EFTA Document EFTA01785152

From: Office of Tana Rod-Larsen Sent: Monday, May 13, 2013 6:16 PM Subject: May 11 update Article 1. <file:///ClUsers/Efrat=20Elron/AppData/Local/Microsoft/Windows/Temporary%20Internet%20Files/Conte=t.IES/NXRD KT39/11%20May.doc#a> NYT Why=Putin Can't Solve Syria David Rohde <http://rendezvous.blo=s.nytimes.com/author/david-rohde/> Article 2. <file:///ClUsers/Efrat=20EI ron/AppData/Local/Microsoft/Wi ndows/Tem porary%20Internet%20Files/Conte=t.l E5/NXRD KT39/11%20May.doc#b> The Washi=gton Post In =yria's war, the lines that matter aren't red Fouad Aja=i Article 3. <file:///ClUsers/Efrat=20EI ron/AppData/Local/Microsoft/Wi ndows/Tem porary%20Internet%20Files/Conte=t. I E5/NXRD KT39/11%20May.doc#c> Fpreign A=fairs Isr=el's Man in Damascus Efraim Halevy <http://www.foreignaffarrs.com/author/efraim-halevy> Article 4. <file:///ClUsers/Efrat=20EI ron/AppData/Local/Microsoft/Wi ndows/Tem porary%20Internet%20Files/Conte=t. I E5/NXRD KT39/11%20May.doc#d> Al-Arabiy= Spe=tre of bankruptcy haunts Egypt Adel al-Toraifi Article 5. <file:///ClUsers/Efrat=20EI ron/AppData/Local/Microsoft/Wi ndows/Tem porary%20Internet%20Files/Conte=t. I E5/NXRD KT39/11%20May.doctte> EFTA_R1_00107014 EFTA01785152 Project S=ndicate The=Egypt-Israel Peace Test Itamar Rabinovich <http://www.project-syn=icate.orecontributor/itamar-rabinovich> , <http://www.project- syndicate.org/contributornamara-witte=> Article 6. <file:///ClUsers/Efrat=20EI ron/AppData/Local/Microsoft/Wi ndows/Tem porary%20Internet%20Files/Conte=t. I ES/NXRD KT39/11%20May.doc#f> The Atlan=ic Wha= Is China's Plan for The Middle East? Matt Schi=venza Art=cle 7. The Natio=al Interest The=Day After a Strike on Iran Marwan Muasher <http://nationalinteres=.org/profile/marwan•muasher> Article 8= Prospect<=span> Mic=ael Sandel and AC Grayling in conversation Article 1. NYT Why Putin Can't Solve Sy=ia David Rohde <http://rendezvous.blogs.nytimes.com/author/david-=ohdeh May 11, 2013 -- Moscow — Afte= marathon meetings with Secretary of State John Kerry here this week, the =ussian foreign minister, Sergey Lavrov, hinted that Moscow might finally pressure President Bashir al-Assad of Syria to l=ave office. 2 EFTA_R1_00107015 EFTA01785153 "We are not interested in the fate =f certain individuals," Mr. Lavrov said at a late night news conference <httpl=www.state.gov/secretary/remarks/2013/05/209117.htm> on Tuesday. "We are interested in the fate=of the Syrian people." Mr. Lavrov and Mr. Kerry announced th=t they would host an international conference where Syrian government officials and rebels will be given a chance to name an i=terim government <http:=/www.reuters.com/article/2013/05/07/us-syria-crisis-conference-idUSBRE9461=S20130507> . The odds of the two sides agreeing are low but Mr. Kerry d=serves credit for securing a small diplomatic step forward here. The problem is that Mr. Lavrov =nd his boss, President Vladimir Putin, may be unable to deliver on Mr. Ass=d. For nearly two years, Mr. lavro= and Mr. Putin have served as the Syrian leaders' chief diplomatic allie= but Iran has provided far more military support. Russian analysts say Washington is kidding itself if it believes Mr. Putin=can orchestrate a quick and easy Assad exit. "All of this is wishful think=ng," said Sergei Strokan, a columnist for the liberal Moscow daily Komme=sant. "Moscow has quite limited influence on the Syrian regime." Decades from now, President Bar=ck Obama's decision to not arm Syria's rebels may be condemned or prai=ed. But a visit to Moscow this week showed that it has come at an immediate price. Washington's failure to act created a=vacuum that Mr. Putin and Mr. Lavrov used to boost Russia's global stand=ng. "For the last two years, Lavrov has=dramatically elevated his profile on the world stage," Susan Glasser rec=ntly wrote in Foreign Policy magazine. "He has done so by almost singl=-handedly defying Western attempts to force some united action <http://www.foreignpolicy.com/arti=les/2013/04/29/minister_no?page=full> to stop Syria's deadly civil war." Mr. Lavrov and Mr. Putin have a=so used Syria to bolster their standing at home. Mr. Kerry's widely publ=cized visit coincided with the one-year anniversary of disputed elections in Russia that led to Mr. Putin's third term in of=ice. Before meeting with Mr. Kerry, Mr. Putin fired a key lieutenant who w=s the architect of the system that has allowed the Russian leader to contr=l major industries, seize most media outlets and intimidate or co-opt rivals. With the price of oil low, Putin's =il-dependent economy is flagging. Barring a surge in prices, massive socia= welfare payments are unsustainable. <=ont face="Times New Roman">Corruption is endemic, consuming an estimated $300 billion a year <http://www.blo=mberg.com/news/2013-05-07/strongman-putin-is-no-match-for-corruption.html> , 16 percent of Russia's g=oss domestic product. Transparency International, an anti-corruption group= named Russia the worst nation on earth in its most recent Bribe Payer's index <http://bpi.transparency.org/bpi2=11/results/> , which ranks firms on their likelihood to bribe. A spate of recent laws on libel, prot=sts, blasphemy and treason has made it more difficult to exercise basic rights chttp://artic=es.washingtonpost.com/2013-04-17/world/38597570_1_russia-putin-alexander-c=erkasov> , the Washington Post reported last month.=Mr. Putin also recently ordered prosecutors nationwide to search for non- g=vernmental organizations that have failed to abide by a new law requiring them to register as "foreign agen=s" if they receive foreign funding. Mr. Putin is probably secure un=il the end of his term in 2016. But a slowing economy and public fatigue w=th Mr. Putin are taking a toll. In the end, the key factor may be the price of oil, the pillar of Putin's one-dimens=onal economy. "If the price of oil drops below $50 [a barrel), it is a death sentence,=94 said a Russian analyst who asked not to be named.<=p> On the international stage, mea=while, Russia is ascendant. For Mr. Putin, Mr. Kerry's request for help =arked the achievement of a decade-old goal. From the North Atlantic Treaty Organization's 1999 bombing of Kosovo, to=the 2003 3 EFTA_R1_00107016 EFTA01785154 invasion of Iraq, to the 2011 U.N.-backed toppling of Muammar Gad=afi, Moscow has been largely irrelevant. Mr. Putin saw each post-Cold War =merican intervention as an attempt to remove opponents, not defend human rights. "In Putin's view, they were all v=ctims of a cynical U.S. plot for global domination," journalist Lucian K=m wrote last year, "whe=e any weapon is fair game, be it smart bomb, a pro-democracy grant or Twitte=." <http://www.luciankim.com/blogs/Ircian-in-moscow/the-syrian-connection/> Instead of being the West's p=tential victim, Mr. Putin is now its vital interlocutor. Maria Lipman, a s=holar-in-residence at the Carnegie Moscow Center and a leading political analyst, said Mr. Putin's logic is simple= "You may denounce us," she explained, "but when it comes to the mos= important international issue today, you come to Moscow."=/span> So, why is the Obama administra=ion turning to Mr. Putin for help? The answer is simple: the White House=92s deep desire to not get entangled in Syria. To American officials, a deal with Russia is a cost-free solution. The geo=olitical equivalent, if you will, of a drone strike. No Americans lives wi=l be lost. There will be little domestic political risk. In truth, though, there is no e=sy way to stem the conflict in Syria, which increasingly threatens to dest=bilize the region. Blame is widespread. Mr. Assad, of course, is the worst culprit. His refusal to relinquish powe= in the face of an initially peaceful protest movement has led to the kill=ng of an estimated 70,000 people. In Washington, Mr. Obama allowed exagger=ted fears of another Iraq to paralyze his administration. Mr. Putin, though, has arguably=been the most cynical. He exaggerated his control of Mr. Assad and may als= be double- dealing. Twenty-four hours after Mr. Kerry lef= Moscow, the press reported that Russia was planning to sell surface-to-air missiles to Syria <http://news.yahoo.rom/kerry-russia-sells-missile-defense-syria-1S2511867.html> that would make any American intervention in the conflict vastly more difficult. The Wall Street J=urnal reported that Israeli officials had warned the Obama administration <http://online.wsj.com/article/S=.10001424127887324059704578471453006383248.html> of Russia's imminent sa=e to Syria of sophisticated 5-300 missiles with a range of 125 miles. Asked about the sale at a press=conference in Rome on Thursday, Mr. Kerry said Washington would prefer tha= Russia not provide arms to Syria and called the missiles "potentially destabilizing" to Israel. If true, the missi=e sale would be a personal affront to Mr. Kerry, who lauded Mr. Putin and =r. Lavrov in Moscow. Sale or no sale, the proposed c=nference should be carried out. Both sides may miraculously agree on an in=erim government. But it is more likely that the =nited States has lost control of the rebels, particularly the jihadists. A=d Russia has lost control of Mr. Assad, who retains Tehran's backing and has killed so many people that he canno= compromise. Syria's downward spiral will continue. Article 2.