America the resilient

by | Mar 1, 2008 | Conflict and security

Stephen Flynn, the Senior Fellow for national security studies at the Council on Foreign Relations, has an oustanding essay – America the Resilient – in the current edition of Foreign Affairs.

Right at the heart of Flynn’s argument is that resilience needs to be a bottom-up undertaking – something I’ve written about here before, as has David.  His premise: “When it comes to managing the hazards of the twenty-first century, it is reckless to relegate the American public to the sidelines.”  Historically, he notes, resilience has been one of America’s great natural strengths: “the quality that helped tame a raw continent and then allowed the country to cope with the extraordinary challenges that occasionally placed the American experiment in peril”.

But today, he continues, “this reservoir of self-sufficiency is being depleted”.  Partly that’s a function of “an increasingly urbanised and suburbanised population [embracing] just-in-time lifestyles tethered to ATM machines and 24-hour stores that provide instant acess to cash, food and gas”.  Partly it’s the result of under-investment in emergency management capacity and critical national infrastructure. 

But it’s also, he continues, the result of how the government is treating the citizenry.  In Climate Change: the state of the debate, David and I queried the wisdom of a dual narrative on climate change that applies apocalyptic imagery to the problem of climate change, but then plays a solution narrative that extends little further than remembering to turn the lights off and recycling a bit more.  Flynn thinks the same applies to terrorism:

Since September 11, 2001, the White House has failed to draw on the legacy of American grit, volunteerism, and ingenuity in the face of adversity. Instead, it has sent a mixed message, touting terrorism as a clear and present danger while telling Americans to just go about their daily lives. Unlike during World War II, when the entire U.S. population was mobilized, much of official Washington today treats citizens as helpless targets or potential victims.

This in turn results, he continues, from a need-to-know rather than a need-to-share mentality on information management.  In a point that Charlie also makes in his last Demos report on national security, Flynn says that

This discounting of the public can be traced to the culture of secrecy and paternalism that now pervades the national defense and federal law enforcement communities. After decades of combating Soviet espionage during the Cold War, the federal security establishment instinctively resists disclosing information for fear that it might end up in the wrong hands. Straight talk about the country’s vulnerabilities and how to cope in emergencies is presumed to be too frightening for public consumption.

This is madness. The overwhelming majority of Americans live in places where the occurrence of a natural disaster is a matter of not if, but when. And terrorist groups’ targets of choice are noncombatants and infrastructure. These are hazards that can be managed only by an informed, inspired, and mobilized public. Both the first preventers and the first responders are likely to be civilians.

Flynn understands the importance of narrative, too.  It’s a shame, he says, that the prevailing story about 9/11 is about the attacks that succeeded, rather than the one that failed – because of self-organised action by citizens on United 93.  Later, he notes that

Two tricky but potentially influential allies in the effort could be the mass media and Hollywood. To a large extent, the stories Americans see on their small and big screens have been part of the problem. A more inspirational and less dramatic reality is rarely portrayed. As the mass evacuation of Manhattan on September 11 made clear, in real crises Americans largely keep their wits about them and assist one another. During World War II, Hollywood played a helpful public-service role by supporting war-bond drives and producing training films, while providing much-needed entertainment. Media executives today could do the same by committing themselves to relating stories and communicating messages that inform and inspire individual and societal resilience.

His conclusion:

Rebuilding the resilience of U.S. society is an agenda that could reverse the debilitating politics and mounting cynicism now bedeviling the U.S. electorate. Whereas increasing security measures is an inevitable answer to a society’s fears, resilience rests on a foundation of confidence and optimism. It involves taking stock of what is truly precious and ensuring its durability in a way that would allow Americans to remain true to their ideals no matter what tempest the future may bring.

Outstanding.  I’m off to buy his new book.

Third world debt (the sequel)

by | Mar 1, 2008 | Africa, Climate and resource scarcity, Economics and development, Global system

Lots of concerns lately about stagflation, given how commodity prices have continued their inexorable rise even as the US economy falters.  Inevitably, some have wondered whether it means it’s the 1970s all over again. But here’s another reason to think about dusting off those flares: what about the risk of a new third world debt crisis? 

Consider how rising commodity prices – especially food and energy – are affecting low income countries.  I saw a very worried-sounding email this week from UNDP in Yemen, noting that the country is 75% dependent on food imports, that the price of a bag of wheat is now over two and a half times its level a year ago – and that fuel subsidies are already going to absorb 30% of government expenditures this year “against a backdrop of declining revenues due to a combination of reduced production and rising local consumption of oil and its derivatives”.  Not good.

On top of that, consider how much aid is being diverted towards coping with these price increases.  As I noted back at the start of the year, we already know from the International Energy Agency that oil importing low income countries in Africa have seen all of their aid and debt relief over the past three years offset by increased costs for energy imports.  That’s before food prices are even factored into the equation – and as WFP head Josette Sheeran’s alarm bell-sounding interview last week underscores, there are plenty of problems on that front too.

If aid isn’t enough to offset the problem, then it follows that some countries may have to take out loans to cope with the balance of payments problems.  One place they might look to is the IMF; the Institute of Development Studies’ Stephany Griffith-Jones made such a proposal in January, when she wrote in a letter to the FT that

When oil prices went up in the 1970s, the International Monetary Fund created low conditionality oil lending facilities. These helped sustain growth and facilitate adjustment in many developing economies. Should not a similar facility be created now in the IMF to ease the burden, especially on the poorest countries? Or should not existing IMF facilities, like the different windows of the Poverty Reduction Growth Facility, be modified to provide rapid, significant, cheap, low conditionality loans to poor countries facing the external shock of a large deterioration of their terms of trade?

The Fund itself subsequently confirmed that this was already happening: “several countries already receiving support under the International Monetary Fund’s poverty reduction and growth facility have recently requested additional lending in response to a terms of trade shock”.

But of course it may not be the Fund that emerges as the key lender in all this.  Just as in the 1970s, the world economy is suddenly awash with petrodollars from newly flush oil producers – hence all the fuss about the rapidly evolving role of sovereign wealth funds.  China, too, is also starting to invest some of its vast dollar reserves – now around $1,500 trillion – in Africa.  So far, these investments have concentrated on commodity producers rather than importers, but this could change if China comes to regard balance of payments lending as an inexpensive means of purchasing influence more generally.

In all cases, the underlying question on balance of payments loans to poor countries is: what happens if – as many commentators believe – the current food and oil price shock isn’t just a cyclical blip, but is instead a longer term structural shift?  Are low income countries just supposed to keep borrowing? 

One to add to the agenda when food prices come up at the IMF / World Bank spring meetings, perhaps…