Bill Keller has moved on from the esteemed position of New York Times executive editor to the very vulnerable position of New York Times Op-ed Columnist Ripe for Mockery. 

Alas, it's hard to mock Keller's column today for two reasons.  First, Keller bothered to do some actual reporting, traveling to India to interview supporters of Anna Hazere to get their opinion on Occupy Wall Street.  Since the Times itself has suggested that overseas protest movements might inspire similar action in the advanced industrialized economies, this seems appropriate.  It certainly seems more appropriate than comparing the Occupy movements to the Arab Spring. 

The second reason is what Keller got from his interview with Anna Hazare associate Kiran Bedi: 

“When we started the movement, it was like Occupy,” Bedi told me. “But we went beyond Occupy.”

For starters, while Occupy Wall Street is consensus-oriented and resolutely leaderless, Hazare is very much the center of attention. There was an anticorruption movement before Hazare, but it was fractious and weak until he supplied a core of moral authority. When he announces his intention to starve himself, he parks himself on an elevated platform in a public place, thousands gather, scores of others announce solidarity hunger strikes, and TV cameras congregate, hanging on his every word. Hazare and his entourage can seem self-important and high-handed, but he is a reminder that leadership matters.

Second, the Occupiers are a composite of idealistic causes, many of them vague. “End the Fed,” some placards demand. “End War.” “Get the money out of politics.” Much of the Occupy movement resides at the dreamy level of John Lennon lyrics. “Imagine no possessions. ...”

Hazare, in contrast, is always very explicit about his objectives: fire this corrupt minister, repeal that law bought by a special interest, open public access to official records.

His current mission is the creation of a kind of national anticorruption czar, a powerful independent ombudsman. The measure is advancing, and Team Anna hovers over the Parliament at every step, paying close attention to detail, to make sure nobody pulls the teeth out of it. Instead of a placard, Bedi has a PowerPoint presentation.

Occupy Wall Street is scornful of both parties and generally disdainful of electoral politics. Team Anna (yes, they call themselves that) likewise avoids aligning itself with any party or candidate, but it uses Indian democracy shrewdly, to target obstructionists. Recently Hazare turned a special election for a vacant parliamentary seat into a referendum, urging followers to vote against any party that refused to endorse his anticorruption bill. Hazare has also called for an amendment to the election laws to require that voters always be offered the option of “None of the Above.” When it prevails, parties would have to come up with better candidates.

“What really changes them,” Bedi said of recalcitrant politicians, “is the threat of losing an election.”....

“Occupy has been, to my mind, an engaging movement, and it’s driving home the message, to the banks, to the Wall Street circles,” Bedi said. “That’s exactly the way Anna did it. But we had a destination. I’m not aware these people — what is their destination? It’s occupy for what?” (enmphasis added)

Damn, that sounds familiar. 

There's one other big difference that's buried in Keller's column, however.  He notes that, "One poll found 87 percent public support for Hazare’s 12-day August fast."  While the Occupy movement is certainly more popular than the Tea Party movement, I haven't seen a single U.S. poll demonstrating that breadth of public support. 

Am I missing anything? 

Anne-Marie Slaughter has responded to my musings about her new foreign policy frontier with a potent combination of vigor and logic, topped off with just a dollop of guile.  I am happy to see that we share some vital zones of agreement -- namely, continued hegemony for the Boston Red Sox. 

About lesser issues like the contours of world politics, we have some respectful disagreements.  This is a fun debate, to have, so let's dive right in!

To summarize the gist of Slaughter's latest post:  she argues that realists think of the world through a states-only, security-first, billiard-ball approach: 

[T]he whole point of realism, as every first year IR student knows, is that structural realism (the school that holds as its bible Kenneth Waltz's Man, the State, and War) says that international relations analysts can treat the world as if it were composed only of states pursuing their power-based interests. 

In constrast, Slaughter advocates a "modern/liberal-social" because such an approach will: 

[factor in] all the important social actors, from tribes to democracy activists, focus on the relationship between those social actors and their governments, then assess interests relative to other governments that are themselves enmeshed in domestic and transnational social networks. 

