Good choice on Emanuel

Sharp guy who will run a tight ship.

Very good sign, in my mind.

You want sharp elbows in that spot.

Yes, the GOP will complain. What else is new?

My choices?

Summers as Treasury
Kerry as State
Hagel as Def (Gates won't stay)
Danzig as Nat Sec Adviser
Hamre as DNI
Susan Rice at UN

Please, no Powell! Be a man, Barack!

Good article/citation for my "post-Caucasian" column

OP-ED: "The nation's changing complexion: A recent Census report showing a surge in blacks, Hispanics and Asian should be seen as an opportunity for the United States rather than as a burden," by Sheryl McCarthy, USA Today, 15 October 2008.

The prediction that by 2042, minorities make up a majority of 54%.

Also the NYC bit: 60% of New Yorkers are already black, Hispanic or Asian, and only 35% are white—as in European Americans (be proud of your background, I say).

I knew the California stat from other sources.

To me, that's a sign of our inverted globalization, continuing our world-class experiment in uniting states, integrating economies, and ensuring collective security and the pursuit of happiness.

Teach your children well on the environment—and 20 years later you've got a new way of thinking

NATION: "Schools' turbines power learning: Districts get electricity and lessons on wind energy," by Jeff Martin, USA Today, 15 October 2008.

Nice story about wind turbines on school ground that provide most of school's need but also a lesson on the local generation of energy to impressionable kids.

A key advantage for emerging economies: young demographic profiles. That means the turnover on conventional wisdom is relatively fast—as in, a good 15 years later and the bulk of the population can't remember the old and bad ways and think only in terms of the new paradigm.

The turnaround in the U.S. is very similar, based on my observation: educate the kids in kindergarten and within 15 years you've got a very different mindset brewing not just among adolescents and young people, but also with their parents, who are educated "upwards."

Think about drunk driving, recycling, smoking, etc.

It'll be interesting to see what Obama tries to do in this regard, because he's been given a period with plenty of play plus the concentrated attention of young people.

A book to consider on the GWOT WRT AFRICOM

RECENT BOOKS: Africa and the War on Terrorism, edited by John Davis (Ashgate, 2007), reviewed by Nicolas van de Walle, Foreign Affairs, Nov/Dec 2008

Academic volume (you can tell by the whopping $100 price!).

Here’s the key judgment:

Al Qaeda networks have long been present in one form or another in northern and northeastern Africa … The essays make it clear that the threat is not uniform across the countries of the region but is notably more substantial in the northern half of the continent, where Islam is more present and state formation more problematic. They also suggest that U.S. actions have not focused enough on the region’s own unique problems and need to emphasize state building and poverty reduction more than military matters.

Good reinforcing analysis for AFRICOM, despite the ritualistic put-down on “military matters,” since—duh!—state building will include the very mil-mil cooperation that AFRICOM focuses on.

The Pentagon feels the need . . . the need for astronomic speed!

WORLD: “Pentagon envisions spaceship troopers: Rockets would rush combat teams around the world,” by Tom Vanden Brook, USA Today, 15 October 2008.

This is the classic case of a capability looking for a real-world justification.

Truth is, and I’ve researched this personally myself working for the military: THERE IS NO SUCH REQUIREMENT FOR INSTANT RESPONSE.

We really never respond instantly to anything. It just doesn’t correspond to real life.

Something happens and if we’re going to respond to any serious degree, there are things to negotiate with host nations and allies and discussions to be had diplomatically. We just don’t rush in as a rule, because it almost never makes any sense to try and do that.

Here’s the kicker: huge cost, and what does this spaceship deliver? 13 combat troops and their weapons.

Where, I ask you, are 13 combat troops, lightly armed, going to make a serious difference?

We have ships that ply the world’s oceans. We have Marines ready to roll and forward positioned. We have small bases networked around the planet in the hundreds. Our jets and bombers can reach out and touch places in hours.

