The Dispensable Nation

The people of the Middle East don't want the leadership that President Obama offered them on Thursday.

President Barack Obama's State Department address on the Middle East was a desperate attempt to define a new narrative about the Arab awakening and America's role in this critical region. But the speech only confirmed that Obama has no alternative strategic vision to replace the neoconservative fantasies of his predecessor. In the process, the president demonstrated that the United States has little to offer the region and its people.

Obama spoke at what is, in fact, a moment of crisis for America's position in the Middle East. In her introductory remarks, Secretary of State Hillary Clinton said that "America's leadership is more essential than ever" in the Middle East. The president himself claimed that America's pursuit of its interests was not at odds with the aspirations of the region's people, but rather essential to the fulfillment of those aspirations.

Sorry, but the people of the region disagree. Earlier this week, Pew Research released a poll of key Middle Eastern populations conducted in late March and early April -- a period that includes many of the major elements of the Arab Awakening to date (the changes of regime in Tunisia and Egypt, the U.S./NATO military intervention in Libya, Saudi intervention in Bahrain, and the outbreak of unrest in Syria). The poll shows continued anger and resentment over U.S. policy and toward Obama, himself. The results are in keeping with the most recent running of the annual Arab Public Opinion Survey, which showed that Obama is now even less popular than President George W. Bush at the end of his tenure. Today, it is not even clear that Obama would be able to give a speech about America's approach to the Middle East in a major regional capital, as he did with his 2009 speeches in Istanbul and Cairo.

Beyond public opinion, the region's major strategic actors -- the Islamic Republic of Iran, of course, but also post-Saddam Iraq, Turkey, post-Mubarak Egypt, Saudi Arabia, and Israel -- are increasingly charting their own strategic courses. More and more, they see the United States as poorly intentioned, incompetent, and less relevant to their interests; as a result, they are ever more prepared to take major decisions and initiatives without deference to American preferences.

This was manifested recently in Saudi Arabia's invasion of Bahrain -- Manama's "invitation" notwithstanding, Saudi Arabia's military intervention was clearly against the preferences of a majority of Bahrainis -- and Egypt's decisions to upgrade relations with Iran and cease its cooperation with Israel in keeping Gaza under siege. Immediately after Obama spoke, the trend was extended when Israeli Prime Minister Binyamin Netanyahu rejected as "indefensible" the president's proposal that Israeli-Palestinian borders be negotiated on the basis of the 1967 map.    

Obama's wan rhetoric about the Palestinian issue -- recycling a formula on final borders that was first introduced into presidential rhetoric 10 years ago by Bill Clinton, while ostentatiously punting on Jerusalem and refugees -- highlights the utter lack of strategic vision and creativity in the administration's approach. The same can be said of his rhetoric about Hamas and other Islamist groups. It is now absolutely imperative for the United States to revamp its posture toward Islamist movements in the Middle East, including Egypt's Muslim Brotherhood and Hezbollah, as well as Hamas. By continuing the same dysfunctional approach as his predecessors -- demanding, up front, that these groups recognize Israel's right to exist and disarm before negotiations and surrender everything else that makes them distinctive as political actors -- Obama is not isolating the Islamists. He is only deepening America's isolation from some of the most vital political forces in the Middle East today, whose leaders have precisely the kind of democratic legitimacy the president claims to want to encourage.

The president's rejection of serious engagement was even more stark with regard to the Islamic Republic. We have argued, from early in Obama's presidential tenure, that he was never serious about productive engagement, much less "Nixon to China" rapprochement, with Tehran. But in his speech, Obama dropped even a façade of interest in negotiations with Iran.

Obama depicts the Islamic Republic as the antithesis of the Arab Awakening. It is certainly the case that there is no significant constituency outside the Islamic Republic for replicating precisely its form of government. But, however much the U.S. president and his administration try to deny it, the Islamic Republic is, in broad terms, a prototype of the sort of political order that other Middle Eastern populations want to create for themselves -- orders that may be imperfect, but which will be indigenously authentic, highly competitive, and not subordinated to an overbearing American hegemon (as with Mubarak's Egypt) or any other external power.

