GOP should control The Hill?

I believe that Democrats should lose control of the House and Senate this election cycle; it will be good for them. Sometimes a forest has to burn down to reinvigorate itself. Hopefully, the two years in wilderness will force them to develop more spine and balls. Although it is hoping against hope; the Democratic Party is not one, but a conglomeration of  several political philosophies covering the entire spectrum from liberal to conservative. The GOP, on the other hand, is uniquely individual in its mindset: very conservative, the only variation being the ultra-conservative, far-right faction.

Talking of spine, the Obama Administration and the Democratic Congress has achieved more than any other presidential term in recent history. Yet, they are afraid to advertise the gains made and explain to the public how it will better their lives.

That a healthcare insurance company is mandated to not turn down individuals for pre-existing conditions, that mid to large businesses are forced to offer health insurance to its employees and persons who can afford it are provided assistance for purchase, and that there would be no life-time maximums for any illness so one doesn’t go bankrupt under treatment are all part of a much needed reform of the predatory practices of the healthcare insurance industry. It would have been hard for Republican candidates to argue why do they want to take these benefits from Americans.

The only thing that bothers me is that the Democrats diluted the whole Healthcare Reform bill to appease Republicans, and yet, none of them voted for it anyway. Since this bill had to pass with only Democratic votes, why didn’t they follow though with their original agenda that included the public option. They would not have been any more unpopular with the segment of the populace that is now threatening to unseat them from power, but in doing so they would have acted with conviction and would have changed the country for the better. But this take balls.

The same is with the Financial Reform that received little GOP support despite it being watered down. Despite it having many helpful features still, it would have been far more effective had the Democrats stood their ground. The credit card reform and the creation of a consumer protection agency alone are very useful provision of the bill, but I haven’t seen Democrats crowing about it.

Other achievements such as increasing the student loans and removing the middle-men (banks) from the picture and enhancing fundings for research institutions like the NIH are left unmentioned.

Why don’t the Democrats explain to us the necessity of the TARP in preventing a complete economic meltdown? After all, this program was started under a Republican administration, yet the brunt is being borne by the current Democratic setup for supporting it and following it through.

Sea of tomorrow?

On a visit to Australia in the 1980s, the Prime Minister told Tip O’Neill (the Speaker of the House during Ronald Reagan’s presidency), that “…the Mediterranean was the sea of the past, the Atlantic, the sea of the present and the Pacific the sea of tomorrow.”

The prophecy has come true. Pacific Ocean IS the prominent waterway where commercial sea-lanes traverse between the world’s factory, China, and the world’s mall, America.

However, as the bipolar world of the past (US and USSR) has led to the unipolar world (US) presently, a new world-order is taking place in the 21st century. It will be a multipolar world, with competing interests of the US, Russia, China, India and maybe even other countries like Brazil and South Africa.

Nicholas Burns, former undersecretary of state, in a review of a new book by Robert D. Kaplan, Monsoon, says “…the twenty-first-century balance of power in the world will rest, more than anywhere else, on the fortunes of China, India, and the United States in the Indian Ocean.

Mr. Kaplan argues that  “Like the monsoon itself, a cyclical weather system that is both destructive and essential for growth and prosperity, the rise of these countries (including India, Pakistan, China, Indonesia, Burma, Oman, Sri Lanka, Bangladesh, and Tanzania) represents a shift in the global balance that cannot be ignored. The Indian Ocean area will be the true nexus of world power and conflict in the coming years. It is here that the fight for democracy, energy independence, and religious freedom will be lost or won, and it is here that American foreign policy must concentrate if America is to remain dominant in an ever-changing world.

On Fareed Zakaria GPS (aired on 29 August, 2010), Mr. Kaplan summarizes his recent article in Foreign Affairs. The following passages are my reactions mixed in with Mr. Kaplan’s data and analysis:

China is blessed with temperate climate and a vast geography, extending to central Asia westwards, but also has a fifth of humanity to feed and enrich. What has gone unnoticed in the past decade is the rise of China as a seapower. It is coming in competition with India, which is also a rising seapower. China has started to build warm-water ports in Burma, Bangladesh, Sri Lanka and Pakistan. This is seen by many to encircle India in a ‘string of pearls‘ around India. The sea-lanes from the Persian Gulf to China cross the Indian Ocean.

