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Tax optimisation for fun and profit

January 27th, 2012 | Posted by Aosher in General - (0 Comments)

In the boom times, the tension between tax and spending was muted. The government made enough money from relatively modest taxes to fund increasingly elaborate spending plans (in the UK, forgetting that spending should be counter-cyclical – but that’s another matter), meaning that while the issue of taxation existed – as it always goes and always will – it was relatively easy for the government to fend off.

We’re not in the boom times any more, however, and thus the issue of tax optimisation has come up again. The less tax government spends, the less it can spend on services; but the more tax it takes, the less money there is in the real economy for people to spend, hitting jobs, wages, and ultimately taxes. Tax is the Jörmungandr upon which public policy is built, and the question of how much you can tax before the negative impact on the economy outweighs the spending benefit has sharpened over the last half-decade.

As a result, lots of different groups are looking at the question in different ways (as I write this, Andrew Neil is debating Laurie Penny on the retrospective merits of the Community Charge – aka the Poll Tax. It’s not going well for Brillo). And it’s not just the usual leftie malcontents; in America, the very rich – led by the world’s second-richest man, Warren Buffet – are themselves questioning the levels of tax levelled upon them: Buffet famously claimed to pay a lower rate of tax than his assistant.

Increasingly there are numbers to back the various positions up. Shortly before Christmas, a group of economists – Thomas Piketty of the Paris School of Economics, Emmanuel Saez of the University of California, Berkeley, and Stefanie Stantcheva of MIT – put out a paper (pdf) detailing optimal rates of top-rate tax. The results are surprising.

Kevin Drum elaborates on the results, but in short, the paper asserts that top rates of tax can go as high as 76% without inflicting economic damage greater than the net benefit derived. The writers of the paper take a conservative view of behavioral elasticity, as well, so the risks of the rich “going Galt” and fleeing to tax havens is priced into that calculation. There is some historical evidence to support that, too. The UK’s top rate of tax, set at 50%, has made next to no difference to wealth creation since it was implemented a year and a half ago. Furthermore, Martin Feldstein of Harvard found that the 1986 cut in the US top rate of tax, from 50% to 28%, made no perceptible difference to the gross tax yield.

Feldstein does not conclude that taxes can be raised, however. His conclusion is that the tax based needs to be broadened by eliminating reductions. To be fair, the other paper makes a similar point. Have a high tax rate may not intrinsically undermine the economy, but it’s a wasted effort if you still allow people to find ways to avoid paying it. So the first task of tax reformers must be to minimise such opportunities by having a broader tax base, better enforcement and similar tax rates for different kinds of income.

And that’s the problem. Even in small countries – like Sweden – keeping the exchequer in order is a massive challenge. For countries like Britain and America, with a vastly diverse economy and an especially ornate system of financial services and products, any attempts to design a straightforward tax system run into a conflict between fairness and flexibility. Schemes such as that designed by the Deputy Prime Minister, to raise the income level at which tax is charged on the lower band, may be the most straightforward way to force the issue. Removing pressure at the bottom of the pile has to result in increasing it at the top, and if these reports are to be believed, then the top has plenty more to give.

The benefits of universal benefits

January 26th, 2012 | Posted by Aosher in Politics - UK - (2 Comments)

Amid all of the sound and fury surrounding the government’s attempts to change the UK’s benefits system, sight of the grand strategy of entitlement reform was lost this week.

First, a recap. The dramatic interventions of the House of Lords put paid to a couple of the cabinet’s initial skirmishes; plans to cap the benefits that can be claimed by a single household to £26,000pa were stymied by an amendment which has caused child benefits to be excluded, essentially rendering the policy pointless (as the £26,000pa cap is impossible to reach without child benefits being a factor). In a further incursion, the Lords blocked a plan to make single parents pay for the right to claim child support from their absentee coeval. Earlier, the Lords had also dispatched some of the more egregious depredations planned for the Disability Living Allowance in the aftermath of the Responsible Reform (“Spartacus”) Report (pdf). All in all, it’s been a series of bloody defeats for the government in the House of Lords.

Taken individually, you could quite justifiably suggest that the government was acting in a manner that was arbitrarily and deliberately malicious to single mothers, the disabled and the unemployed. Of course I couldn’t possibly comment.

But these individual battles do take place in the context of a wider war. The government wants their benefits to carry a smaller price tag, and are unrepentant about the fact that this will require a reduction in the overall levels of benefits paid out. However, the endgame also features a few policies with real value, including a promise of the holy grail of benefits reform.

Firstly, it’s important to look at the idea of the Universal Credit (£) as a principle. In short, the Universal Credit rolls most existing benefits – including income support, jobseeker’s allowance, disability living allowance, child benefits and housing benefits – into a single means-tested benefit.

This isn’t a massively new idea. The DWP has been pushing the benefits of a universal credit internally since the end of the Major government, and it has been the recommendation of most benefits-focused think tanks and organisations at some point over the last two decades. The reason why it doesn’t exist already owes a lot to the nature of politics in the UK. One of the main criticisms levelled against the last Labour government was that it failed to take the Work and Pensions brief seriously. This was symptomatic of the way that Blair in particular organised his cabinets: positions were often allocated on the basis of loyalty rather than expertise, and as a result the position of Secretary of State in what became the DWP was treated as a political stepping stone rather than an office with an actual function. Part of the problem is that Work and Pensions is not one of the sexy Offices of State – it lacks the glamour of the Foreign Office, or the power of the Home Office or the Chancellery. The benefits portfolio is massive – accounting for by far the largest portion of government spending – and one that it is almost impossible to succeed in.

Whatever criticisms can be levelled against Iain Duncan Smith, however – and there are many – he is the first Secretary of State that the DWP has had since well before Thatcher that both supports the premise of a benefits structure and possesses a practical interest and knowledge in its workings. He is not a careerist – he has lead his party and has no aspirations. That alone is important for one reason: the continued presence of an interested Minister means that, for the first time in decades, there is a genuine interest in reform.

The shift to a Universal Credit comes with some positive and negative consequences, but responses have split – as everything does, these days – along strictly tribal lines. So before we go too much further, this needs to be said: the idea of a universal credit has held a position of logical necessity for almost every expert in the field of benefits reform for nearly thirty years. The specifics of implementation are important and worth more rigorous consideration, but the raw benefits and disadvantages of a universal credit go deeper than political ideologies.

First, pros. The administration of a single universal credit scheme would be massively more manageable than the bloated manpower infrastructure and costs generated by the DWP, which is something like the fifth largest employer in the UK today. If the government has to cut costs then this is an unambiguous win – every penny that can be saved in benefit administration is a penny that doesn’t have to be cut from the benefits themselves. A massively detailed pdf by Gareth Morgan suggests that those who require benefits for a single reason would find themselves better off under the scheme. More will be done on a sliding scale, meaning that benefits can be more flexible to recipient’s needs, rather than the currently rather inflexible scheme that sees millionaire pensioners automatically receiving bus passes. Finally, the single universal credit has the big advantage of removing the delineation between different types of benefit, and thus the attached stigma that comes with specificity.