</=ont> The Washington Post 4 EFTA_R1_00107017 EFTA01785155 4=ont> In Syria's war, the line= that matter aren't red Fouad Ajami May 9 -- It is rarely a go=d idea to draw maps in a hurry. But that is what colonial cartographers di= in the Arab world after the First World War, and the borders they painted were superimposed on old tribal and religious=attachments that long predated the new states. Today, the folly of those lines is ma=e clear, as Syria's war <http://www.washingtonpost.com/world/reported-israeli- airs=rikes-threats-of-retaliation-complicate-syrian-civil-war/2013/05/06/4e8217=6-b67b-11e2-92f3- 1291801936b8_story.html?tid=pm_world_pop> threatens not just its territorial unity but that of its neighbors as we=l. Alas, it was perhaps optimistic to ev=r imagine that the fighting between Syria's Alawite regime and the Sunni=led rebellion would remain within the country's borders. Syria is at once the pivot and a mirror of the Fertile Crescent, =nd its sectarian and ethnic fissures reproduce themselves in neighboring A=ab states. As an oddly passive President Obama ponders what he might do in Syria <http://www.washingtonpost.com/world/national-security/on-=yria-recent- developments-favor-case-for-stepped-up-us-military-aid/2013/05=06/b0089cce-b682-11e2-b94c- b684dda07add_story.html> — and whether to do anything at all — he should b= less preoccupied with red lines of his own making than with the blurring 4 the lines drawn in Arab sands decades ago. On the map, Tripoli, on the Med=terranean Sea, lies within the borders of Lebanon and is the country's s=cond-largest city. But Tripoli, staunchly Sunni, with an Alawite minority, has always been within the orbit of the S=rian city of Horns. So it is no mystery that a deadly conflict now rages in=Tripoli between Sunni and Alawite neighborhoods, rendering the place ungov=rnable. Sunni jihadists and preachers see the Syrian struggle as their own, an opportunity to evict the Alawites=from their midst and to restore Sunni primacy. Look to Iraq, on Syria's eastern bo=der, for the region's quintessential artificial entity. Today, the gover=ment in Baghdad, Shiite-led for the first time in a millennium, sides with the Alawite dictatorship <http://articles.washingtonpost.com/2013=03-24/world/37989851_1maliki-iranian-flights-state-john-f-kerry> in Damascus. But in western Iraq, the Sunni strongholds of Anba= province and Mosul have been stirred up by the Syrian rebellion. The same=tribes straddle the border between the two countries. Smugglers and traders, and now Sunni warriors, pay that=border no heed. The American war upended the or=er of things in Iraq; the Sunni minority lost out to the Shiites and brist=ed under that change of fortunes. The Syrian rebellion, a Sunni upheaval against an Alawite minority, has been a boon t= the Sunnis of Iraq. The Sunnis have bottomless grievances against the gov=rnment of Prime Minister Nouri al-Maliki. To them, Maliki, who spent a qua=ter-century exiled in Syria and Iran, is an agent of the Iranian theocracy. So even though the regime in S=ria did its best to subvert the new order in Baghdad — between 2003 and =009, Syria was the transit point for jihadists converging on Iraq to fight=the Americans and the Shiites — the Maliki government, with oil money, and anchored in the power of the (Shiit=) Dawa party, is throwing a lifeline to the Syrian dictator.=/span> The Shiite appetite in Iraq has grown=with the eating. Anti-terrorism laws and the provisions of de-Baathificati=n have been unleashed on the Sunnis, and the forces of order have become instruments of the Maliki government. Thou=ands languish in prison on spurious charges, and protests <http://articles.washingtonpost.com/2013-0S- 03/world/38994=22_1_security-forces-sunni-protest-site-civil-war> have broken out in Sunni cities. The Syrian conflict has added fuel to the=fire. If the Sunnis needed proof that the Shiite coalition in the region (=omprising Iran, the Iraqi state, the Alawite regime in Damascus and Hezbol=ah in Lebanon) is hell-bent on robbing them of their historic place in Iraq, their government's tilt to=ard Bashar al-Assad provided it. 5 EFTA_R1_00107018 EFTA01785156 It was a matter of time before =hese millennial conflicts were given new life by the Syrian civil war, whi=h has acquired the passion of a religious calling. So Shiite warriors from Iraq and Lebanon flock to Syria today, th=y tell us, to protect the shrine of Sayyida Zeinab in the eastern suburbs =f Damascus. It is easy work for Hasan Nasrallah, the secretary general of =ezbollah, to dispatch young foot soldiers to Damascus and drape his support for the Syrian dictator in the =arb of religious duty. Terrorist groups, Nasrallah sai= on April 30, had threatened to overrun and destroy the shrine. "If such=a crime were to take place, it will carry with it grave consequences," he warned. "Countries supporting these gr=ups will be held responsible for this crime." Nasrallah is not a subtle man. He pro=laimed nothing less than a sectarian war over Syria: "Syria has real fri=nds in the region, and the world will not allow Syria to fall into the hands of America, Israel and the takfiri grou=s," or militant Islamists. Nasrallah, very much in the tradition of Mali=i in Baghdad, offended the Sunnis in his own country. Sunni preachers in B=irut, Sidon and Tripoli have called on their own <http://articles.washingtonpost.com/2013-04- 27/world/38856=12_1_syrian-rebels-syrian-civil-war-syrian-border-region> to rise to the defense of the Syrian rebellion. The schism over Syria was given=away in a Pew survey released May 1 that found 91 percent of Lebanon's S=iites had a favorable opinion of Assad, and 8 percent held an unfavorable one. The results among the country's Sunni= were the reverse: 7 percent favorable, 92 percent unfavorable. Such estra=gement in a small, claustrophobic country! Syria's war plays out differently a=ong its neighbors. Jordan, through no choice of its own, is caught up in t=e struggle as southern Syria, for all practical purposes, spills over its border. An estimated 500,000 Syrians have made their way into Jordan <http://ar=icles.washingtonpost.com/2013-04-21/world/38717617_1_syrians-jordanians-am=an-government> — almost a staggering 10 percent of that=country's population. Jordan is overwhelmingly Sunni, so it has been spa=ed the virulence of the vendettas blowing through Iraq and Lebanon. But it has its own fault line — between a secu=ar monarchy and a strong Muslim Brotherhood. The Brotherhood is invested i= the success of the rebellion in Syria, and the monarchy is on edge. It ca='t close its border in the face of the Syrians, and it struggles to cope with a huge economic burden <http://articl=s.washingtonpost.com/2013-03-04/world/37438059_1_zaatari-syrian-refugees-n=w- refugees> amid its own scarcities. It waits for deliverance —=help from the Gulf Arabs and from the United States — and prays for an a=d to this war from hell. Israel is, of course, a Syrian =eighbor apart. Wisely, it initially kept a policy of benign yet watchful n=glect of this fight. There was no love lost for the Syrian dictatorship but no faith that the rebels would make better=neighbors if and when they came to power. On the one hand, the dictatorshi=, under Assad and his father before him, had kept the peace on the Israeli=Syrian border. But the Syrians had also stoked tensions on the Lebanese-Israeli frontier and had given Ir=n access to the Mediterranean, so perilously close to Israel. It was the b=tter part of wisdom to steer clear of Syria's fire.=/p> But alleged Israeli airstrikes <http://www.washingtonpost.com/world/middle_eastfisrael-sa=s-hezbollah-target-not- syria/2013/05/06/438d805e-b683-11e2-92f3-f291801936=8_story.html> over Damascus in recent days have demonstrated the limits of Isra=l's patience. The targets were depots of Iranian missiles, meant to be d=livered to Hezbollah. These missiles had a range of 200 miles and could carry half-ton warheads. The Israelis m=de good on their "red line." They would not permit Hezbollah that kind=of power over their security. Even with all this instability, =I don't believe that the borders of the Fertile Crescent will be erased.=Western Iraq will not secede and join Syria, nor will Tripoli slip into Syria. But a Syria ruled by a Sunni majority wo=ld rewrite the rules of the region's politics. 