A rising Chinese naval power will bump against the present occupant to its east, the US, which has troop presence in Japan, South Korea and the Philippines. The US also has presence in the Oceania (Guam, Palau, American Samoa, etc.) which will check Chinese expansion into the Pacific. So, China will aim to extend its influence in the Indian Ocean. Also, the rivalry between China and India, commanding the second and third largest global economies by 2025, will spill into the Indian Ocean.

While we cannot ignore China, and should encourage its cooperation, we must also encourage like minded countries lke Japan and India build their naval powers.

Obama has already shown that he understands this equations; Secretary of State Clinton’s first overseas trip was to Indonesia.

This will be the ‘Great Game’ of the 21st century, much like the one between the British and the Russian Empires in the 19th.

When will we leave Afghanistan?

“…the US army must stay until the Iraqi army is fully ready in 2020.” So says the top US solider in Iraq, Lt. Gen. Babaker Zerbari. He added that the planned withdrawal will create a “problem” and increase instability in Iraq. The US government plans to withdraw its combat troops by the end of August 2010, and to remove all troops by the end of 2011.

This has interesting implications for the US strategy in Afghanistan, where president Obama wants to start troop withdrawal starting July 2011. A year before that deadline, things in the AfPak region are far from stable, unlike in Iraq; this means a slower withdrawal.

Saddam Hussein, undoubtedly, was evil. Nevertheless, Iraq has been a progressive and secular society. It was the only country in the middle-east where one could put up a Christmas tree, and women were not necessitated to don a coverall, not drive or not go to work. While the country was predominantly Muslim, there was a sense of national identity, except for some dissension in the northern province of Kurdistan. Before the US invasion, Iraq had a million-man military, one of the largest in the world at that time.

In contrast, Afghanistan has never really been one nation. Until 1973, when a bloodless coup removed the king Zahir Shah, it was a monarchy. However, this Afghani kingdom only came to be in 1919. Before that it was either a transit for invaders to cross over to India, or was a part of an empire, either Indian or Iranian. During much of the 19th century it was a part of the ‘Great Game‘ between Britain and Russia, which continued even after the Bolshevik Revolution of 1917, ending when they became allies in WWII.

Without a federal authority, there have been several centers of power around the country throughout Afghanistan’s history; all politics is really local here. The populace is used to continual wars as fortunes have shifted. To complicate matters further, there are the majority (about two-thirds) Pashtuns in the east and south, while the minorities of Uzbeks are in the north and those with Persian heritage occupy the west. And they don’t like each other.

When the Soviets invaded, they had almost as much troops (100,000) as we have now (110,000) and were helped by an equal number of Afghan forces. They stayed there about the same time that we have been (almost 10 years), and when they left in 1989, the whole country was in tatters, without any central governance. Today, the situation is no better than it was two decades ago.

In other words, Afghanistan does not have any central command and control, no feeling of national allegiance and no viable armed forces. It does not have the structure or institutions to become a Westphalian nation-state.

If it will take 10 years for us to leave Iraq in toto, we will be in Afghanistan for a long, long time. Gen. David Petraeus, the US commander in Afghanistan, has started to hedge on that deadline, and VP Biden says US troop withdrawal could be limited. Even president Obama stated that “We didn’t say we’d be switching off the lights and closing the door behind us,” in July 2011!

Let the ‘Bush tax-cuts’ expire?

It is interesting that Alan Greenspan wants all of the Bush tax-cuts to be repealed. This puts him, a self-described ‘Republican libertarian’, to the left of President Obama, who wants that those making less than $250,000 should not experience any tax increase.

Ironically, these tax-cuts had his implicit backing as the Chairman of the Federal Reserve then, although Mr. Greenspan justifies that endorsement because there were “surpluses as far as the eye could see” at that time.