Then there are cons. While the recipients of single benefits would on the whole be better off, those who claim multiple benefits – child support and disability living allowance, for example, will find their net benefits decreased, although they will also find the process of applying for the single benefit more straightforward than the current melange. On that subject, however, means testing is controversial. That dispute is also varied in quality – some assert that it is a way of bullying recipients into accepting less, some claim that it’s a more direct way of objectively evaluating and eliminating scroungers – but either way, it is indisputable that means testing results in lower payments overall. Importantly, given the government’s recent record of aggression towards claimants, a wholesale switch in systems can be used as a trojan horse to sneak benefit cuts in through the back door. And finally, while the operation costs of a universal credit are much lower, the implementation costs are high. The Chancellor is reportedly relaxed about this, but there are reports that some of the more extreme attacks on existing benefits levels are being added at his behest, so it is unclear whether the calculus will change for him if the Lords continue to work in exclusions.

Finally, the risk of any change to the benefit system is the accompanying rhetoric. Whatever happens, expect more fulminating about scroungers.

So the devil remains in the details. On balance, a universal credit’s benefits outweigh its depredations – any negative impact on overall benefit levels can be counteracted from the massive stack of money that will be saved from operation costs. Whether you trust the current government to pass a policy that works as benignly – or think you can count on the House of Lords to stand in the way of the worst excesses – is another issue.

German strength, French weakness

January 25th, 2012 | Posted by Aosher in Politics | Politics - EU - (2 Comments)

There is an old adage to the effect that the Franco-German relationship exists to both hide France’s weakness and obscure German strength.

Post-reunification, Germany has had an uneasy relationship with its own power. It remains a reluctant military power, much to the frustration of its allies in Washington, London and NATO; and in the EU it has preferred to wield it’s clout quietly, allowing France’s Nicholas Sarkozy to take the lead on promoting a “Merkozy” agenda while keeping its own arm-twisting activities behind closed doors. The one area in which Germany has been contend to exert itself has been economic. Ironically, the division and reunification of the country has left it less dependent on post-manufacturing industries and recession-hit developed markets than it’s big European stablemates, and its historic position as east and south Europe’s main creditor has been carefully mitigated by extraordinarily low levels of public, corporate an personal debt. An economy that was already reaping the capacity benefits of its long, slow process of reunification is ideally placed to maximise its gains from a weak global economy and its subsequent rebound.

France is another story. The global recession has been particularly cruel to France, exposing the gaps in its massively centralised, leveraged economy. Even Britain’s similarly sized and distributed market has fared better, partly thanks to the City of London’s cozy relationship with the money markets but also thanks to a perception that the UK, which has much more control over its own currency and spending, is better placed to affect a recovery. The recent downgrade of its bonds by S&P has also effectively ended he collective delusion that France could be at the political core of the Eurozone. What moral right does France have to lead when it is ultimately in the same firing line as Italy and Spain? It’s political authority was always borrowed, but now the transaction is compromised. The ideological core of the Euro is Germany, and always has been, but that is now explicit.

This is starting to show in practice. Over the last month Angela Merkel has been taking meetings with European leaders in private, to promote her agenda, bypassing the French altogether. In public both sides insist that nothings has changed, but tell-tale signs of status anxiety – familiar to those who have observed the Anglo-American relationship – have started to emerge from Paris.

There are both opportunities and risks here for Germany and the Eurozone. The risks are most obvious. A Europe led by Franco-German concord could maintain a veneer of consensus politics. Unbridled German leadership may will no longer have that figleaf, and public discontent at ECB-enforced austerity may take on a new form. The image of an assertive Germany remains politically sensitive in Europe, for reasons that feel anachronistic in Britain and America but which still strongly resonate in Poland and Hungary. And like it or not, Germany’s political class are curiously uncharasmatic by European standards. This sends a message about what the Germans look for in a leader, but makes the task of selling tough economic reform to the Greeks and Italians – who have a marked preference for flash in their leaders – more of an uphill struggle.

The opportunities, however, are massive. Germany’s self-imposed doctrine of consensus-led soft power has allowed it to recover both the position and the reputation that it has always traditionally enjoyed, but the extent to which it can help – now that it has surpassed its local rivals and remains the only identifiably big fish in a medium-sized pond (which is shrinking by the day) – is diminishing. Meanwhile, it commands vast production resources, an educated and mobile workforce, and all of the legal accouterments considered necessary for an emerging market make the big leap. It feels odd to be talking about Germany as if it were an emerging power, as its level of development greatly exceeds that of the likes of, say, Brazil or South Africa. But, at the head and the heart of the world’s largest common market, Germany has the potential – if harnessed properly – to parlay its current position into something much greater. It is not too big a claim to suggest that the 21st Century could as easily be German as Chinese.

The obstacles to this are great. Britain, France, Italy and Spain are as likely to obstruct German leadership as support it, although – as David Cameron’s abortive veto over changes to the Euro Stability Pact before Christmas demonstrates – mutual antipathies make them unlikely to oppose a German ascent in tandem. The bigger obstacle is that Germany largely does not perceive itself as a hegemon-in-waiting. But then, neither did America. What is interesting is that Germany has many of the qualities required, should the need arise.

Is Ron Paul’s foreign policy actually possible?

January 23rd, 2012 | Posted by Aosher in History | Politics - Middle East | Politics - US - (2 Comments)

Ron Paul is a man with a small but constant and passionate fanbase. There are many reasons for this, some good, some bad – he is one of the few candidates to openly advocate liberalisation of drug law, for example, and in general his supporters, charitably, tend towards the naive on subjects such as his apparent racism. But one of the reasons for his enduring appeal is his advocacy for a military isolationism. In a country that has been suckered into too many wars of choice since 1950, a candidate promising a return to the good old days, when wars were fought only in the national defence and politics ended at the water’s edge, has a certain appeal. It even has an element of historical rigour to it; the great long-lived empires of the past have tended to shy away from ambitious rhetoric of global responsibility, fighting wars only to protect their back yards or expand them. President Obama was elected party on the basis of a similar aspiration.

Paul argues that America’s twentieth century saw its competitiveness and prestige tarnished through a series of ideologically incoherent, politically unnecessary wars, which also happened to be massively expensive and left the country’s political class in hock to its military industrial complex. He doesn’t just want to pull US troops out of its remaining one-and-a-half wars; he wants to root the military out of government payrolls entirely, proposing to shut bases from Germany to Korea, ending foreign aid entirely (which of course plays into a broader political point, part of which is that much of that aid goes to countries who simply use it to buy American kit), and reducing both economic and military support to Israel. The last paragraph tells you one important thing about Ron Paul: namely, that he will never be the President of the United States, or even a nominee for that office. Nevertheless his ideas resonate, both with young libertarians and rightward-leaning centrists. They have a long tradition in the US – military intervention is a post-war innovation, and it has been noted that Paul’s policy really only echoes those of the country’s thirteenth President Millard Fillmore.

But Fillmore lived in simpler times. Do the politics of a complex, interconnected world allow for the isolation of its greatest power?

The short answer is probably no. Obama has found disentanglement harder than his campaign rhetoric suggested; the Afghan war drags on, drone bombings have massively increased and offences against human decency, such as corpse desecration and Guantanamo Bay, remain as problematic as they were under President Bush. This is partly a reflection of the world in which we live. Retired Colonel Pat Lang today asked

It is not clear to me what Ron Paul’s actual position is. Someone should ask him what he would do if the Iranians actually attempted to close the Strait of Hormuz to international maritime traffic. What would he do as president and commander-in-chief of the armed forces?

