Category Archives: United States

Pakistan: Whatever happened to Kerry-Lugar?

Raza Rumi published by Express-Tribune

Pakistan’s dire fiscal situation has resulted in the reduction of development spending by 40 per cent. This does not bode well for the citizens who have been tormented by an energy crisis, persistent food inflation and rampant unemployment. In these circumstances, the development assistance under the Kerry-Lugar Bill (KLB) is much needed. Pakistan’s civilian government braved a media onslaught and the ire of the security establishment for tacitly supporting the US legislation. Other than the rhetoric around the ‘conditions’ drafted in Washington, there was an unstated agreement that the development assistance was welcome. It was expected that given the urgency of the situation, USAID was going to kick start the delivery of its interventions. Well, the progress so far has been disappointing.

First, there seems to be no public sign of a consensus within the US bureaucratic machine on how the aid under KLB will be delivered. Unconfirmed media reports suggest that the political versus the bureaucratic channels are not on the same page. The ‘political’ administration is ostensibly managing USAID systems and processes. There may be strategic reasons for that but the net result is that things are delayed. Not long ago, the Pakistani government’s procedures were thought to be a problem, but the trajectory of US bureaucracy only proves that public sector ailments are common. Second, USAID is unfamiliar with the methods of working with the governments. In fact, its operations keep the government systems out of the programme design and create parallel structures for big US firms for accountability and results. On the ‘results’ front the experience of USAID has not been flattering to say the least. The case of irregularities in the ongoing Fata programme, highlighted by the media in recent months, is a case in point. Third, there is no clear roadmap for the key priorities that KLB will help address. We read about the energy sector support and other immediate responses to Pakistani government’s needs. But surely, the sizeable pipeline of $7.5 billion needs to be well planned. Needs identification and programme design should be responsive as well as flexible. Bureaucracies are averse to out-of-the-box thinking, and perhaps this is what explains lack of alternatives to lengthy, US firms-centric approach typically employed by USAID. Continue reading

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Filed under Development, International Aid, Pakistan, United States

US congressman: “If we don’t pass this bill, we’re going to have martial law in the United States”

By Tom Eley writing at WSS

(3 October 2008)

In the wake of Monday’s vote in the US House of Representatives rejecting the $700 billion bailout package for the American financial industry, prominent voices in the US and international media have responded by denouncing the lower house of Congress and complaining that the American political system is too susceptible to popular opinion and insufficiently obedient to the will of the corporate and political elite.

The yearning for more authoritarian forms of rule was expressed by, among others, Michael Gerson, the former chief speechwriter for George W. Bush. In a column in the Washington Post, he complained, “[I]t is now clear that American political elites have lost the ability to quickly respond to a national challenge by imposing their collective will.” The Times of London, part of Rupert Murdoch’s media empire, was even more blunt, headlining a column, “Congress is the Best Advert for Dictatorship.” Continue reading

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Filed under Capital markets, capitalism, finance, United States

Farewell to the neo-classical revolution

by Robert Skidelsky

A few geniuses aside, economists frame their assumptions to suit existing states of affairs, and then invest them with an aura of permanent truth. They are intellectual butlers, serving the interests of those in power, not vigilant observers of shifting reality

The looming bankruptcy of Lehman Brothers and the forced sale of Merrill Lynch, two of the greatest names in finance, mark the end of an era. But what will come next?

Cycles of economic fashion are as old as business cycles, and are usually caused by deep business disturbances. “Liberal” cycles are followed by “conservative” cycles, which give way to new “liberal” cycles, and so on. Continue reading

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Filed under capitalism, finance, United States

Afghan Opium Fields Show Failure of U.S. Economic-Aid Efforts

By Ken Fireman

Feb. 11 (Bloomberg) — The strategy combined economic development, drug control and security: two Afghan-American brothers with a factory in Kandahar and a plan to give opium farmers an incentive to grow cotton instead.

For two years, Yosuf and Abdul Mir pleaded with U.S. officials for a $1.5 million grant for their project, arguing that it meshes perfectly with a billion-dollar-a-year American opium-eradication program. Then, last year, they were turned down.

The Agency for International Development’s refusal reflects a broader American policy breakdown in Afghanistan, according to critics: Even as the U.S. and NATO win tactical military battles against the Taliban, they may be losing the war through an inability to create the economic and political environment needed to defeat the insurgents.

The decision against funding the cotton proposal “is a remarkable example of the failure to align our tools with our strategy,” Barnett Rubin, an expert on Afghanistan at New York University, said in Jan. 23 testimony to the House Armed Services Committee.

The long western effort to shore up Afghanistan after the U.S.-led overthrow of the Taliban in 2001 stands at what former Undersecretary of State Thomas Pickering, the co-author of a new report on the enterprise, calls “a critical crossroads.” Continue reading

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Filed under Afghanistan, International Aid, United States