One must understand that these budget surpluses were as a result of a modest tax increase under President Clinton, as well as the ‘pay-go’ rules (which require that tax-cuts or new spending should not add to the federal deficit) adopted as part of the 1990 budget deal between President George H.W. Bush and the Democratic-controlled Congress. When Mr. Clinton left office, the budget had been balanced for the first time in four decades, there was a surplus and the DJIA had increased almost five-fold during his presidency to over 10,000.

Eight years of the ‘second’ President Bush took that flourishing economy and landed it in a tailspin. With a balanced budget and a surplus when he assumed office, the state of the economy was at its worst since the Great Depression. What happened?

Firstly, Mr. Bush enacted across the board tax-cuts in 2001 and 2003, and scrapped the ‘pay-go’ rules with a Republican-controlled Congress. He did this despite the need of increased expenditure required by expanding the government (Homeland Security) and conducting two wars. To hide the financial effects of these wars, their expenses were kept off-budget.

While the current state of economic affairs is more complex to simply explain away with the ‘Bush tax-cuts’, the fact is that the revenue so lost is a major part of the current budget deficit. It is rather paradoxical that Republicans (and some Democrats), who want no budget deficits and are opposing things like the Healthcare Reform for its cost to the Treasury, are wanting these cuts to be extended.

On this, I agree with Mr. Greenspan. All the cuts enacted by Mr. Bush in 2001 and 2003 should be repealed. Further, something should be done to collect taxes from the almost 50% of Americans who pay no tax at all. The allegations that this will hurt small business is simply an eyewash. To help those seriously affected by the current conditions, Congress should extend the unemployment benefits for another year or more, until the economy improves.

One just has to look across the pond where the conservative Prime Minister, Mr. Cameron, is including tax-increases to spending cuts to tame Britain’s budget deficit.


UPDATE 1: In his piece in Newsweek, Fareed Zakaria makes similar arguments. It is a great read.

UPDATE 2: Two Secretaries of the Treasury appeared on ‘Fareed Zakaria GPS‘ program on CNN on 8 August.

  1. Paul O’Neill, the 72nd Secretary of the Treasury in George W. Bush’s first term, was against the tax cuts and was fired for disagreeing with the President. His reasoning was that the war in Afghanistan and the impending war on Iraq (at that time) does not allow the luxury to have this precipitous decrease in revenue that will ensue. He also argued that the entire tax-code should be reformed; $400 billion go uncollected every year, and $300 billion are spent on collecting taxes.
  2. Robert Rubin, the 70th Secretary of Treasury for both terms of Bill Clinton, agreed that the Bush tax-cuts should not be extended, but for the time being, say two years, those making less than $250,000 should be spared. Mr. Zakaria said that this would cost $250 billion of uncollected taxes. Mr. Rubin wants that the estate taxes should be put it place immediately, since they are none right now. He emphasized that letting the Bush tax-cuts expire would only let the taxes go back to what they were when Mr. Bush took office, and not an actual increase.

I tend to agree with all the recommendations above; I wouldn’t mind giving those making less than $250,000 (98% of all Americans) a temporary break until the economy recovers.

There was also a talk of introducing a consumption tax, like the European VAT (Value Added Tax), during the show. Doing so will provide the government with an alternate source of revenue, without having to raise taxes any further than they would be after the ‘Bush tax-cuts’ repeal and would allow people to be more discretionary with their earned income.

A tale of two countries?

India gained independence from Britain over six decades ago in what has been termed as the biggest non-violent transfer of power. Credit for this effort goes largely to the Indian masses and their leaders, especially Mahatma Gandhi, but there were other factors at play as well, and the United States had a rather significant, behind the scenes role.

England was exhausted and broke after the second World War. Against the wishes of it’s populace, the US had entered the fray in what essentially was an European civil war, and in 1945, it emerged the only nation in the world with a positive balance of payments. Power abhors a vacuum, and as the big powers of the day lay decimated, America rose to take the mantle of the new world leader.