Presumably Paul’s counter would be that, by pulling its military out of Iran’s vicinity and reducing its support for Israel, the US would reduce tensions and improve its leverage sufficiently that such a situation would be less likely to arise. But this is optimistic, not least because the US is hardly alone amongst Iran’s agitators (Britain is arguably even less popular in Iran than the US). Disrupting oil traffic is an extreme case, but the truth is that the US is implicated, either directly by dint of supplied equipment, economically by dint of strategic interests, or morally by way of training or political support, in more or less every conflict that could conceivably take place. The international system is immensely complex. The US can not extricate itself from the web of coercive force that partly constitutes the international political order. One way or another, all wars are about power, and therefore all wars inevitably factor in the superpower. Declaring isolationism will never protect the US from being attacked.

Obama has already demonstrated that imprudently promising an end to American war. In truth, the call to war for any country is often driven more by events outside that country’s borders, and the intentions of a single leader can rarely stand in the way of the inevitable – remember, George Bush Jr came to power expecting to be a peacetime President. Paul’s rhetoric is hopeful, but it is based on a fantasy that can never be realised unilaterally. Were Ron Paul ever to find himself in the unlikely position of holding office, his principles would not survive first contact with the enemy.

Face of the Week

January 22nd, 2012 | Posted by Aosher in Politics - (3 Comments)

This week saw Romney’ aura slip as Newt win South Carolina, tensions with Iran tighten as the US and Europe blocked oil imports, and Scottish independence take a bit step forward. However, my face of the week for this week relates to none of these stories. Like most, if not all, observers, I thrilled as Britain’s most popular elected official effectively launched his re-election campaign:

Alexander Boris de Pfeffel Johnson, yawning

Between lobbying for a new airport in the Thames estuary, planning fresh tunnels under the Thames in Greenwich and criticising the unemployed youth of today (a population which includes your humble author) as being too feckless and lazy to find work, London’s Mayor Boris Johnston has been ubiquitous this week. As often happens to elected officials, he swiftly found that the more people see him, the less they like him, but he remains likely to regain the nomination simply by tilting at his own party from the left. Another four years of dealing with the finesse of bus policy beckons.

Congratulations Boris Johnson, my Face of the Week!

Matt Yglesias does not understand what hedge funds are for

January 21st, 2012 | Posted by Aosher in Economics - (0 Comments)

I owe the internet a longer post about hedge funds, because they’re an interesting phenomenon, and an instructive one for anyone interested in some of the more exotic products thrown up in sophisticated money markets. This won’t be that post, though. For now I just won’t to respond to this piece from Matt Yglesias, who now blogs for Slate:

Insofar as hedge fund managers are just running a scam where one class of rich people rips off another class of rich people, I’m not sure there’s anything systematically problematic about this. But a large share of the money invested in hedge funds seems to come from foundation endowments and pension funds. That in turn makes me wonder to what extent some of the dysfunctional aspects of the financial system can be traced back to dysfunctional governance of those institutions.

Yglesias (and the Economist’s Buttonwood, who he quotes) correctly observe that hedge funds have grown by a dowdy 2.1% over the last decade and a half, despite a booming economy. Indeed it is true – hedge funds have, over the last decade, failed to justify their existence in many respects. But there is a divide between how hedge funds are perceived as an element of the financial system and how they’re used by massive passives – pension funds, endowments and so forth. Hedge funds are often referred to as being an absolute return strategy, and many think this means that they simply exist to make as much money as possible by any means necessary. But that is in fact very rarely the case.

Primarily, hedge funds exist as a hedge against negative performance in more traditional asset classes; thus the name. A pension fund with a properly diversified portfolio will have a hedge fund allocation, not as a workhorse, not to generate massive returns, but to take advantage of unexpected effects elsewhere in the market – sudden stock market rises and falls, geopolitical instability, or bubbles. In other words, a hedge fund doesn’t have to outperform treasury bonds over the long term to justify its existence in a portfolio – it simply has to massively outperform treasury bonds during those periods when bond yields are weak, and thus protect the overall value and yield of the portfolio as a whole.

Now, over the past three years hedge funds have largely failed to do that. In fact they have had a torrid recession, largely because they are pursuing highly correlated strategies (i.e. strategies that closely mirror economic indicators, and thus largely conform to broader economic trends) – a recent study showed that 80% of hedge funds were investing in Apple, which is fundamentally not what pension funds use them for. Which just goes to show: Yglesias may not know what hedge funds are for, but he can be forgiven for that, as many hedge fund managers appear not to either.

Newt in Columbia

January 21st, 2012 | Posted by Aosher in Politics | Politics - US - (3 Comments)

Over the past week, the race for the Republican nomination for the White House has taken another strange turn. With the ink still wet on newsprint declaring the contest all but over – Mitt Romney having taken Iowa and New Hampshire, and having built up a prohibitive lead in South Carolina – it all suddenly unravelled. The Iowa win was taken from him as his slender victory was overturned, in Rick Santorum’s favour; and the removal of former favourite Rick Perry from the race saw Newt Gingrich leap into the lead in South Carolina. Meanwhile, questions about his tax affairs cropped up – allegedly he has been paying less than 15% on his many millions, and tax scandals are possibly second only to sex scandals in the affection of America’s tabloids. Suddenly, it’s all to play for again.

The merits of the contest are uninteresting. Romney is still overwhelmingly likely to win the nomination, but regardless of the outcome, then the Republicans – whose media mouthpiece, Fox News, this week referred to the President as a “skinny, ghetto crackhead” – will get the nominee they deserve. A defeat for President Obama is looking increasingly unlikely this November. America hates Newt but they’re lukewarm on Romney at best (Stephen Colbert: “the only difference between Mitt Romney and a statue of Mitt Romney is the statue never changes its position”), and as 2012 is likely to be a year of modest improvement in the US economy Obama doesn’t need to do much more than avoid tripping over his own feet.

The question remains, though: why has this Republican race been so weird?

From the moment Michelle Bachmann won the Aimes straw poll, a non-binding poll that is perceived as an Iowa bellweather despite its spotty track record, the race has been in almost weekly flux. Candidates have ascended swiftly then collapsed as an indecisive electorate have searched for a credible alternative to Romney. Fortunes have been made and lost as pundits, powerbrokers and gamblers have seen the shape of the race and built a position upon it, only for it to shift beneath their feet.

So what it is about this race, that has made it so volatile? Well, there are a number of factors, inevitably. One is the genuine lack of quality in the candidates. The nominees with an proposition that honestly appeals to a section of the electorate – Romney and Ron Paul, primarily – have performed consistently. Bachmann, Perry, Cain, Santorum and Gingrich have struggled, partly because they are competing for the same demographic (cultural conservatives and the reactionary right), but also because of their personal flaws. Bachmann has a long track record of saying incredible things on topics from taxation to religion; Perry is a stilted debater, prone to gaffes; Cain lacked a sufficiently robust and coherent grasp of his own policy proposals; Gingrich is a man of manifold personal flaws, which turns off his culturally conservative constituency. In many ways Santorum is a more ideal candidate, but his extreme conservatism may be a stretch too far even for Republican voters – he believes that even contraception is a sin and a threat to America, let alone abortion. He also suffers from attacks levied against him via his Google search results. All of these characters have wilted under fire from a largely hostile media, which has tactically engendered conflict between the candidates and their voters. Gingrich and Santorum have bounced back, the others have dropped out. Complaints about the lamestream media have inevitably followed, but if the candidates weren’t weak they would not need defending.

