From Paul Ryan’s Mailbag

An admission from the Congressional Budget Office: Factor in the “doc fix”, and one finds that $59 billion is added to the deficit over the next ten years.

Remind me why anyone is supposed to think that the health care reform bill before the House is the best bill that we can get.

Obama’s Israel Crisis

Now that the rift between the Obama administration and the Netanyahu government has acquired the status of “crisis,” it is worth stepping back from the details of the spat and looking at the big picture. While the Ramat Shlomo announcement and its immediate aftermath were the immediate cause of the Obama administration’s ire, this was a crisis that was waiting to happen and was probably inevitable. The primary reason for this is the fundamental disconnect between Obama and Netanyahu, not only as personalities but, more importantly, in terms of their long term goals for Israel and the Middle East.

To a certain extent, Obama and Netanyahu deserve each other. As I have written before, they are, ironically, remarkably similar in many ways. They are both charismatic, articulate, extremely image conscious politicians whose capacity for visionary rhetoric often far outstrips their competence. Both have been accused of being essentially empty and shallow personalities, which is true in both cases to some extent, but ignores the fact that they are also ideologically driven idealists with very clear visions of the future they are striving toward.

That these visions are, in all likelihood, completely unrealistic and likely impossible is both their Achilles heel and the secret of their intense appeal. I have personally witnessed supporters of both men speak breathlessly of their genius in the way most people talk about movie stars or cult leaders. Such things occur not only because they believe in the man, but because they also believe in his vision.

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Unfortunately for both Israel and the United States, these visions are mutually incompatible, especially in their short term consequences. Believing, along with much of the Israeli right, that Arab rejection of Israel is currently intractable, Netanyahu’s strategy is simply to maintain the status quo. He wants to strengthen Israel’s military superiority, defend the country against any and all immediate military threats – such as Iran – while working to maintain and expand Israel’s economic prosperity. Any concessions to the Palestinians or anybody else would, in his view, simply endanger Israel’s security without bringing any kind of viable peace.

Needless to say, this point of view is not entirely unfounded. It has, in fact, been a basic tenant of the Zionist right since their intellectual founder, Ze’ev Jabotinsky, formulated his “Iron Wall” theory more than half a century ago. Jabotinsky held that Israel would have to establish and sustain itself by military force – the “iron wall” – and while the Arabs would never fully accept the Jewish state, they would eventually resign themselves to being incapable of destroying it. Depending on how one reads the history of the Israeli-Arab conflict, Jabotinsky was either prophetic or dangerously paranoid. One could argue that the peace treaties with Jordan and Egypt show that Arab opposition to Israel’s existence is not eternal. But one could argue with equal credibility that these treaties were forthcoming only after the Jordanians and the Egyptians had realized that they would never be capable of destroying Israel militarily.

The flaws in Netanyahu’s strategy are nonetheless apparent, mainly because demographic realities in the West Bank are as much of a danger to Israel’s long term security as any military threat; and the more time passes, the more Jewish settlements are being built (the temporary settlement freeze notwithstanding), and the harder it becomes for Israel to disengage from the West Bank and its Arab population. Much of the Israeli political establishment has accepted this fact, Netanyahu has not. He places his hope in an “economic peace,” in which Israel will aid in the development of the West Bank and, perhaps sometime in the indeterminate future, some limited form of Palestinian statehood will eventually emerge.

The “economic peace,” like the neoconservative ideal of the “democratic peace,” is ideologically appealing to Netanyahu’s partisans, but there is no reason to think that it will actually work. Nor is it a particularly new idea. Since 1967, Israeli leaders have placed their hopes of pacifying the West Bank in the economic benefits brought by the Israeli occupation. They have all failed, and for fairly obvious reasons, religious hatreds and nationalist resentments being far more powerful forces than the desire for economic prosperity. The ultimate result of Netanyahu’s strategy, if it is successfully implemented, will most likely be a series of endless intifadas, each one more violent than the last.

Obama’s strategy, however, is no more realistic; though it is more or less diametrically opposed to Netanyahu’s. Vice President Joe Biden articulated it fairly well in his Tel Aviv University speech when he said, “The status quo is unsustainable.” Believing that the Israeli-Palestinian conflict has been allowed to fester for too long, Obama is putting his faith in the possibilities of negotiation and dialog, and trying to force both parties to the negotiating table. It now appears, moreover, that by and large he considers the Israelis to be the primary offenders in regard to the lack of progress in this department, and is conducting himself accordingly, demanding extensive concessions from Netanyahu while demanding nothing of the Palestinians and very little of the Arab states. This is not really much of a surprise, since despite the pervasive sense of denial among American Jews, Obama’s low-key hostility toward Israel has been palpable from the beginning of his campaign, and there seems no reason to think that this has changed. If anything, it seems to have become more violent than it was in the past.

