Global financial crisis – Asian view
By Shankar Acharya, Business Standard, February 12, 2009

[Andrew Sheng, former chair of the Hong Kong Securities and Futures Commission,] sees the present crisis as a product of “four historical mega-trends”. The first was the post-Cold War (and post-trade liberalization) integration of the Asian labour forces into the world economy, which flooded Western markets with cheap goods and kept inflation low. The second was Japan’s 1990s’ monetary policy loosening in response to its prolonged asset bubble deflation, which took yen interest rates near zero and spawned the famous “carry trade”, a key element of subsequent bubbles elsewhere, including the mid-1990s’ East Asian financial crisis. Third was the flood of physicists and engineers (a flood swelled by the collapse of the Soviet empire) who propagated quantitative models across the West’s financial industry to assess returns, create complex derivatives and manage risk. Of course, most of these models, based on typical, bell-shaped “normal” distributions for random variables, failed to account for the “long tail, black swan risk” that destroyed Western finance. The last was the mega-trend of global deregulation, of trade, capital controls and financial regulation, which swept across Western finance and paved the way for subsequent excesses.

In essence, as Sheng puts it, “these mega-trends were four arbitrages that created converging globalization — wage arbitrage, financial arbitrage, knowledge arbitrage and regulatory arbitrage”. The mega-trends welded national markets into a networked, global financial market, but without the steadying influence of any global regulator. The “four arbitrages also led to four excesses that were the hallmark of the present crisis — excess liquidity, excess leverage, excess complexity and excess greed.” [continued…]

From Asian to global financial crisis [PDF], Andrew Sheng, Indian Council for Research on International Economic Relations, New Delhi, February 7, 2009

Decade at Bernie’s
By Paul Krugman, New York Times, February 16, 2009

The surge in asset values had been an illusion — but the surge in debt had been all too real.

So now we’re in trouble — deeper trouble, I think, than most people realize even now. And I’m not just talking about the dwindling band of forecasters who still insist that the economy will snap back any day now.

For this is a broad-based mess. Everyone talks about the problems of the banks, which are indeed in even worse shape than the rest of the system. But the banks aren’t the only players with too much debt and too few assets; the same description applies to the private sector as a whole.

And as the great American economist Irving Fisher pointed out in the 1930s, the things people and companies do when they realize they have too much debt tend to be self-defeating when everyone tries to do them at the same time. Attempts to sell assets and pay off debt deepen the plunge in asset prices, further reducing net worth. Attempts to save more translate into a collapse of consumer demand, deepening the economic slump.

Are policy makers ready to do what it takes to break this vicious circle? In principle, yes. Government officials understand the issue: we need to “contain what is a very damaging and potentially deflationary spiral,” says Lawrence Summers, a top Obama economic adviser.

In practice, however, the policies currently on offer don’t look adequate to the challenge. The fiscal stimulus plan, while it will certainly help, probably won’t do more than mitigate the economic side effects of debt deflation. And the much-awaited announcement of the bank rescue plan left everyone confused rather than reassured. [continued…]

Nationalize the banks! We’re all Swedes now
By Matthew Richardson and Nouriel Roubini, Washington Post, February 15, 2009

The U.S. banking system is close to being insolvent, and unless we want to become like Japan in the 1990s — or the United States in the 1930s — the only way to save it is to nationalize it.

As free-market economists teaching at a business school in the heart of the world’s financial capital, we feel downright blasphemous proposing an all-out government takeover of the banking system. But the U.S. financial system has reached such a dangerous tipping point that little choice remains. And while Treasury Secretary Timothy Geithner’s recent plan to save it has many of the right elements, it’s basically too late. [continued…]

Radical surgery is required to save this patient
By Anatole Kaletsky, The Times, February 12, 2009

Maybe the only way to avoid a truly catastrophic global depression and trade war is to nationalise every significant bank in America, Britain and the eurozone – since none could survive without government guarantees.

Many economists now take this view. The bitter disappointment over Mr Geithner’s announcement, which sent share prices on Wall Street crashing back towards the lows they hit just before Barack Obama’s election, now threatens to turn this desperation into a majority view.

I am not yet quite ready to join this growing consensus. For me, dismantling global financial capitalism and replacing it with a neo-Marxist system of capital allocation by the State is too big a mental leap. But the way things are moving, even I will soon capitulate to the inevitability of universal bank nationalisation. The reason is simple.

As the Governor of the Bank of England explained yesterday, neither zero interest rates nor tax cuts can revive economic activity if the credit system remains paralysed. Our politicians and bankers face a simple choice: either normal private banking services are restored quickly or governments take direct control. [continued…]

Editor’s Comment — New York Senator Charles Schumer said yesterday: “I would not be for nationalizing. I think government’s not good at making these decisions as to who gets loans and how this happens.” By implication, he’s suggesting — as no doubt his most generous constituents would wish — the task of running the banks should be left in the talented hands of the very same individuals who helped steer us into this global economic crisis. Are we supposed to think that the bankers are simply the victims of rotten luck?

Embedded in the to-nationalize-or-not-to-nationalize ideological debate is the widely unquestioned assumption that opportunities for fabulous personal enrichment necessarily serve as lures for talent. Continue reading →

Job losses pose a threat to stability worldwide
By Nelson D Schwartz, New York Times, February 15, 2009

The International Monetary Fund expects that by the end of the year, global economic growth will reach its lowest point since the Depression, according to Charles Collyns, deputy director of the fund’s research department. The fund said that growth had come to “a virtual halt,” with developed economies expected to shrink by 2 percent in 2009.

“This is the worst we’ve had since 1929,” said Laurent Wauquiez, France’s employment minister. “The thing that is new is that it is global, and we are always talking about that. It is in every country, and it makes the whole difference.”

In Asia, any smugness at having escaped losses on American subprime debt has been erased by growing despair over a plunge in sales among major exporters. On Thursday, Pioneer of Japan said it would abandon the flat-screen television business and cut 10,000 jobs worldwide in response to sagging demand for consumer electronics.

Millions of migrant workers in mainland China are searching for jobs but finding that factories are shutting down. Though not as large as the disturbances in Greece or the Baltics, there have been dozens of protests at individual factories in China and Indonesia where workers were laid off with little or no notice. [continued…]

Israel’s biggest danger
By Fareed Zacharia, Newsweek, February 23, 2009

For Israel, handling the relationship with its Arab minority is more crucial even than dealing with Hizbullah or Iranian President Mahmoud Ahmadinejad. Israel needs to decide how it will deal with the Arabs in its midst. As extreme as it may sound, Lieberman’s call to disown them seems to have resonated with many of his fellow Israelis. Benjamin Netanyahu has warned that Israel’s Arabs constitute a demographic time bomb. He calls it unacceptable. Benny Morris, the once dovish historian who chronicled the forced expulsion of most Palestinians from the Jewish state in 1948, has turned to arguing that Israel needs to protect itself from the Arabs now living within its borders. “They are a potential fifth column,” he warned five years ago in an interview with Haaretz. “In both demographic and security terms they are liable to undermine the state … If the threat to Israel is existential, expulsion will be justified.” It’s a dangerous spiral: the worse the distrust gets, the less loyalty Israel’s Arabs feel toward their country—and vice versa. Last week’s election has brought the issue into the open. Its resolution will define the future of Israel as a country, as a Jewish state, and as a democracy. [continued…]

Israel’s identity crisis
Editorial, Los Angeles Times, February 14, 2009

Avigdor Lieberman, leader of the right-wing Yisrael Beiteinu party, campaigned on a platform of “no loyalty, no citizenship,” arguing that Arabs in Israel should be required to sign loyalty oaths and accept its flag and national anthem. If they refused, he said, they should be stripped of their citizenship. Lieberman also wants to transfer Israel’s Arabs into the jurisdiction of a future Palestinian state, and has proposed the death penalty for Arab politicians who talk with Hamas. In Tuesday’s election, Yisrael Beiteinu became the third-largest party in the Knesset and a likely member of the next governing coalition.