The other issue is the Republican Party itself. The split that emerged in 2008 between the mainstream party and its extreme Tea Party manifestation still exists, and the reality is that no candidate can convincingly appeal to the full breadth of aspiration in the party. This is a serious divide that will keep the eventual candidate from the White House in 2012. It’s debatable whether the it’s a conflict that cam be resolved at all.

Is Iran building the bomb?

January 20th, 2012 | Posted by Aosher in Politics | Politics - Middle East - (3 Comments)

A growing sense of unease is evident in Britain and the US. Populations that have been railroaded to war once suspect that the gears are quietly crunching once again. They may be right.

I saw “may be right”, but the only real doubt is to whether a state of declared war will exist in the near future. Because the US and Israel have been pursuing covert war against Iran for decades; STUXNET, drone incursions, explosive sabotage and targeted assassination of nuclear scientists, the last of which is arguably an act of terrorism. The ostensible casus belli is Iran’s nuclear programme, but Iran has consistently denied that it is making a bomb, claiming that its programme is purely civilian. That this is a lie has become an almost unchallenged public orthodoxy in Washington and Tel Aviv.

To those in the know, however, broad uncertainty does exist, which explains the emergence of articles like this one in today’s Haaretz – Israel ‘very far off’ from decision on Iran attack – which claims that Israel’s intelligence community believes Iran itself has not yet decided whether to make a nuclear bomb.

The Israeli view is that while Iran continues to improve its nuclear capabilities, it has not yet decided whether to translate these capabilities into a nuclear weapon – or, more specifically, a nuclear warhead mounted atop a missile. Nor is it clear when Iran might make such a decision.

This rings true to me. To an extent, the fate of the nuclear programme depends on both the extent to which external provocation backs the regime into a corner, as well as the extent to which internal pressure allows the government a free hand. 2012 could be a pivotal year in Iran – a parliamentary election in March offers a threat for fresh political instability, and an oil shock or the collapse of the Syrian regime could increase the ability of Iran’s enemies to tighten the screws. Any of these factors could bring even Iran’s robust political construction tumbling down.

Sobering thought for the day:

June 8th, 2011 | Posted by Aosher in Ephemera | Politics - US - (0 Comments)

“All the crimes Richard Nixon committed… are now legal.”

Some obituaries

May 4th, 2011 | Posted by Aosher in General | History | Politics - Middle East | Politics - UK - (0 Comments)

Was it right to have killed Osama bin Laden in cold blood?

Because that’s what the good men of SEAL Team Six did – they were given a kill order and they executed it, no pun intended.

It’s a complex question and gets tangled up in a lot of other problems, both emotional and intellectual. This post aims to unpick some of that.

Was it legal?

Many will hardly care whether it was legal or not, arguing that right and wrong are not always reflected in law. That’s a fair point, but legalities are still important, if only because they’re the difference between the subjective opinion of an individual and the agreed parameters established by a society.

On this issue the rules are actually very straightforward and relatively unambiguous: killing Osama bin Laden was inalienably legal under international law.

Under international humanitarian law, a member of an armed organised group can be killed as an enemy combatant, and as al Qaida was a recognised participant in the war in Afghanistan his death is an entirely justifiable act of war. The only strictures on such an action are the principles of distinction and proportionality, and the action in Abbotabad seems not to violate either of those restrictions.

Under international human rights law (a separate and oftentimes contradictory code), targeted killings are harder to justify but still not impossible. The International Covenant on Civil and Political Rights of 1966 is the document that governs this code, and it states that “no one shall be arbitrarily deprived of his life” – meaning that assassination is legal so long as it can be justified. If he had attempted to surrender then the case would be sticker, but the White House claims that bin Laden resisted arrest and that is certainly consistent with his own pronouncements of the issue. Given that the White House holds video of the killing – which can be subpeona’d – we can probably assume that they are being truthful in this regard.

Was it morally justifiable?

The question of moral right or wrong breaks in two – ‘can it be coherently justified to others’ and ‘is it, at a fundamental level, consistent with the moral norms established in our society’. One can be critically examined; the other is conceptually much more woolly.

The question of whether the killing could be justified is straightforward. Yes; it is clearly possible to build a coherent and convincing argument asserting that killing bin Laden was morally preferable to taking him alive. Here’s how you do it:

  • He was an enemy combatant, not a civilian. While taking him alive was an option, killing him was an equally viable one, and the question needs to be viewed in that light.

  • There was no gain to be had from taking him alive, for the following reasons:
  • He would not have given up information except under extreme torture, and the compulsion to use that torture would have been acute.
  • Taking him alive would not have changed the ultimate outcome. He confessed to the crime, he only would have been tried in America, and he would have been put to death.
  • The only difference is that taking him alive would have subjected the world to the spectacle of a court case, which would have had no real value. It would have been impossible to try him fairly, it would have been perceived to be a humiliating sham amongst our enemies (and many of our allies) overseas, regardless of how rigorous the trial actually was, and it would have given him one last prime-time podium from which to agitate for further slaughter. I accept that we should not be afraid to face extremist rhetoric, but that doesn’t mean we have to give it our network airtime.
  • The key point in the above section is that it wouldn’t actually win us any friends. People don’t like that we assassinated him and that’s sad, but the shitstorm we would have faced for trying him would have been much worse. The Nuremburg trials would have been invoked, and probably not entirely unfairly. America’s own divisions would have come to the fore as everyone’s favourite bigots – Beck, O’Reilly, Palin, Trump – would have vied to be toughest on the terrorist. Even our allies in the region would have been forced into the position of defending Islam, and bin Laden by proxy, from the acid tongues of America’s most divisive assholes.
  • Every day that he spends on TV in an orange boiler suit and shackles, his friends get more pissed off. That means reprisals, and not just against us – against anybody.
  • The videotapes of bin Laden’s final hours would be passed from hand to hand like relics. It’s a short-cut to martyrdom.
  • All of these would be equivocations from a moral imperative, though, were it not for one thing: he was an enemy soldier in a time of war. If he was a political leader, a civilian, then it would be a different matter, but he was a man whose life was war. Ultimately, this was the end he chose, and we shouldn’t let an obsession with abstract principles interfere with that.

So it’s certainly morally defensible. If the Dalai Lama can bring himself to recognise the justification then it seems bizarre to suggest otherwise.

Was it right?

If it’s legal and justifiable, then surely that shouldn’t be in question?

