Hire China's Princelings, Lucrative Contracts Follow

Last May, according to a report by the New York Times, JPMorgan Chase received a request from the antibribery unit at the US Securities and Exchange Commission. The company complied, providing information on the hiring of Zhang XiXi. In August, the company disclosed it had also provided information on a second hire, that of Tang Xiaoning.

Why were these Chinese employees of interest to the SEC? Both are the children of current or former high-ranking Chinese officials. These types of hires, and there are scores of them across Wall Street banks, are the focus of a current SEC investigation into whether or not US banks have been offering “princelings”—the sons and daughters of China’s ruling elite—jobs or contracts in direct exchange for business.

Doing so would be in violation of the Foreign Corrupt Practices Act, a 1977 federal law that forbids US companies from offering a long list of items, from cash to plane tickets to parties to gifts, to a foreign official in exchange for business.

Egypt Comes Full Circle -- Again

Here’s the opening of Eric Trager’s latest on Egypt in The Atlantic:

Nearly six months after the mass uprising-cum-coup that toppled Mohammed Morsi, the key cleavages of Egypt’s domestic political conflict are not only unresolved, but unresolvable. The generals who removed Morsi are engaged in an existential struggle with the Muslim Brotherhood: They believe they must destroy the Brotherhood—by, for instance, designating it a terrorist organization—or else the Brotherhood will return to power and destroy them. Meanwhile, Sinai-based jihadists have used Morsi’s removal as a pretext for intensifying their violence, and have increasingly hit targets west of the Suez Canal. Even the Brotherhood’s fiercest opponents are fighting among themselves: the coalition of entrenched state institutions and leftist political parties that rebelled against Morsi is fraying, and the youth activists who backed Morsi’s ouster in July are now protesting against the military-backed government, which has responded by arresting their leaders.

Egypt has come full circle twice—first when General Sisi made himself the second coming of Hosni Mubarak, and again now that young activists are at war with the government.

The idea that Sisi would ever “restore” the democracy that went “off track” with Morsi, as so many activists claimed when he seized power, was always delusional. Egypt had no democracy to begin with. (A single election does not a democracy make.) Nor does the Egyptian military have a democratic cell in its corpus.

Egypt’s choice is the same now as it has been for decades: Islamic theocracy or military dictatorship. It can’t be sustainably settled at the ballot box, so it will be fought over instead in the streets.

Ariel Sharon (1928–2014)

It speaks volumes that Ariel Sharon, whose name rarely if ever appeared in any context without the word “controversy” or “controversial” nearby, was in his own country most often referred to by his few close friends and numerous foes alike by the familial “Arik,” reducing him from the grand lion of “Ariel” to human proportions. Without any doubt this was meant to signify that what he represented, good and bad, both in generous proportions, was inseparable from the existence and history of Israel, a country, which he indefatigably served.

A Free Donetsk?

Want more proof of the fact that the Yanukovych regime is crumbling? Take a look at recent goings-on in his bastion, Donetsk.

Communists ruled the city with an iron fist for decades; then the equally thuggish and equally corrupt Regionnaires took over. The Yanukovych Family, their cronies, and Ukraine’s richest man—indeed one of the world’s richest men—Rinat Akhmetov control everything, making sure that the majority of the population reads, hears, and sees only what they want them to read, hear, and see and snuffing out opposition by means of intimidation, coercion, and violence.

Think of poor Donetsk as a mafia town that is also a company town. Small wonder that, while privately expressed criticism is rampant—especially by the city’s sizable educated elite—open opposition is minimal. To protest publicly could mean sacrificing your career, your family’s life chances, and, possibly, your health. With the population cowed, why shouldn’t the Regionnaires feel confident? Until now.

Creating 'Independent Arab and Jewish States'

What’s in a name? That which we call a rose
By any other word would smell as sweet...