The fact is that any political order in the Middle East which becomes at all more representative of its people's values, beliefs, and positions will, by definition, become less enthusiastic about strategic cooperation with America. (That's why Tehran thinks it is "winning" relative to the United States as the Arab Awakening unfolds.) But, rather than face this reality and take on the real challenge of thinking through how the United States pursues its interests in the Middle East in ways that don't offend most of the people who live there, Obama resorts to rhetoric and policies that have already manifestly failed.

In this context, few in the region are likely to be fooled by Obama's promotion of U.S.-sponsored economic development as the solution to many of the Middle East's most pressing problems. This tactic has been deployed, futilely, for years to assuage Palestinian despair over life under open-ended, U.S.-facilitated occupation and "explain away" the fundamentally political roots of anti-Israeli and anti-U.S. violence in the region. To add to the disingenuousness of this part of the president's speech, most of the money ostensibly allocated as economic support to fledgling democracies in the Middle East is not new funding. Meanwhile, Saudi Arabia has become the single largest source of economic assistance and investment for Egypt -- but the kingdom warranted hardly a mention in the president's speech.

The Middle East is changing, and American policy toward the region needs to change, too. Unfortunately, Obama hasn't fulfilled his repeated promises to improve on George W. Bush's disastrous foreign policy. Instead, he may end up presiding over an even more precipitous decline in America's regional standing and influence than his predecessor. 


Immoral Hazard

There's no way the Europeans should get to pick one of their own as the new IMF chief.

Ever since International Monetary Fund managing director Dominique Strauss-Kahn's arrest last weekend, eye-popping developments have come fast and furious -- most memorably the "perp walk" the Frenchman took to face prosecutors' accusations that he sexually assaulted a hotel maid.

Now comes a spectacle that is appalling in a different way: a power grab by officials of the European Union who are insisting that they must retain their prerogative to name one of their own as Strauss-Kahn's successor at the IMF.

The Europeans will probably get their way. If so, that will be a travesty.

The chorus began to emanate from continental capitals even before the IMF chief had a chance to acquaint himself with the unpleasantries of Rikers Island. According to top policymakers in Brussels, Berlin, and elsewhere in Europe, it is necessary to continue -- at least for a while longer -- the "understanding" about the management of the Fund that has existed ever since its creation in the 1940s, namely that its head will be a European.

After all, they say, the eurozone is in turmoil, and the IMF is playing a central role in the rescue of several countries that belong to the currency bloc. European Commission President José Manuel Barroso, German Chancellor Angela Merkel, Belgian Finance Minister Didier Reynders, and many of their colleagues have made clear that this is no time to be handing over the Fund's reins to someone from another part of the world. "We are in a very difficult European situation, and it's quite natural that we would have a strong European influence in the IMF," Anders Borg, the Swedish finance minister, told reporters.

Talk about the shoe being on the other foot.

A logic of sorts used to pertain to the mutual-backscratching deal that gave the Europeans the managing directorship of the IMF while the presidency of the World Bank was reserved for an American. As a rookie economics reporter more than 20 years ago, I heard the following explanation from an IMF spokesman: The United States and Europe are the biggest contributors to the Fund and the Bank, while developing countries are most likely to be borrowing the institutions' money. Thus, rich countries have a legitimate claim on a majority of the votes on the institutions' boards, and they could hardly be expected to hand over control of the management to the borrowers.

This arrangement, which bestows Western powers with extra clout in global affairs, has increasingly become an affront to good international governance. Even though middle-income nations such as Brazil, China, India, South Africa, and Turkey have grown in economic size and importance -- and their governments are complaining anew that some of their leading policymakers deserve consideration -- the Americans and Europeans have the votes to block them. And thus the de facto IMF/World Bank leadership arrangement undermines the credibility of these vitally important institutions by making them look like tools of Washington, Paris, Berlin, and London.