And yet. Outside of ground zero, away from the gates of the white house, many people – not just the airy-fairy left – are uneasy. The policy of whacking terrorist leaders is from an Israeli playbook that has a tendency to inspire revulsion, as Alan Dershowitz notes:

Among others, these critics include officials in Britain, France, Italy, Russia, the EU, Jordan, and the United Nations. [Jack Straw, the former British foreign secretary] once said, “The British government has made it repeatedly clear that so-called targeted assassinations of this kind are unlawful, unjustified and counterproductive.” The French foreign ministry has declared “that extrajudicial executions contravene international law and are unacceptable.” The Italian Foreign Minister has said, “Italy, like the whole of the European Union, has always condemned the practice of targeted assassinations.” The Russians have asserted that “Russia has repeatedly stressed the unacceptability of extrajudicial settling of scores and ‘targeted killings.’” Javier Solana has noted that the “European Union has consistently condemned extrajudicial killings.” The Jordanians have said, “Jordan has always denounced this policy of assassination and its position on this has always been clear.” And Kofi Annan has declared “that extrajudicial killings are violations of international law.”

Yet none of these nations, groups or individuals have criticized the targeted killing of Osama Bin Laden by the US. The reason is obvious. All the condemnations against targeted killing was directed at one country. Guess which one? Israel, of course.

I disagree with Dershowitz’s conclusion – I think that bin Laden is a qualitatively different name from Mahmoud al-Mabhouh, and politicians tend to be sensitive to the political sensitivities of condemning the killing of such a widely despised man. But nevertheless, a bad taste lingers. No-one is quite sure if they’ve passed through the looking glass.

Bin Laden wore no uniform. Is the argument that he was an armed combatant not a legal fudge? Yes, putting him on trial would be politically difficult. Isn’t that the kind of difficulty a strong society, with a sound ideological basis, should welcome? And aren’t the flag-waving crowds at ground zero… kinda crass?

And ultimately, those are justifiable concerns. I agree with the decision as it was made, but still, I am uneasy. It’s never comfortable to see an act of war feted on a widescreen TV.

Perhaps this moment will be a moment of closure, a final transgression that allows America to move past its dirty wars, to put Abu Ghraib and Guantanamo Bay behind it, and to close the door on “enhanced interrogation” and extraordinary rendition. If that turns out to be the case then the moral qualms will have to be quashed, because it will have been worth it, this final destruction of the mirror that reflected America back upon itself. If not then America will continue to owe us a little more justification for this than it has yet been able to give, to quiet that tiny voice of conscience; but in that case, more and greater atrocities await.

Is Iran in the business of funding African coups?

November 23rd, 2010 | Posted by Aosher in General | Politics - Middle East - (1 Comments)

This morning brings the news that the Gambia has severed all relations with the Islamic Republic of Iran. The two pariah states have a decent history of mutual declarations of support – developing nuclear power Iran once said that Gambia deserved support as it was under pressure from “bullying” powers, while human-rights-abusing Gambia has supported Iran’s right to atomic weapons – but the affair seems to be well and truly over:

[...] all government of the Gambia projects and programmes, which were implemented in co-operation with the government of the Islamic Republic of Iran have been cancelled.

[...]

The Gambia government hereby requests all Iranian nationals representing the interest of the government of Iran in the Gambia to leave the country within 48 hours from the effective date stipulated through a notification issued to the government of Iran.

What’s interesting, though, is that ties between Nigeria and Iran were strained earlier this week when Nigeria intercepted a shipment of arms that the Iranian government was routing through their ports. Also long-term allies, the Nigerians stopped just short of freezing the relationship but demanded a full and frank accounting from the Iranian government. Under pressure, Iran claimed that the shipment was from a private company and was on its way to Gambia… No reason was given by Gambia for the suspension of ties but it doesn’t seem especially likely that the two incidents are unrelated.

Shipments of arms going to Africa without the knowledge of the African governments in question are rarely innocent. The question is: is Iran arguing factions in Gambia? Or is it throwing its relationship with Gambia under a bus to hide its real activities elsewhere – possibly in Nigeria itself?

Narratives

November 3rd, 2010 | Posted by Aosher in General | Politics | Politics - US - (0 Comments)

I find media narratives strange at times.

Two years ago, Barack Obama was elected on a wave of enthusiasm at his message of hope and change. Was he? Or was he elected in a wave of rejection at the unusually unpopular George Bush?

At the same election, the Democrats entrenched their leads in both Houses of Congress. Did they get there on Obama’s coattails, or did they ride the same anti-Bush wave as he did?

Elections are made or lost on a hundred million micro-choices. Media narratives occasionally pick up on dominant trends but never tell the full story. All to often, however, their need to focus on narrative ignores the smaller stories of micro-choices and political realities. Today, the first obituaries for Barack Obama’s presidency are being written, despite the fact that his popularity is not abnormally low and that his involvement in campaigning was muted at best. Is it possible that this election was nothing to do with him at all?

The Republican party got handed an unholy beating in 2008, such that predictions were made that the party would be locked out of power “for a generation”. That can happen, from time to time; most notably, the Democrats held both houses of Congress for 13 consecutive terms, or 26 years (despite only holding the Presidency for twelve of those years in total) between 1955 and 1981 – astonishingly they continued to hold the House of Representatives until 1995, and unbroken run of 44 years. As the chart below shows, both Houses of Congress can be seen to be historically strongly Democrat.

The huge majorities that the Dems had after 2008, then, could safely be seen as presaging another long period of blue control on Capitol Hill, no? Well, not really. The 77-year average is interesting, but much more relevant is the last twenty or so. Since the Democrats lost control of both ends of the House in 1995 (from, it must be said, a 1993 peak that equalled their lead in 2008), the Republicans have controlled both houses non-stop until anti-Bush sentiment started to become acute in 2007. For many voters, the 110th Congress was the first in their adult lives that had enjoyed a Democratic majority in either Chamber, let alone both.

It was more fragile than it appeared, however, due that that aforementioned anti-Bush feeling. And this is the central thrust of my thesis: it’s actually pretty rare for a President’s popularity to affect the results of a Congressional election in a lasting or sustained manner. Carter was massively unpopular when he left office, but handed the Republicans only a weak, temporary control over the Senate and only an ephemeral boost to their minority standing in the House. The extent of Democratic control of Congress was virtually unaffected by either the unpopularity of Richard Nixon or the popularity (and untimely death) of JFK. Reagan made almost no headway on reducing the Democrat’s lock on either chamber, despite being widely popular across the spectrum.

Control of Congress changes at a macro level that, in many ways, cannot be understood through the results of a single election. Because they occur much more frequently, focus much more on local issues and are far more subject to manipulation through tactical spending, gerrymandering and the weird vagaries of political chance (would a Harry Ried figure really find himself against a Sharon Angle at the national level?) they are much more reliable indicators of the national political mood when taken as an aggregate over time. What recent history shows us is that, Congressionally speaking, we are living in a Republican era in this GOP control of both House and Senate may be considered the default mood of the country.

In other words: 2008 was a weird fluke, an ephemeral result brought about by the passage of an unpopular President. It was the equivalent to the GOP retaking the Senate in 1981. In all probability, Barack Obama could have done nothing to prevent it short of beating Osama bin Laden in a fist-fight underneath the Washington Monument. This result, in short, is an anti-indicator; it is simply political gravity reasserting itself. It could never last, and today’s result should not be taken in any other light.

Book-burning

September 10th, 2010 | Posted by Aosher in Politics | Politics - US - (0 Comments)

So there’s this pastor in America who, for weeks, has been talking loudly about holding a book-burning, specifically of the Qu’ran, on the anniversary of Sept 11. He’s now apparently semi-backed down (it was off; now it’s “postponed rather than cancelled”).

