Thursday, March 29, 2018

Those Meddlesome Russians

Russian relations with the Western nations of planet earth are in a tailspin. Scandal erupts over the use of a nerve agent to poison former KGB spy Sergei Skripal and his daughter Yulia in the United Kingdom. The incident ignited concerns of over core principles of international law concerning states failing to honor the sovereign rights of other nations. In global stability, this is a critical barrier between peace and war among nations whose inherent national interests often do not align. It is dangerous precedent, that if allowed to stand, could enable other nations or their actors to pursue perceived enemies with impunity anywhere, regardless of the laws of the nation where the target is located.

Western nations are reacting using an international response strategy sometimes referred to as DIME. It stands for Diplomacy, Intimidation, Militancy and Economic response. They operate as a quartet in managing global stability in cases. So far, the first two response silos have been activated. Intimidation, also known as exposure and shaming, has been acrimonious by the U.K. including Prime Minister Theresa May public calling out the Russian government in parliament. Diplomatically, Britain and the United States have expelled Russian diplomatic personnel, 23 for the U.K. and 60 by the U.S. The Russians, also practitioners of DIME, have so far only activated a diplomatic response by similarly expelling an equal number of diplomats. Overall, despite all the news coverage and posturing, a muted tit-for-tat at best.

Epic Chasm

For westerners who live in cultures where criticism and defiance of the state is considered a virtue of democratic debate, the appearance of the statecraft and governance of societies like Russia’s where the image and stability of the state stands above that of the citizenry is a bit of a head bender. But in places like Russia, the security of the state is paramount. Russia is a large and poor country. Seventy-five of the eighty-five districts of the Russian Federation are insolvent. Keeping things together constitutes a large portion of the work of the central government in Moscow. Execution of this effort in Russia is not democratic by any means. The central government works though oligarchies that create a semblance of economic stability; albeit, through a corruption prone system rivaling that of any third world ninety-nine percent of the wealth in one percent’s hands. To obtain the narrowest of tenuous hold, Russia sacrifices the quality of life of its people.

Sanctioned Criminals

This generates one of the truly macabre path dependent technology revolutions on planet Earth. Russia is an amazingly intellectual society. Think of a place where community colleges can produce scientists and engineers rivaling the products of MIT, Georgia Tech and Cal Tech in the US. Back in the day, I used to joke with my friends in the stealth aircraft and electronic warfare specialties of the defense game that, as a net assessment risk and stability analyst, I always found it funny that most of the math equations they worked with were named after Russians, and the Reds did their calculations using pencils. They were not amused.

But Russia’s tiny $1.2 Trillion GDP economy cannot absorb all this brain talent into domestic industry. All that talent is poor and looking for something to do. Remember from earlier in this article that the Russian government’s main goal in life is to preserve the stability and image of the state. They are not dumb. They know they have a festering unemployed talent problem that they need to keep distracted while they figure out how to, somehow, centrally plan the growth of the Russian economy’s eighty-five federation districts, such is the way of socialists.

Thus, here comes the resurgence of the old concept of criminal privateering; the sanctioning of unscrupulous behaviors for gain. In technology that means looking the other way as the pauper technocrats engage in credit card fraud, computer hacking, and unethical datamining. In some cases, for personal profit; in other cases, for hire. The simple rule of the letter of mark for a privateer applies. You can do whatever you want as long as you don’t point your stick at Mother Russia; none of that western democracies questioning the state stuff. Indeed, Russia’s FSB has shown it remains stalwart in it’s viciousness against enemies of the state. Pretty sure the Skripals would agree. Today, you can buy any sort of meddle for hire from Russia’s technocrat class; and Moscow will quietly look away so long as you do not violate the social compact of aiming that meddle outside the castle keep.

Thoughts on the Mueller Investigation

And so we get to the alleged Russian meddling in the US 2016 election. By 2016, the Russian system of criminal privateering for hire had reached organizational maturity just in time to meet the demands of the gigantic multi-million dollar ($USD) budgets of intensely competitive presidential campaign motivated to stop at nothing to win. Russia’s pauper technocrats were looking at making five to fifteen times the amount of money a month than they’ve ever dreamed. Moscow correctly judged that it didn’t actually affect the domestic image or stability of the Russian Federation. Therefore, it was ok to look the other way as “Peggy” robots went to work for all sides in American politics resulting in social pandemonium and breakdown of decorum in America. For profit, not policy.