One of the first orders of business was to help the sun set on the British Empire, the gem of whose crown was India. Since it had the IOU chits in pounds sterling, America was in a unique position to dictate the foreign policy of the erstwhile superpower. We would never know why Lord Mountbatten had to give over governance to the Indians in so much haste, since a slower and graduated transfer of power could have very likely averted the Partition of the subcontinent and the ensuing violence, but it is probable that the US wanted England to cede power before it got up on its knees and changed its mind.

A young India, born in the mayhem of this post-WWII world, looked around for a finger to hold. The actions of two leaders, one Indian and the other American, changed the trajectory of evolution of association between the two nations.

Jawaharlal Nehru, the first Prime Minister of independent India (1947-1963), was a Harrow alum. He came of age when the Oxbridge institutions were veering left in intellectual thought. On his return to India, Mr. Nehru gave up his Seville Row suits for a homespun khadi attire, and envisioned a free India that was self-sufficient, secular and socialist. The British Raj was a successor to the East India Company, which was, in essence, a capitalist multi-national corporation. Nehru’s vision enmeshed with the concurrent Indian sentiment, and the idealist in him was more enchanted with the Russian model of economy than that of the United States, which was seen as another capitalist haven were the few were rich at the expense of many. The anxiety and disdain for MNCs existed in independent India for over half a century; only lately is this fear being mollified as the country sheds its centrally planned past to slide gradually into free enterprise.

Harry S. Truman was the 33rd President of the United States (1945–1953). The Truman Doctrine was to contain Communism which lead to the introduction of the Marshall Plan, creation of North Atlantic Treaty Organization and the Korean War. The Truman Administration also roped in the newly created state of Pakistan to help it set up monitoring stations to eavesdrop on the USSR. To this day, Pakistan is a client state of the US, and the third largest recipient of American aid, after Israel and Egypt. It was born out of India’s bosom, and this separation had been less than amicable. The partition displaced up to 12.5 million people in the former British Indian Empire, with estimates of loss of life varying from several hundred thousand to a million, the largest in history. India was therefore hyphenated with Pakistan in the 1950s, continued to be so for the rest of the century, and relationship with either was a zero-sum game.

Consequently, India refused to take sides in the Cold War between the two superpowers, and along with Tito of Yugoslavia and Nasser of Egypt, Nehru founded the Non-Aligned Movement. This organization consisted of poor third-world countries, most of whom had been newly independent. They shared common problems and goals, and had to indulge in socialistic medicine to feed their masses. As a result, they tended to lean towards the Soviet Union and away from America, though they would officially remain non-commital. America viewed this with suspicion, and felt that if you are not with us, you’re against us. A chill settled between the two countries, and since India was of little international importance in the 1950s and 1960s, the US just chose to ignore it.

This active neglect of India, as well as active courting of Pakistan which included massive economic and military assistance, by the US further pushed India towards the USSR. In 1971, during the Bangladesh War where India helped the country gain independence from Pakistan, the stationing of the Seventh Fleet in the Bay of Bengal by the Nixon Administration won no favors with Indira Gandhi. The mutual disdain between the two leaders gave the final push to India into the waiting Russian arms. The other issue that influenced this transfer was the US support of Pakistan whenever it had an argument with India over Kashmir. The State of Jammu & Kashmir had legally seceded to India, but Pakistan felt it had been coerced to join Indian Union. There was an armed conflict in 1948 between the two nations over this and a United Nations mandated Line of Control was drawn, which divided Kashmir into a Pakistani and an Indian controlled area. India liked to call the state as its possession, while Pakistan preferred to label it as disputed territory. Off and on this issue would crop up in the UN Security Council, where the US would support any resolution supporting Pakistan’s view, while the USSR would veto it.

This is a very short and simplified history of the distrust between the two nations. It would behoove one to think, if unaware of the above, why these two nations that are so similar are poles apart?

Both are democracies. Both are multi-religious, multi-ethnic, and secular. India is one of the few countries that have not seen a military dictatorship since its independence from Britain; ditto for the United States. So why wouldn’t the oldest democracy lead the largest, and a young, democracy in the world to become more stable, confident and self-sufficient? The answer lies in the worldview of the two countries.