6 EFTA_R1_00107019 EFTA01785157 It could put an end to the mili=arization of Syrian society that has wrecked that country. Free of despoti=m, the Syrian middle class might erect the foundations of a more open and merciful nation. Syria is a land of merchan=s and commerce, and therein lies the hope that a better country could emer=e from this ruin. Lebanon, too, would be given a =hance at normalcy. The power of Hezbollah in that country has derived to a=great extent from the power of the Syrian dictatorship. If Syria is transformed, Lebanon must change as well, and th= power of Hezbollah could be cut down to size. Utopia will not visit the r=gion after the fall of the Syrian tyranny, but there is no denying that be=ter politics may take hold in Syria and in its immediate neighborhood. The remarkable thing about this=drawn-out fight, now entering its third year, is the passivity of the Unit=d States. A region of traditional American influence has been left to fend for itself. Of course, these sectarian enmi=ies do not lend themselves to an outsider's touch. Nor did Obama call up=these furies; they cannot be laid at his doorstep. But the unwillingness of his administration to make a clean break with Ass=d helped radicalize the Syrian rebellion. The landscape would have been al=ered by American help. A no-fly zone near the border with Turkey could hav= sheltered and aided the rebels. An early decision to arm the rebellion would have leveled the killing fiel=. Four of the president's principal foreign policy advisers from his fir=t term advocated giving weapons to the rebels — Secretary of State Hilla=y Rodham Clinton, Defense Secretary Leon Panetta, CIA Director David Petraeusand the chairman of the Joint Chi=fs of Staff, Gen. Martin Dempsey. But the president overrode them, his cau=ion of no help in a conflict of such virulence. Under the gaze of the world, Obama in=tead =font face="Times New Roman">drew a red line <http://www.washingtonpost.com/blogs/worldviews/wp/2013/04=30/video-obama-reiterates-syria-red-line-but-vague- on-response-if-crossed/. target=> on the use of chemical weapons and warned that his calculus would chang= if these weapons were used or moved around. He thus placed his credibilit= in the hands of the Syrian dictator and, in the midst of a storm of his own making, fell back on lawyerly dist=nctions. A Greater Middle East, an Islam=c world, used to American campaigns of rescue — Kuwait in 1991, Bosnia i= 1995, Kosovo in 1999, Afghanistan in 2001, Iraq in 2003, Libya in 2011 — is now witnessing the ebb of American power and responsibility. Obama has held his fire in the face of great slaughte=, and truth be known, congressional and popular opinion have given him a p=ss. America has wearied of Middle Eastern wars. Syrian rebels sure that the Ame=ican cavalry would turn up after this or that massacre have been bitterly =isappointed. It's the tragic luck of the Syrians that their rebellion has happened on the watch of an American pres=dent who has made a fetish of caution, who has seen the risks of action an= overlooked the consequences of abdication. Fouad Ajami, a senior fellow =t Stanford University's Hoover Institution, is the author of "The Syri=n Rebellion" and "Dream Palace of the Arabs: A Generation's Odyssey." Article 3.<=a> Fpreign Affairs<Apan> Israel's Man in Damascus<kont> Efraim Halevy 7 EFTA_R1_001 07020 EFTA01785158 May 10, 2013 -- In October 1995= Israeli Prime Minister Yitzhak Rabin telephoned Egyptian President Hosni =ubarak to inform him that peace was at hand between Israel and Syria. Two weeks later, Rabin was dead, killed by a rea=tionary Jewish Israeli fanatic; the peace agreement that Rabin referenced =ied not long thereafter. But Israeli hopes for an eventual agreement with =he Assad regime managed to survive. There have been four subsequent attempts by Israeli prime ministers -- one=by Ehud Barak, one by Ehud Olmert, and two by Benjamin Netanyahu -- to for=e a peace with Syria. This shared history with the As=ad regime is relevant when considering Israel's strategy toward the ongo=ng civil war in Syria. Israel's most significant strategic goal with respect to Syria has always been a stable peace, and t=at is not something that the current civil war has changed. Israel will in=ervene in Syria when it deems it necessary; last week's attacks testify =o that resolve. But it is no accident that those strikes were focused solely on the destruction of weapons depot=, and that Israel has given no indication of wanting to intervene any furt=er. Jerusalem, ultimately, has little interest in actively hastening the f=ll of Bashar al-Assad. Israel knows one important thin= about the Assads: for the past 40 years, they have managed to preserve so=e form of calm along the border. Technically, the two countries have always been at war -- Syria has yet to officially r=cognize Israel -- but Israel has been able to count on the governments of =afez and Bashar Assad to enforce the Separation of Forces Agreement from 1=74, in which both sides agreed to a cease-fire in the Golan Heights, the disputed vantage point along the=r shared border. Indeed, even when Israeli and Syrian forces were briefly =ocked in fierce fighting in 1982 during Lebanon's civil war, the border =emained quiet. Israel does not feel as confide=t, though, about the parties to the current conflict, and with good reason= On the one hand, there are the rebel forces, some of whom are increasingly under the sway of al Qaeda. On the other, th=re are the Syrian government's military forces, which are still under As=ad's command, but are ever more dependent on the Iranian Revolutionary G=ard and Hezbollah, which is also Iranian-sponsored. Iran is the only outside state with boots on the ground in Syria, and alth=ugh it is supporting Assad, it is also pressuring his government to more c=osely serve Iran's goals -- including by allowing the passage of advance= arms from Syria into southern Lebanon. The recent visit by Iranian Foreign Minister Ali Salehi to Damascus, durin= which he announced that Iran would not allow Assad to fall under any circ=mstances, further underscored the depth of Iran's involvement in the fig=ting. It is entirely conceivable, in other words, that a post-Assad regime in Syria would be explicitly pro=96a1 Qaeda or even more openly pro-Iran. Either result would be unacceptab=e to Israel. Of course, an extended civil wa= in Syria does not serve Israel's interests either. The ongoing chaos is=attracting Islamists from elsewhere in the region, and threatening to destabilize Israel's entire neighborhood, inc=uding Lebanon, Jordan, and Iraq. It could also cause Assad to lose control=of -- or decide to rely more on -- his stockpile of chemical weapons. Even though these problems have=a direct impact on Israel, the Israeli government believes that it should =eal with them in a way that does not force it to become a kingmaker over Assad's fate. Instead, it would prefer to =aintain neutrality in Syria's civil war. Israel does not want to tempt Ass=d to target Israel with his missile stockpile -- nor does it want to alien=te the Alawite community that will remain on Israel's border regardless of the outcome of Syria's war. Last week's attacks were a ca=e in point. Israel did not hesitate to order air strikes when it had intel=igence that arms were going to be funneled from Syria to Hezbollah. Although Israel took care not to assume official =esponsibility for the specific attack, Minister of Defense Moshe Yaalon pu=licly stated that Israel's policy was to prevent the passage of strategi= weaponry from Syria to Lebanon. But parallel with that messaging, Israel also made overt and covert effort= to communicate to Assad that Jerusalem was determined to remain neutral i= Syria's civil war. The fact that those messages were received in Damasc=s was reflected in the relatively restrained response from the Assad regime: a mid- level Foreign Ministry of=icial offered a public denouncement of Israel -- and even then the Syrian =overnment offered only a vague promise of reprisal, vowing to respond at a=time and in a manner of its choosing. 