Considering the non-instant nature of our decades of history of responses, plus all those capabilities, why spend billions to pretend that rushing 13 combat troops (Or hell, make it 26, or 39—screw it, I want 52 guys there within 2 hours! And not from some neighboring FOB or off some carrier in the vicinity either! I want them fricking rocketed directly from CONUS!) is the answer?

This is just goofy.

I see commercial opportunities with airlines that cut cross-oceanic travel times. But I don’t see the utility of a rocketed collection of SWAT teams.

Somebody’s got to rein in the Marines on this one.

In crisis, there is great opportunity

COVER STORY: "Staggering to-do list awaits '08 winner: Economic crisis, two wars likely to overrun the next president's agenda," by Susan Page, USA Today, 15 October 2008.

What interested me here was the poll that said "stabilizing the U.S. economy" is number 1 issue at 68%, then the wars at 12%.

That's not just a function of the crisis.

The key thing to diminishing the sense of crisis with Iraq and Afghanistan, as I said repeatedly for years now, was to get our casualties down.

When the surge accomplished that, it was inevitable that other crises would supersede.

The fact that the wars are now viewed as such smaller problems actually gives the next president a lot more leeway.

And frankly, the economic crisis here and abroad is also fairly empowering.

Obama handles the first couple of years of his presidency well, and he's golden for a second term—like a Reagan. If he performs badly, he might do okay because a recovery will be well underway by the midterms (I know, I don't side with the pessimists on that one), but he'll be a lot more challengeable.

A wonderfully concise history of banking in America

OPINION: "A Short Banking History of the United States," by John Steele Gordon, Wall Street Journal, 10 October 2008.

People forget (because they all died, I suppose) how crazy banking was in the U.S. prior to the Civil War, when our currency was basically made up of bank notes issued by thousands of banks. We didn't even have a unified currency—as in, dollar bills—until Lincoln signs the 1862 law creating them.

State banks (tiny, under a million in capitalization) continued to proliferate through the 1920s, setting up those fantastic (by today's standard) numbers of failed banks in the Great Depression. We don't get the great consolidation of banks in America until the 1990s, when interstate banking was finally allowed, setting up the rise of the national banks of today.

Nice upbeat finish to the piece by banking historian Gordon:

While it will be painful, the present crisis will at least provide another opportunity to give this country, finally, a unified banking system of large, diversified, well-capitalized banking institutions that are under the control of a unified and coherent regulatory system free of undue political influence.

Hmm. Methinks I see another historic opportunity for the U.S. to pioneer another model of rules for the global economy.

GOPEC seems inevitable

OP-ED: Controlling gas, By Lex, Financial TimesOctober 26 2008

Many unusual things (some even inconceivable!) are now made possible by the crash. As always, where gaps occur, rules rush in. GOPEC would be a serious new rule set. In many ways, it seems inevitable.

(Thanks: Jarrod Myrick)

Notice how the AU welcomes Africom

TRANSCRIPT: African Union Representative Pledges Support for U.S. Africa Command, By Brigadier General Jean De Martha Jaotody, Head of Operations and Support Unit, Peace Support Operations Division, African Union, AFRICOM Public Affairs, Oct 17, 2008

Think about it, what other option do they have in terms of propelling development of their militaries?

Rara avis

POST: Gates Speaks on Modernizing the Military, By Mark Irvine, PCR Project, September 30th, 2008

Gates is that rarest of birds as grand strategist: good as adviser (past) but even better as decision-maker (current). A pleasure to be associated with him, however people draw the connections.

Russia: break out the sickles!

EMERGING MARKET REPORT: "The Business Boom Unfolding Down on the Russian Farm: Investors are pouring billions into agribusiness—and trying to reverse decades of Soviet mismanagement," by Jason Bush, BusinessWeek, 20 October 2008.

One sector looking up long term for Russia is ag. Lots of arable land not being used, and Russia is already a big global source (one of four) for net grain exports. Plus, yields in Russia stand about 30% of that in the advanced West—hence the investment payoff opportunity.

The UN says Russia has 480,000 square miles of arable land. That's twice the size of France and 8% of the world total.

And we're talking truly Black Earth, which most people in the world have never seen.