In the end, will the USA, indeed the world, learn the lesson that the reforms we really need are to place safeguards and ethics around our elections, and our economic, not to fall prey to sending checks to pauper technocrats who will use nonsensical memes to obscure the discussion of important issues; not because they are politically activist, but because it generates more click-thru rates and ad serves. We bought the meddling with our own money. It was never the Russian government’s responsibility to stop the hackers.

Friday, March 16, 2018

"All About Vlad"; What I’d Like to Ask Vladimir Putin If I Could Interview Him

We recently passed the equinox of the Cold War. The Berlin Wall has now been down longer than it was ever up. And the European landscape is once again returning to it’s post-Hundred Years War pattern of smaller political rifts and incremental border movements that it has used to blow off steam since 1,453 A.D. Cities like Sevastopol are once again fought over like the days of old when Hapsburgs went tit-for-tat with each other over strategic towns and valleys. Byzantine intrigue emerges again, the cloaks and daggers of spies replaced by the apparent surgical use of weapons grade toxins. The dour of Theresa May addressing Parliament has the indignant ring not heard in the House of Commons since Margaret Thatcher. The Romans would be proud at what the Romani have rediscovered.

The Russian Federation is a perplexing nation still caught, even after all these years, in the fallout of the Cold War. It’s predecessor, the Union of Soviet Socialist Republics, cratered spectacularly many years ago after the Berlin Wall fell and the Warsaw Pact vanished from the face of the earth. It’s $1,283 Billion (USD) GDP in 2016 is a dwarf compared to economic powers such as the United States’ $18.6 Trillion (USD), the European Union’s $11.8 Trillion (USD) and China’s $11.1 Trillion (USD) GDP’s in the same year. At barely three percent (3%) the wealth of it’s competitors, it’s the Duchy of Grand Fenwick from the Cold War era film “The Mouse that Roared” starring Peter Sellers. But this movie now stars Vladimir Putin and he is no mouse.

Putin is a complex man with a complex problem. He strikes me as a cross between the fiery bluster of Nikita Kruschev and the broken heart of Boris Yeltsin. He promotes the image of a strong Russia worthy of respect, which it does deserve; but his methods seem to harken back to times when the Soviet Union was run using the designs of a more dictatorial Stalinist state capitalism. He’s seen the economic dreams of his country stalled and thwarted, often by circumstances beyond his control; sometimes by the work of his own, at times overly prideful, hands. Only ten (10) of the eighty-five (85) districts of the Russian Federation are solvent. The poverty rate is at least twice above levels it should be to create the conditions under which a modern first world nation with a constrained elite, burgeoning middle class and high employment rate working class can be a truly self-sustaining economy. Every year that goes by, Russia’s 3% of the GDP of its most important blocks of competitors for global influence creates greater necessity to roar with bravado rather than walk quietly with a big stick.

And he can be clumsily shifty; something that the Obama-era played down but the more pragmatic and tangible result-oriented Trump-era shows little tolerance to put up with. His political apparatus can at times seem comedic, like Boris Badenov and Natasha Fatale from the old Rocky and Bullwinkle cartoons, were it not also as deadly as Turkish Prime Minister Erdogan’s National Intelligence Organization; with similarly disastrous results in foreign relations that just make it harder for Putin to reach this heart’s national vision. Overall, it’s not a globally stabilizing path.

So the first question I’d like to ask Vladimir Putin is “Can you swallow your pride to reach a better tomorrow?” This is a question not so much for Mr. Putin himself but for this government and its apparatus. The blustery fire resurgent in Russia today is about as effective as the 1950’s Soviet attempt to blockade Berlin. Once again, it’s causing the world to build a new wall. The world, even a Twitter speaking pragmatic Trumpian world can still smell a Red Menace with there’s one in the room; and it will protect itself reflexively from it by isolating the source and cause of the bravado. It’s beginning to happen to Russia as deteriorating trade agreements, narrowing diplomatic ties and confrontive deterrent force postures begin to build and erase the “peace dividend” that people like Ronald Reagan and Mikhail Gorbachev worked so hard to assemble. This is not a good thing for the 85 districts of the Russian Federation. It’ll leave them poorer and more isolated from the global economy; maybe even less well off than the sacrifices made to endure the Great Patriotic War of 1941-1945.