These developments present very basic and very obvious civil rights concerns. But they also raise a deeper, fundamental question that Israelis generally prefer to avoid: Is it possible to be both a Jewish state and a democratic state? Or, put another way: Can a nation founded as a Jewish homeland — with a “right of return” for diaspora Jews but no one else, a Star of David on the flag and a national anthem that evokes the “yearning” of Jews for Zion — ever treat non-Jews as true, equal citizens? [continued…]

I’m a scared Arab in Israel
By Sayed Kashua, Haaretz, February 15, 2009

I remember being scared. Very scared. I remember I was having a conversation with a friend from Haifa who told me about his feeling that something had changed in the city. He talked about a different look he had started to see in the eyes of some people. A look of desire for revenge, he described it. I told him he was wrong and accused him of unnecessary paranoia, especially in an attempt to ally the fears I have. Fears that more than ever before, at least as far as I remember, there is a feeling that it’s legitimate to harass Arabs. Continue reading →

Global economy top threat to U.S., spy chief says
By Mark Mazzetti, New York Times, February 13, 2009

The new director of national intelligence told Congress on Thursday that global economic turmoil and the instability it could ignite had outpaced terrorism as the most urgent threat facing the United States.

The assessment underscored concern inside America’s intelligence agencies not only about the fallout from the economic crisis around the globe, but also about long-term harm to America’s reputation. The crisis that began in American markets has already “increased questioning of U.S. stewardship of the global economy,” the intelligence chief, Dennis C. Blair, said in prepared testimony. [continued…]

Editor’s Comment — Even if the DNI’s warning was not intended as such, the elevation of global economic turmoil to the position of being the most urgent threat to the United States, is much more significant than simply being a reordering of national security threats.

Implicitly, this is a recognition that the greatest threat to the United States is systemic and both external and internal. Instead of facing the psychological comforting prospect of an external enemy — we can come together when we see a threat as intrinsically ‘other’ — we now face a threat that reveals the instability of the social and global order.

The widening gap between the interests of the corporate-state and the interests of ordinary people are becoming ever more glaringly visible. Ultimately and who’s to say how rapidly, this might create revolutionary conditions. Given that we live in a society well inoculated by superficial distractions and pervasive ignorance, the tipping point may not be close at hand. Even so, what seems different at this point in history is that more so than at any other time the conditions seem ripe for the articulation and organization of a global revolutionary movement. Trotsky could only dream of living at such a time.

A world in revolt
By Paul Rogers, Open Democracy, February 12, 2009

The sums involved [in bailing out the global banking system] are massively greater than those required to meet all of the United Nations’s Millennium Development Goals; yet the link between the urgent bailouts in one kind of emergency and the neglect and delay in the other has not yet been fully made. This, perhaps, will change with the emergence of transnational radical social movements.

There is evidence for this suggestion in the context of what happened in Mexico on new year’s day, 1994: the launch of the Zapatista rebellion in the southern (and largely indigenous) province of Chiapas. A rebel source outlined the roots of the revolt:

“We have nothing, absolutely nothing – not decent shelter, nor land, nor work, nor health, nor food, nor education. We do not have the right to choose freely and democratically our officials. We have neither peace nor justice for ourselves and our children. But today we say ‘enough’!”

It was little less noticed at the time that the Zapatistas saw their movement and rebellion in global terms, not just as a local or regional revolt. Indeed, their insurrection was timed to coincide with the coming into force of the North American Free Trade Area (Nafta), an agreement they were convinced would make their predicament even worse.

The aspiration to what might be called the internationalisation of dissent has not yet been fully realised. But there are more than glimpses of the phenomenon in social, environmental and workers’ movements – reflecting the fact that one result of globalisation is the much wider understanding of the transnational nature of marginalisation and exclusion. [continued…]

Depressed? No! We’re angry
By Richard Rodriguez, Salon, February 13, 2009

According to American legend, when the stock market crashed on Oct. 29, 1929, flocks of stockbrokers jumped to their death on Wall Street, in violent parody of down-trending graphs and ticker-tape parades and calendar pages flung from windows on New Year’s Eve. It never happened.

The fallacy of American capitalism is the equation of our economic status and our mental well-being. In a country where we routinely define ourselves by our job, an economic downturn must lead to a psychological downturn. Right?

It becomes oddly pertinent to observe that, as the country faces an economic calamity unequaled since the Great Depression, the employees of the failed brokerage houses and banks in New York are not clustered on the ledges of skyscrapers above Wall Street. (I am afraid if they were, the cry from below would be “Jump! Jump!”) The pope of Ponzi, Bernard Madoff, is required by a federal judge to wear an ankle bracelet not because he is a danger to himself, but because the judge fears that Madoff will skip town.

Politicians, Democrats and Republicans alike, have learned in these last weeks that Americans are not a people listless with dejection. Quite the reverse. Americans are angry at corporate incompetence that is rewarded. Americans are angry at having to bail out the institutions that so efficiently foreclosed on their mortgages. Americans are angry that rich people — rich, smart, educated people who know all there is to know — seem not to know how to pay their taxes. [continued…]

Global recovery rests on a fresh US approach to China
By Martin Jacques, The Guardian, February 13, 2009

As the previously unrivalled global hegemon, the United States is not used to dealing with other countries as equals. Blatantly the case in Bush’s presidency, it has been true ever since 1945. Obama’s presidency rests on new assumptions: it recognises that American power is not what it used to be and that the country faces a huge economic crisis. But in practice will it be mindful of and sensitive to the interests of other nations? The widely criticised statement by the new Treasury secretary, Timothy Geithner, that China was manipulating its currency suggests not.

No previous administration has made such a grave accusation. If the US treasury officially decides that China is a currency manipulator, the administration could resort to a range of actions including anti-dumping measures, countervailing duties and various safeguards. It would certainly provoke a response from China, with a trade war drawing in other countries a likely possibility.

In fact, the charge that China undervalues its currency has little foundation. Beyond a point, the Chinese government has little control over the value of its currency, which is largely determined by market forces. Furthermore, since the peg to the dollar was abandoned in 2005, the renminbi has appreciated 21% against the greenback. Geithner’s charge was thus a deliberate provocation. It was also highly insensitive. China, still a poor country it should be remembered, is feeling the effects of the financial meltdown with a declining growth rate and rising unemployment: an appreciation in the value of the renminbi will only exacerbate its domestic impact.

