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January 22nd, 2008

Q&A: Illiberal capitalism

My recent article Illiberal capitalism: Russia and China charter their own course has prompted some interesting debate. Robert Kagan, foreign-policy analyst at the Carnegie Endowment for InternationalPeace, and I answered some of readers’ questions in a Q&A on FT.com on Tuesday. All the questions and answers can been seen here.

January 22nd, 2008

Column: Let us not lose faith in democracy

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President George W. Bush’s “freedom agenda” has run into the Middle Eastern sand. The president himself will be the last to recognise this. Speaking in the United Arab Emirates on January 13, he hailed a “great new era” of “the advance of freedom”. “My friends,” he proclaimed to the assembled sheikhs, “a future of liberty stands before you.” Then Mr Bush flew on to Egypt and lavished praise on President Hosni Mubarak, who threw into jail the last man to run against him for the presidency.

As Mr Bush traipsed around the Arab world, Freedom House – which monitors political and civil liberties – issued its annual report. It lamented that “2007 was marked by a notable setback for global freedom”. The lobby group pointed to events in south Asia, the Middle East and the former Soviet Union. The bad news keeps on coming. The violence and instability surrounding the Kenyan and Pakistani elections has underlined the difficulties of holding democratic votes in relatively poor countries with deep ethnic and tribal divisions.

While Freedom House bemoans the setbacks to democracy in places such as Kenya, Pakistan and Egypt, there will be plenty of others who will shrug and say, in effect: “What did you expect?” The Bush administration has been naive. It is pointless – and often counter-productive – trying to push democracy in countries that are not ready for it. Stability and economic growth must come first.

Continue reading this column here.

January 17th, 2008

Neocons, realists and newspaper columnists

I am always on the look-out for boring headlines - and I found a good one lying around on a desk at the FT today. It is in a newsletter from Moody’s, the ratings agency - "Belgian political uncertainty no threat to ongoing fiscal consolidation".

The whole question of what makes for interesting reading is the subject of this post - which is provoked not by Moody’s, but rather by an outburst from Steve Walt, a Harvard professor. Walt - who has become famous (or infamous) - as the co-author of a critical book on "The Israel Lobby", has written a piece bemoaning the appointment of William Kristol, a prominent neo-con, as a columnist for the "New York Times".

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January 15th, 2008

Abolishing income tax

All the mainstream pundits agree. Mike Huckabee is a crack-pot. The first piece of evidence is that he is a creationist. But the second point is that Huckabee wants to abolish income tax.

As far as many of my colleagues are concerned this is breathtakingly unsophisticated - the economic equivalent of creationism. However, when I heard Huckabee explain his plan recently in a burger joint in New Hampshire, it sounded pretty good to me. Huckabee - who is one of three front-runners for the Republican Party nomination - advanced several plausible sounding arguments. First - simplicity. He would replace the entire income tax code, with a simple sales tax set at a flat rate of - say - 23%. No more form-filling. In fact the Huckster would abolish the IRS (America’s much-hated Internal Revenue Service). Second, his plan would ease the burden on honest tax-payers. At present drug-dealers and other nefarious types avoid all income tax. But they have to spend - so they would be caught by a consumption tax, just like the rest of us. Also he reckons that his flat consumption tax would encourage saving - because you are taxed when you spend, not when you earn. And the whole thing is designed to be "revenue neutral"; ie if the calculations worked out, it wouldn’t cause a massive whole in the federal budget.

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January 15th, 2008

Column: Hillary Clinton and the thrill of political power

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Western politicians routinely say that they are motivated by a “desire to serve” and they are routinely disbelieved. With her near-tears in New Hampshire, Hillary Clinton briefly managed to puncture that scepticism – and, perhaps, to swing the US presidential election back in her direction.

Her performance raised a fundamental question about politics. What motivates people to seek power?

Mrs Clinton said that she was upset because: “I have so many opportunities from this country. I just don’t want to see us fall backwards.” In other words, she was weeping not for herself but for America.

Continue reading this column here. Please post comments below.

January 13th, 2008

The bald truth

As journalists thrash around to make sense of the American election, the latest theory is that John McCain is the favourite. The US may not be ready to elect a black (Obama) or a woman (Clinton) - so it could opt for the Republicans’ current front-runner, the reassuringly white and male Mr McCain.