I, however, grew up 40 miles from a town called Black Earth. No kidding. And yeah, the earth there was like something most people can only buy in a bag at a lawn store.

Obviously, a lot of local and external big ag companies look to take advantage. Already, Russia's grain harvest is up 50m tons over the last five years, growing from 75 to 125.

This is why John Deere's doing nicely.

Amazingly enough, with all that potential, Russian ag land costs about 10% of that in France and 20% of that in Brazil.

Global economy info graphic

GOOD Sheet: It's the Economy, Stupid!, GOOD, October 16-22, 2008

I won't pretend to be smart enough to decipher all the meaning. I do think it's interesting, though, how things begin to change for us structurally in the 1970s and then take off in the 1980s. I think there was a small-world global economy (West) until the 70s, and then it began changing with OPEC, etc, and then we saw the great expansion across the 1980s. I feel like our spending became almost a sort of implicit Marshall Plan for the post-Cold War world, sustaining a lot of development, but that now we've run into two structural realities: 1) the global economy is too big to rely on just the dollar as a reserve currency (we can't spend enough to provide more, plus there needs to be automatic balancers, like the Euro is becoming and like an Asian variant must become); and 2) there is a sizable non-US global economy emerging (although it's hardly decoupled from us, as the current crisis shows). Add those two together, and I think you see a profound evolution in the works. I believe we have reached the limits of our ability to dominate/sustain the global economy, meaning great power cooperation will be forced upon us whether we want it or not.

This is a theme of Great Powers.

Into Africa

ARTICLE: Defense Contractors' Growing African Business, By Lawrence Delevingne, BusinessWeek, October 23, 2008

No surprise, as most of the SysAdmin work (especially the local training) will be done by private contractors.

Globalized downturn and recovery

STORY: Globalization Fueled Downturn; Will It Aid Recovery?, by Tom Gjelten, NPR, October 24, 2008

Nice, clear piece with good quotes from Jeff Sachs. Gist: globalization's connectivity means the financial meltdown in US rapidly transmitted elsewhere, but also raises the likelihood that the recovery (we're first in, and likely first out) will spread similarly as well. We're getting at that point when it seems safe to declare this crisis a true system perturbation in the sense that many things are being revealed about globalization, both bad and good. That new knowledge is likely to lead to a lot of new system rules, especially to govern inter-market activities, or those money flows between national financial markets. Globally, we're like the U.S. before the Great Depression triggered all our new rules and organizations (like the SEC). There is no global SEC, but there needs to be one.

(Thanks: David Blair)

Frontier integration

We've got a new glossary entry in preparation for Great Powers:

Frontier Integration

Globalization has entered into an extended period of frontier integration—as in, economic and network integration of previously off-grid or poorly connected societies. The historical example par excellence is the settling and taming of the American West after the Civil War. The chief activities are infrastructure building, the extension of social networks and rule of law, state building, the generation of permanent and pervasive security, the squelching of insurgencies and criminal mafias, and the formal marketization of existing and new economic activities—including both "exploiting" the labor of, and selling to, the so-called bottom of the pyramid population. America's frontier integration was continental-sized, involving millions. Today's project targets the globe's entire Gap, involving billions in so-called emerging or frontier economies. It also involves the impoverished rural regions of New Core pillars such as China and India. In general, neither Americans nor Europeans will lead this frontier-integration effort. We price out too high. Instead, the frontier-integrators of the age will be mostly Asians, who know better how to jump-start development in these harsher environments. America's role can be to mentor and enable the integrators, helping especially on security, or we can sit the whole thing out and hope for the best in terms of resulting political outcomes.

Historic day all around

Obviously, a big day for the nation, as any election is, but this one is different, and so we note that, and we take pride, as we always do, when America leads the way.

How do I define that?

Show me an African leader ruling a great power anywhere.

So yeah, pretty amazing stuff from a place that did its best to persecute that race.

But that is simply so American. It's why we recover so fast. It's why we innovate and push the envelope so hard.

These United States are simply the greatest experiment on this planet. And membership is something worth celebrating.