Two things here. First is that this guy, who has a flock of maybe 50 nutjobs in his congregation, has had world leaders, four-star generals and even Sarah Palin personally appealling to him to pull the plug. He’s been on 24 hour news non-stop for the last week or two, exploding his pulpit.

Second is that, in this country, he would probably have been arrested for inciting racial hatred and shut down in around 20 minutes.

Which way is better?

“Rape by Deception” in Israel

July 27th, 2010 | Posted by Aosher in Feminism | General | Politics - Middle East - (1 Comments)

A couple of days ago, a Palestinian man got convicted for rape by deception in Israel. The bare facts of the case are this. The man met an Israeli woman in a bar. The two got to talking, and during the course of the conversation the man directly claimed to be Israeli. The two spent the night together; explicit consent was given, and that consent was not made explicitly dependent on the man being an Israeli. Later, the woman discovered that the man was, in fact, an Arab, and prosecuted him for rape by deception.

This is a complex situation, clearly, and large sections of the internet have devoted considerable time to overreaching in search of hard conclusions. Mondoweiss, for example, which does this by raising false equivalences. Meanwhile, Al Jazeera calls it “the selective application of the law against Arabs” and “just plain racism.” Even Feministe concludes that “there are certain circumstances where rape by fraud is a legitimate claim” but “this… is not one of them, and opens the door to even greater abuses.”

One thing is clear: the crime of rape by deception is a legitimate complaint, and not in an abstract sense. Cases have been successfully prosecuted where the man has lied about his sexual health, passing HIV onto his partner; where a man posed as a senior official and promised increased social security payments in exchange for sex; and where a woman consented to sex with a man who she believed to be her boyfriend but was actually her boyfriend’s brother. The statute is not used for situations where a man, say, claimed to be 27 when he’s actually 25, or a woman who claims to be a supermodel in a bar.

For many, though, the overtly racist nature of the complaint seems to be the deciding factor. My own personal feeling is perhaps dangerously relativistic, but my gut tells me that racism needs to be viewed through a different prism when dealing with Israel and Palestine. From a western perspective, the explicitly racial justification for the suit can be nauseating; but then, racial issues – although by no means defused in Europe or America – are less of an immediate concern than they are in the Levant. It is impossible not to decry the institutional racism and xenophobic nationalist tribalism exhibited by both Israeli and Arab political and social elements.

But the heart of this case isn’t an abstract principle; it’s rooted in personal actions and responses. The woman felt genuinely and legitimately deceived and violated. That in itself isn’t enough to determine guilt of course. What is, however, is the fact that the man knew that the deception was of decisive magnitude and did it anyway. The problem here is that the man chose to tell a lie of sufficient magnitude to deny the woman the opportunity to give consent. That the woman’s objection to the deception was racist in nature is vile but to some extent beside the point.

In many ways, Israel and – to a lesser extent – the occupied territories (particularly the Hamas-dominated Gaza Strip) are fundamentally racist. They are societies constructed on a nationalist ideal, defined by opposition to an alien “other”. Widespread societal changes are needed to prevent citizens of Israel from viewing non-Israeliness as a defining flaw. But the fact remains that, for now, it is a defining flaw, and that fact is a factor that must have been known to the defendant.

As much as it galls me, I have to accept that in this case the verdict was probably correct.

EDIT: For an interesting comparative, check out how rape is handled in the UAE.

The West: Torture, Kidnap and Terror

July 15th, 2010 | Posted by Aosher in General | Politics | Politics - Middle East | Politics - UK | Politics - US - (2 Comments)

How far should a government go in order to safeguard its citizens?

Two stories have emerged concurrently that cast the question into new light. While most citizens tend to be happy with the theoretical notion of covert defence, security agencies usually try to keep the visceral practicalities of that defence obscured, as support for their methods often vanishes like spit on a hot rock when exposed to the full scrutiny of public opinion.

Yesterday, I discussed the story of Shahram Amiri the Iranian who was kidnapped by / defected to the CIA in 2009. To my chagrin, the post was overtaken by events almost as soon as it was posted; Amiri was flown back to Iran and has started to talk about the events that led to his disappearance:

Speaking to Al Jazeera during a transit stop in Qatar, Shahram Amiri said he was interrogated for 14 months by US agents who refused to allow him contact with his family, but that he “never cracked” and had not revealed any secret information about Iran’s nuclear programme.

Washington has denied the claims, saying Amiri had lived freely in the US, had himself reached out to US officials, and was free to come and go.

[..]

“They gave me a shot which made me unconscious and then transferred me to the US onboard a military plane,” Amiri said in Tehran, before making allegations that he was tortured during interrogations in the US.

“Within the first two months, I was subjected to fierce mental and psychological torture by agents and interrogators from the US Central Intelligence Agency.”

Speaking to Al Jazeera during his journey back to Iran, Amiri said he had been forced by US authorities to say in a video released on the internet that he was enjoying life in the state of Arizona.

Although it seems unlikely that the US will receive the censure it deserves for this, it is still unquestionably a scandal of severe proportions. The US government kidnapped a man on a religious pilgrimage, held him against his will for over a year and subjected him to torture and coercion. The man in question was not a military target, nor even a political one. Both the US and Iran deny that he was involved in the country’s nuclear programme, so whatever paltry justification the CIA may have had has become noticeably thinner.

Meanwhile, this morning the Guardian is reporting that the UK has also been complicit in kidnapping and torture, this time of its own citizens. The Guardian has helpfully highlighted many of the key passages, but the entire document is worth reading.

A few thoughts emerge from this. Firstly, dragging these revelations into the light of day is hard and the organisations that have done so deserve to be praised. Iran will probably not receive any credit for this in the wider world, but by doggedly and tenaciously pursuing the fate of its citizen it exposed a cruel double-standard at the heart of America’s security apparatus. Here in the UK, civil liberties organisations such as Liberty and, in particular, Reprieve deserve a tremendous amount of credit for their lobbying and legal action in exposing the worst excesses of the government in the early days of the Global War on Terror. These organisations should be celebrated for their achievements and offered every support.

Secondly, citizens should not be content to give abstract permissions to government in any situation, let alone one as broad-ranging as security and defense. We have an obligation to understand exactly what is being done in our name, and if we don’t ensure that the government is acting in accordance with our wishes then we are complicit in whatever acts they undertake.

Third, it is distressing that this is so unsurprising.

What the deuce is going on here

July 14th, 2010 | Posted by Aosher in General | Politics | Politics - Middle East | Politics - US - (2 Comments)

That’s Shahram Amiri.

Mr. Amiri is an Iranian who vanished while on hajj in 2009. What happened to him is a mystery. A video released by the Iranian government in June suggested that he was an Iranian nuclear scientist, that he had been kidnapped by the CIA and tortured, and that he was being held within the US against his will. In a concurrent video, a person who appears to be the same man explains that he wasn’t kidnapped – he moved to the US of his own volition, to complete his PhD. Further muddying the waters was this ABC report, which cited unnamed CIA officials, and which claimed that Amiri is a nuclear scientist, but that he defected to the CIA of his own free will.