Russians went on to be the poorest of the members of an uneasy Cold War era that, quite frankly, had a lot to do with creating a world where it would be impossible to create any more Third Reich’s or Greater East Asia Co-Prosperity Spheres. The Russians still wait for their turn, to borrow a term from America’s past, for Reconstruction. But it won’t happen if Russia’s leadership remains prideful. And Vladimir Putin, because of his position, is the man on the spot to either change that path so that Russian pride evolves to for better or degrades into another half century of worsening quality of life for his nation. I’m really curious to know how he and his apparatus sees this challenge they have no choice to face.

And then I’d like to ask an even tougher follow up question. “For the good of the Russian people’s future, are you willing to do what it takes to obtain ‘Most Favored Nation’ (MFN) trading partner status with the United States?” This is a powerfully loaded question. One I’m sure that would not be lost on Mr. Putin. MFN status is the modern equivalent of the US post-World War II Marshall Plan that rebuilt Western Europe and Japan from ruins. The conferring of MFN would establish pathways to create free trade zones with preferred trade and tariff treatment with each of the 85 districts of the Russian Federation. It would raise the standards of living in these districts and create tangible pathways for each of them to become part of the first world economy in ways presently impossible as long as their survival stems solely from the health of their central government in Moscow. For the US, it would create a vast new trading partner that over the next fifty years would almost assuredly blossom for both economies. It’s not unreasonable to envision a future Russia with GDP’s in the $4 to $10 Trillion (USD) range under such bilateral conditions. It’s probably the single most unfulfilled “peace dividend” on this planet from end of both the Second World War and the Cold War.

Are there implied demands that would come from the US to grant MFN status? Of course. Ensuring graft and corruption are nowhere near the economies that would emerge in each of the economic free trade zones so everyone feels comfortable that the risk-reward economics meet competitive world standards is one of them. Altering the behavioral culture of Russia’s central government from one that still believes it is fighting the shadow puppets of the Cold War to one that is focused on being a fully participating member of a hegemon free economic circle of trading partners is another. Put more bluntly, it demands that Russia take the therapy it needs to move beyond the PTSD of losing the Cold War.

One day, I hope to hear Mr. Putin’s reply in person. To be honest, I’d really like to ask Donald Trump and Xi Jinping what they think of the same questions.

Friday, March 9, 2018

“Getting to Yes”; Getting a Little Closer

Global stability is a titanic art. Planet earth is witnessing an earthquake on the 38th parallel. A man made one orchestrated by U.S. president Donald Trump. Since taking office, the president and this team, including Secretary of State Rex Tillerson, Secretary of Defense James Mattis, and United Nations Ambassador Nikki Haley, have labored tirelessly to create a “peace through strength” opportunity for the world in the Korean peninsula. Along the way they have garnered the cooperation and assistance of Chinese president Xi Jinping and Russian Vladimir Putin to coerce the Democratic People’s Republic of Korea, also known as North Korea, and its leader Kim Jong-un on a path towards de-nuclearization, peace and normalization; including even the possibility of the peaceful re-unification of the entire Korean peninsula.

I first wrote about this possibility in January 2018 in an article “Getting to Yes”; Can Donald Trump Manage the Ultimate “Art of the Deal” and bring Korea to Camp David?”(1) After a year of global pressure, the thaw in the ice happened, poetically, at the Winter Olympic Games in Pyeongchang, South Korea. The two Koreas, countries divided against their will in the 1950’s by a Cold War among the very powers now coercing the north, basically said “WTF, let’s talk.” To the horror of US hawks, South Korean president Moon Jae-in combined forces with North Korea creating goodwill teams and contingents to participate in the Olympiad. American delegations, including Mr. Trump’s daughter Ivanka, stood in assigned positions next to North Korean general Kim Yong-chol at the closing ceremony on February 25, 2018. All the while, the Koreans talked, like two long lost families meeting anew. Barely eleven days later, Kim Jong-un offered to meet with president Donald Trump. That meeting will happen by May of 2018.

What does it mean for the United States to have a provocateur President? What can a Nation accomplish when it looks at old problems with “out of the box” eyes? What pathways to global stability are open today that were not open when America led incrementally? As noted earlier, American hawks, our crusty contingent that see the world through the lens of the Cold War are aghast at the possibility that a fundamental global stability paradigm they use to frame the meaning of “US leadership” in the world might change pivotally. A world where the 38th parallel is just another mile marker on an empty road to another town is scary when all you’ve known is a world with a Red Menace the speaks in sinister Russian and Chinese tongues. A world where conflicts are economic not nuclear. Back in the 1990’s, theorists that studied post-Cold War global stability organizing alternatives for the planet would describe this as a northern powers option.