Diplomacy is inherently ill-equipped to handle identity. It excels at obfuscating issues, deals in constructive ambiguities, and fudges sharp divisions. Its product, when it succeeds, is invariably some kind of a document that no one is happy with but everybody can live with. Identity, on the other hand, requires clarity, which serves to reaffirm the image people have of themselves and their position in the world. Identity without clarity is no good because instead of reaffirming, it reinforces doubts about the image people have of themselves, and even more so, about the image other people have of them.

Islamist Rule in Tunisia is Over

Tunisia’s Islamist prime minister resigned today and ceded power to a caretaker government. He was not overthrown by guerrillas or by the army, but by peaceful and legal means familiar to citizens raised in democracies.

Tunisia is still the model for post-revolutionary politics in the Arab world. I expected as much at the outset and explained why three years ago. Morocco is the only Arab country in the entire world as politically mature. Egypt is an emergency room case, Libya could turn into a failed state if it’s not careful, and Syria is suffering near-apocalypse. Iraq is…well, it’s Iraq.

And truthfully, that headline of mine is a little exaggerated. The Islamists never actually ruled in Tunisia. They were simply the largest party in a governing coalition, and they were resisted at every step by millions of liberals, secularists, and socialists who also had a voice and a vote.

When I returned for the second time two years ago, the country didn’t look or feel even remotely Islamist. It looked and felt exactly as it did when the government was autocratic and secular, only citizens could finally speak and act freely.

The Tunisians I’m still in contact with think a secular labor coalition will sweep the next election later this year, and they’re probably right, but political predictions in the Middle East are about as accurate as a weather forecast several months in advance, so we’ll see.

Afghanistan Before the Wars

Business Insider has published an amazing gallery of photographs taken in Afghanistan before the wars (the first was the Soviet invasion and insurgency) blew the place back to the seventh century.

Afghanistan clearly was not an advanced country then, but it functioned and had not yet been destroyed.

China’s Water Crisis Made Worse by Policy Failures

On Friday, the National Development and Reform Commission announced that China will, by the end of 2015, put in place a three-tier pricing structure for water. Heavy users will pay more under the new system, which will cover all cities but not all towns. The Wall Street Journal called it “the first stab at actual resource-sector reform” after November’s Third Plenum.

Technically, it’s the first announcement of a future stab because it remains to be seen whether significantly higher charges, which will surely be unpopular, will in fact be imposed. If there were political will, the NDRC would likely have put the new and urgently needed price restructuring system in place much sooner.

Al Qaedastan in Fallujah

Al Qaeda has reconquered parts of Fallujah and Ramadi, and Iraqi security forces are battling to reclaim them.

The bin Ladenist resurgence in Iraq may be but a blip. It could also be just the beginning of yet another Middle East horror story. I spent more time than I ever wanted hanging out with American and Iraqi soldiers in Fallujah, Ramadi, and Baghdad during the war, and I spoke to dozens if not hundreds of people there during that time, and the salient features of the Iraqi army back then were extraordinary incompetence alongside extraordinary improvement. We’re about to find out which trait wins out.

Let’s be perfectly clear about one thing, however: The hatred in Iraq for Al Qaeda is incandescent, even in the Sunni areas that theoretically make up its base. This should not be hard to believe. Bin Laden’s Mesopotamian enforcers butchered far more Iraqis than they even dreamed of killing in New York and Washington.

They shot people for smoking. They tortured people to death. They threatened to execute vegetable vendors who displayed cucumbers and tomatoes next to each other. (The vegetables are supposedly different genders.) But that was back when the stores were still open. Just a few months before I showed up in Ramadi in 2007, Al Qaeda so thoroughly ravaged the city that the economy ceased to exist. It was at zero. Nothing worked, nothing was open. Electrical wires ran cold. Water didn’t come out of the sink. Garbage collection was a thing of the past. Life itself was nearly a thing of the past. Al Qaeda did not even try to govern the places they seized. They were just psychopaths running amok during a local apocalypse.

Political Islam may always have at least a small natural constituency, if not a large one, in the Muslim world, but Al Qaeda’s totalitarianism is in a dimension beyond. It is at war not only with the West and the region’s Shia minority, but also with the Sunni Arab society that produced it.