America, until the 1930s, was content to be an introverted country. Events in the 1940s, as well as prodding by the ‘mother country’, forced it to come to the fore-front in world affairs. There is no doubt that without American help, England, along with the rest of Europe, would have been a part of the Third Reich. When the dust settled in mid-decade, the US found itself to be the lone man standing, a respected world power, yet being challenged by an emerging power, the USSR and a doctrine being popularized in the new world order, Communism. The Truman Doctrine, the Marshall Plan, the Korean and Vietnam Wars, NATO and numerous other treaty organizations created throughout the world, the Berlin Airlift, the Cuban Missile Crisis, the Bay of Pigs operation, etc. occupied the US for the next forty years to contain Communism. It also became very suspicious, choosing friends and allies very carefully.

America was new to the world stage and did not possess the finesse for imperialism of the English. It also did not have the luxury of time previous world powers had to establish their supremacy and therefore went along with this dictum: Countries don’t have permanent friends; they have permanent interests. In addition, with troops already in Europe, which lay tattered after the war, the US chose to remain longer to deny any expansionist plans the Russians may have. Troops also stayed put in Japan and in Korea after the wars. Further, it discovered that it is easier to deal with dictators whose world was law than deal with democracies, like itself, where any pro-American policy may take a long time to be enacted, and was very likely to be diluted or outright rejected. With its sole objective to stand up to Communism, it had to deal with autocrats in Saudi Arabia who controlled the source of energy for a stable developed world as well as ones in Chile who were right-wing terrors and slaughtered their own people and Communists among them, thereby keeping the world free of their influence.

In due time, the US foreign policy became a unique instrument. Although it sermonized democracy, human rights and free enterprise for public consumption, it became an open secret with the company it was keeping to advance its short-term goals. Like its own election cycle, the American attention span toward the world remained short. The American presence was respected for its values the US embodied as a nation and feared for its power as it spent more on its military than the rest of the world combined, yet not trusted because everyone knew that you cannot rely on their word.

India is in a different kind of haste. The share of India’s GDP to that of the world was almost a quarter during the reign of Akbar in 1500s; when the British left in the mid-20th century, it was reduced to less than 1%. The colony was raped and pillaged. It had no wealth or foreign reserves. All it had was hundreds of millions of mouths to clothe, feed and educate. To be fair, the British handed Delhi a united India, which was one the biggest contiguous land mass ever assembled in India’s history; only the Mughals in mid-second millennium and the Mauryas a few centuries BCE could claim that fame. This has problems of its own, as it was as if a Europe is being handed over to a central authority for unitary governance. In 1947, India was more diverse than any other country ever.

This challenge of having ‘unity among diversity’ was not conducive to experimenting with a free-market, capitalistic system. The Central Government will have to be involved in a lot of aspects of the individual. For the polity to be secular and equitable, it will have to be socialist. India was not starting off like America; it was the Old-World with over 5,000 years of civilized history unlike the almost unpopulated land, rich in resources, that the Europeans found in the New World. It couldn’t afford to have robber barons, but will make lemonade out of lime.

It is obvious that while the interests of the two countries were similar, their goals did not converge. Besides, for the second half of the 20th century, India was ignorable. It was not creating trouble, and was a stable country that was minding its own business. It was so busy to get out of the mess the British left it in that it wasn’t creating anything that could have garnered international, or American attention. It had a hand-to-mouth economy, yet managed to keep its head above water and not join the growing list of newly independent states that were failing. In addition, there were other hotspots around the world that were challenging America, be it countries that were Communist, failing or creating nuisance.

America chose to let the sleeping dogs lie. Often, it had to take actions that were harmful to Indian interests to further its own short-term goals, but that was no problem because India was too weak to respond and too proud to be an annoyance.

