December 1, 2009

From the desk of Bob Keefe

Washington, D.C.

December 1, 2009

                                                                 Political Update

            From the looks of it, this will be a very big week for President Barack Obama.  Tonight he will unveil his comprehensive Afghanistan policy to the waiting world from the West Point Military Academy.  And on Thursday, he hosts a major conference at the White House designed to attack a more important political question, unemployment.

            A great deal of his presidency will be defined by these two issues… not so much by what he says in these events, but how the strategies he defines and the results he produces play out over the next months. 

            These are the two biggest political problems he faces – though it is fair to suggest that there are several other issues on his plate that compete for space in the top two – health care, budget deficit, global warming, just to name a few.  All are critical, but Afghanistan and employment are the issues that win and lose elections. 

The Wars

            The last thing that President-elect Obama would have thought he would be doing these first days of December is explaining his plan to increase the American troop strength in Afghanistan – with still 120,000 troops still in Iraq – just a few days before heading to Stockholm to pick  up the 2009 Nobel Prize for Peace.  It would have been incomprehensible twelve months ago… but here we are.

            While the focus on Iraq has dimmed, we still have more forces there than in Afghanistan – a total of 124,000 U.S. troops as of September 30, 2009.  The Coalition of the Willing has collapsed.  All other nations have withdrawn their troops.  We believe that the force will be drawn down dramatically next year, after the Iraq election now scheduled for January to fulfill the promise Candidate Obama made to end combat operations and withdraw most of the 142,000 troops he found in Iraq when he was sworn in within 16 months. 

            This would leave in Iraq a residual force of as many as 50,000 troops until the end of 2011, the date the US-Iraq Status of Forces Agreement stipulates the removal of all US troops. According to the president, this transitional force would have three missions: training Iraqi security forces, carrying out anti-terrorism missions and protecting American civilian and military forces.

            The President, in a prime time address to the nation tonight that mirrored  his speech in July 2007 as a candidate, explained his goals, his strategy and his long range vision for the Afghanistan mission.  In simple terms, the goals are to provide a security force as part of a counterinsurgency strategy to wipe out al Qaeda elements and stabilize the country, while training Afghan forces and building the central government to be self sustaining and secure.  Al Qaeda is, after nine years of war, the reason we went to Afghanistan after their attack on the United States on 9/11.  And we are still there trying to eradicate their threat once and for all.

            This new troop deployment brings the total U.S. force in Afghanistan to almost 100,000 troops, and they are supported by about 45,000 NATO forces.  Obama also emphasized the limit on U.S. resources in manpower and budget, and stressed that the Afghan mission is not open-ended.

            In pursuing this new troop deployment, Obama is swimming directly upstream and alienating his political base.  Most Americans (32 percent) oppose the increase while about 4 in 10 (39 percent) say the number of troops should be decreased. Just 2 in 10 say troop levels should be kept the same.  Democrats are the least likely to support an increase – just 17 percent do, compared with 34 percent of independents and about half of Republicans.  Obama pulled some scabs off of years old divisions in the Democratic Party with his decision to expand the Afghanistan conflict.  The Hawk and Dove division of the party of the 70’s may be re-emerging big time.  It is not pretty. 

            This new commitment is expected to cost $30 billion a year.  To date, $915.1 billion dollars have been allocated to the wars in Iraq and Afghanistan based on the total approved amounts through the end of Fiscal Year 2009.  In addition to this approved amount, the FY2010 budget shows a $130 billion request for more war spending. This would bring total war spending in Iraq and Afghanistan to more than $1 trillion. 

            Unfortunately, these costs are just the start of a long drain on the national treasury to pay for these conflicts.  The residual cost of providing care for the injuries and health problems of the veterans of these wars will be immense.  The count of the wounded now measures over 35,000.  Twenty percent of those injured have serious brain or spinal injuries- not counting those with psychological problems.  Thirty percent of US troops serving in these theaters have developed serious mental health problems within four months of returning home.  The care and treatment of these veterans will cost billions into the next decades.

            And what do we get for thousands of American lives and Billions of our dollars?  A recent poll in Iraq showed that:

• Iraqis “strongly opposed” to presence of coalition troops…  82%
• Iraqis who believe Coalition forces are responsible for any improved security…  -1%
• Iraqis who feel less secure because of the occupation… 67%
• Iraqis who do not have confidence in multi-national forces… 72%

            What a pretty dish to set upon the Presidential table.

Jobs

            Last week The Federal Reserve raised its estimate for economic growth next year and, while forecasting lower unemployment ahead, although the jobless rate will stay uncomfortably high for at least the next three years.  That is bad political news for the President and his party.  Nothing matters as much in politics as the unemployment rate. 

