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PA faces future with fewer donations

The Palestinian Authority has long been a political football in the Arab world, and that has never been more apparent than during the Arab Spring. Mahmoud Abbas’ request that wealthier Palestinians donate food from expensive iftar dinners — the meal following the daily Ramadan fast — to the poor exemplifies the drop in funding the PA has received from its Arab friends.

The last paragraph from this short Al Bawaba story is the most telling:

For months, Palestinian Prime Minister Salam Fayyad has warned of financial woes due to a chronic shortfall in financial support pledged by donors, especially Arab countries.

Arab leaders have long used Palestinians as a symbol of Western oppression. However, most of those autocratic Arab leaders held discriminatory views of Palestinians, relegating them to second-class citizens. Only Jordan accepts Palestinians into its borders, where they are treated more as a nuisance than an accepted portion of the population.

But the Arab Spring has made it clear that while the leaders viewed the Palestinian symbol as important, the Arab street has not. The Arab Spring was never about and never will be about Palestinians. Arab oppression occurred at home at the hands of their own government, not the West. That means when and if democratically-elected governments come into power, the Arab street will hold those politicians accountable for domestic problems. Those leaders will not be able to deflect problems on the West if they want to win re-election — the Arab street is no longer uninformed or naive. Communication technology has opened them up to how the Western world lives, and those societies are not built on oppression like the Arab world’s autocrats claim.

All this could reduce financial support for the PA. Arab politicians will realize their citizens care more about the domestic situation than some existential Western campaign of oppression in the Middle East. The fact few Arab protests have invoked the Palestinian cause in this Arab Spring shows how little that issue matters. Arab citizens will likely frown upon sizable donations to the PA if such donations lead to sacrificing domestic issues.

That means the onus is on the PA to develop its own economies. The West Bank has done an admirable job. Gaza, on the other hand, has not been as fortunate. It will be interesting to see what happens if the Rafah crossing at Egypt has any effect — and if the Muslim Brotherhood, which supports the PA, ramps up Egypt’s influence in the PA.

The West Bank has experienced significant economic growth during the past several years. Ramallah’s population doubled between 2000 and 2010, with Israel saying much of that growth came from removing various checkpoints. At the same time, checkpoints and security measures in the Gaza Strip have prevented the free flow of goods and capital needed for economic development. The West Bank, therefore, has grown at a much faster pace while Gaza has stagnated.

Arab countries comprise 20 percent of PA donations. The European Union, which is dealing with a significant monetary and debt crisis, amount to more than half of donations to the PA. Relying on this aid is unsustainable and unlikely to continue at its pre-recession rates.

The West Bank is doing relatively well, given its circumstances. Gaza, however, relies on direct donations because its economy has been stunted by heavy-handed Israeli security. Whether justified or not, there is no doubt Israel’s security apparatus damages Gaza’s economy.  I would argue economic development and opportunity would reduce terrorism’s draw and therefore mitigate Hamas’ role in Gaza, but I’m not going to waste my time, either. Things like the 2005 unilateral withdrawal from Gaza that eventually led to increased terrorist attacks in Israel have given credence to hardliners’ views. But autonomy or lack of foreign military presence does not end terrorism. Only a better standard of living can reduce terrorism. That takes time.

Cartoon: Iraqi puppets

August 3, 2011 1 comment

As Iraq dithers on its decision regarding US troop extension beyond 2012, violence only increases in the war-torn nation. The cartoon shows the massive presence US boots have in Iraq, but that the military is simply biding its time as Iraq tears itself apart. Iraqis have increased suicide bombings, targeted their own oil fields and ramped up sectarian violence.

The US has long played puppetmaster in Iraq. All bets are off when the US cuts the strings. Instability and unpredictability are about the only things foreign investors and Iraqi citizens can count on. That will have a detrimental effect on investment and economic recovery for decades to come. Not only that, but a stressed economic system and security situation will only cement corruption in the hands of powerful, oppressive leaders who believe they must resort to force.

The US might have unnecessarily involved itself in Iraq when it went to war there in 2003, and it might leave Iraq’s society and economy even more tangled.

From UPI:

Stuart W. Bowen Jr. said in his quarterly report that June was the deadliest month for the U.S. military in more than two years, with 14 soldiers killed, The Washington Post said. Most of the deaths were the work of Shiite militias, he added.

“Iraq remains an extraordinarily dangerous place to work,” Bowen wrote. “It is less safe, in my judgment, than 12 months ago.”

Cutting US foreign assistance bad for economy, Arab democracy

August 2, 2011 1 comment

Everyone knows US foreign assistance is slated for spending cuts, but recent aid authorization bills show the major differences already forming between the House and Senate. Never has there been a better opportunity and greater need for democracy promotion and US aid than the Arab Spring. But if the House gets its way, that will mean a sharply decreased US role abroad — and, as I will argue, to the detriment of the US economy.

First, let’s start with the facts. The foreign assistance fund — which includes food aid, supporting stable democratic institutions and the like — is not in any way related to the defense budget. Politicians usually lump the two together, whether intentionally or not, because our military missions in Iraq and Afghanistan have undertaken the ostensible role of democracy promotion. But when you look at the numbers, foreign assistance accounts for a mere 1 percent of the US budget. That still hasn’t stopped people like Rep. Paul Ryan, R-Wisc., from suggesting cuts of 44 percent by 2016. By comparison defense budget — cuts to which the House has tried to avoid — is the largest spending item in the US budget, comprising 24 percent of total spending this fiscal year.

