Brazil is exercising its independence in foreign policy by not joining the international coalition against Iran. This, despite the fact that even Russia is sounding more positive on joining the US/EU line on Iran’s nuclear policy. What is actually at play here has nothing to do with Iran. Brazil aspires to play a global role. It even has a claim to a permanent seat on the UN Security Council. Fair enough. I actually think Brazil deserves it. But with increased power and influence comes increased responsibility. A foreign policy based primarily on defying the United States and not on the actual issue at hand is not the sign of a global power. Brazil lessens its own credibility when it chooses not to join global solutions to the critical issues of the day.

Israel is the other country on my list. I am normally quite pro-Israel. I profoundly believe in Israel’s right to exist in peace within secure borders. It is for that reason that I, along with Israel’s other friends (eg the United States government) favor a two state solution. The alternative is one state in which Jews ultimately find themselves in the minority. Announcing more settlements then is a mistake as it makes achieving a two state solution that much harder. Furthermore, by announcing it at the very moment when Vice President Biden was in the country, Netanyahu is clearly telling President Obama that it is not going to play ball on the peace process. This is very unfortunate for Israel. Not only is it deferring a fading opportunity for peace. It is also thumbing its nose to its closest ally, and that is something that is especially unwise for a country with as few friends as Israel.

Brazil and Israel are in two parts of the world, but both are demonstrating the same determination to set a foreign policy that is independent of Washington. This is their right. But to act against your own interests (or those of the world community) just to defy the US, is hardly the sign of confident or rising nations.

 The summit in Pittsubrgh is being hailed as a great success, with a surprising amount of agreement. From what I can see, the main topics discussed were as follows:

• Continuing the Economic Stimulus – everyone agreed to keeping the money taps going. No one really answered the question as to when we would return to some kind of normality. In the mean time, we continue to saddle the next generation with ever increasing amounts of debt. Chief villain: the United States which is already knee-high in debt but believes the economy will stall in the immediate term without never-ending spending (or Germany which is most cavalier about near term stability, depending on your point of view).

• Rebalancing the Global Economy – everyone agrees that a few countries cannot keep generating huge surpluses selling to the rest of the world (particularly the US) and then complaining that everyone else is a glutton. This is the biggest long term change the world needs to make. Everyone agrees, but no one is saying how it will be enforced except by “peer review”. This is remarkably lame. Chief Villains: Japan/China/Germany. Japan sounds like it means to take action and it probably does. China is making the right noises but probably has no intention of doing anything whatsoever. Germany isn’t even making the right noises

• Regulating the Banking System – this is not getting the attention it deserves. Most of the world’s banks have not recognized the huge liabilities on their books. We will not get to normality until this is done. They will not just “grow” their way out of the problem. Everyone to blame, though the US seems more realistic on this than the rest. Chief Villain: Europe

• Changing the voting power at the IMF – emerging countries rightfully deserve more say at the IMF. America is for it. Chief Villain Europe says it’s also for it, but actually is not. (Its claims that America should give up its effective veto are nonsensical. America is already underrepresented in voting power relative to its economic weight).

• Banker pay – everyone agrees that excessive risk taking has to be curbed. It cannot be rewarded. But Europe’s excessive zeal for this says more about continental Europe’s reflexive anti-financial attitude than it does about banker pay. Chief villains: France and Germany

• Climate Change – all countries are getting it that something needs to be done about climate change. Europe and now Japan seem most serious about cutting emissions. America is getting there, though the Senate may pose a problem in getting domestic legislation passed. The Chinese have begun to point to real emissions cuts – twenty years from now. India has made fighting this a case of national virility on the grounds that on a per capita basis it is still the West that are the polluters. True – but is this really a helpful approach? Chief villains: everyone

I do not doubt that the new global G20 conference is where the power has shifted. I also do not doubt that within that, it is the relationship between the G2 that will increasingly be what matters. As to how to enforce any of the agreements, which on the whole are good ones, I have no clue.