This continued until the very end of the millennium. The current Prime Minister, Dr. Manmohan Singh, was the Finance Minister in 1990, when India went broke. He enacted reforms that brought the country out of the centrally-planned isolation, interacting with the world. By the latter part of the decade, India was recording growth rates in high single digits. The world sat up and took notice, though its thunder was stolen by China that had started this upward rise about 20 years before.

Towards the end of his presidency, Bill Clinton started to make overtures towards India. There were other reasons for this attention as well. The Berlin Wall had fallen about a decade ago, and the rotting economies of the second world were exposed. America was the new sole superpower, but while USSR had fallen, China was rising, thanks to its own efforts under Nixon in an attempt to contain Russia. Now it was China who has missiles pointed towards major US cities and had to be contained. A new short-term goal had come to fore.

The young presidency George Bush was hit with a sledgehammer by the 9/11 attacks in 2001. His entire first term was spent dealing with this crisis, and creating new ones. Meanwhile, India chugged along and continued to grow, with GDP increases almost touching double digits. While China had established itself as the manufacturing center of the world, India was showing promise in Information Technology, BPO and customer service. It was becoming apparent that by 2025, it will be the third largest economy in the world, after the US and China, pushing Japan in the fourth place. It seemed that the stars were finally coming in alignment for India so that the US  can extend a hand of assistance and friendship.

And it did. In 2005, US and India signed a civilian nuclear treaty. While the two countries had been increasingly cooperating in a host of other areas over the last decade, this was a major breakthrough. With lot of effort and anguish, the deal was finally passed in the legislatures of both countries by the end of Mr. Bush’s term in 2008.

But by this time, another storm blew across the world: tanking of its economy. Interestingly, while the first world reeled under the gale, two former third world countries appeared to have been left standing with minimal damage: China and India. China was still ahead, and also had 2.5 trillion dollars worth of IOUs. This was something that the next president, Mr. Obama, could not ignore. Also, he had promised to bring the Iraq war to an end, and escalate the one in Afghanistan. To do that, he will have to rely more and more on Pakistan.

Once again, in 2009, the US is facing this dilemma. It knows that in the long run, its interests are threatened by China which is rising rapidly enough to challenge US supremacy in a decade or two. Even now, the signs of this ominous fate are becoming apparent. Traditionally, US presidents lecture China on human rights and appreciate the yuan. During Mr. Obama’s visit last week, Chinese leaders scolded him on imposing import tariffs, keeping the interest rates low and not doing enough to tackle the federal deficit. Who would have thought!

Pakistan is another albatross around America’s neck. All terrorist attacks after, and including, 9/11 have a connection that leads to Pakistan. It is an open secret that their spy agency, the ISI, has dealings with the Taliban, al Qaeda and other terrorist outfits and that it helps recruit, plan and execute attacks as well as warn them of pending US attacks. Yet there is no choice but to deal with them because the CIA has zero knowledge about that area. We know that money we give them is pilfered by corrupt officials, but we give them a blank check that they are cashing for tens of billions of dollars since they’ve come into being.

So there we go again. The US knows that in the long term, it’s relations with China and Pakistan will prove to be costly but it has to because that is what the vox populi demands. Elections are every two years, and there may be no choice but to make a Faustian bargain with these two. A relationship with India may prove more fruitful in the long tern, but there are no short term benefits that can be displayed to the electorate.

So this dance will go on. It is quite possible that the US is rather uncomfortable in being the world’s sole superpower. It is now being believed that in a few decades, the world will become multipolar. It could become a self fulfilling prophecy.

Mr.Singh comes to Washington

Indian Prime Minister Manmohan Singh’s five day State visit to the US begins today. The Americans are emphasizing that this is the first official state visit of the Obama presidency, which shows the importance placed on the mutual friendship. The Indians are wary.

As the Bush Administration matured, so did its relationship with India. It gave recognition to the growing import of an emerging India, de-hyphenated it from Pakistan and developed far ranging associations that culminated in signing an Indo-US civilian nuclear deal during Mr. Bush’s last year in office.