As much as I breathe a sigh of relief that certain very bad thinking about the future of this world and America's role in that all-important evolution has been prevented from rule in our land, I have no illusions about what this election represents: we have simply listened to our conscience and the globe and come to the conclusion that we need to rejoin this world of our creating.

For the vast majority of Americans, nothing will change. We'll continue in our pursuits, in our campaigns, and in our dreams.

For me personally, all I see is a field slightly tilted in my direction, not so much in understanding of the world, but in distraction from unduly screwing up that world--and that is enough.

It is never about the BEST answer, but always about the least worst one. I have hopes for the Obama administration--not high hopes but just enough.

I don't expect anything from this administration in terms of advancing my long-held agenda. I simply expect that it won't make my path any more difficult, when I knew in my heart that a McCain administration would have been a huge obstacle.

Why not more celebration and "hope"?

The grand strategist needs only the next best iteration. That's it. That's all he hopes for and it is all he demands.

The work does not change. The campaign continues. The battle--room by room--remains unabated.

Remember: when you think horizontally and explore in terms of decades, you don't get too excited or too bummed out. You simply calculate the correlation of forces and press on.

And so the history of this day is full of the personal and the profound, the petty and the professional.

I went to about midnight with Warren Sunday night, combining my edits with his over the phone for about 3 hours.

I had spent the entire day finishing my last read of the book. I made lots of tiny edits, and while they're bothersome, it's so much better to be focusing on those than larger problems. So this edit, besides updating the financial crisis references, really became a huge exercise in fine-tuning individual problem sentences.

Up Monday and caught plan to LaGuardia, then rental up to New Haven, just making my talk at Yale by a couple of minutes. Maybe 40 students and staff. Many of the students were from the grand strategy course they teach (past or future, because I think the current class actually had a lecture then). I spoke at 4pm and went about 1:45, then 45 minutes of questions. Very responsive audience and questions were pretty good.

Then to a local Yale institution (established 1857), where I have dinner with a select group of grand strategy-oriented students. Clearly, I'm not their usual cup of academic tea, but it was a great discussion. That went two hours solid. The Whiffenpoof singers go around the restaurant and serenade. They were stunningly good.

Then to my hotel by 9 and go to after 2 am finishing the final edits effort with Mark, basically all the realignment chapters, coda, glossary, acknowledgments, and index. Mind-numbing and Warren was toughing out a cold or something, but he gutted it out because he's off to DC to spend election night with the Dem congressional leadership (he's tight with Reid after ghosting his bio last year).

I sleep in, until 0930, then pack-up, eat some room service and drive 2 hours to West Point.

Gas up beforehand, because I know the timing will be tight. Arrive at 1300 and talk from 1330 to 1445 (75 mins) to a collection of senior officers from the Corps of Engineers and associated West Point officer profs. Do 15 Q&A and then dash out.

In car and off base by 1515 and need to go 53 miles to catch LaGuardia flight at 1655!

I drive like demon down Pallisades Parkway, go over 3 big-ass bridges (GW, Triboro and something else), drop the car, get on bus, blow through security as I hear the flight boarding, but then I get a bad inspect while they're calling my name. Finally get release and then have to dash at sprint, in suit, with heavy backpack and carryon bag for about . . . 200 yards and just get on my plane.

Home to celebrate youngest child's b-day (historic to us) and Obama's victory.

One big-ass martini on that one!

Watched it in the home theater on high-def. History, baby.

Proud day to be an American.

Can't believe the book is finally done and I really don't have any more to do on it. It's been the dominant life-schedule item for 12 full months, but it was worth it.

I really believe in this book and its message--and especially its timing, which matters most.

No rest for the weary: column tomorrow and something quick for a policy journal online post-election issue. Plus I'm working the Good piece and my current in-production "How to Become a Grand Strategist" with Esquire.

So the fingers keep moving . . .

Gotta rake some leaves though, and start pestering Bradd Hayes for my Great Powers slides. Time to work the new brief!!!!