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 The US needs to start paying attention to what is happening in its back yard. True, China’s role in the region is still a lot smaller than America’s. There will also be a natural limit to the growth in Chinese trade as China isn’t particularly interested in the region’s manufactured goods but just its raw materials. In fact, a Chinese-led economic model for Latin America would lead to its de-industrialization just as it was taking off. Nevertheless, the trend lines are clear – for example, China just overtook the US as Brazil’s largest trading partner. What makes the emerging situation especially worrisome, however, is the combination of this economic shift with the rise of anti-Americanism in the region. Obviously, Venezuela under Chavez is making a big deal of its links to China, Russia and Iran. But longer term, Brazil may be of greater worry. Brazil has entered into many “Southern” partnerships as it charts its own course on the global stage. This does not have to be a problem eg its trade/political grouping with India and South Africa (“IBSA”). But these countries are democracies, and strong ties with them are not fundamentally at odds with strong ties with Washington. (In fact, the US has good reason to encourage more Indian engagement in Latin America to counter the Chinese, as it is doing in Africa). Brazil’s leadership of the nascent Latin American “union” UNASAL is more questionable. Ultimately, Brazil’s relations with China and other non-democractic countries such as Iran and increasingly Venezuela beg the question, as the Economist put it recently, ”Who’s side is Brazil on?”

 Latin America won’t leave its basic US orientation any time soon. Not even Venezuela. Geography and the sheer size of the US economy will see to that. But the rise of China (and of Latin America’s own economies) point to a future where US hegemony in the region can no longer be assumed.

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So, how has President Obama done?

In terms of jihadi terrorism, the President has finally reversed George Bush’s terrible mistake in believing Iraq was the critical front in the War on Terror. He has correctly understood that it is Afghanistan and Pakistan (“AfPak”), as a single theater, that pose the greatest security risk. The President has now taken ownership of the Afghan war and is ramping up operations there – something we regard as a necessity to drain the swamp of Islamist extremism. On this, we give the President high marks, especially when taken in conjunction with his plans to overhaul the military to better take on counter insurgency operations. Pakistan, however, has deteriorated far faster than expected and puts the President’s plan to force it to stop the attacks in Afghanistan in jeopardy. Pakistan has in fact itself emerged as the bigger threat to US security as its own Taliban strengthen, posing an existential to this nuclear armed nation. Any terror attack on the West is likely to have been planned in Pakistan. We do not see a coherent plan from the Administration as to how to deal with Pakistan. So far, the President seems to be falling into the same trap as President Bush by sending over every increasing amounts of aid while not preventing the flow of arms and support to the Taliban. Unconditional aid produces limited results. President Obama had talked about “Islamabad not getting a blank check”. Yet that seems exactly what he feels compelled to give. Without a serious Pakistan policy, we doubt the President can succeed in Afghanistan. The US and the West also are at a heightened risk of additional attacks. So while we are somewhat encouraged by the “Af” side on the AfPak war, we are concerned with the “Pak” side.

In terms of broader outreach to the Muslim world, we are not far from where we had expected to be given the President’s undeniable appeal. President Obama told the Turkish parliament in no uncertain terms that the US is not at war with Islam. His plan for a sensible drawdown of troops in Iraq will also help a lot on the proverbial “Arab Street” (if not the broader Muslim world). We hope that the President can stay the course in Iraq, and not get sidetracked by the inevitable violence that will flare up. America’s strategic priorities do not call for drawing borders or deciding constitutional niceties between Sunnis and Shia. The bold new initiatives in Iran are welcome though progress will have to wait until after the Iranian elections. Nevertheless, it is a new start with an important Islamic country and further demonstrates that America is not at war with the Islamic World. The Administration’s plan to place heavy sanctions on Iran if it goes nuclear misses the point that it essentially already has gone nuclear by acquiring the capability to enrich uranium. Rather a containment strategy is to be called for. It is unclear, however, how an American outreach to Iran will affect America’s relationship with its traditional Sunni Arab allies.

Despite these new initiatives, it is unclear to us how the President’s outreach has played with Muslims given the high degree of cynicism when it comes to the United States. We expect Arabs in particular will want to see progress on the Palestinian question before giving a thumbs up. Still, the President gains simply by not being George Bush. The sight of a black President with the middle name Hussein is still something most regard as remarkable. Although few Muslims will admit that Barack Obama’s story would scarcely be possible in their own countries, his election has confounded many detractors of America and American society. The President has also quietly begun to challenge the Muslim World to look at its own problems rather than just blaming America, but we doubt he will be heard, particularly on women and minority rights. At the very least, though, the President has begun to reduce the volume of US-Muslim rancor, and for this he deserves credit.