8 EFTA_R1_00107021 EFTA01785159 As brutal as the Syrian war has=become, Israel believes that another international crisis is even more urg=nt: Iran's continued pursuit of a nuclear program. Jerusalem has long believed that mid-2013 would be an hour of dec=sion in its dealings with Iran. In the interim, Israel wants to focus its =wn finite resources on that crisis -- and it would prefer that the rest of=the world does the same. Article 4.4=ont> AI-Arabiya</=pan> =font color="11000000">Spectre of bankrupta haunts Egypt Adel al-Toraifi aspan> 9 May 2013 -- There were t=o worrying pieces of news from Egypt this week. One was the reshuffling of=Prime Minister Hisham Kandil's cabinet based on partisan calculations, rather than competencies as was initially =oped. The second piece of news was the report that Egypt's population no= stands at more than 84 million. This is the result of the birth rate doub=ing during the revolution due to the decline in birth control programs, which had previously been sponsored=by the government and international institutions. The population increase =s a concern for a very simple reason; it will present additional financial=and environmental burdens on Egyptian society, particularly in the country's already overcrowded cities and sl=ms. Two decades ago, Egypt was=one of the world's largest agricultural exporters, whereas today it is o=e of the largest importers of wheat. For this reason, it is no surprise that we find President Mursi requesting tha= his Russian counterpart Vladimir Putin—at the height of Russian militar= aid to the Bashar al-Assad regime in Syria—grant Egypt preferential rat=s in an attempt to reduce the cost of subsidizing bread. There can be no doubt that the economy could force p=litical concessions simply to guarantee the price of bread. In a country w=ere incomes have declined over the past two years, more than 60% of foreig= currency reserves have evaporated, and the Egyptian pound has lost 7% of its value since the beginning of the=year, talk about a program of economic reform is not just necessary, it is=crucial. Unfortunately, it does not seem that the ruling party today—or =he Brotherhood, if you prefer—is serious about solving the problems facing the Egyptian treasury and the ec=nomy at large, not to mention putting an end to the weakening of the Egypt=an pound and record inflation. Delaying the crisis=/font> However, more dangerous th=n this is some observers resorting to the tactic of "delaying the crisis=94 for future budgets, saying that the deficit in the trade budget is normal under such circumstances, and that this can =nly be resolved in future budgets. This is because expenditure, from their=point of view, is necessary to revive growth during the current stage of e=onomic slowdown that Egypt is experiencing. In principle, this proposa= has merit. However, in terms of implementation during the Mursi era, expe=diture—rather than investment—is already on the rise, thanks to government assistance programs, not to mention othe= financial burdens on the state. Of course, there are those in Egypt who p=ay down the risk of the treasury becoming bankrupt, believing that the Egy=tian economy is, as they say, too big to fail. They base this on Egypt's huge human resources and wealth, =nd expected sources of financing, such as foreign investment and tourism, =articularly if political stability can be ensured. 9 EFTA_R1_001 07022 EFTA01785160 More than 60% of foreign c=rrency reserves have evaporated, talk about a program of economic reform i= not just necessary, it is crucial Adel al-Toraifi Those who hold this opinio= believe that domestic demand will prevent the Egyptian economy from facin= bankruptcy. But hold on—this view is based more on the sense of Egyptian national dignity, rather than the language o= numbers. Brazil and Mexico would have announced bankruptcy during the 198=s were it not for the intervention of the International Monetary Fund (IMF= and the World Bank. Everybody knows how countries like Chile in 1975 and Yugoslavia in 1989 and Nicaragu= in 1990 went bankrupt, or, to put it in the language of economists, exper=enced huge inflation and the collapse of the national economy. Let us take Argentina in t=e 1980$ as an example. Argentina borrowed in a way that repayments became = heavy burden, and following the loss of political stability in the country—as is happening today in Egypt—inte=national lenders refused to help. As a result, the country had no choice b=t to devalue its currency in order to reduce the value of its debt. This w=s a way of announcing bankruptcy. Egyptian vulnerability Is the Egyptian treasury v=lnerable to bankruptcy? Not yet, but if it continues on this course then t=ere can be no doubt that this will be its fate. There can also be no doubt that some people are relying on Western o= Gulf assistance; nobody wants to see the Egyptian treasury declare bankru=tcy, as it would have political and security consequences for everybody.4=ont> However, at the same time,=the Egyptian government is not helping itself or allowing others to help i= to fix the situation. What does it mean for Kandil to name an al-Azhar professor specializing in Islamic jurisprud=nce and murabaha (Sharia-compliant sale) as the country's new finance mi=ister? What does specializing in Islamic studies have to do with the USD 4=8 billion interest-based IMF loan? The answer is that this minister was appointed simply because he is affili=ted with the Muslim Brotherhood, and he only has the power to pass directi=es—not to implement the required corrective plan.</=pan> Although the judgment agai=st the new finance minister may come a little early, would it not have bee= better to choose a competent Egyptian with international experience who enjoys the confidence of the national pr=vate sector. If you remain unconvinced of the possibility of bankruptcy, t=en you must face the facts: Egyptian GDP per capita is less than U.S. $2,0=0 per annum and the average Egyptian household's expenditure on foodstuffs represents more than 50% of its an=ual income, despite government subsidies of bread, cooking oil and fuel.q=ont> According to a study by re=earcher Dalibor Rohm`, of the Washington-based Cato Institute entitl=d "Towards a reform of Egypt's commodity subsidies," a third of Egyptian public spending goes on subsidizing foodstuff and othe= goods, while around 80% of the Egyptian population depends on government =inancial assistance. This is the state of affairs created by the 1952 revo=ution, which turned Egypt into a consumption-based economy, establishing a black market which, for decade=, specialized in pillaging this financial assistance. Rohat's stu=y shows that only a quarter of this assistance finds its way to Egypt's =oor, with the rest benefitting the middle and upper income brackets. Reforming government suppo=t It is true that some of th= ruling Freedom and Justice Party members have spoken on a number of occas=ons about their intentions to reform the system of government support, suggesting a number of mechanisms that faile= to achieve much. However, the IMF loan conditions are based mainly on the=gradual reduction of fuel subsidies, which is a pledge that Qandil's gov=rnment has failed to fulfil, fearing the response of the street which is still in a "revolutionary" mindset= 10 EFTA_R1_00107023 EFTA01785161 Egypt could try replacing =he government subsidization system—which is a program whose corruption a=d lack of effectiveness has been proven for decades—with direct support for the poor: directly providing funds, or c=upons, to the poor so that the government can revive market competition. T=ere are a number of successful examples of this model; however, that does rot necessarily mean that it would succeed in Egypt. There are a number of reasons for this, most prominently=the government's lack of administrative competence, not to mention the l=ck of legitimacy that would allow the ruling party to take difficult decis=ons without the street rising up against them. In Iran, for example, Pres=dent Ahmadinejad tried to implement this in two stages. However, the resul= was an increase in expenditure, as more than 95% of the people applied for direct financial assistance, while the =olitical parties and forces rejected the price increase imposed on fuel. 1= other words, the results were both counterproductive and costly: the peop=e know how to take advantage of the government's funds. The Freedom and Justice Pa=ty are facing a huge challenge, and failing in this task may take Egypt bark decades, both economically and politically.<=p> <=span> Adel al-Toraifi is the =ditor-in-Chief of Asharq al-Awsat and Editor-in-Chief of Al Majalla magazi=e. As a specialist in Middle Eastern affairs his research focuses on Saudi-Iranian relations, foreign policy decision m=king in the Gulf and IR theories on the Middle East. <=span> =/font> Article 5.</=ont> Project Syndicate4=ont> =font color="#000000">The Egypt-Israel Pea=e Test Itamar Rabinovich <http://www.project-=yndicate.org/contributor/itamar-rabinovich> , Tamara =ittes <http://www.project-syndicate.org/contributo=/tamara-wittes> =/span> <=span> 10 May 2013 -- The rocket strike= that a militant Islamist group recently fired from the Egyptian Sinai int= the Israeli city of Eilat served as yet another reminder of how delicate bilateral relations remain two years afte= Egypt's revolution. Terrorist activity could easily cause a crisis on t=e border, with the potential to trigger an unwanted confrontation that wou=d threaten the peace treaty<=font> <http://avalon.law.yale.edu/20th_century/isr=gypt.asp> that normalized bilateral relations in 1979. To avoid such an outcome, Isr=el and Egypt must take convincing action now to uphold the treaty.