The great danger facing the world is that what looks like a depression will deepen into a slump. In this situation, there can be no salvation in domestic recovery alone; in a globalised world, every country’s domestic recovery will be intimately linked to a wider global recovery. But the latter in turn requires a new kind of global co-operation. [continued…]

Will the relationship change? Yes it can
The Economist, February 12, 2009

In mainstream American politics, especially Jewish-American circles, the idea of talking to Hamas has been virtually taboo. This is no longer true. After Mr Obama’s election, a group of senior bipartisan foreign-policy veterans handed a compelling letter, still unpublished, to the incoming president. Its signatories included Zbigniew Brzezinski and Brent Scowcroft, who headed the National Security Council in Mr Carter’s and George Bush senior’s White House; Lee Hamilton, a Democrat who for many years chaired the House committees on foreign affairs and intelligence; Sam Nunn, a Democrat who chaired the Senate’s armed services committee; Paul Volcker, a long-time chairman of the Federal Reserve; Mr Siegman; and James Wolfensohn, a former head of the World Bank who was more recently entrusted by the younger President Bush with reviving the Palestinian economy.

The letter’s three key demands were that Mr Obama should appoint an even-handed special envoy with real clout (done); that he should spell out a clear vision for a Palestinian state (awaited); and that he should seek to draw Hamas into talks (not so easy). A key member of Mr Mitchell’s staff, Fred Hof, who previously co-drafted Mr Mitchell’s famous report on the state of the Israeli-Palestinian conflict in 2001, is close to the Scowcroft group.

Mr Mitchell’s appointment was warmly applauded by that group and greeted coolly by many in the old pro-Israeli lobbies, such as the American Israel Public Affairs Committee (AIPAC). More to the point, though there have been other recent envoys to the Middle East, none has as much potential influence on the president as Mr Mitchell. General Jim Jones, too, Mr Obama’s new national security adviser, is a tough realist with recent experience in trying to improve security between Israel and Palestine. He is in hock to neither side.

No one is sure how Mrs Clinton, as secretary of state, will relate to Mr Mitchell—or to the Israelis and Palestinians. Since she became a senator for New York, she has ardently echoed more or less whatever AIPAC has said about Israel-Palestine. But some people recall how, when it was still controversial and her husband was president, Mrs Clinton called for a Palestinian state and even kissed Yasser Arafat’s wife after she had castigated Israel, a moment of horror in AIPAC’s eyes. Most probably, if Mrs Clinton sees a chance for a breakthrough to peace, she will go for it, whatever her previous constituents may think. [continued…]

Week before Gaza op, Israel and Syria were ready for direct talks
By Zvi Barel, Haaretz, February 13, 2009

Israel and Syria were about to announce that they would speak directly a week before the fighting in Gaza broke out, a Turkish official said. Turkish Prime Minister Tayyip Erdogan had spoken with Syrian President Bashar Assad during Prime Minister Ehud Olmert’s visit to Ankara, and had mediated in crafting a joint statement.

But a few days later, while still awaiting Olmert’s approval for the statement, Israel launched Operation Cast Lead in Gaza and Erdogan felt betrayed.

“Nobody imagined that Olmert would go behind Erdogan’s back like that and not even hint that he intended to start fighting in Gaza,” the Turkish official said. Erdogan had invited Olmert to his official residence after he met Turkey’s president. He suggested calling Assad and drafting a joint announcement about a direct discussion between the Israeli and Syrian delegations. [continued…]

Israel’s intelligence disaster
By Richard Sale, Middle East Times, February 12, 2009

Palestinian intelligence agents, working for Israel in its recent “Operation Cast Lead,” were exposed and many of them captured or killed in the aftermath, U.S. officials said.

The ongoing round up is ongoing and expanding, these sources said. In the course of the operation, Israel also failed to find and reclaim Gilad Shalit, an Israeli soldier captured by Hamas in 2006, and Tel Aviv also failed in its planned targeted killing of Ahmad Haabri, the commander of Hamas’ military arm, the Al-Qassam Brigades, these sources said.

“The use of Palestinian agents to spy on Hamas has been Israel’s operating philosophy for many years,” said former CIA counter-terrorism chief Vince Cannistraro. [continued…]

US military loses 222,000 weapons sent to Afghanistan since 2001
By Tom Coghlan, The Times, February 13, 2009

The US military has lost track of about 222,000 weapons shipped to Afghanistan since 2001, a leaked report compiled by the US Government Accountability Office revealed.

The report shows that the US military failed to keep proper records of 87,000 rifles, pistols, mortars and other weapons sent to Afghanistan between December 2004 and June 2008. It also failed to track 135,000 weapons donated to Afghan security by 21 other countries. The UN spent more than $100 million (£70 million) on a disarmament programme that sought to remove weapons from the hands of illegal armed groups after November 2003. Many militiamen are known to have handed over antique or faulty weapons and UN officials reported First World War and even 19th-century flintlock rifles surrendered, rather than AK47s and rocket launchers. [continued…]

Secret talks with Taliban gather pace as surge looms
By Kim Sengupta, The Independent, February 13, 2009

Secret talks between the Afghan government and the Taliban, brokered by a Saudi royal who heads the country’s intelligence service, are gathering pace before the US-led military surge in Afghanistan.

Prince Muqrin bin Abdulaziz Al Saud is said to have been greatly encouraged by meetings he had held with both sides on recent visits to Afghanistan and Pakistan, paving the way for a fresh round of negotiations, The Independent has learnt.

The militant groups have appointed a former member of the Taliban regime as their envoy because of his good relations in the past with the Saudi government. He is Aghajan Mutasim, a minister under the ousted Taliban leader Mullah Omar, who is believed to have held detailed discussions with Saudi officials and also to have visited the kingdom during Ramadan. [continued…]

Poll: Most Americans want inquiry into anti-terror tactics
By Jill Lawrence, USA Today, February 13, 2009

Een as Americans struggle with two wars and an economy in tatters, a USA TODAY/Gallup Poll finds majorities in favor of investigating some of the thorniest unfinished business from the Bush administration: Whether its tactics in the “war on terror” broke the law.

Close to two-thirds of those surveyed said there should be investigations into allegations that the Bush team used torture to interrogate terrorism suspects and its program of wiretapping U.S. citizens without getting warrants. Almost four in 10 favor criminal investigations and about a quarter want investigations without criminal charges. One-third said they want nothing to be done. [continued…]

Unredacted documents reveal prisoners tortured to death
By Stephen C. Webster, Raw Story, February 12, 2009

The American Civil Liberties Union has released previously classified excerpts of a government report on harsh interrogation techniques used in Iraq, Afghanistan and Guantanamo Bay. These previously unreported pages detail repeated use of “abusive” behavior, even to the point of prisoner deaths.

