- Writing in the New Yorker, Malcolm Gladwell explains how “the roots of Wall Street’s crisis were not structural or cognitive so much as they were psychological”. Overconfidence among bankers, he suggests, in addition to the more familiar arguments about poor regulation and simple incompetence, played a significant role in the financial crisis.

- The Prospect blog, meanwhile, discusses how “the Indian Ocean is emerging as a focus for Chinese logistical and naval expansion” – something being felt acutely in Washington and New Delhi. Staying with the US and India, WPR takes an interesting look at Hillary Clinton’s recent trip to South Asia.

- Elsewhere, the Channel 4 News blog has more details about the UK’s upcoming Iraq War Inquiry – suggesting that it is due to hear “mountains of evidence” and, given the expansive nature of its remit, is unlikely to have lawyers present.

- Finally, Adam Roberts has an interesting piece in The World Today assessing the current state of the Geneva Conventions. Sixty years later, he ponders, are the laws of war still relevant to the changing nature of conflict?

We will be doing this quadrennial review, which will be, we hope, a tool to provide us with both short-term and long-term blueprints for how to advance our foreign policy objectives and our values and interests. This will provide us with a comprehensive assessment for organizational reform and improvements to our policy, strategy, and planning processes.

- Hillary Clinton, announcing the Quadrennial Diplomacy and Development Review last week

More than 230 years ago, Thomas Paine said, “We have it within our power to start the world over again.” Today, in a new and very different era, we are called upon to use that power. I believe we have the right strategy, the right priorities, the right policies, we have the right President, and we have the American people, diverse, committed, and open to the future.

- Hillary Clinton, speaking at the Council on Foreign Relations yesterday

- Over at Politico, Ben Smith has more news about the Secretary of State’s big foreign policy speech, to be delivered today at the Council on Foreign Relations. Placing the last six months of US diplomacy into perspective, it will also offer Hillary the chance to begin putting her own distinctive stamp on policy. As Smith comments:

Clinton appears increasingly comfortable expressing her views. State Department officials have suggested that she’s been a hawkish internal voice, pushing Obama toward more confrontational stances toward adversaries from Iran to Cuba.

- The NYT has an interesting article highlighting the importance of water, as well as land, to Middle East peace. “[W]hen it comes to water”, Stanley Weiss suggests, “every nation is in the same boat”.

- Elsewhere, the FT’s Brussels blog identifies five priorities for the next European Commission – defending the single market; reforming financial regulation; clarifying climate change and energy security policy; unifying a foreign policy voice; and finally the small matter of appointing a new President. Deutsche Welle, meanwhile, has an interview with Hans-Gert Pöttering, the outgoing President of the European Parliament.

- Finally, a veritable slew of polls – well ok, two – on British defence spending. A PoliticsHome poll suggests 66% of voters feel defence should be protected from inevitable cuts in public spending (79% among Conservative supporters, 64% for Labour supporters, and 49% among Lib Dems). Details here. The Guardian, meanwhile has an interesting ICM poll (pdf) indicating that 54% of British voters now support nuclear disarmament, with only 42% in favour of replacing Trident.

One debate that will run and run in the coming months is on the whether, why and how of reforming US foreign assistance – a theme that Barack Obama riffed on frequently during the course of the Presidential campaign.

Over at the Center for Global Development, Sheila Herrling has just posted a Q&A on reforming the antiquated 1961 Foreign Assistance Act, which created USAID in the first place. As Herrling observes, the Act has only been overhauled fully on one occasion – and that was back in 1985. So what should reform achieve?  According to Herrling, a new act should:

- clearly outline the objectives and priorities of U.S. foreign assistance programs;

- consolidate decision making and implementation functions into a single independent institutional entity;

- specify the roles and responsibilities of other government agencies where appropriate;

- clarify the coordination of oversight responsibilities and functions; adjust regulatory requirements to fit the reality of implementing assistance programs; and

- discourage to the highest degree possible political and bureaucratic constraints (such as earmarks and presidential initiatives).

However, the really big question lurking in the background is whether USAID should be hived off and made into a separate department, a la DFID in the UK: expect plenty of speculation and debate about this over the course of the spring.  Me, I’m not holding my breath – for two formidable obstacles stand between here and USDFID.

One: the fact that Obama can’t just create a new department with a stroke of the pen.  In the US, machinery of government changes of that magnitude need Congressional approval (many would argue that the only reason the Department for Homeland Security came into being was the determined campaign run by the 9/11 families for just this outcome).

Two: the even more challenging hurdle of one Ms Hillary Clinton.  Hillary made plenty clear as soon as she arrived at State that she sees development as one of the core pillars of foreign policy.  It’s very unlikely that she’d see such a significant part of her empire slip through her fingers…

Marc Ambinder writes:

So where does Hillary Clinton’s foreign policy cabinet hang its hat for the next four years?
Her main team consists of:

Richard Holbrooke, the former U.S. Ambassador to the United Nations and Dayton Peace Accord broker; Clinton’s chief defense adviser, Bob Einhorn, a Clinton administration veteran and non-proliferation expert, Andrew Shapiro, Clinton’s chief foreign policy adviser, Wendy Sherman, a senior adviser to Madelieine Albright and Warren Christopher, and Melaine Verveer, a former Clinton chief of staff and longtime Clinton confidante.

Now — signing up for Team Obama, especially when things were not looking so hot in late 2007, was a real act of professional courage for many Obamaites. And there was quite a bit of tension between the two camps — although it’s not clear whether the principals listed above were involved.

Tensions have cooled; Clinton advisers are assisting Obama’s transition team and serving on several advisory committees. But staff is destiny, and there are conflicting reports about how much latitude Clinton will have to bring her own team aboard.

I’d say Ambinder underplays the irony of the situation.  As Alex noted over a year ago, the Clinton camp let it be known that no foreign policy expert associated with Obama’s primary campaign would be welcome to change sides once Hillary won her inevitable nomination.

Team Clinton has put the word out that the usual process – whereby foreign policy advisers to other candidates are allowed to switch horses as and when their candidate gets eliminated during primary season – has been abolished, at least as far as Hillary as concerned. The ‘you’re with us or against us’ ethos is no longer limited to the GOP, it seems…

Clinton’s people are lucky that their boss’s new boss is a more forgiving type…