That’s the straightforward bit.

Yesterday morning, both the Pakistani and Iranian governments claimed that he had taken refuge in Pakistan’s Washington embassy – which serves Iran’s interests in America in the absence of its own diplomatic mission – and was trying to get home. America flatly denied the claim, however, and Wired’s Danger Room blog has a repudiation from a spokesperson at the Pakistani embassy.

But a Pakistani embassy official tells Danger Room that the reports of Amiri turning up in the embassy are ”incorrect information” and “we have no one here” matching his description. That’s from an individual at the press office who didn’t identify herself and said she could not speak for the record. She added she couldn’t explain why a spokesman for the Pakistani Foreign Ministry in Islamabad told reporters that the scientist is at the embassy’s Iranian interest section, about two miles away from the main facility in D.C.’s Glover Park neighborhood. But she also didn’t split hairs: “He’s not in the embassy at all.”

That said, the Iranian interest section is staffed by Iranians, not Pakistanis. A spokesman for the Iranian interest section, Ali Shahrazi, tells Danger Room, “When we arrived this morning, [Amiri] was here.” He dodged a question about whether the Pakistanis assisted in Amiri’s alleged arrival, saying that it was the job of Iranian staff to help Iranian nationals. But there are lots of questions remaining about Amiri’s true identity, to say nothing of his whereabouts.

What to make of this? Firstly, if you think that the CIA isn’t trying to abduct Iranian scientists and hold them against their will then you’re out of your mind. The only question is, would they do so so badly? If true, this shows a frightening lack of finesse, not least in allowing the captured scientist the liberty to broadcast his unexpurgated thoughts onto YouTube, and then permitting him to wander into Pakistan’s embassy unimpeded. Also, the still above – of Amiri’s pro-Merican-version video – is so obviously staged it hurts. The chess set? The globe, artfully set to show America on its visible face? The warm, structured lighting rig (note how the light illuminates Amiri on the face, despite the low, mood-lighting behind)? C’mon, you can almost see the camera crew and military escort just offstage.

On the other hand, this could quite easily be an Iranian stitch-up, although it would be hard to see the benefit to Iran to escalate the story to the level that it has unless it had something worth revealing.

One thing is for sure, though, and that is that you couldn’t pay me enough money to be an Iranian nuclear scientist. Wherever he is right now, I’m quite sure that Mr Amiri is wishing for nothing more than a quiet life.

EDIT: Looks like answers may be forthcoming, as he’s on his way home.

Housekeeping

July 14th, 2010 | Posted by Aosher in Ephemera - (0 Comments)

Apologies for the lengthy silence. I’m currently in the process of winding up my current job and looking for a new one; I finish here in central Government on Friday and, at present, am facing unemployment. Activity on the blog may spike next week if, as seems likely, I find myself with a lot more free time.

The Civil Liberties agenda in Britain

June 29th, 2010 | Posted by Aosher in General | Politics - UK - (2 Comments)

The coalition government is making many of the right noises when it comes to civil liberties in the UK. Unpicking the authoritarian streak that Labour exhibited during its years in power is a worthwhile task that shouldn’t be trivialised, but the debate surrounding civil liberties is still defined by the rigid limits set out by those who enjoy many of the greatest privileges.

The list of areas to be targeted describes a largely positive direction of travel. ID cards and biometric passports are to be scrapped; the fingerprinting of children at schools is to be curtailed. Government databases are to be pruned back. FOI is to be extended; libel laws will be reviewed to protect freedom of speech; CCTV is to be regulated. A “Great Repeal Bill” promises to cut through swathes of redundant and obstructive legislation; in an email to his supporters, Nick Clegg suggested that the bill would

…roll back Labour’s surveillance state, scrapping ID cards, the children’s database and restoring civil liberties.

In areas like education, health and policing people are going to get much greater powers over the services in their area. And we are going to hand more powers to communities and councils.

All very fine and worthy. But the proposals are geared overwhelmingly towards a single section of society as beneficiaries. ID cards and CCTV are middle-class concerns. Freedoms of information and speech can be seen as a stimulus package for Britain’s already over-eager newspaper industries and will result in ever-more salacious stories for their largely middle-class audiences. The power to modify the services offered by schools, hospitals and local police forces are dogwhistle sops to Middle Britain. And while the exact form of the Great Repeal Bill is yet to be revealed, it seems unlikely to tackle such personal infringements as stop-and-search, the Dangerous Dogs Act, control orders, or ASBOs, which tend to target the poorer sections of society disproportionately.

But even the wild class disparity in the conversation is mild compared to the glaring hole that exists when talking about the most disadvantaged groups of all: political and economic migrants, and asylum seekers (the treatment of whom can be particularly inhumane). While the government’s commitment to reversing extended detention without trial is a big, and welcome, improvement, ASBOs in particular continue to be used as a method of suppressing dissent, as in this account from 2006:

Recently, at a demonstration outside Harmondsworth detention centre in solidarity with asylum seekers, I was hemmed in with 50 other protestors when the police used powers under section 14 of the Public Order Act 1986 to impose a blanket Asbo on anyone who tried to get near the buildings.

They then used powers under section 50 of the Police Reform Act 2002, which makes it an offence to refuse to give your name and address to a police officer who “reasonably suspects” that you have engaged in “anti-social behaviour”. A few people who refused were arrested.

This was no violent protest, and there was no threat to public order or anyone’s personal safety. But the demonstration gave the police an opportunity to use the laws to collect intelligence on “troublemakers”, without having to show that they had actually made any trouble.

This is particularly germane on the day in which the Parliament Square protestors lost their legal right to express their views – thanks to a decidedly illiberal misuse of existing powers.

The discussion on civil liberties in the UK remains too enmired in privilege. Part of this is because libertarians strongly tend to be middle class, white and male; their political preferences tend to reflect their (often unchallenged) social biases and privileges. Part of it, too, is because Labour have consistently chosen not to make social freedom a cause that they would fight for on behalf of the working classes, leaving it as a policy ground for the Lib Dems and the Tories – parties with their roots firmly in the middle classes – to scoop up.

But whatever the reason for the disparity, there is an opportunity now for the civil rights of all sections of society to be strengthened and extended. It requires that we not allow the discussion to be limited to those rights enjoyed by those who already enjoy entrenched rights and securities, whose political access is already entrenched. The work of organisations like Liberty needs greater support and needs to be extended to ensure that human dignity is respected at all levels of society. The rights enjoyed by well-off British citizens, while by no means complete, are some of the most extensive in the history of the world. It behoves us to extend those rights as far through our culture as is conceivably possible.

Bhopal and corporate responsibility

June 29th, 2010 | Posted by Aosher in General | Politics - (1 Comments)

Nearly 26 years ago, the Bhopal plant of an Indian subsidiary of Union Carbide, a massive US corporation, suffered a catastrophic malfunction. The storage containers of the plant – which produced industrial pesticides – leaked highly toxic gas during the night, exposing over 500,000 people to the poisonous fumes. Estimates into the effects vary – the Indian government confirmed nearly two and a half thousand deaths immediately after the leak, and fatalities related to the incident have swelled to over 15,000 since then. The company continues to insist that the disaster was the result of sabotage, but successive studies have pointed to a wide array of internal processes that led to the leak, including a negligent approach to critical equipment and safety standards. Most shockingly, the plant has still not been entirely fixed – 390 tons of toxic chemicals abandoned at the UCIL plant continue to leak and pollute the groundwater in the region.