The heat is on . . . the oligarchs

WORLD NEWS: "Russia's Deripaska Faces Western Investigations: Fund Transfer Is Focus of U.S., U.K. Probes of Metals Magnate; in a New Setback, He Surrenders Stake in a German Company," by Glenn R. Simpson and Susan Schmidt, Wall Street Journal, 10 October 2008.

EMERGING MARKET REPORT: "Russia: It's Scarier Than You Think," by Jason Bush, BusinessWeek, 20 October 2008.

The sort of problems a key oligarch like Deripaska (top ten richest in world) is now facing is the right way to handle the Georgian incident, reflecting smart sanctiony (hey, if you can be mavericky, why not sanctiony?) moves by the Bush administration "to put Russian economic interests under greater scrutiny."

Of course, politicizing economic transactions is something we accuse (rightfully) the Russians of--rule by law instead of rule of law (big difference).

But here's why this approach works: according to BusinessWeek, "Western investors have pulled out en masse in the past few months. Until recently foreigners accounted for up to 70% of investment in Russian equities."

Seventy percent!

Georgia picked its moment and paid dearly for it.

Russia picked its response and also paid dearly for it, in large part because its timing was terrible, given global trends and ensuing financial crash.

Not so fast on the post-American world

EUROPE: "Lessons from a crisis: European Schadenfreude over the ills of American capitalism does not signify a dramatic move away from the free market," The Economist, 4 October 2008.

FINANCE AND ECONOMICS: "The resilient dollar: Why the greenback has so far withstood the panic in financial markets," The Economist, 4 October 2008.

THE OUTLOOK: "Against the Odds, Financial Crisis Helps Stimulate the Dollar," by Joanna Slater, Wall Street Journal, 20 October 2008.

The Economist remains suitably sensible (unlike the Asia Times's Spengler, who seems to have swallowed some LSD recently) on the issue of the "death of capitalism," a subject summarily delivered with almost absurd stupidity by way too many sources.

Still, you can't blame a little piling on by the Euros given Bush's 8 years of disrespecting them. So we take some lumps, BFD.

Yes, we'll lean to more regulation, but we've never had absolutely free markets in anything, so this is a question of degree, even as we all gasp a bit at the change in direction. After all, this comes after three decades of de-regulation, which worked until it succeeded just a little bit too much—thanks in part to the huge expansion of globalization that it decidedly fueled. If the cost of spreading that much globalization that fast to that many people involves a nasty Core-wide recession (remember the WSJ graphic), then I say, it was a fabulous deal.

Corrections are always necessary after a while. I just feel bad for the Millennials who've never known anything like this, since our last serious time of troubles was more than a quarter-century ago.

The weird bright spot? The restrengthening of the dollar. For several years earlier, it had been too high, leading to coordinated Old Core efforts to bring it down slowly. Now it's heading back up, signaling what? The Economist credits "the persistent foreign demand for American assets," which it terms "remarkable given all those scares."

Key reason according to MIT economist: "… a lack of financial development at home makes foreigners keener to invest in America. What attracts them is the size, liquidity, efficiency and transparency of its financial markets compared with what is on the offer in their domestic markets."

I actually wrote something very similar to that in Great Powers and have been toying with adding some caveats given the current crisis. But then I see analysis like this and I realize there's no need.

That's where I do worry about Obama and the Dems: anything that stops our financial markets from being risk-takers will cost us in unimaginable ways.

Another big cause of the dollar's rise, suggested by Slater, is that all the investments made to speculate on commodities and emerging markets is cashing out in dollars, with a lot of that money coming home here.

Would Iran strike preemptively?

ARTICLE: Top Iran officials recommend preemptive strike against Israel, By Barak Ravid, Haaretz, October 22, 2008

If true, then this is how the MAD-ness begins: the claim to equal danger for both sides.

Read your history. The shoe-banging has begun for real.

(Thanks: Justin Cosmano)

When even hardware is open source

ARTICLE: Build It. Share It. Profit. Can Open Source Hardware Work?, By Clive Thompson, Wired, October 20, 2008

An example of useful competition at the bottom of the pyramid.