The Indians were ecstatic. Achieving GDP growth rates of between seven and nine percent in the first decade of the 21st century, they felt that the sole superpower has finally recognized their potential and their true place in the world. The party had just begun and they were arriving fast on the world stage. Despite being a non-signatory to the NPT, they had been acknowledged as a de facto nuclear power; a permanent seat at the Security Council seemed not to be too far off.

The election that electrified the world made Indians uneasy. Within the first few days of his election, Mr. Obama called leaders in countries throughout the world. Pakistan and China were among the ones called, but India was not. This brought forth memories of how Mr. Obama had reacted to issues regarding India in the past and it gave an indication to how things could be in the future.

Mr. Obama belonged to a group of Democrats that were unsettled over the Indo-US nuclear deal and saw it as a beginning to the unravelling of the NPT regime. The Hyde amendment, which, among other limits, placed restrictions on new nuclear testing by India, was accepted by the then White House to placate this lobby. This did not satisfy this clique, and neither did India’s agreement to have 14 of its 22 reactors be open for inspection, nor the country’s impeccable record of non-proliferation.

In addition, Mr. Obama spoke of US involvement in the Kashmir dispute, reckoning that this would placate the Pakistanis, who would then be more able and willing to help the bad guys on their border with Afghanistan and that this would actually reduce the threat of terrorism by taking away the raison d’etre of many groups like Lakhsar-e-Toiba, who were inching ever closer to al-Qaeda.

With Mr. Obama determined to end the hostilities in Iraq within a couple of years and increasing his commitment to Afghanistan, the importance Pakistan would play in his calculations was not secret.

Within the first week after the elections in November, it was becoming apparent to the Indians that cold water is about to be thrown on the relationship that had grown leaps and bounds under the Bush presidency, even though it was started at the tail end of Mr. Clinton’s.

Their fears proved true as the Obama presidency started. The “Senator from Punjab”, as Ms. Clinton was labelled by Mr. Obama during the campaign, made her first visit as Secretary of State to the People’s Republic of China. In no uncertain terms, she stated that the US would not put the issue of human rights in the way of their mutual relationship. While morality was important, economy takes precedence. It could be that during the current financial crisis, it became clear that the Chinese hold a trillion dollars worth of IOUs, and it would be prudent to keep them amused. That the rest of Ms. Clinton first foreign trip included countries that fall under China’s sphere of influence – in southeast Asia – only highlighted the fact that the equation between China and the US is being rewritten.

As if this was not getting the their attention, the Administration was twisting India’s arm in private to assuage Pakistani fears. The US wanted India to thin its deployment along their border in Kashmir and to start the composite dialog that had been suspended after the terrorist attack in Mumbai on 26 November, 2008. Indians were being ‘adamant’ that Pakistan stop supporting terrorism from its soil, bring the perpetrators of 26/11 (who are Pakistanis) to justice and hand over the terrorists responsible for previous attacks who have now found safe haven in Pakistan under the patronage of the state.

To Indians, it seemed futile to take either of the two actions without Pakistan acceding to these reasonable demands. To Americans, it seemed that all terrorists attacks would cease as soon as the Kashmir issue was solved and everyone in the subcontinent will be singing hakuna matata.

In addition, there were indications from the top levels of the US administration that it was willing to talk to the ‘moderate’ Taliban. This differentiation came from the Pakistanis. The ‘good’ ones were the Afghan Taliban, who were created by the Pakistani covert agency, the ISI, and were used  to fight the proxy war with India in Kashmir and elsewhere. The Pakistani Taliban were the ‘bad’ guys; they attacked the Pakistani state, and it would be good if they were eliminated. This US gesture of trying to find a lesser evil based on Pakistani assumptions did not sit well with Indians, who concluded that terrorist attacks on India is the least of the American concern, despite their rhetoric of War on Terror being universal.