Slaughter asserts that the second perspective is the superior approach despite its greater complexity, because it permits a greater focus on the "social and developmental issues" that Slaughter believes will the the primary drivers of world politics over the next decade.  As evidence for her more enlightened perspective, Slaughter compares her Twitter stream with my Twitter stream and concludes:

Going through these tweets actually offered an even more succinct contrast between how Dan and I think about foreign policy. Dan asked last week, addressed to all "IR tweeps": "Is there a better international relations song than Tears for Fears 'Everybody Wants to Rule the World?'" He got some great responses, but for me, his choice says it all about how, his protests notwithstanding, he sees the world. (Many a truth is spoken in jest.) By contrast (and again, with much less humor!), I tweeted a link on Monday to a in the Financial Times by the Israeli novelist Etgar Keret on the J14 protests and quoted the following passage: "In our current reality, the political cannot be separated from the social." The new foreign policy frontier is deeply social, as messy and unsatisfactory as that may be.

Slaughter's historiography of realism is a touch problematic, but also a bit of a distraction, so I'll leave it to others to address that question.  Instead, let's start with the Twitter evidence. 

Slaughter is clearly a huge fan of microblogging (despite its negative externalities) and its social networking capabilities.  As an earlier adopter of these technologies, I'm a fan too.  I do think there's a danger of reading too much into this kind of data, however.  If I really didn't care about the kind of social and economic issues that Slaughter embraces... well, I wouldn't be following her.  Like any curious IR scholar, however, I do follow her.  Just because I don't tweet/re-tweet about these things all that much doesn't mean I don't read/blog/write about them in other venues.  Slaughter assumes that I manage my Twitter feed the same way she does, as a natural extension of her research interests.  Trust me when I say that I value Twitter somewhat differently. 

This might be a trivial issue, but it gets at a point I hinted at in my last post:  there's a difference between what's visible and what's significant in world politics.  Twitter is highly visible, for example, but I think it's significance might be exaggerated -- or, rather, online networks merely replicate offline power structures.  The threat of coercion is often invisible -- but it's effects can be quite significant. 

Slaughter's more substantive point is her contrast between old-school realpolitik and new-school modern social-liberal foreign policy approach.  On this distincton, let me start by observing that another important modern strategy in world politics is the notion of issue-framing.  If they're good, policy entrepreneurs will be able to take their issue and frame it in a manner most favorable to their preferred policy solution.   When their policy problem is pushed to the front of the queue, they are therefore likely to win the argument. 

I bring this up by noting that I don't accept Slaughter's framing of our dispute.  She posits that only by adopting her international relations worldview is it possible to recognize the social and developmental issues that are bubbling under the surface in world politics.  Because realists primarily care about guns, bomb, and interstate security, they ostensibly will miss these problems. 

Now, I know a lot of realists, and I can kinda sorta understand how Slaughter arrived at this caricatured version of realism.  Nevertheless, Slaughter conflates subject matter with how one models the dynamics of the subject matter.   In his last memoir, even über-classical-realist Henry Kissinger acknowledged the importance of human rights issues in modern diplomacy and staecraft.  I certainly agree that the economic, social and developmental issues that are near and dear to Slaughter's heart are matters of import for world politics -- indeed, this is a theme I've written and rambled spoken about for quite some time.  I suspect most realist IPE scholars believe these issues are important... or they wouldn't be studying IPE in the first place. 

Just because I agree with the importance of these issue areas, however, does not mean that I agree with Slaughter's implicit model of how these issues get addressed.  Anne-Marie places great faith in the ability of transnational, networked, non-state actors to bend the policy agenda to their preferred sets of solutions.  I think that these groups can try to voice their demands for particular policy problems to be addressed.  I think, at the national level, that social movements can force even recalcitrant politicians to alter their policy agenda (see:  Party, Tea).  Where Slaughter's optimism runs into my skepticism is the ability of these movements to a) go transnational; and b) supply rather than demand global solutions.  I'm skeptical about the viability of transnational interests to effectively pressure multiple  governments to adopt a common policy solution, and I'm super-skeptical that these groups can supply broad-based solutions independently of national governments. 

There's a "two-step" approach to world politics with which Slaughter is intimately familiar:  it posits that interest groups and social movements can influence national policy preferences, but that outcomes in world politics are driven by the distribution of power and preferences among national governments.  In her embrace of a new foreign policy frontier, Slaughter embraces the first step and mostly rejects the second. 

That second step is really important, however, as most social movements are keenly aware.  Indeed, most of the protests that Slaughter keeps identifying on Twitter are not about solving problems on their own, but demanding that governments address or ameliorate their needs. 

