) than in Old Core economies-on average.

People aren't stupider in the Gap, the governments are.

Hernando de Soto is the Peruvian economist who's spent a career shining a spotlight on this reality and creating solutions for Gap and New Core governments. His work figures prominently in one of my chapters in Blueprint for Action.

Afghanistan Says, We Want Our SysAdmin!

■"Afghan Delegates Agree on the Need for Foreign Troops," by Carlotta Gall, New York Times, 9 May 2005, p. A3.

Afghanistan's parliament is smart enough to realize that the real definition of a "failed state" is one that cannot attract America's attention, much less it's military help, to prevent its collapse into civil strife.

You know what the biggest cause of civil war is in the world? It's civil war. That's right. Most civil wars start within a few short years of the last one, meaning the biggest cause of civil wars are the affected countries' inability to move beyond that reality without lapsing back into it.

What's the cure? Foreign troops that keep the peace and prevent that relapse.

The Newsletter from Thomas P.M. Barnett 9 May 2005

The Newsletter from Thomas P.M. Barnett 9 May 2005 (Word doc)

But you have to admit, if the Pentagon is the last centrally-planned economy in the Core, then the Vatican is the last truly socialist autocracy in the Core, beating those sloppy Chinese "communists" by a ways.

Feature: Why Benedict XVI was a big disappointment to me: Ö Pg. 4

Furthermore: from the Thomas P.M. Barnett :: Weblog Ö Pg. 9

∑The choice of the next Pope Ö Pg. 9

∑Basically a coup d'etat for Pope selection Ö Pg. 9

Ask Tom Ö Pg. 10

∑Ry Parsons Ö Pg. 10

∑Winfred Ö Pg. 11

Whereís Tom? Ö Pg. 12

∑The Future in Review (2005) Ö Pg. 12

∑The New Map Game Ö Pg. 12

On the effects of lack of sleep . . .

Dateline: above the garage in Portsmouth RI, 7 May 2005

When I blogged about next week, I got days of week wrong.

I meet with USAID chief on Monday, brief at AFEI Conference on Tuesday, and sit with Sen. Kerry on Wed. I plan on either buying a house on Thursday or having a nervous breakdown.

Right now, I'm fairly ambivalent on that choice.

Nothing like a solid 8 hours of sleep!

Dateline: above the garage in Portsmouth RI, 7 May 2005

But better if you don't have to stretch them over two nights. Just not enough.

Up at 0600 this morn to type some notes to Mark from interview I accomplished in some house I was viewing in Greenwood on Friday. Then I grabbed his first final edited draft (magnificently reorganized--he is a real genius at editing) and headed to Cracker Barrel with father- and monther-in-law. They drop me off at airport and I get into BWI so fast I grab an early flight.

Going insane considering this house. Weird lot is big issue (house is placed for view), because 250 foot drive down hill has to pass through neighbor's land (an easement is duly recorded, but we must investigate--maybe to point of trying to buy little triangle of land from neighbor as well).

Having a 2-fer pair of wooden electricity poles sitting off the drive isn't aesthically pleasing, but it's minor since it's off to the far side of the drive and doesn't disturb the view. Houses in the neighborhood are all valued nicely, so that's not an issue. I can live with it.

Real issue is living on tippy top of hill like that, as in where to set a playset? Thinking of a retaining wall and creating a terrace like someone down the block did.

Still, the house is a stunner and would be a dream to live inside, it's so nice. And I love the distant view of Indy's skyscrapers. Too cool. I just love the feeling of being country and not country, of being well grounded on hill and yet seemingly in a high-rise.

Still, nothing to rush into.

Working the Mother's Day from here on out. Just sending some Ask Tom replies to Critt, my webmaster, for weekly digest. Will write short essay on papal selection tomorrow night, once Mom feels totally appreciated.

Too cool today: saw 8 paperback copies of PNM in Indy airport in non-fiction section "new releases in paperback." Very prominent, and very exciting for me to see in stores again. Ditto at BWI. Ditto at Providence.

I was so thrilled I bought my wife a really nice new handbag that she'll love on my way out of the PVD airport. Strategic planner, I.