But there is one factor that few people are considering yet, which I think the Republicans would do well to think about - the baldness factor. In a fascinating recent blog entry, Dan Hannan - a Conservative Euro-MP - points out that if an election comes down to a contest between a baldie and a man with a full head of hair, the bald man always loses. Hannan had to go back to 1880 to find a presidential election where the bald candidate won. (It’s true that Eisenhower was bald, but he was running against Adlai Stevenson, who was also follically-challenged).

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January 10th, 2008

Security and the American election

One of the whispered discussions that takes places around the fringes of the American election is whether somebody might try and shoot one of the candidates - in particular, Barack Obama.

But although plenty of people talk about the risk of assassination, security around the candidates remains startlingly lax. Last Saturday I went to an Obama rally at a high school in New Hampshire. I got lost on the motorway, so I was a bit late. I rushed up to an entrance marked press and waved my press card. It’s a real press card, as it happens - but I could quite easily have bought it on the internet. I was waved into the rally. Nobody checked my bag. Within a couple of minutes I was standing ten yards from Obama. Apparently he does have secret service protection. But I suspect they cannot do very much, given the hectic nature of his schedule and the openness of his meetings.

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January 10th, 2008

Column: Illiberal capitalism: Russia and China chart their own course

During the cold war it was natural to lump Russia and China together. They were the two great communist powers -€“ the leading ideological adversaries of the west.

Then came 1989 -€“ the year of the crushing of the students’ revolt in China and the collapse of the Soviet empire. Communism had failed. Free markets and democracy seemed poised to sweep all before them. The spirit of the time was captured in Francis Fukuyama’s famous article on "€The End of History€", published in Washington’™s National Interest magazine that summer. Mr Fukuyama did not argue that history had ended in the sense that there would be no more great events. Rather he claimed ideological victory for the west, suggesting that "€œliberal democracy may constitute the end point of man’s ideological evolution".

Even though it swiftly became fashionable to dismiss Mr Fukuyama, a variant of his thesis has powerfully influenced US foreign policy ever since. The chain of thinking works something like this. Communism failed as an economic system. Russia and China have had to embrace free markets. Economic freedom will, in time, produce political freedom. A liberalised economy will generate new forces and tensions that will make it impossible to maintain an authoritarian political system.

The remainder of this column can be read here. Please post comments below.

January 9th, 2008

The tears of New Hampshire

As I was saying, Hillary Clinton is doomed - or possibly Barack Obama is. After Hillary’s victory in last night’s primary in New Hampshire, I think I may give up making predictions about American politics for 24 hours.

To be fair to the pundits and the pollsters, it wasn’t just journalists who were confidently predicting an Obama victory. Even people in the Hillary camp were talking about trying to keep the margin of their defeat in New Hampshire down to below double digits. When, on Monday, Hillary broke down and cried - or rather "choked up", it looked like she had accepted that defeat was inevitable.

New Hampshire lore is also that crying in public is very bad news for a candidate. It is what is deemed to have finished off Edmund Muskie in 1972. However, one of the Obama people did, presciently, say to me - "Hillary crying is bad news for us. It humanises her. It’s easier to run against a robot." Today’s conventional wisdom is that Hillary’s display of emotion did indeed help her, particularly among women voters.

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January 8th, 2008

Column: Barack Obama’s message to the world

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Barack Obama is in favour of hope, unity and change. If only his rivals would agree to campaign on a ticket of despair, discord and stagnation, the electorate would have a real choice.

As it is – now that Mr Obama is the Democrats’ front-runner, going into Tuesday’s New Hampshire primary – all the leading candidates for the US presidency have rushed to imitate his language. This has become the “change” election. The question for America, and the rest of the world, is whether this is all empty rhetoric – or whether something real is happening.

Some of my scepticism about Mr Obama was dispelled by watching him at a rally in Nashua, New Hampshire, on Saturday. He is an increasingly confident and charismatic performer. Although the senator does not stress that he would be the first black president of the US, this obvious fact helps him to embody his campaign’s messages of change, reconciliation and hope. His supporters treat him like a rock star and increasingly he sounds like one, ending his rally with: “Thank you New Hampshire, I love you.”

Read the remainder of this column here. Post comments below.


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