&n=sp; Last November, when hostilities erupted in Gaza, Egyptian President =ohamed Morsi mediated a swift resolution, even providing a guarantee for t=e cease-fire with Gaza's ruling Mamas. Morsi thus implicitly 11 EFTA_R1_001 07024 EFTA01785162 recommitted=Egypt to upholding peace on the border and to playing a constructive role in the Palestinian-Israeli conflict. Th=s boosted confidence in Israel that the Muslim Brotherhood, Egypt's ruli=g party, would uphold the 1979 peace treaty. But Morsi has not explicitly =ndorsed peace with Israel and has avoided direct engagement with Israeli leaders. Preserving peace is in bot= countries' interests. The attack on an Egyptian army outpost in the Sin=i last summer, in which armed militants killed 16 soldiers, demonstrated that terrorism threatens Egypt just as it does I=rael. In this volatile environment, reverting to a confrontational relatio=ship with Israel would be extremely dangerous, inviting the risk of anothe= disastrous war. Upholding the peace treaty with Israel would have the opp=site effect, enabling Egypt to pursue its goals of consolidating the military's authority at home and e=hancing its influence throughout the Middle East. Egyptian and Israeli leade=s must recognize that the ongoing struggle to secure the Sinai Peninsula =96 which the treaty established as a demilitarized zone — is testing peace daily. Israel has so far tolerated Egyptian milirary activity and force deployments that technically violate the bilateral =reaty, approving them retroactively in the hope that Egypt will do more to=secure the border and crack down on weapons smuggling into Gaza. But Israel has little confidence that the =eployments will enhance its security, and Israeli leaders are becoming inc=easingly anxious about the Egyptian military's mobilization of forces wi=hout notice. In Egypt, the treaty is even more clearly under threat. The Muslim B=otherhood has long called for a referendum on the treaty, viewing the rest=ictions on Egyptian forces in the Sinai as an affront to national sovereig=ty. The Brothers condemned Morsi's involvement in resolving the Gaza crisis last year, portraying it as kowto=ing to Israel. In fact, Morsi is under fire from both the left and the right for up=olding former President Hosni Mubarak's obliging approach to Israel, as =ell as for reasserting Mubarak's authoritarian bargain — diplomatic an= financial support in exchange for "stability" — with the United States. Faced with a collapsing economy and approachin= elections, the temptation for Morsi to stoke nationalist, anti-Israel sen=iment will become stronger. A major incident on the border could be enough=to push him over the edge. In order to sustain the peace treaty, Egypt and Israel should renegotiate its milit=ry annex to allow Egypt to deploy forces in previously restricted zones an= re- establish full sovereignty over the Sinai. Such a move would strengthe= bilateral relations, generate goodwill in Egypt, and increase Israel's confidence in the Muslim Brothe=hood's commitment to peace. During such a renegotiatio=, the two countries would discuss in detail the most effective approach to=tackling their shared challenges related to terrorism and transnational crime, in order to ensure that Egypt's in=reased military presence in the Sinai also enhances Israel's security. E=ypt's newly democratic government would be more strictly accountable for=fulfilling the treaty's terms if it played an active role in establishing them. At the same time, the agreement would=boost domestic support for Egypt's government and enhance its regional s=anding. Likewise, US involvement in the negotiations would benefit all parti=s. The process would provide an opportunity for the Egyptian military to e=gage with the US, helping to bolster its case for aid in a difficult envir=nment. Moreover, the US could set=clear, narrow terms for the talks and provide a guarantee that the outcome=would not impinge on Israel's core interests, thereby mitigating Israeli officials' fears that opening the treaty's =ilitary annex for revision would call into question its other terms. Final=y, playing a successful role in bolstering Israel-Egypt relations could ad=ance US Secretary of State John Kerry's diplomatic initiatives in the Middle East. In a region as volatile as=the Middle East, no country can afford to take peace for granted. But, by =enewing their bilateral treaty now, Egypt and Israel would maximize their chances of prolonging an arrangement that =as kept them from fighting for more than three decades. Itamar Rabinovich, a fo=mer ambassador of Israel to the United States (1993.1996), currently is ba=ed at Tel Aviv University, New York University, and the Brookings Institution. Tamara Wittes is Director of the Saban Cent=r at the Brookings Institution. 12 EFTA_R1_00107025 EFTA01785163 Article 6.</=ont> The Atlantic =font color="1$000000">What Is China's Plan=for The Middle East? Matt Schiavenza <=span> May 10 2013 -- Solving the=lsrael/Palestine crisis has long been the holy grail of American foreign p=licy -- an elusive goal that each successive president has strived to achieve. Like moths to a flame, American presiden=s cannot resist the temptation to solve a problem from which so many other=issues -- terrorism and Iran, notably -- seem to come from.<=span> Could China, then, be stealing A=erica's thunder? President Xi linping made waves <http://www.nytimes.com/2013/05/06/world/asir/mahmoud-abbas-benjamin-netanyahu-in-china.html?_r=1&> last week by inviting both Israeli prime minister Benjamin Netanyahu and P=lestinian leader Mahmoud Abbas to China, a diplomatic maneuver that elicit=d the attention <http://blogs.seattletimes.com/opinionnw/201=/05/08/beijing-as-a- middle-east-power-brokerh (and app=oval <http://www.washingtonpost.com/blogs/w=rldviews/wp/2013/05/03/why- its-great-news-that-china-wants-to-mediate-isra=l-palestine-talks/> ) of the U.S. media. The ambitions for the visit weren't terribly ambitious;=Netanyahu and Abbas never met, and Xi issued a bland "four-point plan=quot; that reinforced existing norms for resolving the crisis. But the ver= fact that China thrust itself in the situation nonetheless was significant. Why, then, did China decide to do it?<=font> There are two major forces=at play. First, publicly claiming an interest in solving this crisis is co=sistent with China's new global approach to foreign policy. For years, China focused its attention primarily on its=periphery, but as its economy grew Beijing needed to come up with a strate=y to deal with the rest of the world, one that, at least, went beyond &quo=;just sell us natural resources and we'll let you do whatever you want to your people." Now, a strategy h=s emerged. On the United Nations Security Council China has formed a=de facto alliance with Russia, using their respective vetoes to stymie American-led initiatives. Beijing has also flexed its diplomatic muscle through organizations like the Shanghai Cooperation =rganization (a grouping of Central Asian republics plus China) and the Ass=ciation of Southeast Asian Nations (which, though not a member, China exer=s significant influence in). China may claim to be just a middle-income developing country, but in diplomatic=terms it has become much more than that. However, Beijing's involve=ent in the Middle East has as much to do with the United States than it do=s with China. Prospects for U.S. brokerage of Israeli/Palestinian peace are bleaker than they've been in a long time.=President Obama's relationship with Netanyahu, to put it mildly, is not wa=m, and the continued split between Fatah and Hamas complicates matters fur=her. The administration has also publicly signaled a "pivot to Asia", a declaration that foreign =olicy priorities won't be dominated by the Middle East forever. And when r=cently asked about the Israeli/Palestinian crisis, Secretary of State John=Kerry pessimistically gave the "two-state solution" a window of two more years. Clearly, Washington doesn't fee= good about the situation. So will China fill the breach? B=ijing's involvement does offer a fresh dynamic to the region; whereas Wash=ngton is seen as a staunch Israel ally, China tilts much more toward the Palestinians. It wasn't a coincidence that i= was Mahmoud Abbas, not Netanyahu, who was awarded full state visit honors=in China. That said, China still lacks the clout to play more than a peripheral role in the Middle East peace process=-- something Beijing surely knows. But by meeting with the two leaders, Xi=Jinping served a timely reminder that his country, at the very least, wasnrt going to sit this issue out anymore. 