Searching for home

Dateline: in the loft at Nona's, Terre Haute IN, 6 May 2005

Another killer long day of looking at houses, finally ending on one that I think will work. It sits on the absolute highest point in Johnson County south of Indianapolis, and it has a stunning view of both the countryside and Indy's skyscrapers in the distance. Really a unique place, and in spectacular shape at only five years old. Few details to check, but I think we make an offer on Monday.

Hold the catch-up!

■ The limits of SysAdmin

■ The Big Bang's latest pulses

■ China cracks down in crack-up avoidance

■ Consolidation! Consolidation! Consolidation!

■ You can only go so fast in Latin America

■ Polio spreads to the boundaries of the Gap

■ On Bolton speech: calling a tyrant a tyrant in Pyongyang

■ A late ripple from 9/11 in the insurance industry

■ Aging America? Rising Asia to the rescue!

The Big Bang's latest pulses

■"Iraq's Violence Sweeps Away All the Norms," by Sabrina Tavernise, New York Times, 6 May 2005, p. A1.

■"Loss of Lebanon Stings Syria: Citizens Focus May Swing Toward Troubled Domestic Situation," by Bill Spindle, Wall Street Journal, 2 May 2005, p. A16.

■"On TV in Syria: Satire, Corruption, Religious Tensions; With Government's Blessing, New Shows Get Edgier," by Bill Spindle, Wall Street Journal, 5 May 2005, p. A1.

■"Lawmakers Block Women From Voting In Kuwait," by Hassan M. Fattah, New York Times, 4 May 2005, p. A6.

■"Islamic Banking Grows, With All Sorts of Rules," by Hugh Pope, Wall Street Journal, 3 May 2005, p. C1.

■"Democracy's Dead End? Uzbekistan's Hard-Liners Stall Region's Revolutionary Momentum," by Philip Shishkin, Wall Street Journal, 4 May 2005, p. A17.

The Bang keeps getting bigger in impact, if not in geographic reach, and yes, it's focused more in economics than in politics, but that's only natural.

Inside Iraq, the situation is not pretty, but the masses are muddling through, despite the brutalization of their spirit by all that violence. Law and order will be the order of the day for a very long time, meaning we need to be accepting of the authoritarian bent the government, however elected, will inevitably assume in its efforts to keep the country reasonably stable and in tact.

Meanwhile, Syria is forced to deal with its own wanting domestic political situation, thanks to being denied its economic grip over Lebanon (it was as much or more about that money flow that any geostrategic design), and the society is showing real signs of being restive, putting such growing political sarcasm on display on the TV.

Elsewhere we see the eminently positive sign that the moribund Islamic banking industry is awakening from its centuries of slumber. As one successful banking executive puts it, "Risk has no religion." How do these ventures succeed in a world where sharia forbids interest? You simply repackage Western financial products with new names for interest, getting the stamp of approval from the mullahs when you show just enough sensitivity to maintain the illusion that money must somehow behave differently in the Islamic world, when-of course-it behaves the same way everywhere, and thank God or Allah or anybody you want for that.

You want women to vote in the Islamic world, then put money in their hands and let human nature do the rest. Right now the Kuwait parliament says no to women voting, thus restricting the voting public to just 15 percent of the population (women and guest workers need not vote, leaving just the rich guys-sounding an awful lot like post-revolutionary America where only land-owning white guys got to vote). But that will necessarily change when women increasingly enter the workforce and economy. They'll want a say on how things work.

But have no illusions about how fast such change can emerge, because it's all driven by economic connectivity with the outside world. Gotta be able to tap foreign investment flows to really build up the economy in such a way as to grow connectivity with the global economy. Absent that dynamic, something clearly missing in Central Asia, and you'll be looking at a static political situation for as far as the strategic eye can see.

The limits of SysAdmin

■"Pentagon Says Iraq Effort Limits Ability to Fight Other Conflicts: Chairman of Joint Chiefs Tells Congress of Risks," by Thom Shanker, New York Times, 3 May 2005, p. A1.

■"Pentagon's Plan to Transfer Troops Is Faulted by Panel: A concern whether forces could respond quickly in a crisis," by David S. Cloud, New York Times, 5 May 2005, p. A19.