The documents, obtained by the ACLU under a Freedom of Information Act request, contain a report by Vice Admiral Albert T. Church, who was tapped to conduct a comprehensive review of Defense Department interrogation operations. Church specifically calls out interrogations at Bagram Air base in Afghanistan as “clearly abusive, and clearly not in keeping with any approved interrogation policy or guidance.” [continued…]

After Israel’s election, Palestinians weigh a new intifada
By Tony Karon, Time, February 12, 2009

Israel’s election and the Gaza conflict have revealed the scale of the challenge facing President Barack Obama in “jump-starting” Israeli-Palestinian peace efforts. Israeli voters tacked to the right, and the government that results from Tuesday’s poll will be, if anything, even less inclined to conclude a two-state peace agreement with the Palestinian leadership than the current government of Prime Minister Ehud Olmert has been. (And, of course, the year of talks-about-talks between Olmert and Palestinian Authority President Mahmoud Abbas failed to yield any progress.) Meanwhile, the Gaza war has cemented the stature of Hamas as the dominant political force among Palestinians.

Needless to say, there is not much optimism in the region over the prospects for peace. But the urgency of resolving the conflict may have become greater than ever, because the security situation is likely to see a perilous decline in the coming months. Much of the membership of Abbas’ Fatah movement, seeing themselves steadily eclipsed by Hamas, is urging a break from their president’s strategy of negotiating with the Israelis, and a return to confronting the Israeli occupation in the West Bank.

Fatah leaders on the ground see the Israeli election as confirming what they already knew: that there’s nothing to be gained by continuing the charade of U.S.-sponsored talks-about-talks with the Israelis. They could not get what they needed from Olmert, and they know his successors will be even more hardline. From the Palestinian perspective, the past eight years of waiting for negotiations with Israel has left Abbas empty-handed, while the latest Gaza conflict has put Hamas in a stronger position than ever in Palestinian public opinion. Despite the violence by Hamas gunmen against Fatah activists in Gaza since the Israeli offensive, many in Fatah view their movement’s only hope of reestablishing its leading role in Palestinian politics as joining a unity government with Hamas — and beginning to directly challenge the Israeli occupation on the ground in the West Bank. [continued…]

Rabin’s legacy: Protesters’ accounts show Israel ‘breaking the bones’ of peaceful demonstrators
Ma’an, February 10, 2009

Israeli forces are carrying out a policy of shooting at the legs of peaceful demonstrators who protest the Israeli separation wall each Friday in towns across the West Bank, demonstrators are reporting.

The accounts of the Palestinian demonstrators who have been wounded by Israeli fire in recent weeks are raising the legacy of the first Palestinian Intifada, when Israeli then-defense minister Yitzak Rabin ordered his soldiers to “break the bones” of young protesters.

A representative of the Popular Committee against the Wall in the village of Ni’lin, Ahed Al-Khawaja, said that Israeli snipers, shooting from nearby hilltops or from stands of trees, are causing debilitating injuries, especially among young men who come to demonstrate.

In the village of Jayyus, which also holds a weekly demonstration against the wall, protesters said Israeli soldiers put silencers on their guns. When five young men were shot at last Friday’s demonstration, none of the marchers present said they heard the sound of gunshots when they were shot. [continued…]

Editor’s Comment — What Obama should be asking himself is this: does he want to grab the flexibility that comes from being in the role of an initiator, or is he willing to accept the constraints imposed on those who can do no more than react. The door for initiatives is closing rapidly. If he waits too long, George Mitchell’s mission is going to turn into a rerun of his task in 2000: an effort to come to grips with another intifada.

As for Mahmoud Abbas, his irrelevance is utterly transparent. One moment he is mounting a campaign for “diplomatic resistance“, while the next he is expressing the sanguine view that pragmatism will prevail, whatever the political complexion of the next Israeli government.

A veteran Middle East reporter shares insights about covering conflict in Gaza
Paul McGeough interviewd by CJR, February 11, 2009

Columbia Journalism Review: Reading about the current conflict in Gaza, it’s been difficult to understand the role of Hamas as an organization. Can you give us some sense of its role in Palestinian society?

Paul McGeough: A hiatus in a crisis like this tends to get locked into broad scripts written by the various players. Now, if you take a helicopter view of the Middle East crisis, you see Hamas in a different light. People keep repeating that Hamas’s charter is opposed to the existence of Israel. Yes it is, but Hamas has not stood by its charter for the best part of the last ten years. Hamas has recognized the Oslo peace process, which it said it would oppose. It has taken part in democratic elections, which it has won. It has de facto recognized the two-state solution by seeking to be elected as the government of the Palestinian Authority. It has not struck outside historic Palestine; it never has. So to dismiss it as a terrorist group that has to be stamped out misses entirely the point of its position in Palestinian society.

Again, take the helicopter view of what’s happened in the Middle East since 1948, with the setting up of the state of Israel. In 1967, the Israelis could have negotiated with King Hussein of Jordan in the aftermath of the Six-Day War; they chose not to. Because they chose not to, Yasser Arafat and the Fatah movement and the PLO all got a huge head of steam [built] up. And because they weren’t negotiated with in a way that gave Palestinians an identifiable outcome, they fell by the way.

And now you have Hamas. Hamas came into being and thrived because there was no breakthrough. There was nothing in the land-for-peace basis—a foundation of the Oslo process—there was nothing in that for the Palestinians. They were negotiating on the basis of land for peace when their land was being consumed by Israeli settlements. So now Hamas is there, and if you take Hamas out of the equation, God knows what you get in its place. [continued…]

We’re heading toward a global Weimar
By Jacques Attali, Wall Street Journal, February 12, 2009

The global banking system is… on the brink of bankruptcy. So the worst-case scenario is the most likely scenario: a collapse of the banking system followed by world-wide inflation.

This growth of public debt, on top of private debt, can only lead to catastrophe: the bankruptcy of households, banks, even countries. What has happened to Iceland can happen to larger countries as well, if panic seizes creditors. Anything is now possible, including the collapse of the global banking system, whose losses would have grown beyond reach of rescue.

This panic could be set off by the realization of the insolvency of the system. It could also be set off by political or terrorist movements: A number of determined groups, with even limited means, could organize speculative attacks on banks, leading to their collapse.

Then we could arrive at a global depression. It could even be followed by hyperinflation, provoked by the immensity of the monetary means created since the start of the crisis; the depression would allow the debt to be reduced to nothing, to the benefit of the borrowers. The world would then be experiencing a depression ready for inflation, a global Weimar. [continued…]

Popular rage grows as global crisis worsens
Der Spiegel, February 9, 2009

About 50 million jobs could be lost worldwide in the next 11 months and more than 200 million people could drift into total poverty, warns the International Trade Union Confederation (ITUC). Guy Ryder, the group’s general secretary, believes that these changes represent a “social time bomb,” and that the resulting instability could become “extremely hazardous to democracy” in some countries.

In the West, the crisis could cost heads of state their jobs, as was recently the case with the prime minister of Iceland. But what does it mean for the giant countries in the East? Could the regime in Beijing falter as the country faces its greatest challenge since the beginning of market reforms? Are the Russian people terminating their political moratorium with the government, because prices are rising while the ruble falls, or could the middle class even be about to rebel?