13 EFTA_R1_001 07026 EFTA01785164 Article 7.<=a> The National Interest The Day After a Strike on =ran Marwan Muasher May 10, 2013 -- All eyes are on=what it will take to prevent Iran from getting its hands on a nuclear weap=n. If sanctions and diplomacy prove incapable of containing Tehran's nuclear ambitions—and soon—a military strike =o destroy or at the very least delay its program is seen as the least bad =ption available. Iran gaining a nuclear-weapons capability is a red line t=at the United States and Israel just won't let it cross. But not enough thought has been=given to what happens after a strike is actually carried out. Debate in the United States end= at how to prevent Iran from getting the bomb, while the repercussions of = military strike are not widely discussed. This ominously echoes the run up to the war in Iraq.ap> When Washington was preparing t= invade Saddam Hussein's Iraq, little consideration was given to what ca=e next. Ten years later, the mistakes are evident. Iraq did not pose the immediate security threat that Washington b=lieved, forcefully building a democracy was easier said than done, and the=difficulties bogged U.S. troops down for years. The war cost trillions of =ollars and damaged America's standing in the Arab world. And now the real issues are bei=g left unaddressed again. Conventional wisdom holds that a military strike=on Iran is the best thing to do in the face of a legitimate fear. But tough questions must not be avoided. Will a strike stop Tehran from =ursuing a nuclear weapon or push it to weaponize? A successful military attack on=Iran's nuclear facilities will likely set the country's program back, =ut it won't be enough to end its nuclear activities for good. A strike could actually have the opposite effect. If Tehran hasn=92t yet decided to weaponize, as many intelligence experts presume, an att=ck could certainly make its leaders feel the need to speed up their effort=. Will hitting Iran help the regi=n, or hurt those standing against extremism? Moderate voices in the Arab wor=d, as weak as they are presently, are finally beginning to be heard with t=e outbreak of the Arab Awakening. But an attack on Iran could have significant ramifications. A strike that is perc=ived as illegitimate in the region could push more people toward extremist=views, increase negative perceptions of the United States, and deal a fata= blow to the moderates. Will a strike weaken Iran in th= Middle East, or resurrect it from the dead? Tehran lost popularity and legi=imacy following its crackdown on protesters in the aftermath of its 2009 e=ection and by supporting the brutal Syrian regime. Damaging Iran's nuclear program won't necessarily weaken Iran =urther, however, as the action could flip the script. Tehran could be seen=in a more positive light as the latest victim of an unwarranted attack and=actually gain influence in the Middle East. 14 EFTA_R1_00107027 EFTA01785165 Until these three questions are=answered, the military option should be left off the table.<=span> A strike is taken as a fait acc=mpli if negotiations fail. This is wrong. I think it's clear that a mili=ary attempt to derail Iran's nuclear program will push Tehran to weaponize, threaten the moderates emerging in the Midd=e East, and give Iran newfound legitimacy across the region as the country=standing up to imperialist America. But don't take my word for it= These questions need to be properly considered and openly debated. Propon=nts of military action need to analyze the long-term repercussions and defend how this will serve wider interests and=not just tackle an immediate concern. Opponents need to publicly discuss h=w they believe diplomacy serves U.S. interests more than war. Today, everyone recognizes the =istakes made waging the battle in Iraq. Washington rushed into a conflict =ithout a proper assessment of the risks or plans for what came after the smoke had cleared. Let's not let histor= repeat itself only a decade later. The United States should not st=rt something it does not want to finish. Serious thought needs to be given=to the day after a strike on Iran to avoid its downsides or plan for its consequences. Marwan Muasher is vice president fo= studies at the Carnegie Endowment for International Peace. He previously =erved as foreign minister and deputy prime minister of Jordan. Article 8. Prospect</=> Michael Sandel and AC Gray=ing in conversation May 10, 2013=span style="font-size:l8pt"> -- On Wednesday night (8th May), =rospect hosted an evening of conversation between Michael S=ndel and AC Grayling at the Royal Geographical Society in London. Here is =n edited transcript: AC Grayling: You were brought up mainly in California, educated at Brandeis and t=en at Oxford. You were a Rhodes scholar there and stayed on for your doctorate, and you were supervised for your d=ctoral studies by Charles Taylor. What influence still persists from your =ime talking to Charles Taylor? Michael Sandel: I had a wonderful time at Ox=ord and Charles was at the centre of a small but compelling group of heter=dox, moral and political philosophers who stood outside the then mainstrea= of purely analytic philosophy, which was largely utilitarian. I came late to philosophy—I had studied politics as an unde=graduate. So I was first enticed, almost forced, to study Kant by Alan Mon=efiore. Then after I had done that, with Charles I studied Aristotle and Hegel, and then with Stuart Hampshire, Spi=oza. All of these thinkers were in a way counter-cultural, at odds w=th the mainstream. I found it all fascinating, and the influence this had on me =as to question some of the overly individualistic assumptions that informe= contemporary moral and political philosophy, including those of Rawls. Also, to question the idea that debates about ju=tice and rights can be neutral with respect to conceptions of the good lif=. 15 EFTA_R1_001 07028 EFTA01785166 Grayling: I know you don't like the label "communitarian" but that is of co=rse one that's associated with Charles Taylor's views. You did mention the overly individualistic view of things. This is =remendously important because a large part of what you've thought, espec=ally in talking about the marketisation of our society, has really been a =ament for the sense of community. So there is a sense that the label, although you don't quit= like it, does somewhat describe the position you come from—and it would=be a Charles Taylor sort of position. Sandel: There is a sense, you're quite right, that the term fits. B=t it's in the sense that suggests that it's not reasonable, it's not=possible in some cases, and not desirable in others, to try to reason about justice or rights or the good society by st=pping back from the particular identities that shape citizens. Grayling: You urged against Rawls's =dea that somehow you could think about how you would like to see society o=ganised if you were ignorant of where you would be in society. Your point =s you can't start from there—you've got to start from where you are located. This is a theme in a great deal of what you have written and =aid. It naturally enough raises questions in the minds of those who do hav= an interest in conceptions of autonomy, individual liberty and the rest, that they lie in tension with the idea th=t we are already connected and, to use a wonderful word coined by Bishop B=rkeley, embrangled in society. How are we going to deal with the difficulty that there seems=to be an irresolvable conflict between, on the one hand, the interests tha= individuals have in their own lives and projects and so on, and these commitments that they cannot escape from= Sandel: Take the right of freedom of speech. There are some who say t=at the moral basis of freedom of speech is that government should be neutr=l with respect to the content of people's speech and respect the fact that it is the speech of a freely choosing sel=. I would put the case of freedom of speech differently. It des=rves special protection for two reasons. First, respecting freedom of spee=h is essential to democratic life. Democratic life matters not just because it satisfies individual preferences, but bec=use it makes us better. It enables us to develop our human capacities more=fully if we participate in self-government and deliberate about important =ublic questions. The second reason goes beyond civic virtue and suggests that =e are free when we actively participate in public deliberation and develop=the full range of our human faculties. So you might call this an Aristotelian defence of freedom of speech becaus= it does refer to a certain conception of the good life and maybe even vir=ue. Grayling: The way you set that up is that the reason central civil liberties like=freedom of speech matter is that it makes for a good society, that if people are fully participating, are fully