            The economic stimulus package passed last winter to stop the slide of the economy over the precipice did wonders for the overall economy and particularly, the stock market, but it did little to address the problem of unemployment.  The forecast shows the central bank expects gross domestic product, the broadest measure of the nation’s economic activity, to grow between 2.5% to 3.5% in 2010. That’s a bit more bullish than the 2.1% to 3.3% growth it had forecast for the period back in June.

            The Fed predicted high employment through this year and they were right.  Now they are predicting high unemployment for the next several years and that is really bad politics for the incumbent party.  The unemployment rate, which hit 10.2% in October according to the Labor Department’s latest reading, is expected to improve to between 9.3% to 9.7% for all of 2010.

            Getting America back to work is going to be the subject of a one day conference on Thursday at the White House.  The President has invited economists, business leaders, union and political leaders – 130 in all, to try to brainstorm the problem and come up with concrete plans to add jobs to the economy.  The conference is really a preliminary to the development of a jobs program by the Administration and the Congress.

            Here’s why.  As unemployment has increased, Democrats have fallen behind Republicans in Gallup’s generic congressional ballot.  The latest  survey shows that the  Republicans now lead the Democrats 48 percent to 44 percent – the first time Republicans have held a lead in the survey in several years.  And 2010 is an election year.

            The Jobs Conference will propose some form of government action to directly get more jobs.  One proposal Obama is seriously considering is a tax credit for businesses that bring on new workers. Obama as a presidential candidate proposed a similar plan, one that would award a $3,000 credit to businesses for each new, full-time worker that they hired. Such a plan was opposed when Congress was writing the stimulus in February, arguing that there were more direct ways of spurring economic action.

            Labor unions favor fiscal aid to help states stave off teacher and public employee layoffs, transportation and other infrastructure investments and increased loans for small businesses.  Plans for more infrastructure spending and expanding small businesses’ access to credit are also favored by Congress.

            For sure, some form of job stimulus will be forthcoming… and soon.  This week’s session will plant the seeds of what that stimulus will look like.

A Missed Deadline

            President Barack Obama surprised many this past week by adding a trip to Copenhagen for the meeting of United Nations Climate Conference to wrestle with other world leaders over the challenge of developing an international policy to control the emission of green house gases and fend off the ominous threat of global warming.  It was once hoped that this conference would agree on an international treaty to lock in national emission standards to replace the Kyoto Treaty which will expire soon. 

            Obama’s presence at the conference will be brief and more symbolic than participatory.  He will arrive empty-handed.  The United States is not prepared to provide the leadership other nations had expected in this vital effort.  Climate change has lost ground in the pecking order of priorities.  United States policy on this issue is unsettled. 

            Emission standards are controversial.  A few nations, including the United States produce a vast majority of the noxious gases that are blamed for climate change. Our emissions are caused by our vast use of petroleum in transportation and coal to produce electricity in support of our modern advanced way of life.  Less developed nations are loathe to commit to emission standards that might impinge on their increased industrialization and modernization.  They want to grow through industrialization the way we did… and not have to worry about the soot and smoke that their chimneys belch carbon into the air. 

            Emission standards are controversial in the United States, too.  There is broad public support for an energy reform policy that reduces carbon emissions and promotes increased reliance on alternative and renewable energy. Americans believe it is urgent that we end our dependence on oil, especially imported oil, and see the development of alternative energy as offering real potential to create the next generation of American jobs. 

            I’m afraid the consideration of health care reform by the Congress may have taught them bad lessons on how to act.  Climate legislation is easily as complicated as health care.  There are ample special interests which will want to protect their turf and their profits.  Additionally, there is a geographic phenomenon that does not exist in health care. The energy producing states, Texas with its oil, Montana with its coal, see their interests challenged by methodical carbon reduction.  And those states have two senators who can obstruct, delay, and object to legislative proposals.  It could be Health Care Version 2.0, and that is a shame.  We need to do it right.

Meanwhile, our Wars Continue

             Lest we forget, Americans keep dying and keep being injured in Iraq and Afghanistan.   The official count as of November 30, 2009, of the dead since our involvement in Iraq began on March 23, 2003 is 4,367; the dead from the war in Afghanistan from its beginning in September 2001 is 929.  The count of American service personnel wounded in Iraq is now 31,607; in Afghanistan 4,684, according to the Department of Defense.

            By the time I have to rework these totals in the next Political Update, President Obama will have begun to implement his new policy for the Afghanistan problem.  I wish there were good options, but I fear there are none.  I am glad he took a holistic look at the situation…not just a review of troop requirements.

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Robert J. Keefe

TKC International, Inc.

1776 I Street, NW, Suite 900 – Washington, D. C. 20006

Telephone: 202 255-8161 – E mail: rkeefe@tkci.com

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