Cabinets in London, Moscow, Beijing and Paris have been overcome by a sense of helplessness. Self-confessed workaholic Gordon Brown is trying to cope with calamity by taking constant countermeasures, while Putin sends his police officers into the street and Beijing distributes gifts to the poorest of the poor. French President Sarkozy, on the other hand, remained silent for a full seven days after the first major, large-scale demonstration. [continued…]

U.S. now sees Iran as pursuing nuclear bomb
By Greg Miller, Los Angeles Times, February 12, 2009

Little more than a year after U.S. spy agencies concluded that Iran had halted work on a nuclear weapon, the Obama administration has made it clear that it believes there is no question that Tehran is seeking the bomb.

In his news conference this week, President Obama went so far as to describe Iran’s “development of a nuclear weapon” before correcting himself to refer to its “pursuit” of weapons capability.

Obama’s nominee to serve as CIA director, Leon E. Panetta, left little doubt about his view last week when he testified on Capitol Hill. “From all the information I’ve seen,” Panetta said, “I think there is no question that they are seeking that capability.” [continued…]

In Pakistan, U.S. special envoy finds discontent
By Jane Perlez, New York Times, February 12, 2009

The American special envoy, Richard C. Holbrooke, wound down his whistle-stop tour of Pakistan on Wednesday with a brief visit to the lawless tribal areas, and then dinner with liberal intellectuals at a rooftop restaurant here in Lahore.

He had come to listen, not to lecture, Mr. Holbrooke said. What he heard was a familiar list of requests for more money and arms from Pakistan’s top leadership, as well as a litany of complaints about American airstrikes in Pakistan’s tribal areas using Predator drones.

Mr. Holbrooke’s trip to Pakistan, and his four-day tour of Afghanistan, which is scheduled to begin Thursday, was part of a top-to-bottom review of American policy in the region ordered by President Obama. [continued…]

Mumbai attacks partly planned in Pakistan
By Zahid Hussain, Wall Street Journal, February 12, 2009

Pakistan publicly acknowledged for the first time Thursday that last year’s attack on Mumbai was largely planned on its soil and that it had arrested most of the key plotters.

Detailing a strong Pakistani link to the three-day rampage in Mumbai, Interior Ministry chief Rehman Malik said his investigators had tracked down safe houses and hideouts used by the conspirators and traced the boats that carried the attackers from a seaside Pakistani town to Mumbai using engines boat in the Arabian sea port of Karachi.

“Some part of the conspiracy has taken place in Pakistan,” Mr. Malik told reporters. As for the plotters, “most of them are in our custody.” [continued…]

Continuity of the wrong kind
Editorial, New York Times, February 10, 2009

The Obama administration failed — miserably — the first test of its commitment to ditching the extravagant legal claims used by the Bush administration to try to impose blanket secrecy on anti-terrorism policies and avoid accountability for serial abuses of the law.

On Monday, a Justice Department lawyer dispatched by the new attorney general, Eric Holder, appeared before a three-judge panel of the United States Court of Appeals for the Ninth Circuit in San Francisco. The case before them involves serious allegations of torture by five victims of President Bush’s extraordinary rendition program. The five were seized and transported to American facilities abroad or to countries known for torturing prisoners.

Incredibly, the federal lawyer advanced the same expansive state-secrets argument that was pressed by Mr. Bush’s lawyers to get a trial court to dismiss the case without any evidence being presented. It was as if last month’s inauguration had never occurred. [continued…]

Read Glenn Greenwald for the definitive coverage on the “state secrets” story

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The new Fallujah up close and still in ruins
By Dahr Jamail, TomDispatch, February 12, 2009

Driving through Fallujah, once the most rebellious Sunni city in this country, I saw little evidence of any kind of reconstruction underway. At least 70% of that city’s structures were destroyed during massive U.S. military assaults in April, and again in November 2004, and more than four years later, in the “new Iraq,” the city continues to languish.

The shells of buildings pulverized by U.S. bombs, artillery, or mortar fire back then still line Fallujah’s main street, or rather, what’s left of it. As one of the few visible signs of reconstruction in the city, that street — largely destroyed during the November 2004 siege — is slowly being torn up in order to be repaved.

Unemployment is rampant here, the infrastructure remains largely in ruins, and tens of thousands of residents who fled in 2004 are still refugees. How could it be otherwise, given the amount of effort that went into its destruction and not, subsequently, into rebuilding it? It’s a place where a resident must still carry around a U.S.-issued personal biometric ID card, which must also be shown any time you enter or exit the city if you are local. Such a card can only be obtained after U.S. military personnel have scanned your retinas and taken your fingerprints. [continued…]

Kahane won
By Gideon Levy, Haaretz, February 8, 2009

Rabbi Meir Kahane can rest in peace: His doctrine has won. Twenty years after his Knesset list was disqualified and 18 years after he was murdered, Kahanism has become legitimate in public discourse. If there is something that typifies Israel’s current murky, hollow election campaign, which ends the day after tomorrow, it is the transformation of racism and nationalism into accepted values.

If Kahane were alive and running for the 18th Knesset, not only would his list not be banned, it would win many votes, as Yisrael Beiteinu is expected to do. The prohibited has become permitted, the ostracized is now accepted, the destestable has become the talented – that’s the slippery slope down which Israeli society has skidded over the past two decades. [continued…]

Fatah fears Shalit deal will bring down Abbas
By Avi Issacharoff, Haaretz, February 9, 2009

Concerned voices have been heard in the Muqata in Ramallah over the past few days: Senior Palestinian Authority and Fatah officials are speaking openly of the end of an era if an agreement to free abducted IDF soldier Gilad Shalit is reached.

Palestinian officials say a Shalit deal would bring about early elections in the territories, and Hamas would win again – but this time it would win the Palestinian presidential election, too. Israel would then be forced to deal with a Hamas-controlled Palestinian Authority in both the West Bank and Gaza Strip, they say. [continued…]

Rift between Hamas and Fatah grows after Gaza
By Tim McGirk, Time, February 7, 2009

Hamas officials have accused Abbas’ former national security chief, Mohamed Dahlan, of colluding with Israelis in advance of the invasion in a bid to weaken Hamas’ resistance.

A senior Hamas official alleged to Time that Dahlan appeared in El Arish, an Egyptian coastal town near Gaza, shortly before the Israel attack, and had sent in Fatah loyalists to “cooperate with the Israelis” in hunting down Hamas commanders. Hamas officials say their allegation is based on interrogation of suspected collaborators accused of helping to pinpoint Hamas’ hideouts and weapons caches for Israeli targeting. The objective, say Hamas officials, was to help Israel decimate the Islamists in the hope of reestablishing Fatah control in Gaza. Aides to Dahlan deny the allegations. [continued…]

After Gaza: Prominent Israelis and Palestinians evaluate where the two sides are
By Marjorie Miller, Los Angeles Times, February 9, 2009

Efraim Halevy: The United Nations, the European Union, Russia and the United States laid down three conditions for negotiations with Hamas. Two of these are not only valid, they are essential. First, that Hamas accept all previous agreements the Palestinian Authority entered into with the international community. Second, that it refrain from all acts of hostility. Continue reading →

Why the Muslim world can’t hear Obama
By Alaa Al Aswany, New York Times, February 8, 2009

We saw Mr. Obama as a symbol of this justice. We welcomed him with almost total enthusiasm until he underwent his first real test: Gaza. Even before he officially took office, we expected him to take a stand against Israel’s war on Gaza. We still hope that he will condemn, if only with simple words, this massacre that killed more than 1,300 Palestinians, many of them civilians. (I don’t know what you call it in other languages, but in Egypt we call this a massacre.) We expected him to address the reports that the Israeli military illegally used white phosphorus against the people of Gaza. We also wanted Mr. Obama, who studied law and political science at the greatest American universities, to recognize what we see as a simple, essential truth: the right of people in an occupied territory to resist military occupation.