Dealing with China and dealing with America’s long term economic future have essentially meant the same thing over the past 100 days. China’s stimulus is important to the world economy and a welcome sign that it understands what is required of it as a leading economic power. The President seems to understand that tough discussions are going to be necessary if China is going to be forced to generate economic growth which does not involve huge trade surpluses with the US. But The President also needs China to finance his huge social programs, and so he has punted on any of the serious discussions, both on the trade deficit and on the related issue of currency manipulation. China’s talk of replacing the dollar is, for the moment, just that – talk. There’s not much they can do. However, they are asking a reasonable question about the stability of US finances. We have the same concerns.

While economics is binding America and China together, military rivalry is threatening to pull them apart over the longer term. China’s military buildup concerns us. The review of the fleet this past week, its deployment of ships to Somalia, its support to countries such as Sudan all worry us that a long term strategic game is afoot. Even though the President has wisely reached out to Japan, the fact that Hillary Clinton’s visit to Asia did not include New Delhi sends the wrong message to the other rising power in Asia, particularly given the great advancements in US-India relations made by both Presidents Clinton and Bush. The President is offering nothing new in North Korea. In fact it is being goaded into the same tired responses to Pyongyang’s tactics as were the Bush and Clinton presidencies. North Korea is already nuclear. Now is the time for containment and roll back, not hysteria at each new antic. Now is also the time to make China step up and take responsibility for North Korea, especially as it had a major role in creating this rogue state and commands the greatest degree of influence.

In terms of maintaining America’s broader strategic strength in the face of a rising China and still turbulent Islamic world, the President needs to reach out to Europe, as the Western World’s other major power center. This has not yet happened from a substantive point of view. The President’s trip in Europe smoothed a lot of ruffled feathers, but did not engage at all on the complex issue of the usefulness of NATO and the form of a future Western military alliance. America needs Europe to stand up on security – time will tell if and when the President will start a serious dialog on this. The President also left the G20 summit in London with little to show in terms of European economic cooperation. This is not encouraging. On other fronts, we are heartened to see that the Administration has placed a “reset” on relations with Moscow. Expanding NATO has earned us Russian enmity, while gaining us nothing. No one believes that we are seriously going to risk war to defend the Georgian Republic. Engaging Russia on Iran is a good idea, but it remains to be seen if the Russians will agree to the Administration’s offer to halt work on missile defense in Europe in exchange for help in Iran.

The President is right to raise the profile of Latin America – but its unclear what the follow through there will be. Latin America is an area that deserves far greater attention, particularly as it grows economically and is becoming increasingly linked to the Chinese, both economically and strategically. Latin America has traditionally been seen as America’s back yard and hence was assumed to always be in America’s orbit. This is no longer the case. Brazil’s rise as an economic power will give it room for strategic independence. This is something that Washington should both welcome and harness the potential economic prospects. The same can be said of Mexico, which deserves particular attention not because of its drug violence, but because its long border with the US makes it critical to the future of the US. If the Mexican flu virus demonstrates anything, it demonstrates this. The President was also right to begin the long process of normalization of ties with Cuba, a country which is currently not critical enough to be taking up so much newspaper space.

What worries us most from a geosecurity perspective, however, is not foreign policy but rather the President’s economic policies. We agree that the times call for an economic stimulus. We also agree that investment in roads, schools and even green jobs is required. But given the expansion in the money supply, the plans for healthcare, and the still high defense budget, we wonder where the money will come from. Actually, we don’t wonder – we know. Its called T-bills. However, issuing excessive debt is the fastest way to producing inflation which in turn will lead to higher interest rates, choking long term economic recovery. It will also lead to staggering national debt numbers. On the most critical issue of all, social security and medicare, the President has not yet signaled a serious willingness to tackle this. If he does not, he will be ignoring the biggest long term threat to American geosecurity. An America that lives beyond its means is the fastest way to ensure long term economic and hence geostrategic decline. We are therefore greatly troubled by the Administration’s inability to put forth a realistic plan of how to cut the deficit and arrest the ballooning of the debt.