I’m not going to attempt to replicate the work of the many journalists and academics who have been working to uncover the truth of this case for nearly three decades. The Bhopal Post does outstanding work bringing the unfolding effects of the disaster to a wider audience, while Amnesty has consistently agitated for justice. Unfortunately, the Bhopal victims’ days in court so far have delivered anything but. Union Carbide has so far paid just $470 million in damages and compensation, a criminally small sum in the face of the $3 billion claimed. Those officials who were tried for criminal negligence received small sentences – 2 years each. Warren Anderson, the head of Union Carbide at the time and the figure most widely blamed for the incident, was allowed to escape trial for reasons that remain unclear.

The incident has exposed some measure of hypocrisy on behalf of the US government when it comes to corporate crime. Union Carbide paid $470 million to clean up its mess, compensate half a million victims and build hospitals in the region. By contrast, BP have pledged $20 billion to clean up the Deepwater Horizon spill.

These two cases bring to mind a proposition, put forward by a British lawyer, that “ecocide” be considered a crime to be tried in the International Criminal Court, on a par with genocide and other crimes against humanity. As described, the suggestion seems whimsical at best:

The radical idea would have a profound effect on industries blamed for widespread damage to the environment like fossil fuels, mining, agriculture, chemicals and forestry.

Supporters of a new ecocide law also believe it could be used to prosecute “climate deniers” who distort science and facts to discourage voters and politicians from taking action to tackle global warming and climate change.

But the idea of a system of corporate responsibility that can be prosecuted at an international level is an intriguing one. It would, sadly, almost certainly be opposed by the US, which would regard it as a hostile mechanism for attacking American corporate interests. Sadly, it’s hard to see how justice can be served to those still suffering in Bhopal.

What is ‘shock doctrine’?

June 23rd, 2010 | Posted by Aosher in Economics | General | Politics | Politics - UK | Politics - US - (2 Comments)

In the run-up to yesterday’s UK budget, the left wing of the internet – a cocoon that I comfortably inhabit – made merry with its buzzphrase du jour. No shock doctrine for Britain! we hear from such twitterlectuals (and Green Party luminaries – many of the most vocal Green activists have been really going for the Lib Dems of late – but that’s another post) as Sian Berry and Adam Ramsay. Now, look; the budget was painful. We all got hosed, the poor proportionally more than the rich. And the government spin hasn’t been even remotely coherent; even the usually credible Lynne Featherstone came over all loyally dishonest.

But “shock doctrine” is one of those phrases that just annoys me. It annoys me all the more because it comes from the left – a space which I nominally occupy – but yet is such a deeply incoherent piece of intellectual padding.

It was popularised by Naomi Klein in her 2007 The Shock Doctrine: The Rise of Disaster Capitalism, in which she argued that free-market capitalists and their political backers have used, and occasionally manufactured, crises and disasters in order to inflict social change on populations that are unwilling to accept them but unable to resist, due to the aforementioned upheaval. The term gained traction on the left after the Haiti quake, when the US right-wing Heritage Foundation caused an uproar by suggesting that aid be tied to economic reforms. Here’s Adam Ramsay again:

News stories about Haiti are full of tales of looters. There’s less talk of a bigger scale plunder to come. In Naomi Klein’s ‘The Shock Doctrine‘ she maps the rise of “disaster capitalism”. She describes how, over 40 years, The International Monetary Fund (IMF), Pentagon, and various mega-corporations have increasingly used (or created) disasters as an excuse to push through unpopular right wing economic policies, and asset strip vulnerable economies.

I was just finishing this book on Thursday as the scale of Haiti’s earthquake was becoming clear. My immediate fear was an obvious one. So I did what all young lefties do in a time of crisis. I set up a Facebook group: “No Shock Doctrine for Haiti”.

I plucked that quote a little bit selectively but it illustrates my first problem with the term and its use: shock doctrine is a methodology seeking application. Exponents of the theory tend to force this most fashionable of ideas onto situations rather than respond to the unique characteristics of an individual incidents. The book, for example, rests on the idea that the policies of free marketeers tend not to be very popular. For the most part this is unarguable – even Milton Friedman would concede as much – but in her zeal to apply her theory to every possible case Klein makes some dramatic reaches. Apparently, Hurricane Katrina led to the “privatisation” of New Orleans against the will of the population; however, the reforms imposed on New Orleans were structural and mostly welcomed by a population frustrated by lazy and corrupt local government. Haiti is another example of this; although tying catastrophe aid to any kind of condition would have been horrifically wrong, measures to curtail corruption and establish good governance in one of the world’s poorest countries would have enjoyed overwhelming local support. Klein’s depiction of the 1993 Russian constitutional crisis as a conflict between grasping capitalists and honourable democrats shows a profound lack of historical understanding, and her claim that the protests crushed in Tiananmen Square were against further market freedom is based on pure ignorance. And those are just the cases that stretch credibility; the claims that Margaret Thatcher fabricated the Falklands War as a way of breaking the unions shatters it irrevocably.

The second problem is to do with the way that the argument is cased. At one level, the problem is that the issue is mischaracterised as being a tool used purely by the right wing to advance their corporatist goals. In truth, the technique of using a crisis to drive policy reform is as popular on the left as it is on the right. The New Deal in America was launched on an unwilling society as a result of the Great Depression; the great social reforms in the UK of the late forties and early fifties, which led to the formation of the NHS, arose off the back of the post-war slump; Barack Obama used the current economic collapse to the same ends. Blair and Brown spent much of their respective times in office extending the powers of the state, evoking the spectre of terrorism and war as justification.

But this gap masks a deeper problem with the argument, which is the assumption that governments should not use crises as a way of driving social change. It’s predicated on a somewhat condescending lack of faith in populations; it assumes that electorates, struck numb by catastrophe, are unable to resist the snake-oil of perfidious political salesmen. In fact, crises inspire rare moments of national unity; often these moments arise because the crisis in question has exposed a policy failing or fault that simply needs to be corrected, and the correction of which is obvious. Thatcher had to break the power of the unions; whether she needed to do so quite so thoroughly is an open question, but most even on the left now assume that the unions were too powerful, and that to persist in allowing them to run entire industries was a path to economic and social ruin. New Zealand, Chile and Brazil abandoned socialistic policies for freer markets because the former weren’t working well and induced economic crises.

There is some limited value to some of the ideas contained within the term “shock doctrine”. Attaching conditions to Haiti aid, for example, would clearly have been grossly wrong, and those who suggested it were rightly excoriated. The term itself, however, masks deep intellectual failings that continue to undermine the legitimacy of left-wing economic arguments. There is plenty to debate in the new UK budget; the rise in VAT, for example, will be economically and politically unpopular for some time to come. Branding it as “shock doctrine” is ludicrous and shrill, and will neither advance the debate nor grow the left-wing base in opposition.

Naomi Klein, meanwhile, remains an extremely poor role model for the left, and in an ideal world would join Michael Moore on the island of left-wing intellectual rejects. Honestly, we can be much better than this.