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To quote from Hindu mythology: Lord Krishna was born to defeat the demon Kansha. Had there been no Kansha, God would not have taken the form of Krishna to defeat Kansha and prevent a major catastrophe resulting from his misrule.
The economy has been the Achilles heel of the Bush administration, and it took John McCain and the Republican Party down. Had the election been held three months earlier, the outcome would have been different. Obama’s victory, if he had won, would not have been as widespread.
Now that the election is over, it remains to be seen how Obama and his team will handle the deteriorating economy, the Iraq War, the Afghanistan-Pakistan situation, China’s rising exports, the trade deficit and the rising power of countries like India, all of which are still dependent upon U.S. largesse.
The U.S. economy is unlikely to mend anytime soon, especially after six years of careless and unabashed capitalism on Wall Street, which brought it down. It could take three years or more to return to normalcy. That does not mean that the Iraq War or Afghanistan will be put on hold. Rather, the United States has two choices – withdraw or fight to the finish. Withdrawal from Iraq is possible, while it is likely to be a fight to the finish in Afghanistan.
U.S. conduct in the next four years will largely depend on Obama’s men in the White House. He has a huge talent pool of Clinton-era men and women waiting to be offered jobs. On the other hand, he cannot come up with a remake of the Clinton administration. Reaching out to both sides of the aisle would spell wisdom. Clinton’s first administration was marred by acrimony with Congress; Obama would be better off avoiding that.
In an era of globalization with the United States at the center, mending the U.S. economy will mean mending the world economy. However, if the United States falters, then the world would follow suit. Europe and Asia are learning this the hard way, as developing countries are worst hit by the current financial crisis.
Europe is actually in better shape to tide over the current economic crisis. It may be wise for the Europeans to go slow on globalization. Otherwise, any future U.S. economic downturn will continue to take the rest of the world down. This is the first such experience since the push for globalization in the 1990s.
The economic fundamentals that created the current situation are not likely to dissipate in a freewheeling society like the United States. These crises will likely be reborn with new faces. The junk bond and savings and loan crises of the 1970s, along with the present-day subprime loan crisis, are reincarnations of the same old malady.
China’s exports and India’s information technology services will be most affected, while the rest of Asia, much of which relies on U.S. exports and tourism, will find itself at the short end of the stick. Africa as a developing region will also be badly hit; its plight will neither be forgotten nor helped. Reduced economic aid will be the norm.
If Obama were to end the Iraq War, it could save US$150 billion in annual expenses. So why prolong a war that cannot be won? Rather, the United States should go ahead and amend its Constitution to prevent future meddling in affairs beyond its borders.
The United States’ half-hearted military approach to war is a disaster. Key errors in Iraq were declaring victory too soon and going in with too few military boots for a ground offensive against an enemy that went into hiding and later began a bombing campaign.
The unhealthy rivalry that the United States has developed with Russia by unnecessarily expanding NATO eastwards should end, to prevent Russia from building its military arsenal all over again. Besides, the unfolding conflict over Georgia must end and the incapable Georgian President Mikhail Saakashvili, who initiated the war, should be removed from power. Locals are likely to remember him as the man who truncated Georgia permanently and killed 12,000 Georgians.
There is only one way out of the Afghanistan mess. As the Taliban cannot survive without supplies from Pakistan, cutting off supplies will end the battle in Afghanistan. So far, the policy has been to support Pakistan to hunt for Osama bin Laden and his men in the mountains. However, bin Laden should be ignored and the Pakistanis should go after al-Qaida and the Taliban in a big way, or let NATO troops come in and do the job. Bribing the Pakistanis with US$10 billion to look for al-Qaida has not worked.
Among Obama’s coterie of advisors, India has to watch out for two personalities. They are former Secretary of State Madeline Albright, the destroyer of Yugoslavia under President Bill Clinton, and Colin Powell, the Pakistan-supporting former chairman of the Joint Chiefs of Staff under the first George Bush and later secretary of state under the younger Bush.
There are three things that India should do to improve relations with the United States under the Obama administration. First, it should keep a low profile on the sale of civilian nuclear reactors to India. Second, it must be more diplomatic toward Pakistan. Third, it should attempt to secure more foreign direct investment, similar to China, to become an alternate source of manufactured goods for the U.S. market.
India should make it clear that it is a trillion-dollar economy and not a football to be tossed around at will. Rather, the United States should protect India’s interests in the same way it protects those of China, Japan and the European Union.
After 50 years of sniping at each other, India and the United States have made progress in mending their relations. The Indo-U.S. nuclear deal is a product of that. Hopefully, the new administration will not appoint people like Robin Raphael – the former assistant secretary of state for South Asia who meddled in India-Pakistan affairs and single-handedly kept Indo-U.S. relations in the doldrums during the first Clinton administration.
As long as the U.S. economy is in the doldrums, the United States should not meddle in the Arab-Israel conflict, or for that matter in Lebanon, Kashmir and NATO expansion in Eastern Europe. However, Obama should prioritize foreign policy on Iran. Also, relations with North Korea should be mended, as China cannot be trusted to deal with North Korea. It is playing the same double game that Pakistan has been playing in Afghanistan.
Obama is expected to carry the weight of the world on his shoulders, and any sign of fatigue will be a signal to the destructive forces to begin their tirade. The world’s best hope is that he and his team will perform well on the economy and stay out of trouble elsewhere.
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(Hari Sud is a retired vice president of C-I-L Inc., a former investment strategies analyst and international relations manager. A graduate of Punjab University and the University of Missouri, he has lived in Canada for the past 34 years. ©Copyright Hari Sud.)