This is not the primary reason, however, that Obama’s strategy is as doomed as Netanyahu’s. It is because when Biden claimed that the status quo is unsustainable he was merely stating the obvious. The status quo in the Middle East is always unsustainable. And this is because of factors – primarily religious – that are well beyond the capacity of any politician to control, let alone cure. This has been borne out by Obama’s complete failure to extract any concessions, or even gestures of goodwill, from the Arab states. His one attempt to do so was unceremoniously rebuffed, and there is no reason to think that any future attempts (which I doubt will be forthcoming) will have better results. Under these circumstances, Obama’s current attitude toward Israel is somewhat understandable. Israel at least can be effectively pressured. It is far harder, after all, to squeeze your enemies than it is to squeeze your friends.

In the end, however, Obama will likely have to face the fact (or suffer the consequences of refusing to face it) that the Israeli-Arab conflict is impervious to Israeli concessions. There is a fairly good reason for this, which is usually lost in the firestorm of pontification that greats anything and everything to do with Israel. It is simply this: the Israeli-Arab conflict was begun by the Arabs, and it can only be ended by the Arabs. It was a war of choice, unnecessary and unfortunate; and the Arabs, should they wish, can choose to end it. This would not be easy, given how the conflict has become culturally ingrained throughout the Arab world, and how any number of deranged and at times psychotic myths about the evils of Israel and the Jews have become normalized. Nonetheless, it is hardly an impossible task. So long as such ostensible partisans of reconcialition and peace as Obama continue to push for the opposite, however, thus handing ever more power to those like Netanyahu who believe the Arabs will never end their half-century long war against us, concessions may or may not be made, but no peace is likely to be forthcoming.

Follow Benjamin Kerstein, Senior Writer for The New Ledger, on Twitter.

Obamacare’s End

Coffee & Markets will wait til Sunday (we want to see how things turn out), so here’s a brief podcast with a few thoughts from me on the eve of health care reform’s final vote: “Obama’s dedication to passing this spectacularly flawed and unpopular health care bill appears to be based on the assumption that the American people like a winner even if the victory comes at their expense.”

Related Links:

TNL: How Obamacare Will Reshape the Workforce
DC Examiner: Pro Reform Liberals Admit This Wasn’t a Battle Against Special Interests
Heritage: More Bad News in the House Health Care Bill
Keith Hennessey: Understanding the Health Care Bill
Jane Hamsher: 18 Myths About HCR Debunked
The Note: Rep. Frank Says HCR Could Still Fail
NRO: Obamacare’s IRS Connection
NEMJ: 46% of Family Doctors Forced Out of Medicine Under Obamacare
Fred Barnes: Health Care Wars Only Beginning

Google Abandons the China Market

I’ve been on record for about two years now to the effect that what happened this week was only a matter of time.

China doesn’t do free-market competition. To them, the whole concept of taking market share away from your competitors is against the natural order of the world. In every industry space, they’ll tend to pick a small handful of anointed winners, assign a relative market share to each one, and then everyone stays in his lane.

In search, the anointed ones include Baidu and Ali-Baba. The point of allowing Google into this market was so that the Chinese players could learn from them and improve their offerings. And it was clear from day one to everyone with eyes that when the Chinese entrants were ready, a pretext would be found to erase Google. That just happened.

I hear from Chinese correspondents that Baidu and Ali-Baba are now growing at rates that are simply astounding, so it’s not the case that the market there isn’t big enough for another large player.

There’s another space where I’m not making a prediction on the timing, but that you should watch: network routing.

Cisco was early to the China market. It’s generally believed that Cisco added code to their carrier-class routers to allow the Chinese to block any traffic they wanted to, thus enabling the “Great Firewall of China.” China is still an enormous market for Cisco. BUT, while you weren’t paying attention, a company called Huawei came up as a direct competitor to them.

Huawei isn’t a new company, having been in business for 20+ years. So far they don’t have a strong brand identity in the US. But they’ve grown to well above $20 billion in revenue. That’s not a typo. If I were Cisco, I’d be scared of these guys.

- March 19, 2010 -

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