All in all President Obama has had an extremely active 100 days. We suspect that globally the President is more popular as a person than the US is as a country right now. He is wisely using that to reintroduce America to the world, and even if nothing else has been achieved, the atmospherics are far improved. Closing Guantanamo, coming clean on torture (no matter how painful), and using his own personal popularity (and that of the Clintons) have all helped to restore some of America’s moral authority and popularity. On substantive matters, there is a huge amount yet to be done: a viable strategy in Pakistan that stabilizes it, removing it as a threat to both us and to US operations in Afghanistan; discussing new security structures with the Europeans; tough talk with the Chinese on the trade deficit (and other issues such as North Korea); and articulating a plan to address the country’s long term finances. But if measured in terms of “repackaging” America to a skeptical world audience, which was always going to be the first task for any new American leader, the President and Michelle Obama can look back to a successful first 100 days.

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We have repeatedly put forth that it is a country’s geography – physical, human and economic – that determines its security risks, priorities, allies and enemies. Iraq will fade away over time, but the Mexican border won’t. The movement backwards and forwards of Mexicans and Americans across this shared frontier ensures linkages at a human level too. And with NAFTA, Mexico has become one of America’s biggest trading partners ensuring enormous ties at the economic level.

The outbreak of Mexican swine flu is a global problem. But have no doubt that the country most at risk is the United States. Our common border ensures it. To deny this geography is dangerous.

The US, therefore, has a fundamental security interest in seeing the success of Mexico. It is in America’s vital interest that Mexico develops its economy, civic institutions and justice system. It is an American security priority that Mexico not just deal with its drug violence but also deal with the enormous economic gap between its European elite and indigenous masses. A Mexico that cannot provide opportunities for all of its citizens will prevent it from reaching its true potential as one of the world’s great nations, and a source of US economic growth for decades. It will also ensure unchecked illegal immigration and untold human suffering.

If the Mexican swine virus shows us anything, it reminds us that what happens over there matters over here.

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Reaching out to the French, Germans, Turks and Mexicans is one thing. They are all traditional allies that have become estranged from America over the past few years. Reaching out to Hugo Chavez, however, is something altogether different. He is not an estranged ally.

Under Chavez, Venezuela has gone from being a flawed democracy to becoming an even more flawed dictatorship. Chavez has used his initial popularity with Venezuela’s poor to systematically undermine the state’s institutions and boost his own personal power. However, instead of using his resources and energy to help build the country, he is squandering his country’s oil wealth on non-productive social schemes that will pacify his base, and on a quixotic mission to confront the United States in whichever venue he can find.

In order to cast himself as the hero of a global struggle against “imperialism”, Chavez has reached out to other leaders with a history of anti-Americanism such as Iran’s Mahmoud Ahmedinejad. He has flirted with the Chinese, correctly recognizing them to be America’s chief challenger in the coming decades. These antics would be laughable if they were not so dangerous. Forging alliances with extreme elements of the Islamic World is neither good for Venezuela nor for the United States. Similarly, undermining America in favor of China is not in Venezuela’s long term interests either. The two countries share no values in common.

Chavez is looking to become the 21st Century’s version of Fidel Castro. His problem is that he is not living during the Cold War. And there is no Soviet Union to back him. Communism is no longer seen as a viable alternative to liberal democracy. For all of capitalism’s supposed faults, it is vastly superior to the brand of socialism that Chavez seeks to impose on his country. History will ultimately prove him to be the wrong man at the wrong time.

President Obama has reached out to many countries that have not agreed with America in recent years. We support such dialog with leaders (particularly of erstwhile allies) that America can potentially work with. Hugo Chavez is not such a leader.

Venezuelans would be better off rid of him and so would the United States. President Obama should therefore be doing nothing that will delay that day.

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This column has advocated that while the United States has a global role to play, it needs to prioritize among the world’s hot spots. This is the best way to be both effective in dealing with the crisis at hand, and also in providing the most robust security for the United States itself. Foremost amongst US concerns needs to be AfPak, which poses an immediate security threat. The other immediate issue at hand is Iraq, though at this point the only question here is the pace of troop draw downs. Less immediate problems include the nuclearization of Iran and North Korea. They pose no short term danger to America, although their weapons programs must be rolled back before they do. The long term question of China requires a new economic relationship with that country, and new security structures in Asia. These are all issues of importance, with varying degree of priority.

Mexico, however, is often forgotten in the list of important US strategic priorities. It is treated more as an “immigration problem” than a foreign policy concern. It is not a plum posting for career officers rising in the ranks. This has been a mistake, and not just because of the recent drug violence. America has a big stake in the future of Mexico. For better or for worse, a country cannot choose its neighbors. And the US needs to take this neighbor seriously.