info=med and take part in the conversation then society will flourish as a resu=t. Sandel: Grayling: Some people could read Aristotle as saying that it's better that soci=ty is good so that individuals within it can flourish. In other words, the direction of emphasis is towards the flo=rishing of the individual. Whereas the other direction of emphasis is to a=cord individuals these civil liberties so that society can be a good one. ='m wondering which direction we're moving in with you. 16 EFTA_R1_001 07029 EFTA01785167 Sandel: Grayling: I'm very sympathetic to that view but I can hear two different kinds =f critics responding to it. One critic might say that the best kind of society from the point of view of the individual=flourishing is the minimalist society. This might be your bog standard Rep=blican who wants government to get out of the way. In the other direction you might have someone say that a good=society is one that compensates for the failings of the individuals within=in it. Famously, Churchill said democracy was the least bad of a lot of bad systems. But he also said that the stron=est argument against democracy was two minutes of conversation with any vo=er. Sandel: Grayling: That's very interesting. We must come back to it because of course in=your discussion of the marketisation of society in What Money Can't Buy, you end by pointing out how corrupting=of our civic life it would be if everything could be bought or sold. Before we do, the motivation for what you say in that argumen= is predicated on the disenchantment you have with economics and economist=. Perhaps you could explain what it is about them that has made you fed up. Sandel= Some of my best friends are economists. When I started graduate school, l=started out thinking I would do PPE and study philosophy and economics since I'd studied politics before. My pro=ect with economics was to see if I could include within the economic model=a concern for equality, or whether equality as a normative consideration h=d to be brought in from outside those models. So I strayed from that project, although I feel like I've come b=ck to it, in a way, 35 years later. In the old days, back with Adam Smith and the classical econo=ists, economics was understood, I think rightly, as a branch of moral and =olitical philosophy. In the 20th century, economics established itself as an autonomous discipline and presented its=lf as a value-neutral science of social life and human behaviour. This is =ow economics is largely taught today. I think it's a mistake to view economics as a science. When=economics concerns itself with traditional economic topics, such as employ=ent, inflation, how to avoid recession, foreign trade, banks and stocks, then it is easy enough to see how it's =ossible to think of economics that way. But when economics enlarges it's=ambition and undertakes to explain the whole of life, then I think it's =ess and less plausible to think of it as a value-neutral science. When economic reasoning and markets govern not just things li=e toasters and cars but family life, personal relations, health, education=and civic life—when economics tries to explain and inform every domain of life—then it has to enter into morall= contestable choices, although it does so often without fully owning up to=it. Economists often assume that markets are inert, that they don=92t touch or taint the goods they exchange, and this may be true enough if=we're talking about material goods. If you give me a flat-screen television or sell me one, the flat- screen telev=sion will work just as well either way. But the same may not be true when =t comes to using market mechanisms or cash incentives, for example, to mot=vate young students to study harder. Cash for good grades or high test scores—many US schools districts have =ried this as an experiment. In Dallas, Texas they pay eight-year-olds $2 f=r each book they read. From the standpoint of traditional economic analysi=, the only test is: does it work? Does the number of books read increase? What has actually happened is that=the grades have not increased in most of these experiments.<=span> But the real question is: what lesson is being taught by offe=ing cash for grades or studying? My worry is that the lesson being taught =s that reading is a chore, the kind of work to be done for money. And if that's what's being taught, the mark=t mechanism is not neutral—it changes the meaning of the activity and cr=wds out attitudes and norms that we care about. 17 EFTA_R1_001 07030 EFTA01785168 Grayling: However much economics tries to portray itself as value-neutral it isn=92t, because another thing you're concerned about is that economics assumes that consenting adults are the party to th=se deals they make with one another. So if I want you to advertise my book=and I pay you enough to have it written on your forehead, that would be an=example where the question of analysis would be, "is the person renting out their forehead coerced by their eco=omic circumstances?" This is something that makes you anxious. Sandel: But I also worry on another, independent ground. Even if it i= voluntary rather than through economic desperation, there is the question=of whether the tattoo ad on the forehead is degrading. It's a question that arises classically in debates about p=ostitution. There's the worry about coercion, or implicit coercion. But =ven if that objection is met there's still the question of whether it'= morally objectionable because it's degrading. Grayling: Paying somebody to wait in line for you, for example, for a congression=l hearing. This doesn't do anyone any harm and this is someone who might need some money. Certainly, people who are d=awn into sex work, that's troubling—but it's not always easy to draw=a line. Drawing a line involves some kind of value judgement and then the =nevitable question arises: whose values? And I take it part of your answer is that it's got to be our values, tha= somehow we have to reinvigorate a conversation in society about what's =cceptable and what isn't. The big question is, how the heck do we do tha=? Sandel: The objection to paid line standing does involve the degradat=on argument, the idea of it being demeaning, but not necessarily in the ca=e of it being demeaning of the person who has the job. Here it's different from the tattoo or the surrogate mo=her. It's demeaning of the institution of the government that allows thi= kind of ticket touting to govern access to Congress or Parliament or the =upreme Court. It's demeaning of representative government to put access up for auction in this way.<=p> We've seen these long queues where people pay for someone t= get them the first new iPad or iPhone. I think that's different, becaus= that's a commercial product. You'll then say, "OK but that restates precisely the question as it's a value judg=ment." I agree it is and you rightly want to know whose judgement should=govern. I would say ours, but the hard question is how should we reflect o= those values? If we take the arguments from degradation or corruption serio=sly, as I think we have to if we are to define the moral limits of markets= we have to reason together in public about the right way to value goods, whether the goods at stake are the int=grity and dignity of the human person or the proper way of governing acces= to institutions that represent government. Grayling: There's an obvious connection between your interest in the concept of=justice and these issues. Questions about what's just have always been front and centre of the great moral argumen=s. What do you take those forms of justice to be? Is it distributive or is=it some other conception? Sandel= Justice is an important virtue of social institutions. I don't think it=92s the only virtue—there are other virtues to do with community, fellow feeling, solidarity, self-government, the sco=e for and the quality of public deliberation, all of which may have some b=aring on justice, but which may also have independent moral importance. Part of my argument in the book on justice and the book on ma=kets is that we can't entirely discuss these sets of questions independe=tly of one another. What counts as a good society unavoidably embroils us in questions of virtue and the good life. =t can't altogether be separated from whether the distribution of incomin= wealth and power and opportunity in that society is fair, even recognisin= that fairness isn't the only thing that matters. 