Slaughter can and will point to Very Important Initiatives like the Gates Foundation or the Summit Against Violent Extremism as examples of supplying such solutions.  These can matter at particular points in particular places, but I'll need to see some powerful evidence before I think that these transnational groups are as potent as, say, nationalism as political force in the world.  All of the social movements and all of the online networks can agitate for policy solutions, but they're not going to be able to alter fierce distributional conflicts that exist when trying to address many of the topline issues in world politics show no signs of abating.  The kind of non-state actors that Slaughter embraces have not been shy in engaging issues like climate change, Israel/Palestine or macroeconomic imbalances -- but I haven't seen any appreciable change in global public policies as a result. 

Now, it's possible that Slaughter will eventually be proven right.  That's the cool thing about studying international relations, we keep adding new data with every passing day.  So, here's my challenge to Anne-Marie -- name three significant issue areas in which these kinds of networked actors will significantly alter the status quo (and I look forward to Slaughter falsifying me to within an inch of my life.).  Because I can think of far too many issues -- including those listed above -- on which their impact will be negligible. 

One final point:  I agree with Slaughter that the issues she cares about are important, and attention must be paid to them.  That said, the realist in me is not quite ready to claim that the old security-focused approach to foreign policy is truly outdated.  Yes, traditional wars are much rarer than they used to be.  That said, we're just one unsteady power transition away in North Korea, China or Pakistan for traditional concerns about militarized great power combat to return to the main stage of foreign policy practitioners.  I really hope Anne-Marie is correct about these new issues being the important ones -- because that means the horrors of great power war continue to stay a distant memory. 

Your humble blogger has, in the past, live-blogged or live-tweeted the State of the Union address. After reading the National Journal's draft of the speech, I've decided that the mindless applause will convert a decent 30-minute speech into an interminable 75-minute talkathonso I'm gonna watch Mystery Men instead to pass.

Looking over the draft, however, I see that the Obama administration has really taken this competitiveness theme to heart. More than any State of the Union I've seen before, President Obama raises the examples of other countries doing things better than the United States as an impetus for the U.S. to do more. Consider:

The rules have changed. In a single generation, revolutions in technology have transformed the way we live, work and do business. Steel mills that once needed 1,000 workers can now do the same work with 100. Today, just about any company can set up shop, hire workers, and sell their products wherever there's an internet connection.

Meanwhile, nations like China and India realized that with some changes of their own, they could compete in this new world. And so they started educating their children earlier and longer, with greater emphasis on math and science. They're investing in research and new technologies. Just recently, China became home to the world's largest private solar research facility, and the world's fastest computer....

Half a century ago, when the Soviets beat us into space with the launch of a satellite called Sputnik¸ we had no idea how we'd beat them to the moon. The science wasn't there yet. NASA didn't even exist. But after investing in better research and education, we didn't just surpass the Soviets; we unleashed a wave of innovation that created new industries and millions of new jobs.

This is our generation's Sputnik moment....

The quality of our math and science education lags behind many other nations. America has fallen to 9th in the proportion of young people with a college degree. And so the question is whether all of us - as citizens, and as parents - are willing to do what's necessary to give every child a chance to succeed....

Our infrastructure used to be the best - but our lead has slipped. South Korean homes now have greater internet access than we do. Countries in Europe and Russia invest more in their roads and railways than we do. China is building faster trains and newer airports. Meanwhile, when our own engineers graded our nation's infrastructure, they gave us a "D."

We have to do better.

I'm curious to see how this will play out. On the one hand, the administration is obviously using this kind of "we're falling behind other countries!" shtick as a way to build public support for investments in education and infrastructure. In the same speech he talks about falling behind South Korea, for example, he embraces the Korea-U.S. Free Trade Agreement.

At the same time, I have two big concerns with this approach. First, there's the risk of rhetorical blowback, in which everyone freaks out and reacts in a hysterical manner.

Second, and more important, the percentage of the speech devoted to microeconomic "competitiveness" issues vastly exceeds the amount devoted to long-term macroeconomic policy. If the federal government really wants to create a better climate for innovation, it needs to send a credible signal that steps are being taken to deal with long-term budgetary problems. That section of the speech was, er, less solid.