Mexico offers the US an enormous source of long term economic growth. It also promises enormous challenges of illegal immigration and environmental degradation if it collapses. For these two reasons alone, Mexico needs to be a US priority. Far more time is spent on countries like Cuba, which have posed no threat at all to the US since the end of the Cold War, and arguably since the Missile Crisis. The United States needs to rethink just how much its policy planners seriously factor Mexico’s future into that of the United States.

The immediate problem that is focusing everyone’s attention is Mexico’s endemic drug violence. Much has been written on this, so we will not rehash the issue. Needless to say this is a two way trade. Drugs from Mexico. Guns from America. The Obama Administration is right in trying to address the American angle in this, even as he offers US security assistance to the Mexican government as it fights the cartels.

We believe, however, that even beyond the immediate issue of drug violence, the Administration needs to place a higher priority on Mexico. It is often forgotten that Mexico also figures in America’s larger foreign policy challenges of terrorism and a rising China. It can serve as a open conduit for terrorists if both sides of the border are not policed properly. It can become a battleground for rivalry with China as that country relentlessly searches for resources and trade routes.

Even beyond drug violence, or its role in global challenges, Mexico is also of unique significance in its own right. Its economic, historic and ethnic ties to the United States make it critically important. America’s long term future is intrinsically tied to that of Mexico – much more than to those of Iraq or North Korea, which are primarily security issues. Geographic realities demand that Washington engages Mexico at a much higher and sustained level.

Mexico is in a category of its own.

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The Obama Administration has gone some way towards preventing Cuba becoming a (possibly the) main topic of the summit with its recent easing of trade restrictions. More needs to be done, but this is a domestic policy headache more than a foreign policy problem. The Cold War is over, no matter what Chavez may think.

We have argued that the Administration needs to focus its attention, and prioritize. It cannot be too widely stretched when dealing with global crises. Iraq, Iran and North Korea all require immediate attention. Much more importantly, Afghanistan & Pakistan (AfPak) require the most attention, as they immediately impact US security. What happens in the Swat valley matters to the US.

Latin America, howver, is important too, not just as a sideshow but as a part of a global strategy.

Highest priority has to be given to Mexico, and its current drug violence. The instability on the other side of the Rio Grande threatens to spill over onto American streets. This is a two way trade though. Mexico is a conduit for drugs into the US. America is the source for weapons into Mexico. The Administration has recognized that Mexico needs to be treated as a special class by itself, and we applaud Secretary of State Clinton’s recent visit.

Beyond Mexico, Latin America is important for other reasons. We have articulated that America’s three national security challenges include the immediate threat of jihadi terrorism, the challenge of a rising China and the possible longer term decline of the US economy unless it deals with the twin problems of deficits and debt (and this goes beyond the current stimulus). Latin America is an important component on all three of those fronts, and not an afterthought.

We already know that jihadi terrorists are using the vast US-Mexico border to enter the US. This needs to be checked. We are also concerned that they are being given further assistance by such leaders as Hugo Chavez, who has already announced a “partnership” with Iran. The United States must “secure” Latin America, as it is the country’s “soft underbelly”, and no national security strategy can ignore it.

Secondly, China is becoming increasingly active in the region, and to America’s detriment. It is signing up exclusivity in economic resources (especially in Brazil), entrenching itself in the all important country of Panama, and even planning to build canals in Mexico linking the Pacific with the Caribbean. China’s challenge to American interests cannot go unnoticed. While the US has been busy fighting in Iraq, it may come home to find that its backyard has become much less friendly.
The US must encourage Brazil to assume greater leadership – something that it already aspires to do. But Brazil cannot replace America as the region’s leading country. If America forfeits or lessens its influence, China is all too willing to step in with sweetheart economic, trade and energy deals.

Lastly, America’s economy is increasingly integrated with those of Latin America. Mexico is a major trading partner, and Brazil could be a source of continued growth for US business for generations. The US needs to nurture these markets, where it should have a natural advantage, particularly as it faces challenges in other parts of the world, such as East Asia. The United States and Latin America can afford each other a much more mutually beneficial trading relationship.

The US needs to engage globally. It also needs to prioritize what it focuses its limited resources on. Mexico is a priority, and the Administration is right to engage it in a category of its own. But the United States also needs to engage Latin America as a whole, not as part of a sideshow, but as part of its overall global strategy.
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