■"Military Base Closings Will Sting, Panel Chairman Says: An independent commission promises a 'reality check' of the Pentagon's wish list," by Eric Schmitt, New York Times, 4 May 2005, p. A16.

The push to get out of Iraq is getting serious, as I don't think Chairman Myers testimony on his way out the door was in the same backward-glancing manner of Army Chief of Staff General Eric Shinseki last year on the question of troop levels in Iraq. I think Myers is voicing the same concern I hear when I visit military commands down in Florida: the sense that if the White House wants further actions in the Global War on Terror, it better figure out how to make the SysAdmin load lighter in Iraq.

Same basic logic drives the report of the Overseas Basing Commission: that sense of being so heavily concentrated in the Middle East when there's still unfinished business of the most crucial sort in Northeast Asia. Expect the Pentagon to begin arguing for a diminished role in the region as it anticipates a build-up toward an inevitable showdown with North Korea.

Meanwhile, expect Congress to engage in all sorts of idiotic arguments to stave off base closings in their states and districts. Isn't it amazing how congressmen and women who don't know their elbows from their a--holes on defense get all uppity on the Pentagon's judgement whenever their slices of the pork pie are put at risk? "Reality check" my ass.

Consolidation! Consolidation! Consolidation!

■"Cooling China's Hot Property: Leaders Seek to Stabilize Market Without Bursting Bubble," by James T. Areddy, Wall Street Journal, 3 May 2005, p. A14.

■"China's Drug Firms Consolidate: Stricter Beijing Rules, Foreign Rivalry Face Fragmented Industry," by Nicholas Zamiska, Wall Street Journal, 5 May 2005, p. A12.

The Chinese government is doing what it can to make sure rising real estate prices don't send the economy into a tailspin (for example, the price of a square meter of housing in Shanghai has more than doubled in the last decade; hmm, just like Rhode Island!). Remember how Japan's decade-plus recession got started. I believe the tipping point was when we heard that some square mile in downtown Tokyo was worth more than all the land in . . . you remember the hyperbole. Japan was going to buy all and rule all, just like China is allegedly poised to do in the very near term. Beware the pundits selling you this nonsense. China will mature and the Chinese will get greedy for a better life, just like every other society in human history. There is no such thing as Asian values, there is only economic development.

So for now it's location! Location! Location! But soon enough it's all consolidation! Consolidation! Consolidation! As foreign firms enter into China's increasingly lucrative domestic markets and trigger massive reorganizations of the local industries. These consolidations create bigger entities, with stronger impulses toward self-preservation, meaning they're far more careful in production and marketing, lest they come under prosecution for violating the rising tide of government regulations that inevitably accompanies this rising economic transaction rate (you sell one aspirin, there's no need for laws, but you sell billions and billions and you will find yourself with an FDA soon enough).

Right now China accounts for only 2% of global drug sales, but it's growth rate in the range of 25-30%, or 3-4 times that of drug-crazed North America.

China cracks down in crack-up avoidance

■"Beijing Finds Anti-Japan Propaganda a 2-Edged Sword," by Joseph Kahn, New York Times, 3 May 2005, p. A3.

■"The Yin and Yang of Chinese Foreign Policy," by George Melloan, Wall Street Journal, 3 May 2005, p. A17.

■"China Raises Hurdle to Taiwan Negotiations: Tough terms are set for talks with the Taiwanese leader," by Joseph Kahn, New York Times, 4 May 2005, p. A13.

China's political leadership makes clear there are limits to the youth-driven protests against Japan, as a little diplomatic payback is one thing, but threatening Japan's flow of investments is quite another.

Is China as crude in diplomacy as many pundits allege? I would say Beijing's getting slicker by the day. The Party turns on and off the anti-Japan protests like a faucet, getting the desired result from Tokyo while slapping them on the wrist for joining America's defense pledge on Taiwan. With Taiwan, China rattles some sabers with last December's elections in Taipei, watches the result it desires unfold (a slight win for Chen Shubai) and then immediately begins undercutting him by entertaining his opposition, simultaneously currying the impression of a peace-mongering regime. But then likewise making clear that talks with Chen don't begin until he pointedly dials down some of the nationalist rhetoric in his party's ranks.