[What about the foreign policy sections?!--ed. Meh. Nothing bad -- just nothing of substance either. One could argue that the biggest foreign policy innovation of the SOTU is the administration's decision to use globalization as the political crowbar to pry infrastructure spending investments from Congress.]

Feel free to comment away on what you would like to see in the speech.

If David Brooks is announcing his Sydney Awards for the year, then it's time to start garnering nominations for the 2010 Albies, in honor of the great political economist Albert O. Hirschman. 

To repeat and update the description from last year's nominations announcement:

I'm talking about any book, journal article, magazine piece, op-ed, or blog post published in the 2009 2010 calendar year that made you rethink how the world works in such a way that you will never be able "unthink" the argument. 

The winners will be announced on December 31st.  In the meantime, readers are strongly encouraged to submit their nominations (with links if possible) in the comments. 

Apparently, rants about the World Cup generate a lot of traffic to this blog.  With that in mind, one of the things that fascinates me about the World Cup is the orgy of self-examination it produces about when or whether Americans truly embrace futbol football soccer?

From what I can ascertain, there are two clear camps.  The enthusiast camp, epitomized by this Daniel Gross essay, suggests that it's just so hard to be a soccer fan in the United States: 

Being a soccer fan at World Cup time in America is a little like being Jewish in December in a small town in the Midwest. You sense that something big is going on around you, but you're not really a part of it. And the thing you're celebrating and enjoying is either ignored or misunderstood by your friends, peers, and neighbors. It can be a lonely time.

Jonathan Chait's rejoinder to Gross' essay best epitomizes the rejectionist school of thought.    Part of it is a genuine disdain for soccer, a game with lots of flopping and 0-0 ties and is ripe for Simpsons parodies.  I suspect that another component is hostility to the trendiness of the game among DC media elites and intellectuals.  My local sports radiop station has had a contest to name these people, and come up with "nilrods." 

My hunch, however, is that neither of these descriptions fit the American attitude towards World Cup soccer.  I've seen elevated but not overwhelming interest in the World Cup.  Any honest assessment of soccer would have to acknowledge that the game can be boring for long stretches, punctuated by some moments of genuine excitement and athleticism -- not unlike baseball. 

The fact is, there are plenty of sports in the United States that occasionally capture the intermittent attention of the casual sports fan, but won't "break through" the sports zeitgeist until and unless the United States fields a successful national team.  This is how it tends to work with the Olympic team sports, and it's how it will work with the World Cup.  If the United States can advance far in this tournament, Americans will become more interested; if not, they'll switch back to baseball and the NFL draft. 

In this approach, the casual sports fan is using a strategy of "rational ignorance" -- i.e., not caring until the team is sufficiently successful.   This is the kind of thing that political scientists tend to understand, but sports and politics junkies reject as somehow not representing true fandom.  But it is how most people think about most things in life most of the time.   

Last night the Miss USA pageant crowned Rima Fakih the winner.  This is interesting for three reasons:  A)  Fakih is an Arab-American; B)  Fakih's performance in the pageant was a bit underwhelming; and C)  Fakih's victory has triggered a big blog controversy. 

On the underwhelming performance: 

In a moment that was replayed during the broadcast, Fakih nearly fell while finishing her walk in her gown because of the length of its train. But she made it without a spill and went on to win....

During the interview portion, Fakih was asked whether she thought birth control should be paid for by health insurance, and she said she believed it should because it's costly.

"I believe that birth control is just like every other medication even though it's a controlled substance," Fakih said.

This prompted Michelle Malkin to argue that the politically correct fix was in: 

Imagine if those words had come out of the mouth of Carrie Prejean or Sarah Palin.

Between the NYTimes, MSNBC, Jon Stewart, and the late night talkers, we wouldn’t hear the end of it....

Fakih’s cheerleaders are too busy tooting the identity politics horn to care what comes out of her mouth.

Daniel Pipes goes further -- he thinks this is part of a disturbing macrotrend in Western society: 

[Fakih's victory] prompts me to recall some prior instances of Muslim women winning beauty contests in Western countries.

Juliette Boubaaya, 19, was Mlle Picardie in 2009.

Nora Ali was America's Junior Miss in 2007.

Hammasa Kohistani, 19, was Miss England in 2006.

Sarah Mendly, 23, was Miss Nottingham in 2005.

They are all attractive, but this surprising frequency of Muslims winning beauty pageants makes me suspect an odd form of affirmative action.