But Mr. Obama has been silent. So his brilliantly written Inaugural Speech did not leave a big impression on Egyptians. We had already begun to tune out. We were beginning to recognize how far the distance is between the great American values that Mr. Obama embodies, and what can actually be accomplished in a country where support for Israel seems to transcend human rights and international law.

Mr. Obama’s interview with Al Arabiya on Jan. 27 was an event that was widely portrayed in the Western news media as an olive branch to the Muslim world. But while most of my Egyptian friends knew about the interview, by then they were so frustrated by Mr. Obama’s silence that they weren’t particularly interested in watching it. I didn’t see it myself, but I went back and read the transcript. Again, his elegant words did not challenge America’s support of Israel, right or wrong, or its alliances with Arab dictators in the interest of pragmatism.

I then enlisted the help of my two teenage daughters, May and Nada, to guide me through the world of Egyptian blogs, where young Egyptian men and women can express themselves with relative freedom. There I found a combination of glowing enthusiasm for Mr. Obama, a comparison between the democratic system in America and the tyranny in Egypt, the expectation of a fairer American policy in the Middle East, and then severe disappointment after Mr. Obama’s failure to intercede in Gaza. I thus concluded that no matter how many envoys, speeches or interviews Mr. Obama offers to us, he will not win the hearts and minds of Egyptians until he takes up the injustice in the Middle East. I imagine the same holds true for much of the greater Muslim world. [continued…]

Al Jazeera: Palestinians in Israel mull election choices

Israeli Arabs fear a Gaza backlash as far right prepares for power role
By Peter Beaumont, The Observer, February 8, 2009

Fadi Mustafa is a successful young PR executive. He has an office in Tel Aviv and another in the northern Israeli Arab town of Umm al-Fahm, where his family home is. He encourages other young Israeli Arabs to break through the glass ceiling of discrimination. He was what Israeli Arabs call a “straight back”, in contrast to a previous generation – the “bent backs” who were bowed down by the experience of the creation of the Israeli state and the wars that followed. Continue reading →

Moderator rehabilitation therapy
By David Ignatius, Washington Post, February, 2009

Whom should President Obama appoint as his emissary to Iran, to take on what may be the most important diplomatic mission in decades? The right person (or persons) would have the stature and experience to engage Iran at the highest level — and to explore what Obama in his inaugural address called “a new way forward, based on mutual interest and mutual respect.”

My nominees are Zbigniew Brzezinski and Brent Scowcroft, former national security advisers for Presidents Jimmy Carter and George H.W. Bush, respectively. They would elevate the Iran mission, connecting it to the tradition of bipartisan strategic thinking that shaped America’s role in the modern world. And, like our youthful new president, these two octogenarians understand the need for America to “turn a page” in its foreign policy and to connect with what Brzezinski has called a “global political awakening.”

I know Brzezinski’s and Scowcroft’s views about dialogue with Iran because I spent many days with them last spring, moderating a discussion that yielded a book, “America and the World: Conversations on the Future of American Foreign Policy.”

The book was an experiment to see whether a prominent Democrat and a prominent Republican could find common ground for new approaches to the world. Indeed they did: On nearly every issue, from the Arab-Israeli dispute to the war in Afghanistan, the two had similar insights about how to use diplomacy better to align America with a changing world. [continued…]

Editor’s Comment — After Davos, there are those of us who think that David Ignatius is not only a ham at moderation but he can arguably be blamed for singlehandedly elevating Middle East tensions.

A column — “What I learned in Davos” — would be welcome. Instead we’re getting: Why I’m really a whiz moderator. Fair enough, but maybe a grand master of reconciliation of the Democratic-Republican tensions that rock the cozy corridors of Washington’s foreign policy elite could also concede that his old-colonial touch doesn’t play well in the Middle East…

That said, the idea of a Brzezinski-Scowcroft overture to Tehran is well-conceived. It wouldn’t just send the right message to Tehran but also Jerusalem, Europe and Washington itself.

The unthinkable option
By Roger Cohen, New York Times, February 5, 2009

…the U.S. military option is not an option. It is unthinkable.

This is the poisoned chalice handed Obama by Bush, who responded to Iranian help in Afghanistan in 2001 by consigning Iran to the axis of evil, rebuffed credible approaches by the former moderate president, Mohammad Khatami, and undermined European diplomacy.

No, the real “Red Line” will be set by Israel.

Benjamin Netanyahu, Israel’s leading candidate to become prime minister after elections next week, has said “everything that is necessary” will be done to stop Iran going nuclear. I believe him. [continued…]

Hamas ‘more popular’ since Israeli action
AFP, February 6, 2009

Israel’s war on Hamas in Gaza, which killed more than 1300 people and left large swathes of the territory in ruins, has boosted the popularity of the Islamists, an opinion poll has found.

Hamas would get 28.6 per cent of the vote compared with 27.9per cent for the rival Fatah faction of Western-backed President Mahmud Abbas if elections were held this week, according to the survey by the Jerusalem Media and Communications Centre.

It marks the first time that an opinion poll has placed Hamas in front of Fatah, which it ousted from the Gaza Strip in deadly fighting in June 2007. [continued…]

Israel impounds Lebanese aid boat
AP, February 5, 2009

The Israeli navy on Thursday intercepted a ship delivering 60 tons of supplies from Lebanon to the Gaza Strip. An investigation of the ship revealed it contained no hidden weapons and it has been docked in the port of Ashdod.

Israeli sources said that the aid the ship was carrying would be transferred to Gaza via land. The passengers, who attempted to dock in Gaza illegally, were transferred to security forces for questioning.

The ship set sail from the Lebanese port of Tripoli Tuesday in a bid to defy Israel’s blockade of Gaza. Reporters from Arab TV stations Al-Jadeed and Al-Jazeera who were on the vessel said the Israelis fired at the ship before boarding it and beating those on board. [continued…]

Religious groups are ‘penetrating’ Israeli army
By Jonathan Cook, The National, February 4, 2009

Extremist rabbis and their followers, bent on waging holy war against the Palestinians, are taking over the Israeli army by stealth, according to critics.

In a process one military historian has termed the rapid “theologisation” of the Israeli army, there are now entire units of religious combat soldiers, many of them based in West Bank settlements. They answer to hardline rabbis who call for the establishment of a Greater Israel that includes the occupied Palestinian territories.