An Iraqi police officer in the Fallujah area explained it to me this way four years ago: “When you join the Al Qaeda organization, the first thing you have to do is get your parents far away from your mind. Your father and mother have to be away from your thinking. There can be nothing else. Only the Al Qaeda organization. Your kids, your wife, your family, your parents, your beliefs, all have to be out. Only then can you enroll in the Al Qaeda organization. If an Al Qaeda officer gives you an order to kill your father, you have to do it. Your father, your mother, your neighbor, no matter who it might be. It's a matter of ideological indoctrination from the organization itself.”

Al Qaeda isn’t so much a faith-based movement as a totalitarian political cult. It’s an extreme offshoot of the Muslim Brotherhood, but it has more in common operationally with the deranged Shining Path in Peru than with its parent organization.

The Sunnis in and around Fallujah and Ramadi initially welcomed Al Qaeda as liberators from the American occupiers, but the overwhelming majority whipsawed to the American side after the mask came off.

The story of Sheikh Jassim, who helped forge the Iraqi-American alliance in Ramadi and was punished for it severely, is typical.

“Al Qaeda said they would mess him up if he got in their way,” an American army lieutenant told me back then. “He called their bluff and they seriously fucked him up. They launched a massive attack on his area. All hell broke loose. They set houses on fire. They dragged people through the streets behind pickup trucks. A kid from his area went into town and Al Qaeda kidnapped him, tortured him, and delivered his head to the outpost in a box. The dead kid was only sixteen years old. The Iraqis then sent out even nine year-old kids to act as neighborhood watchmen. They painted their faces and everything.”

And yet Al Qaeda has taken Fallujah three times—twice under the noses of the American military, and again this month after boosting their regional strength in the Syrian war.

This is an old story. Ideological minorities have managed to violently seize power all over the world and impose tyrannical rule on the majority. It happened during the 20th century in Russia, Iran, Germany, Cambodia, Syria, Cuba, and in so many other places. And it is happening in the 21st century in parts of the Middle East and North Africa now at the hands of Al Qaeda. The Taliban are doing the same thing in Afghanistan.

Those of us raised in democratic societies have a hard time believing this is even possible, but it happens, and there’s only so much we can do about it. Sure, the US military can drive Al Qaeda from a given location, no problem. I witnessed it myself and wrote about it extensively in my book, In the Wake of the Surge.

Yet guerrilla and terrorist war saps so many advantages even from conventional superpowers that victory is always costly and occasionally only temporary. Al Qaeda has such a wide theater to operate in that counterinsurgency is a game of planet-wide whack-a-mole. Booted out of Afghanistan? Go to Iraq! Defeated in Iraq by the Americans? Move to Mali! Kicked out of Mali by the French? Go to Libya! It’s like using radiation and chemotherapy against a cancer that won’t stop metastasizing.

I’d love to be able to say we should do x, y, and z and Al Qaeda will eventually cease to exist, but there are no x, y, and z. The world may have to wait for this scourge to extinguish itself like communism did in Europe. That hardly implies we should do nothing in the meantime—we did not sit passively by until the Soviets self-destructed—but our options are limited and it will likely take decades.

Is It Too Late to Fix Syria?

On December 20th, Lakhdar Brahimi, the United Nations mediator for Syria, held a preliminary meeting to determine who should attend the much postponed January 22nd talks on the Syrian conflict. More than 30 counties have asked to be at the opening session in Montreux, Switzerland. Obviously, they include the parties with the highest involvement, headed by the United States and Russia, but also Luxembourg, which currently occupies the chair of the UN Security Council.

Brahimi’s other challenge is to identify the participants from the Syrian maelstrom itself, and then persuade them to commit to attending the nuts-and-bolts talks that the UN hopes will jump-start the painful and complex process of determining Syria’s future.

Given the insurgency’s public insistence on President Bashar al-Assad’s departure as a precondition to coming to the table, it is hard to see how the talks can get off the ground at all. Without “jaw-jaw,” as Churchill once called it, there may shortly not be a Syria to argue about. But do the warring factions and their various international supporters realize it?