This has prompted some howls of derision from the liberal side of the political blogosphere, which has in turn provoked counter-howls from the right. 

Clearly, this is the kind of all-consuming, must-respond debate that your humble blogger has no choice but to work through.

In the interest of being useful to college juniors no doubt pondering a good topic for a senior IR thesis, let's propose three topics that could come from this kerfuffle: 

1)  Has political correctness gotten to beauty pageants?  This is Pipes' and Malkin's thesis.  Malkin at least has an empirical toehold in observing that right-wing contestants might be treated differently than left-wing ones.  Fakih is no former Miss South Carolina --  but if the AP story picked up the contrast between her performance and her victory, well, that justifies some further inquiry. 

Pipes' assertion, however, is just horses**t.  He manages to dredge up the names of five Arab/Muslim women in the span of five years to suggest affirmative action.  Let's be ultraconservative and assume that there are a combined 100 pageants a year in the countries of concern to Pipes.  That means that out of 500 possible contest winners, a whopping 1% of them are Arab and/or Muslim in countries far lower than the percentage of Arab/Muslim populations living in these countries.  That's nothing close to resembling affirmative action. 

2)  How do Arab Muslim beauty pageant contestants define their identity?  Liberty Pundit interprets the issue this way:  "She’s in America. She’s doing what beautiful American girls do. She’s acting Western."  Is this assertion true?  I would anticipate that in-depth interviews of the contestants would be required -- as well as a control sample of non-Muslim contestants to ensure a sufficiently divergent set of cases. 

3)  Is what's good for the pageant good for the winner?   Jonathan Turley notes the recent injection of politics into the pageant interviews: 

As with the Prejean controversy, it continues to amaze me that people inject politics (and frankly substance) in this beauty contest. Usually it is an effort to elevate the competition but at times it is an effort to paint the contestants in a darker light.

Actually, if it's intentional, the injection of politics is pretty clever gambit by the pageant owner, Donald Trump.  After all, political controversy catches the attention of people who otherwise would watch beauty pageants as a guilty pleasure but deny it at a Senate confirmation hearing not watch bueaty pageants.   The Miss America beauty pageant, for example, has suffered declining ratings for years.  If politics livens up the buzz factor for these things, the organizers would be fools not to ask third rail questions on issues like immigration. 

Of course, what's good for the pageant might be bad for the winner.  In theory, Miss USA, like other celebrities, should be able to use their star power to promote their own charities and causes.  However, as I noted here, political controversy is guaranteed to tarnish their luster and reduce their ability to appeal across the political spectrum.  Miss USA winner has some charitable alliances -- but political controversies can harm the star power of the winner. 

I look forward to reading the papers that answer these questions. 

Some in the policy blogosphere believe that the American Political Science Review does little more than publish abstruse, small findings of no consequence to anyone other than fellow political scientists.  And, truth be told, a lot of political scientists think this to be the case as well.  

The APSR has had a pretty decent month contradicting that belief, however.  The February 2010 issue of the journal already touched on issues related to Rusia's counterinsurgency tactics in Chechnya. 

A different article has now cropped up in a front-page story in the New York Times by Julia Preston on immigration.  Preston reports that more immigrants are employed in white collar professions than previously thought.  Why is this politically significant?  Preston goes to the APSR for an answer: 

The data belie a common perception in the nation’s hard-fought debate over immigration — articulated by lawmakers, pundits and advocates on all sides of the issue — that the surge in immigration in the last two decades has overwhelmed the United States with low-wage foreign laborers.

Over all, the analysis showed, the 25 million immigrants who live in the country’s largest metropolitan areas (about two-thirds of all immigrants in the country) are nearly evenly distributed across the job and income spectrum....

The findings are significant because Americans’ views of immigration are based largely on the work immigrants do, new research shows.

“Americans, whether they are rich or poor, are much more in favor of high-skilled immigrants,” said Jens Hainmueller, a political scientist at M.I.T. and co-author of a survey of attitudes toward immigration with Michael J. Hiscox, professor of government at Harvard. The survey of 1,600 adults, which examined the reasons for anti-immigration sentiment in the United States, was published in February in American Political Science Review, a peer-reviewed journal.

Americans are inclined to welcome upper-tier immigrants — like Ms. Kollman-Moore — believing they contribute to economic growth without burdening public services, the study found. More than 60 percent of Americans are opposed to allowing more low-skilled foreign laborers, regarding them as more likely to be a drag on the economy.