Pretty yin-and-yang-like, as Melloan points out, but likewise in keeping with the general movement toward more stability and warmer ties in the region. Economics drives all this, of course, except in the strange case of the United States, which, by desire and international design, necessarily plays the role of security Leviathan in addition to prized trade partner for each state in the region. But as all this economic rising continues, that yin-and-yang-like role for US will grow imbalanced. We'll be seen as too much sour on security and not enough sweet on trade. We think we're "containing" China, but in reality, it's America that's most at risk at being shut out of the region over the long haul.

Polio spreads to the boundaries of the Gap

■"African Strain Of Polio Virus Hits Indonesia," by Donald G. McNeil, New York Times, 3 May 2005, p. A1.

The Middle East regimes import a lot of guest workers from South and East Asia. Apparently, one of them took some polio back with him or her to Indonesia. This is some classic spreading of the pattern within the Gap until it reaches a boundary condition that stops it-namely the Core.

Indonesia's last case was in 1995, and it is now the 16th country to be reinfected by a strain of the virus that broke out in northern Nigeria when vaccinations stgopped there, then crossed Africa and the Red Sea.

Sad to say, this spread of polio is a connecting phenomenon for the Muslim world, now reaching its most populous nation. As the article notes, "polio is now found almost exclusively in Muslim countries or regions." Why? The bias against vaccinations plus poverty would seem to be the key. Disconnectedness defines danger, as always.

You can only go so fast in Latin America

■"Brazil Refuses U.S. AIDS Funds Due to Antiprostitution Pledge," by Michael M. Phillips and Matt Moffett, Wall Street Journal, 2 May 2005, p. A3.

■"Star Rising, Mexican Populist Faces New Tests: Leftist Mayor Has the Poor on His Side in Presidential Bid," by Ginger Thompson, New York Times, 4 May 2005, p. A1.

Brazil says, Not so fast with your moral stance, America! And so it refuses $40 million in AIDS funding from Washington.

Better to stand tall and proud for the sex trade and the good it does for women the world over than accept the moralists' money. If more die from AIDS as a result in Brazil, then it's the principle that counts.

This is some first-class stupidity. Ask any country's leadership if they're willing to sign a pledge that prostitution is bad, and all will. This is because money's involved. Some may say, why mix the two? BECAUSE THEY'RE CAUSALLY LINKED! THAT'S WHY!

Reality is, Brazil self-funds on AIDS to the tune of 90%, so it's growing enough to pay its own way. Fine and dandy, so refuse the aid and make your statement condemning the sex trade and really impress the world, Brazil.

In Mexico, we see the latest version of the resurgent left in the New Core. Mexico City's mayor is pulling a Lula, probably engineering an upset on par with the return of the Congress Party in India. This is the New Core's Gap-within-the-Core saying, "No so fast! Remember us!"

This is the latest blowback from the Washington Consensus of the 1990s, or the view that strong market-opening approaches were the fastest and best routes to economic development. But as the New Core itself has shown for decades now, protectionism in the name of emergence is no vice.

What is the Old Core to make of this? It is to pay attention and realize that unless the New Core takes care of the Gaps within, the Core itself will fracture. To shrink the Gap is to grow the Core.

A late ripple from 9/11 in the insurance industry

■"Insurers Fight to Save Terorrism Safety Net: Opponents Say Taxpayers Shouldn't Underwrite Industry's Exposure to Attack Losses," by Michael Schroeder, Wall Street Journal, 5 May 2005, p. A4.

Weird continuing storyline from 9/11: attacks blew away the insurance industry, which just didn't have the equations for that sort of disaster. The re-insurance industry, or the companies that insure the insurers, simply balked, at first, at promising to underwrite it all, given the new uncertainty (How big could a terrorist attack get? What would it cost? We have no historical experience!).

Congress eventually came up with a bill three years ago that promised the government would pay for any gargantuan losses, in effect backstopping the re-insurance industry like FDIC backstops banks, and for similar reasons (i.e., no one wants a financial panic after a big terrorist attack).