Brazil's Important Election Year

When political disillusion takes hold in emerging democracies, some leaders step down. Indian Prime Minister Manmohan Singh, after a stunning electoral defeat for the Congress party in provincial elections, announced last week he would not seek a third term. At age 81, Singh has served for 10 years that disappointed expectations that India would undertake modernizing economic reforms. In Argentina, where an electoral setback in October was followed by police strikes for higher pay and widespread looting of supermarkets, President Cristina Fernández de Kirchner, a left-wing Peronist, announced during a wave of power blackouts and soaring inflation that she would not seek election again to any public office. These changes of leadership are healthy signs for democracy because they recognize that freedom of political choice requires new faces and better alternatives.

Al Jazeera's 'False News' Problem

After the disaster that was Mohamed Morsi, Egypt’s erstwhile leader, it is tempting to dump all over the current regime as well in a plague-on-both-your-houses tantrum. Morsi’s rule was repressive, mean-spirited, pusillanimous, disastrous for the country’s Copt population, who were terrorized under his rule, and disastrous, too, for the press, which was ordered, under the new Morsi Constitution, to “adhere to sensible, professional, administrative, and economic standards.”

Personally, I do not know exactly what those enumerated media duties entail—they seem fairly vague from this distance—but one other little addendum helps somewhat to clarify matters. Under Morsi, “insulting the prophets” became a criminal offense. In fact, Morsi’s Muslim Brotherhood allies went to work on that little twist to the Egyptian Constitution right away, filing criminal complaints against those media outlets who supplied what they called “wrong information” or those reporters who went in for “insulting the president.” President, prophets: they all had, it turns out, tender egos.

New Year, New Political Prisoners in Russia

“You should not see me as a symbol that there are no political prisoners left in Russia,” Mikhail Khodorkovsky, for more than a decade Russia’s best-known political prisoner, said at his Berlin press conference in December after his surprise pardon. “I am a symbol that the efforts of civil society may lead to the release of people whose release was not expected by anyone.” He vowed to make the freedom for Russia’s remaining political prisoners a priority in his own public activities.

The First Post of 2014

I took a break over the holidays to recharge my batteries and keep myself sane, but the entire human race didn’t stop or slow down, so there’s news.

Guess what the news looks like from the Middle East? That’s right. It’s bad.

Hezbollah may have moved long-range Scud missiles from Syria into Lebanon, and Al Qaeda reconquered Fallujah.

The way things are going in Syria, Al Qaeda might even take over Damascus. We are long past the date when a non-horrible outcome from that war was possible. And it could very well make the next war between Israel and whatever remains of the Syrian-Iranian-Hezbollah bloc even worse than it would have been otherwise.

I need a little time to get caught up on recent developments and write my next dispatch from Cuba. In the meantime, if you want to read anything cheery, look at Tunisia. That country has a lot of problems, including many of the Middle East’s typical problems, but it was ahead of its neighbors before the Arab Spring, it was ahead of its neighbors during the Arab Spring, and it’s still ahead now.

Gonged by the Royals

Every December 31st, the New Year Honors list recognizes UK citizens who have distinguished themselves in the past year and confers on them one of a series of decorations ranging from knighthoods to medals. Most of the list is compiled by 10 Downing Street and is often an acknowledgement of services rendered to the government and/or the ruling party. But early in the year a series of investitures are held at Buckingham Palace at which Queen Elizabeth II personally presents each decoration, a ceremony that includes tapping new knights on the right shoulder with a sword.

These honors are familiarly referred to as “gongs,” but for the most part they are a source of great pride, and the titles that some of them confer are rigidly observed by the media. As usual, the British press focused on the better known recipients: for example, the actresses Angela Lansbury and Penelope Keith were each named Dame Commander of the Most Excellent Order of the British Empire, and the mezzo-soprano Katherine Jenkins, best known in the US from competing in Dancing with the Stars, is a Commander of the British Empire.


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