You can access the Hainmueller and Hiscox article by clicking here.  Their argument:

Past research has emphasized two critical economic concerns that appear to generate anti-immigrant sentiment among native citizens: concerns about labor market competition and concerns about the fiscal burden on public services. We provide direct tests of both models of attitude formation using an original survey experiment embedded in a nationwide U.S. survey. The labor market competition model predicts that natives will be most opposed to immigrants who have skill levels similar to their own. We find instead that both low-skilled and highly skilled natives strongly prefer highly skilled immigrants over low-skilled immigrants, and this preference is not decreasing in natives' skill levels. The fiscal burden model anticipates that rich natives oppose low-skilled immigration more than poor natives, and that this gap is larger in states with greater fiscal exposure (in terms of immigrant access to public services). We find instead that rich and poor natives are equally opposed to low-skilled immigration in general. In states with high fiscal exposure, poor (rich) natives are more (less) opposed to low-skilled immigration than they are elsewhere. This indicates that concerns among poor natives about constraints on welfare benefits as a result of immigration are more relevant than concerns among the rich about increased taxes. Overall the results suggest that economic self-interest, at least as currently theorized, does not explain voter attitudes toward immigration. The results are consistent with alternative arguments emphasizing noneconomic concerns associated with ethnocentrism or sociotropic considerations about how the local economy as a whole may be affected by immigration.

To unpack that abstract a bit:   Hainmueller and Hiscox are arguing that material self-interest does not explain attitudes about immigration.  The findings suggest one of two possibilities:  simple prejudice, or concerns that low-skilled immigration negatively affect overall U.S. welfare. 

I confess I have some skin in the game on this question, as I've argued that American attitudes towards immigration would be affected by implicit realpolitik calculations of national interest. 

Still, this is the second time in less than a month that a quant study in the most recent issue of the APSR has yielded salient findings about a matter directly affecting public policy. 

I reviewed Gregg Easterbrook's Sonic Boom: Globalization at Mach Speed today in the New York Times.  The opening paragraph:

America could use a truly Whiggish book right about now. More than a year into the Great Recession, it has become much harder to believe in the idea of inexorable progress. The moment is ripe for a counterintuitive, optimistic perspective that shows, despite appearances to the contrary, that the world is getting better and better every day, in every way. Gregg Easterbrook  tries hard to satiate our inner optimist with “Sonic Boom.”

You'll have to read the rest of the review to gauge how well Easterbrook did at this task.  Here's a small hint, however -- I'd really like to read a persuasive book that advances this argument, because I think it can be done. 

Since your humble blogger reviewed Why Iceland?, he has received e-mails from approximately 0.3% of Iceland's entire population.  That's not much in raw terms, but I find it impressive.  The Icelandic chapter of the Friends of Drezner's Blog (IFDB) is strong and robust, and rumor has it that their happy hours are a must-attend in the summer months.

In the continuing tradition of trying to wrangle an invitation to Rejkyavik making sure that FP readers are fully informed about any developments regarding the emerging geothermal superpower, I hereby relay the latest bizarre step in Icelandic financial history, courtesy of the FT's Andrew Ward, Alex Barker and Michael Steen:   

Iceland was warned on Tuesday that it risked international isolation after the country’s president blocked a deal to repay Britain and the Netherlands almost €4bn ($5.7bn, £3.6bn) lost in a failed Icelandic bank.

The British and Dutch governments condemned the decision by president Ólafur Ragnar Grímsson and hinted at repercussions for Iceland’s bid to join the European Union and for its $10bn international economic rescue programme.

Fitch, the credit rating agency, warned of “a renewed wave of domestic political, economic and financial uncertainty” for Iceland and downgraded the country’s main sovereign rating to junk status....

Mr Grímsson said he would not sign legislation narrowly passed in parliament last week to reimburse the British and Dutch governments for money they paid out to savers in the Icesave arm of Landsbanki when it collapsed in 2008. Instead, he said the bill should be put to a national referendum, amid overwhelming public opposition to the terms of the proposed repayments.

His decision marked only the second time since Iceland gained independence in 1944 that the president, a largely ceremonial figure, had blocked legislation and represented an act of defiance against Jóhanna Sigurðardóttir, prime minister, whose ruling coalition backed the bill.