Their influence in shaping the army’s goals and methods is starting to be felt, said observers, as more and more graduates from officer courses are also drawn from Israel’s religious extremist population. [continued…]

Waltzing with Ariel: Will Obama, too, indulge Israeli rejectionism?
By Tony Karon, Rootless Cosmopolitan, February 4, 2009

What do we call leaders who reject a two-state solution to the Israeli-Palestinian conflict, whose manifestos deny their adversary the right to sovereign statehood, and who oppose a final agreement, instead offering only long-term truces? Rejectionists… if they’re Palestinian… If they’re Israeli, they’re more likely to be called “Mr Prime Minister”.

Consider Benjamin Netanyahu, who looks likely to head the next Israeli government after the elections on February 10. “Bibi” has made clear that he won’t be bound by any undertakings given by his predecessor, Ehud Olmert, to the Palestinian President Mahmoud Abbas. The basis of his government, Bibi says, will be no sharing of Jerusalem, and no return to the 1967 borders: ie, a rejection of the Arab Peace Plan praised last week by President Barack Obama, and of the generally accepted terms of a two-state solution. [continued…]

Arab hope, Arab change
By Rami G. Khouri, Middle East Online, February 4, 2009

The stark juxtapositions within the Arab World — and the wider Middle East-South Asia region — were brought home to me one morning this week in Kuwait. I am here participating in a global gathering that seeks to increase the production of indigenous research in the Middle East in order to better influence policy-making. But our noble endeavor contrasted sharply with the morning newspaper headlines of suicide bombings in Somalia and Afghanistan, continued military strikes in Israel and Palestine, and even the provincial elections in Iraq, happening during a lull between a string of suicide bombings in that country.

Where, in this range of events, is the center of gravity of the Arab world? It is in none and all of these things simultaneously. For the Arab World is defined by both rampant violence — home-grown and foreign-instigated — and a deep desire to become democratic, productive, vibrant societies, intellectually and culturally.

A key to moving in that direction is understanding the main constraint and the common denominator in all these events. I believe it is the legacy of autocratic, top-heavy, centralized Arab governments, which range from relatively gentle monarchies on the one hand to hard police states on the other. [continued…]

Secret report recommends military shift in Afghanistan
By Jim Miklaszewski, NBC News, February 4, 2009

The Pentagon is prepared to announce the deployment of 17,000 additional soldiers and Marines to Afghanistan as early as this week even as President Barack Obama is searching for his own strategy for the war. According to military officials during last week’s meeting with Defense Secretary Gates and the Joint Chiefs of Staff in the Pentagon’s “tank,” the president specifically asked, “What is the end game?” in the U.S. military’s strategy for Afghanistan. When asked what the answer was, one military official told NBC News, “Frankly, we don’t have one.” But they’re working on it. [continued…]

Russia puts a price on its cooperation in Afghanistan
By Tony Karon, Time, February 4, 2009

The U.S. badly needs Russia’s help in Afghanistan, and Moscow can’t afford to let the NATO mission there fail for the sake of Russia’s own security. But Russia will extract a geopolitical price for its cooperation — and the resulting bargaining process can be lucrative for those caught in between. That’s the message of Tuesday’s bombshell dropped by Kyrgyzstan: President Kurmanbek Bakiyev ordered the U.S. to close down an airbase in his tiny Central Asian country used to provide key air support for NATO forces in neighboring Afghanistan.

The Kyrgyz leader’s announcement came on the same day that militants in Pakistan blew up a key Khyber Pass bridge, cutting NATO’s main supply line into Afghanistan and highlighting its vulnerability. And, of course, he happened to be standing alongside Russia’s President Dmitry Medvedev at a Moscow news conference when he served notice on the U.S. to vacate the Manas air base. Moscow, in fact, had just promised to give Bakiyev a vital $2 billion economic bailout package. Russia’s motivations, and its intentions, are ambiguous. [continued…]

Torture row: Judges accuse US of cover-up
By Robert Winnett, The Telegraph, February 5, 2009

Britain succumbed to “blackmail” from America by suppressing details of the torture of a British resident held at Guantánamo Bay, it has been claimed.

Two High Court judges issued a scathing attack on the White House after it emerged that the US threatened to withdraw all intelligence co-operation from Britain if details of the treatment of Binyam Mohamed were made public.

The row threatened to damage relations with President Barack Obama’s administration after the Foreign Office confirmed that the US’s stance on the issue had not changed since his inauguration last month.

The dispute stems from a High Court case in London.

Two High Court judges, Lord Justice Thomas and Mr Justice Lloyd Jones, had intended to order that the documents on Mr Mohammed’s alleged torture be published.

However, they decided reluctantly to block the release of the information after being told that the withdrawal of American co-operation would lead to Britons facing a “very considerable increase” in the risk from terrorists. [continued…]

Bailouts for bunglers
By Paul Krugman, New York Times, February 2, 2009

Question: what happens if you lose vast amounts of other people’s money? Answer: you get a big gift from the federal government — but the president says some very harsh things about you before forking over the cash.

Am I being unfair? I hope so. But right now that’s what seems to be happening.

Just to be clear, I’m not talking about the Obama administration’s plan to support jobs and output with a large, temporary rise in federal spending, which is very much the right thing to do. I’m talking, instead, about the administration’s plans for a banking system rescue — plans that are shaping up as a classic exercise in “lemon socialism”: taxpayers bear the cost if things go wrong, but stockholders and executives get the benefits if things go right. [continued…]

Is America going the way of Japan?
By Nouriel Roubini, Forbes, February 5, 2009

William Pesek, a savvy Asia columnist for Bloomberg, reports, in his latest column, views about the structural crisis faced by Japan that I first outlined in a 1996 paper, “Japan’s Economic Crisis.” Thirteen years later, Japan is entering another severe slump, one that looks like even worse than that of other advanced economies. In the U.S., Europe and some other advanced economies, along with China, the second derivative of growth and of other economic indicators is approaching positive territory (i.e., growth is still negative, but GDP may be falling at a slowing rate). In Japan, it is still highly negative. There, the fall is accelerating, resembling a free fall–a severe case of stag-deflation.

The sad case of Japan’s free fall is a cautionary tale of what happens when a high-flying economy has a real estate and equity bubble that goes bust, avoiding (for too long) doing the painful structural reforms and clean-up of the financial system that is necessary to avoid a lengthy, L-shaped near-depression. Japan had over a decade of stagnation and deflation, then a mild, sub-par growth recovery that lasted only three years, and is now spinning into another severe stag-deflation.

Keep alive zombie banks and zombie corporations with balance sheets and debts that haven’t been restructured, as in Japan, and you end up in an L-shaped near-depression.

Let me explain why the U.S. and the global economy face the risk of an L-shaped near-depression if appropriate policy actions are not undertaken. [continued…]

Herbert Hoover lives
By Frank Rich, New York Times, February 1, 2009

Here’s a bottom line to keep you up at night: The economy is falling faster than Washington can get moving. President Obama says his stimulus plan will save or create four million jobs in two years. In the last four months of 2008 alone, employment fell by 1.9 million. Do the math.