But now the Republicans are backtracking on this issue, saying the U.S. taxpayer should bail out re-insurers when they bail out insurers when they bail out American taxpayers who are blown away financially by a huge terrorist attack. Nah, they say, if it's your state that gets hit, why spread the pain to the country as a whole? I mean, are we all supposed to be in this thing together, this Global War on Terrorism?

This is pinheaded approach by the GOP, because this sort of ultimate backstopping to preserve social cohesion in a time of crisis is EXACTLY what a government is supposed to do: provide collective goods that the private sector can't manage on its own. We're not talking some sweet bailout of big insurance companies, but the USG stepping in once really large thresholds are reached ($15 billion), so only in the godawfulest situations.

Here's the real nastiness, in my mind: this is totally a regionalist argument. The data presented in the article shows that the closer your state is to DC and NYC, the higher the percentage of your companies have sought out terrorism insurance since 9/11. Not a straight line, mind you, but a reasonable correlation.

This is truly a not-in-my-backyard phenomenon, with elected representatives reflecting the what-me-worry? mentality of stingy, easily forgetting citizens. Pretty petty, in my mind.

On Bolton speech: calling a tyrant a tyrant in Pyongyang

■"Korea Speech Comes Back to Haunt Bolton: Former Ambassador Claims His Views Were Misrepresented by U.N. Nominee in a Hearing," by Yochi J. Dreazen, Wall Street Journal, 4 May 2005, p. A4.

■"U.S. Cites Signs Of Korean Steps to Nuclear Test: Satellite Photos Viewed; Allies in Asia Are Briefed on What Appear to Be Rapid Preparations," by Bill Spindle, Wall Street Journal, 2 May 2005, p. A16.

The Dems have to come up with something better than this: Bush-nominee for UN John Bolton's confirmation may be threatened because he once gave a speech he claimed was cleared by our ambassador to South Korea and that diplomat now says Bolton's speech was far stronger in tone than he liked?

Please!

Listen to Bolton's "offending" phrases:

The brazenness of Kim Jong Il's behavior in the past year is striking Ö To give in to his extortionist demands would only encourage him, and perhaps more ominously, other would-be tyrants around the world Ö

While he lives like royalty in Pyongyang, he keeps hundreds of thousands of his people locked in prison camps with millions more mired in abject poverty, scrounging the ground for food. For many in North Korea, life is a hellish nightmareÖ

A good start would be to respect the human rights of his people and not starve them to death or put them in death campsÖ

Wow. Imagine calling a mass-murdering tyrant a mass-murdering tyrant!

The shame, Mr. Bolton! The shame! You should learn more diplomatic language so we can all feel better about ignoring the two million-plus that Kim's killed in the last decade.

Please sir, have you no decency?!?

Why does Bolton's controversial nomination matter? He will be the point man in rallying the UN on the take down of Kim Jong Il, who's apparently intent on sealing his doom by lighting up a nuke just to prove he's got 'em. Little does he know this is exactly the wrong approach to take with W.

So the drum beat begins, and he'll be the main percussionist. He will arrive on scene just in time.

Aging America? Rising Asia to the rescue!

■"As Boomers Retire, a Debate: Will Stock Prices Get Crushed? Prof. Siegel Says Only Asia Can Stop a U.S. Meltdown," by E.S. Browning, Wall Street Journal, 5 May 2005, p. A1.

Interesting fear: boomers retire and start using up all those 401Ks, so stock markets starved for new investment flows. What to do?

One guy, Robin Brooks at the IMF says, don't worry. "He thinks the wealthy individuals who own a large percentage of U.S. stock won't need to sell, and companies may boost dividends so retiree investors can hang on to their shares."

Jeremy Siegel, mr. long-term-stocks-as-the-preferred-investment (Wharton School), now turns tail on the subject. Apparently his long-term vision didn't include the possibility of boomers retiring. Hmmm. Not sure how to interpret his expert opinion now.

But Siegel offers hope as well: get all those Indians and Chinese to invest in American stocks!

Geez! I thought China was going to have all those extra males hanging around, unable to get dates or wives or just plain laid now and then, so the country would have to go to war with the U.S. Now, we seem to need those working investors just as much as China's aging population itself does. All those single-child sons are getting to seem pretty important for global stability! "Little emperors," hell! These guys will turn out to be Big Investors!