Both Britain and the Netherlands insisted they would continue to press for Iceland to fulfil its obligations under an agreement between the three countries in October.

Paul Myners, the UK financial services secretary, claimed that, if the deal were abandoned, Iceland would “effectively be saying that it did not want to be part of the international political system”. ”I don’t think the Icelandic people will be sensible if they reached that conclusion,” he added.

This will be a fascinating political experiment if the Icesave bailout actually goes to a referendum.  On the one hand, there is a ton of resentment by ordinary Icelanders about the fact that they have to help bail out Duch and English savers.  On the other hand, total isolation from the global financial system is not a fun experience, Great Recession or not. 

So here's the question:  will Icelandic outrage at the Icesave agreement dissipate once Icelandic voters are forced to recognize the repercussions of noncooperation?  Icelanders, I want to hear from you!!

OLIVIER MORIN/AFP/Getty Images

Well, I'm in a fine mood this AM.  Ahead of schedule on grading, lots of interesting stuff to blog about later this week.  Yep, it's going to be a pretty good day.

Hey, I see that my friend Randy Schweller has an article in The National Interest.  I wonder what it's about:

Contempoary international relations is moving toward a state of entropy. Chaos and randomness abound. Now, the story of world politics unfolds without coherence, unfettered by classic balance-of-power politics, a plotless postmodern work starring a menagerie of wildly incongruent themes and protagonists, as if divinely plucked from different historical ages and placed in a time machine set for the third millennium. We live in an era in which unprecedented globalization and economic interdependence, liberal-democratic hegemony, nanotechnology, robotic warfare, the “infosphere,” nuclear proliferation and geoengineering solutions to climate change coexist with the return of powerful autocratic-capitalist states, of a new Great Game in Central Asia, of imperialism in the Middle East, of piracy on the high seas, of rivalry in the Indian Ocean, of a 1929-like market crash, of 1914-style hypernationalism and ethnic conflict in the Balkans, of warlords and failed states, of genocides in Bosnia, Rwanda and Darfur, and of a new holy war waged by radical Islamists complete with caliphates and beheadings reminiscent of medieval times. In short, we live in a Thomas Pynchon novel.

The increasing disorder of our world will lead eventually to a sort of global ennui mixed with a disturbingly large dose of individual extremism and dogmatic posturing by states. It is the result of the unstemmable tide of entropy. A world subsumed by the inexorable forces of randomness, tipped off its axis, swirling in a cloud of information overload.

Blackness.... aimlessness.... nothingness.... all of us are alone, spinning out of control.... depression.... resisting desperate urge to wear black, listen to Coldplay. 

Seriously, the article is worth a read.  I do think Schweller is a bit gloomier than myself.  Some of what he characterizes as "entropy" I would characterize as "complexity" -- and complex entities still can create powerful forms of structures and constraint.  Some of what he's talking about is, I suspect, more ephemeral than not. 

Still, I'm in a slightly less good mood than I was a few minutes ago. 

One of the Economist's leaders this week focuses on the global economy and the nature of the incipient recovery.  They use an alphabet metaphor to explain the possibilities: 

The first step in any recovery is for output to stop shrinking. But the more interesting question is what shape the recovery will take. The debate centres around three scenarios: “V”, “U” and “W”. A V-shaped recovery would be vigorous, as pent-up demand is unleashed. A U-shaped one would be feebler and flatter. And in a W-shape, growth would return for a few quarters, only to peter out once more.

Well, first of all, their description of the "U" trajectory sounds an awful lot like an "L" to me. 

Second of all, if that's the case, well, it seems they were paying awfully close attention to an obscure report entitled "Alphabet Soup." 

Third of all, if anything, I'm more convinced of the likelihood of the "W" path coming to fruition.  The nature of the Chinese recovery and the absence of any other global economic locomotive is playing a large role in my calculations here.

I don't have any deep thoughts about the GM bankruptcy that were not already expressed in the first few paragraphs of Michael McKee's Bloomberg story: 

General Motors Corp. once mattered so much to the U.S. economy that a two-month strike in 1970 helped trigger a 4.2 percent drop in gross domestic product for the fourth quarter, as national auto production fell 82 percent.

Then, GM accounted for about half the cars and light trucks sold in the country. Now, GM controls just 20 percent of the market, and analysts say its bankruptcy filing will barely register in the broader economy.