Many people believe the US should turn inward — some argue the nation cannot project itself abroad when it cannot take care of its economic issues at home. I don’t buy that argument. US-based nongovernmental organizations will continue to do a lot of the heavy lifting overseas when it comes to international aid, but they will need government grants to keep major operations going. Denying those funds could lead to job loss, so keeping foreign assistance at current funding levels will keep Americans at work.

Also, it is in US economic interests to promote healthy governments and citizens because it will lead to economic rewards in the future. Corrupt, undemocratic governments will generally operate at the expense of their own people largely by keeping growing wealth for the government elite. That means people have less money to spend on more expensive American goods, which in turn dampens US overseas profits.

Curbing corruption will also ensure future US investment is not wasted. Billions of dollars of US investment — both from the federal government and private citizens or corporations — get lost among red tape or swindling politicians in corrupt foreign nations. Some of those nations — such as Afghanistan, Mongolia and India — sit on treasures of natural resources the US lacks, so US business interests are more than happy to invest. Cleaning up those states would produce a greater return on that investment.

In terms of the hopeful new Arab democracies, US foreign assistance can help build trust between those governing in Arab nations and the US officials with whom they will be communicating. It’s no secret that Egyptians oppose US meddling, a fear the military there is exploiting. But it’s not the Arab street the US must win over — it’s the new, democratically-elected leaders with whom the US must curry favor. The US already is training potential political leaders in Libya, Syria and Egypt — certainly a good start. The US wants to be the nation those new leaders look toward for guidance, but cutting foreign assistance will imperil the US ability to help guide new Arab democracies through the troubles they will encounter during nascent stages. In turn, that will dampen the ability to do everything from strike bilateral trade agreements to establishing and supporting sound human rights protections.

On top of the general budget malaise, a Foreign Relations Authorization bill currently going through the motions on Capitol Hill makes it more difficult for the US to use international aid in corrupt nations:

The corruption indicator has a range of uncertainly (especially around the median) and can have time lags of up to two years.  Using the control of corruption indicator as a hard hurdle for all U.S. economic and development assistance without addressing the inherent problems in the indicator could prove highly challenging.

That bill, pushed by the House (there also is a less restrictive Senate version) is not likely to pass in the Senate. But the writing is on the wall for US foreign assistance. If this debt ceiling fiasco proved anything, it’s that the House and Senate are beholden to very different interests and views. The House will champion spending cuts abroad because, rhetorically, it sounds good. The House will stomach defense cuts, but it will not digest those cuts easily. Still, it’s the assault on foreign assistance that should induce gagging.

 

Jordan proposed reforms limit government control over municipalities

Jordan’s Lower House approved reforms Wednesday giving municipalities greater control at the expense of an increasingly corrupt federal government cabinet.

Municipalities will receive a greater piece of the tax pie, which will help balance local government checkbooks. Ethnically diverse communities could splinter into their own municipalities if they get 5,000 or more people, which might be appealing to Christian minorities. Shielding municipal personnel decisions from a corrupt cabinet will ensure stability and long-term planning at the municipal leadership levels. The reforms also promote women on municipal boards.

With protests amplifying in Amman, the nation’s capital, and across the rest of the country, the vote might have been intended to dampen civil unrest. However, protests continue unabated.

In all, the reforms are a positive. If approved, women must comprise 25 percent of municipal boards instead of 20 percent. Also, municipal affairs managers can no longer request the federal government to forcibly remove municipal board members or mayors — now, the courts will review claims against board members and mayors. The municipal councils themselves will now appoint “executive managers” rather than municipal affairs managers making that selection.

The proposed law contains several other provisions. From the Jordan Times:

Under the new law, municipalities will be given 8 per cent of the fuel tax revenues instead of the 6 per cent stipulated in the older version of the law.

Inhabitants of any district with a population of 5,000 or more can request the establishment of their own municipality or disengagement from a merger with a larger municipality.

So not only does the Jordanian government give up control by shifting responsibility for determining whether mayors and city council members should be removed to the courts, it also gives Jordanians a greater right to self-determination and increases fuel tax revenues 33 percent for municipalities.

In all, these reforms promote stability by taking power over municipal decisions from the cabinet’s hands. However worthwhile, the reforms still might have come too late to squelch Jordanian protests.

 

Egypt holds massive protest in Tahrir square

 

Frustration with the Egyptian military Friday fueled the largest nationwide protest since longtime President Hosni Mubarak’s ouster.

Trials for military officials have been postponed. The military has continued to engage in violence against protesters.

While I feel SCAF should try to postpone September’s elections to allow other parties to gather strength, it has been slow to introduce or announce any reforms. That has sent a bad message to Egyptians, one that leads them to believe the military establishment intends to hold onto its same level of power even after elections. Surely, the protests against Mubarak were just as much against SCAF.

Mubarak relied heavily on the secretive military, which has assumed the role of interim government until September elections. Suppression tactics that led to violence last week that left hundreds of protesters injured and has some believing Mubarak’s legacy lives on with the military.

Egypt had been under emergency rule since 1967, which extended police powers, suspended some constitutional rights and allowed the military to easily detain people and censor newspapers. Mubarak entrusted his secretive military/police force, SCAF, to keep order in the country and his people subservient to the president. SCAF has rounded up “subversives” for years and used torture for years to maintain fear and subordination.

 

 

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