Further, US wants Indians to limit their activity, read influence, in Afghanistan, where India has been active in building schools, roads, hospitals and the like. In the past few years, India has spent over 1.5 billion dollars there. Pakistan, which has regarded Afghanistan as offering it ‘strategic depth’ and would like its influence prevail over that of India, has expressed its displeasure to the US over Indian participation, and has also accused India of helping the Taliban, especially in Baluchistan. While the US concedes that there is no evidence that India is involved in anything more sinister than helping with developing the infrastructure of this war-ravaged nation, it has been pressuring India to limit its exposure in Afghanistan so there is one less excuse for Pakistan to find for being reluctant to help in the war on terror.

Coupled with this arm-twisting, the Administration was also dropping hints that it would not let India get off easy with the conclusion of the nuclear deal. While the deal had been finalized and signed in the waning days of the Bush Administration, certain issues, like reprocessing of spent fuel, had yet to be agreed upon. The nuclear wedding had taken place, but the marriage has yet to be betrothed.

Concurrently, the Kerry-Lugar bill was making rounds at the Congress. This would triple the US aid to Pakistan to the tune of 7.5 billion over the next five years. This civilian aid was new and separate from the hundreds of millions of dollars of annual military aid and covert aid through the CIA (about one-third of CIA’s operating annual budget, according to a recent report in the LA Times). Candidate Obama had promised that there will be no more “blank checks” to Pakistan, yet the White House was pushing the Congress, under Pakistani pressure, to remove the accountability benchmarks that would guide the continuation of the flow of dollars.

By the time the bill reached the President’s desk, it was rather toothless. It was pretty much left for the President to certify every year that Pakistan is behaving well for the aid to continue. To the discomfiture of Indians, language that one of the conditions for aid continuance was that Pakistan would not use its territory to promote terrorism against India was removed. The Pakistanis felt that this gives an impression that Pakistan is actively promoting terrorism, and was therefore insulting.

All these goings on gave Indians a pause. This deep suspicion was turned into belief that Mr. Obama would do anything to bully India, or more conservatively, would give no consideration to India’s interest while conducting US foreign policy when there was a recent Obama-Hu statement in Beijing. It spoke of a joint effort by US and China to lead India and Pakistan to peaceful conclusion over their six-decade long disputes; China would now be a monitor that will oversee South Asia. Indians, who think of themselves as the hegemon of the neighborhood, felt belittled.

Other countries, especially Japan, have noted the deference and allowance the US has given to China now, and also to Russia sometime back. In short, Mr. Obama’s first foreign trip as president has not gone as well as White House had hoped. Mr. Singh’s visit begins just a couple of days after Mr. Obama has returned home from this trip. Combined with the reservations Indians have about America’s commitment to their welfare, it would be interesting to see what this ‘first state visit of the Administration’ will bring.

“Not much”, is the conventional wisdom. It has been mentioned that the Bush Administration has already picked low hanging fruit, like the nuclear deal. Delegates of both nations are trying to put finishing touches on the fate of the spent fuel reprocessing issue, but it is not certain that they will be able to close the deal. There is nothing else that would seem to be a breakthrough.

The State Dinner at the White house on Tuesday is expected to be a gala. With dinner in tents on its lawns, about 400 people are expected to be entertained as compared to about 150 when Mr. Bush wined and dined Mr. Singh inside the White House a few years back. It has been argued that the White House is taking Indians for granted. The Administration believes, the critics contend, that as long they are wined and dined with aplomb, shown ‘respect’, and made to feel that they are ‘important’, Indians will be satisfied.

After all, the White House is playing up the importance of this being the first State visit of the Obama Administration, while trying to play down the joint statement made by the president in China or the other issues that are evolving into bones of contention between the two. Mr. Obama will have to deliver much to earn the trust of one-sixth of humanity, more than just stating that he has tremendous respect for Mr. Singh. He will have to show that he is a sincere friend of India, as much as Mr. Bush was.

Mr. Singh has a lot of expectations riding on him as well. He has risked his prestige and his government to achieve the passage of the civilian nuclear deal in face of stiff domestic opposition. If he fails to secure the conclusion of this treaty in terms favorable to India, he will risk being seen as one who naively succumbed to the designs of ‘untrustworthy’ Americans. Unfortunately, this reputation of the US is not new, but well entrenched.