GM’s drawn-out restructuring, an increase in U.S. manufacturing by foreign carmakers and the recession-induced decline in auto sales all have meant more to the economy than today’s legal filing.

“Bankruptcy now is irrelevant in terms of the economic consequence of what’s happening to GM,” said Mark Zandi, chief economist at Moody’s Economy.com in West Chester, Pennsylvania. “Either way, it’s going to be a shadow of what it was, in terms of jobs and income.”

GM has been reducing payrolls for three decades. Its U.S. employment peaked in 1979 at 618,365, when it was the nation’s largest private employer and auto manufacturing accounted for 4.1 percent of GDP. At the end of this year’s first quarter, autos were 1.5 percent of the economy, and GM had 88,000 U.S. workers.

One of the most difficult and painful aspects in any mature economy is the phasing out of uncompetitive sectors.  Delay and denial, however, accomplish nothing but deferring the pain until later (one oddity of the auto sector is that even most people who blame Ameria's industrial decline on globalization/Japan/China/slave labor in Bangladesh tend to shed very few tears for Detroit.  I suspect this is because it's very, very hard to defend the long-term performance of either management or labor in this sector).   

It's not like I'm thrilled that GM is going under or anything, but as transitions go, this one has been pretty drawn out.  When GM lost a record amount in the early nineties, there was a fair amount of speculation about when the firm was finally going to go under. 

Now we know. 

This story, on the other hand, scares the ever-living crap out of me for reasons that I still need to process. 

The New York Times runs two op-eds today on the future of the dollar's status as the world's reserve currency, particularly with regard to China. 

Victor Zhikai Gao's essay doesn't actually say a whole lot on the matter, except for this excerpt: 

Beijing recently called for a greater role in international trade for the special drawing rights currency of the International Monetary Fund. But China is also fully aware that the United States can veto an I.M.F. decision. China’s call was more meant to sound an alarm to the United States.

Many Chinese people increasingly fear the rapid erosion of the American dollar. The United States may want to consider offering inflation-protection measures for China’s existing investments in America, and offer additional security or collateral for its continued investments. America should also provide its largest creditor with greater transparency and information.

As Brad Setser points out, it's a bit rich for the Chinese to fret about U.S. inflation, since if the renminbi started appreciating, many of the macro imbalances currently plaguing the international monetary system might be lessened.  Of course, talking about "currency appreciation" puts the onus on Beijing, while talking about inflation conveniently puts the onus on the United States.  

The other op-ed is by Nouriel Roubini -- a.k.a., Dr. Doom.  It's a good primer on the benefits that accrue to the United States from having the dollar as the world's reserve currency.  That said, this part confused me: 

We have reaped significant financial benefits from having the dollar as the reserve currency. In particular, the strong market for the dollar allows Americans to borrow at better rates. We have thus been able to finance larger deficits for longer and at lower interest rates, as foreign demand has kept Treasury yields low. We have been able to issue debt in our own currency rather than a foreign one, thus shifting the losses of a fall in the value of the dollar to our creditors. Having commodities priced in dollars has also meant that a fall in the dollar’s value doesn’t lead to a rise in the price of imports (emphasis added).

The other parts of that paragraph make sense, but that last sentence mystifies me.  Wasn't part of the reason that oil and other commodity prices spiked last year was the declining value of the dollar? 

In general, both op-eds urge the U.S. to get its financial house in order.  I certainly don't disagree with that recommendation.  Still, it's a bit disingenuous to suggest that the U.S. is the only country at fault for the current overhang of dollar reserves.  Beijing needs to take a good hard look in the mirror on this issue. 

The final G-20 communique -- get it while it's hot! -- contains the following strong statement:  "We will not repeat the historic mistakes of protectionism of previous eras." 

This is likely true, though one should never underestimate the ability of governments to devise new and unforseen ways to commit new mistakes about protectionism in the current era.* 

How could that happen?  Check out my latest column in The National Interest online to see how a world of considerably less trade is possible, even within the confines of the World Trade Organization. 

The essay is a thought experiment -- I'd put my money on it not happening.  But I can't completely dismiss this scenario out of hand. 

* Indeed, The FT's Alan Beattie and Jean Eaglesham have the best single sentence on this point of the G-20 statement:  "The commitments on protectionism in the G20 communiqué, although longer than their equivalents after November’s Group of 20 meeting, are, if anything, shorter on concrete promises."