We see other artifacts of this “northern” option in things like the emerging steel and aluminum tariff battle between the United States and China. Both countries are struggling with the same question of the sustainability of their base industries even as the global economy in finished goods continues to seek less and less friction to benefit a free market. Neither country has really explained well to their people, or to each other, why it’s perfectly fine to fight over adjustments to tariffs about the things like raw materials such as metals until a sustainable balance for every nation’s domestic, import and export industrial bases are in good order.

Actually, I have to interject that I’ve sort of found the US argument about needing enough steel plants to sustain its defense needs is a weak one in my opinion. I think the there’s a much stronger economic case to be made that the US wants, no needs, to claw back outsourced labor into its domestic economy and create local sources of raw materials supply with which to build the next 50 to 100-year generation of American cities, infrastructure and quality of life. This is something the Chinese can understand, because, they’re doing the exact same thing in China. I respectfully suggest that both nations may do better the rest of this year to negotiate with cooler heads with regards to their practical needs. These are year 2050 and 2100 strategic planning concerns that both countries have vital national interests in finding ways to coexist.

President Trump has a unique opportunity here to frame future coexistence between the Chinese and American economic engines in the context of his domestic infrastructure agenda. If he can find the right champions to explain and campaign it to the US Congress and the American people, despite all the hawks and protectionists that will attempt to derail it, he stands a chance to place the Pacific Rim of planet earth on a better path for posterity. Not a bad “nice to have” created by the catalyst of thinking out of the box with North Korea.

And then there’s Russia. The country that wears the “Scarlet Letter” on its chest, the Red Menace itself. The pinnacle of hawk fears and without whom the next step of demobilization of military might from the end of World War II would turn into plowshares. It’s president Vladimir Putin, a former KGB officer, plays the role of Dr. Evil in an ever more mediocre rendition of smaller and smaller Fulda Gaps. I wonder if America will ever be able to look beyond the bluster of an echo of Nikita Kruschev that Putin plays up in his role as leader in Russia to also hear the hopes of a Russian patriot who cries to improve the quality of life of his people the way the world once heard Boris Yeltsin cry at the door of a Texas supermarket. They are so loud because they have so little. Russia has a $1.283 trillion dollar GDP compared to the US $18.57 trillion dollar GDP.

Drowned out in the bluster of Putin’s March 1, 2018 speech announcing the defiance of a new generation of destabilizing nuclear weapon delivery systems to put the US and the EU on notice that Russia is not to be trifled with in it’s agenda in places like the Ukraine and Syria, I listened to the other half of Vladimir Putin’s address to his nation. His vow to raise living standards for the people of Russia was just as passionate, I thought maybe even more so. Definitely a mix of Kruschev and Yeltsin in that speech. The press reported on the salacious half of course. And I’m told that true to the Russian sense of humor, the jokes about he’ll raise the standard of living by declaring the poverty line to be half what it is now immediately rang across the cities and villages of the former Soviet Union. I thought that was funny because that’s kind of what the US did by manipulating unemployment figures to only count people actively looking for work as unemployed.

But let me end this week’s column with a message to President Trump and his cabinet. There’s an asymmetric response to Putin that I believe should be explored that would benefit the US and improve yet another global stability facet on the planet.  Consider the possibility of not responding to Russia one dimensionally by deflating his bluster about weaponry. To be sure, American weapon systems technology can respond to almost any Russian weapons initiative. That’s not the problem. Humiliating the Russian military gaining no diplomatic or arms control progress between the two nations is a problem; that is not a path to peace. If I may suggest, look at responding economically.  Not with sanctions, but with carrots. In exchange for not developing this next generation of advanced nuclear delivery technologies, that could very well proliferate to rogues, offer to set up free trade zones within Russia where the US can help improve the quality of life of Russians. Demand corruption free guarantees be made by the Russian government as a condition for the US to help. It plays onto the Kremlin’s needs and desires anyway and they can use the US as a lever to accelerate their clean up. If we do something like this creative version of a latter day Marshall plan, the US potentially gains a preferred export market that would further the agenda of consolidating a stronger US industrial base. I believe this is worth looking into.

I also believe it would create an even more compelling “peace through strength” hand for the United States in May when “Donald the Strong”, as the Chinese call him, meets “Rocket Man”. That just sounds so delightfully WWF doesn’t it?