18 EFTA_R1_00107031 EFTA01785169 Grayling: Your lectures at Harvard hav= famously become available to everyone in the world online. MOOCs [massive=open online courses] look as thought they're going to transform educatio= worldwide. But there has been a push back on two fronts. One is that if =hese massive courses have tens of thousands of students taking them, and t=ey do essays, there just aren't enough professors to go around to mark them, so they're graded by software. So =here's one question mark that pops up in people's minds: is being taug=t by a computer OK? Then the second thing is you've been challenged recently by=an entire philosophy department at San Jose State University, who said, =93you're just about to put us out of a job because if our college just has your lectures online, they won't need us=" Where is higher education going? Sandel: The effect was beyond anything we could have imagined. They t=ll us that tens of millions of people have been watching them. For me, the=most rewarding part of the experiment is simply providing free and global access to the Harvard classroom, or to=any classroom, so that anyone, anywhere, including someone in an Indian vi=lage or in a remote part of China or Africa who has access to the internet= can see it and can hear about Aristotle and John Stuart Mill, follow the lectures and engage in the onli=e discussion if they want to. For me it's a way of giving expression to =he idea that higher education should be seen and treated as a public resou=ce and not as a private privilege. But as far as the push back, I would emphasise that I don't=think an online course can replace the experience of students and teachers=gathered in person and deliberating together as part of an academic community. And I hope that even financially pressed=colleges and universities won't assume that it can.=/p> QUESTIONS FROM THE AUDIENCE Question: You're probably aware, Michael, that there's been much discussion i= political circles recently with respect to the morality of tax avoidance. What answer would you give to this issue?</=pan> Sandel= I'm against tax avoidance. I think that countries need to work together=to find ways to reduce tax havens that drain important resources from the public treasuries of societies that have demo=ratically enacted certain tax rates and tax laws. Secret banking arrangements in the Cayman Islands, Switzerlan= and elsewhere provide a way for people to evade taxes. Some of the =ax avoidance is done through loopholes that are in the tax codes itself. I think both forms are objectionable, not onl= because they exacerbate the budget crises, indeed the austerity and the p=in that governments struggle with when they lack the resources that they w=uld otherwise have under the law, but also because I think it's a kind of civic corruption.<=span> We should find a way collectively and globally of cracking do=n on that, and preventing that, because it's corrosive of a democratic c=vic life. It's not just a loss to the treasury. Question: What part of equality do you=espouse: equality of outcome or equality of opportunity? How does your vie= of equality relate to your notion of justice? Sandel: Equality of outcome and equa=ity of opportunity are often thought to be the two alternative ways of con=eiving equality, and I'm not sure they fully capture the range of possib=lities. I would be for a third kind of equality that might be described as equality of condition. 19 EFTA_R1_001 07032 EFTA01785170 Democracy does not require perfect equality, but it does requ=re that men and women from different social backgrounds and different walk= of life inhabit a common life, enough so that they realise that we are all in a common project. Just how much eq=ality is necessary for that is a qualitative judgment. To what extent do we have common spaces and public places tha= gather people together, that provide people access to the fundamental pre=equisites of a good life? My worry is that against the background of rising inequality over the last three decad=s, allowing markets to dominate more and more aspects of life is corruptin= that commonality. We find that people of affluence and people of modest m=ans increasingly lead separate lives. We live and work and shop and play in different places. Our childre= go to different schools. This isn't good for democracy and I don't th=nk, ultimately, that it's a satisfying way to live, even for those of us=who may inhabit the more privileged places of social life. Question: Bearing in mind the abuses t=at took place in the run-up to the credit crunch, at what point do imbalan=es in information between market participants lead to markets becoming una=ceptable? Sandel: Privilege of access and priv=lege of information did play a role in the run-up to the financial crisis.=One of the things that's striking in the aftermath of the financial cris=s is that despite the virtual meltdown of the global financial system, we have not really had a fundamental debat= about the proper role of money and markets in our societies. I think most of us expected that the financial crash would ma=k the end of an era of market triumphalism that goes back to the early 80s= An era defined by the faith that markets and market mechanisms are the primary instruments for achieving the public=good. And although we had some debates about regulation of the financial i=dustry, we didn't really go beyond that. The market faith has had a rema=kable staying power, even after the financial crisis, and I think it's interesting to try to figure out why,=and also an important question for our public life.</=> Question: Women do a lot of the unpaid=work in society. I've tried to come up with how we could change society =o that women are not taken advantage of. The market seems to be the only a=swer because it would put a value on their work. But I worry a lot about going down this road, because of the m=ral consequences and the limits of markets. How, other than a transaction =hat puts value and worth on something like childcare, can we address such =n issue? Sandel: It's a great question, and=not an easy one to answer because, as you say, much of what is traditional=y regarded as women's work is not commodified. In a market-driven societ= like ours, work that is not rewarded with money tends to be undervalued and unappreciated. And so there's the=temptation to think, just as you suggest, that commodifying what is tradit=onally regarded as women's work in the household is a liberating alterna=ive. And yet we see marketising and commodifying roles to do with =are, including care of children and care of the elderly. Those tend to be =obs that are poorly paid, and in fact are paid far out of proportion to what their moral importance suggests the= should be paid. So it could be that simply commodifying what is tradition=lly regarded as women's work would not solve the fundamental problem, wh=ch is that the roles of care are not sufficiently recognised, appreciated and rewarded in our society. The real question is: how can we change that? Whether women p=rform those roles or men perform those roles, we need a public debate abou= it, because simply commodifying care-giving roles may perpetuate and entrench the under- appreciation of those roles if=they are not remunerated in a way that indicates their true importance. The appeal of the market faith isn't just that markets deli=er higher GDP or economic efficiency. The deeper appeal is that markets se=m to be value-neutral ways of deciding social questions. They seem to spare us democratic citizens the hard work =f reasoning together about contested values and judgments about the good l=fe, and questions of care and their importance go directly to the question=of the good life, and how we should value social roles. We should resist the temptation to think that we can outsourc= moral judgment and civic judgment to markets. And that means that we need=to grapple directly, not only as philosophers, but also in public life and in public discourse, with the hard questions, =nthony [Grayling), that you are putting to me: Is there a right way of val=ing this or that good? 20 EFTA_R1_00107033 EFTA01785171 And if there is, how can we possibly decide togethe=, when we live in pluralist societies where we disagree about the good life, and virtue and how to value goods?<=font> It is a mistake to think that leaving these questions to mark=ts will leave them undecided. Instead, as we've seen, that will decide t=em for us, and that's why we need to find our way to a morally more robust, admittedly more demanding, form of publi= discourse. Not because we'll agree, but because it will engage more dir=ctly with the questions we have to decide if we're to take democratic ci=izenship seriously. And it will also enable us to keep markets in their proper place. Michael=Sandel is a professor at Harvard University and author of "What Money=Can't Buy: The Moral Limits of Markets". Anthony Clifford Grayling is emeritus professor of philosophy at Birkbeck College,=University of London, and master of the New College of the Humanities. His=latest book is "The God Argument" (Bloomsbury) =/p> 21 EFTA_R1_001 07034 EFTA01785172