The abyss is widening. Of the 30 companies in the Dow Jones industrial index, 22 have announced job cuts since October. Unemployment is up in all 50 states, with layoffs at both high-tech companies (Microsoft) and low (Caterpillar). The December job loss in retailing is the worst since at least 1939. The new-home sales rate has fallen to its all-time low since record-keeping began in 1963.

What are Americans still buying? Big Macs, Campbell’s soup, Hershey’s chocolate and Spam — the four food groups of the apocalypse.

The crisis is at least as grave as the one that confronted us — and, for a time, united us — after 9/11. Which is why the antics among Republicans on Capitol Hill seem so surreal. These are the same politicians who only yesterday smeared the patriotism of any dissenters from Bush’s “war on terror.” Where is their own patriotism now that economic terror is inflicting far more harm on their constituents than Saddam Hussein’s nonexistent W.M.D.? [continued…]

Editor’s Comment — Writing from New York, Frank Rich probably feels obliged to say a crisis “as grave” as the one that confronted us on 9/11 — but he really shouldn’t have pulled his punch. Continue reading →

Hamas must be brought into peace process, says Tony Blair
By Philip Webster, The Times, January 31, 2009

Hamas must somehow be brought into the Middle East peace process because the policy of isolating Gaza in the quest for a settlement will not work, Tony Blair has told The Times.

The former prime minister implicitly criticises the strategy followed by the Bush Administration and Israel of focusing all peace and reconstruction efforts on the West Bank. “It was half of what we needed,” he said.

In an interview with Ginny Dougary in the Saturday Magazine, Mr Blair says that the strategy of “pushing Gaza aside” and trying to create a Palestinian state on the West Bank “was never going to work and will never work”. He hints in references to how peace was eventually achieved in Northern Ireland that the time may be approaching to talk to Hamas … “My basic predisposition is that in a situation like this you talk to everybody.” [continued…]

Editor’s Comment — The complete interview includes this passage:

Given that he criticised Bush for trying to remove Arafat back in 2002 – I repeat his quote, “We have got to negotiate with whoever is elected by the Palestinians” – does that mean he changed his view when Hamas was elected?

“Erm? certainly my basic predisposition is that in a situation like this you talk to everybody,” but he repeats the Quartet position that there can be no talks, official or unofficial, with Hamas until they renounce violence and recognise Israel. “I have always thought that there is a distinction between the difficulty of negotiating with Hamas as part of the peace process about the two-state solution if they won’t accept one of the states, and talking to Hamas as the de facto power in Gaza.”

Could I say, perhaps, then, that I suspect that you have spoken to Hamas in an unofficial capacity and you could give a [diplomatically guarded] response?

“Er? er?” Blair smiles. Is it tricky? “It is tricky, yes.” OK, I’ll just smile back at you then.

OK. Let’s take that absence of a denial as a silent yes. Continue reading →

Hamas officials signal willingness to negotiate
By Steve Gutkin, AP, January 29, 2009

Senior officials in the Islamic group Hamas are indicating a willingness to negotiate a deal for a long-term truce with Israel as long as the borders of Gaza are opened to the rest of the world.

“We want to be part of the international community,” Hamas leader Ghazi Hamad told The Associated Press at the Gaza-Egypt border, where he was coordinating Arab aid shipments. “I think Hamas has no interest now to increase the number of crises in Gaza or to challenge the world.”

Hamas is trying hard to flex its muscles in the aftermath of Israel’s punishing onslaught in the Gaza Strip, doling out cash, vowing revenge and declaring victory over Zionist aggression. But AP interviews with Hamad and two other Hamas leaders in the war-ravaged territory they rule suggest some of that might be more bluster than reality — and the group may be ready for some serious deal making.

That raises the question of whether Hamas, which receives much of its funding and weapons from Tehran, can be coaxed out of Iran’s orbit. That question looks less preposterous than it did before President Barack Obama began extending olive branches to the Muslim world and Israel’s Gaza offensive reshuffled Mideast politics. [continued…]

Editor’s Comment — Does the fact that Israel is the recipient of the largest share of US foreign aid and has an American-made war machine mean that Israel is a US proxy? I don’t think so — even if some observers who view everything through the prism of US imperialism would argue otherwise. Likewise, ties between Iran and Hamas do not make Hamas an Iranian proxy.

Think about it. If Hamas was really batting for Iran do you not think that we might have just witnessed a stronger performance against the IDF? Hamas just managed to pull off a miraculous survival. I think that even a well-wisher like Hassan Nasrallah would hesitate from celebrating a “divine victory” in Gaza. Continue reading →

Abdullah II: The 5-State Solution
By Thomas Friedman, New York Times, January 28, 2009

The virtues of this five-state solution — Palestine, Egypt, Jordan, Israel and Saudi Arabia — are numerous: Egypt and Jordan, the Arab states that have peace treaties with Israel, would act as transition guarantors that any Israeli withdrawal would not leave a security vacuum in the West Bank, Gaza or Arab Jerusalem that could threaten Israel. Israel would have time for a phased withdrawal of its settlements, and Palestinians would have the chance to do nation-building in an orderly manner. This would be an Arab solution that would put a stop to Iran’s attempts to Persianize the Palestinian issue. [continued…]

Editor’s Comment — Ever since 2002, Tom Friedman has seen himself as a messenger of peace, but with nothing to deliver this time other than the Friedman Peace Plan, I doubt whether his council will carry much weight. Indeed, his five-state solution, practical as it might sound, looks too much like a stepping stone towards Daniel Pipes’ no-state solution. Bring in Egypt and Jordan and if after five years a Palestinian state has not taken shape then Gaza absorbs into Egypt and the West Bank into Jordan. It’s not going to happen.

How to talk to Hamas without talking to Hamas
By Paul Woodward, War in Context, January 28, 2009

As George Mitchell, the United States’ new envoy for Middle East peace, arrived in Cairo, it was unclear whether a new chapter was opening in US diplomacy or whether the emphasis was on continuity with the efforts of the previous administration in Washington. A report in Ynet struck notes in familiar themes. The US would be attempting to bolster the Palestinian president Mahmoud Abbas and the Palestinian Authority. Mr Mitchell did not intend to meet with representatives from Hamas. Continue reading →

Obama’s first interview as president (Al-Arabiya TV exclusive)

Editor’s Comment — President Obama said that the new way the US will approach the Middle East is to “start by listening.”

“[George Mitchell]’s going to be speaking to all the major parties involved…”

“– stop right there,” Hisham Melhem failed to interject. Had the interview been conducted by Al Jazeera instead of the Saudi-funded Al-Arabiya news channel, Obama might at this point have been pushed to provide clarification.

If Mitchell is going to be speaking to all the major parties involved, he’s going to be talking to Hamas? Correct, Mr President? Whatever else might be said about Hamas it is beyond dispute that they are one of the major parties. Only yesterday, Jimmy Carter reiterated what in foreign policy circles is by this point the mainstream position: Hamas has to be engaged.

No doubt the question was in Hisham’s mind. Was he too polite to ask? Was it a ground rule for the interview that this question wouldn’t be answered and therefore should not be posed? For how much longer is this charade going to continue? Hamas isn’t going away. Continue reading →