But it's not just unjust and unwise; now it borders on the unethical. The crisis in the eurozone doesn't fortify the argument for keeping the top IMF post in European hands; on the contrary, it makes the opposing case more compelling than ever.

As the region most desperately in need of IMF loans -- and IMF-guided discipline -- Europe shouldn't get to choose the person with the greatest influence over the terms. The blatancy of that conflict of interest ought to prick the conscience of even the most hard-boiled believer in realpolitik. And the handling of the eurozone crisis to date has already aroused widespread misgivings that Europe's most powerful governments are using their sway over IMF policy to obtain deals that suit their political interests.

In rescuing Greece, Ireland, and Portugal, European leaders vehemently resisted any solution that smacked of default by a eurozone country. Dismissing concerns that the crisis-stricken countries need relief from debts that are unsustainably large, Europe's high command has favored programs requiring that the debtors accept severe austerity policies in exchange for huge loans -- and the IMF has gone along.

Critics deride this approach as a short-sighted effort to defer painful measures for as long as possible. The debt burdens of the afflicted countries will have to be reduced at some point, the critics contend, and the longer the delay in facing reality, the worse the ultimate consequences for the Greeks, Irish, and Portuguese. One major reason the criticisms have been ignored is the fear that any debt restructuring would inflict deep losses on big banks in places such as Frankfurt, Paris, and Amsterdam -- which in turn would oblige European governments to embark on another, hugely unpopular round of bank bailouts.

Whichever side is right, the person leading the IMF in such circumstances ought to be someone with as independent a perspective as possible, who can cobble together packages offering the best hope of success in the long run -- and who can convince financial markets and the public of that fact. That should rule out European candidates, who will be beholden in obvious ways to the continent's politicians. (On the subject of independence, some full disclosure is in order: Kemal Dervis, one of the leading non-European candidates for the IMF managing directorship, is the director of my program at the Brookings Institution. That said, my views on this issue long predate his arrival at Brookings.)

Strauss-Kahn was a maestro at orchestrating rescues. To hear advocates of continued European leadership at the IMF tell it, his replacement must have similarly deep connections with the Continent's policy elites, lest the grand euro project fall into even graver peril.

Nonsense. The reasons Strauss-Kahn was such a force in the eurozone rescues were his economic expertise, his grasp of detail, skills at communicating -- and, of course, the power he wielded by dint of his position. Although his European identity and familiarity with key players may have helped in some respects, his standing was compromised by the common knowledge that he was planning to challenge French President Nicolas Sarkozy in the 2012 election. That cast a shadow over his actions; to what extent was he considering the implications for his campaign?

If anything, deeper suspicions would surely plague any senior European policymaker who succeeded him at the helm of the Fund. French Finance Minister Christine Lagarde, the European favorite for IMF chief, is eminently qualified on many counts, but this time around her nationality should be a huge strike against her rather than a necessary credential. With the Greek rescue already coming unstuck, the last thing Europe -- and the world -- needs is an IMF whose credibility is in doubt because its leader is too cozy with the likes of Merkel and Sarkozy.

Unfortunately, chances are high that international policymakers will ignore these considerations. That's what happened four years ago, when the forced resignation of Paul Wolfowitz from the World Bank presidency evoked calls from around the globe to open up the process for filling that position.

The folly of the old arrangement was never so evident, as I argued in an opinion piece at the time. Many of Wolfowitz's major steps had drawn criticism that the former U.S. deputy defense secretary was turning the Bank into an instrument of U.S. foreign policy. For example, when Wolfowitz cut off aid to Uzbekistan on grounds of corruption, critics linked the move to Uzbekistan's denial of a military base critical to U.S. forces in Afghanistan. Unfair though some of the attacks may have been, the Wolfowitz appointment rendered the Bank vulnerable to them, and that eroded its authority in efforts to reform the economic policies of poor countries.

Not that anyone listened. The George W. Bush administration wasn't about to cede control over the Bank, and it once again invoked the "no-non-Americans-need-apply" principle, choosing Robert Zoellick, the former deputy secretary of state, to run the global lender.

I'm not holding my breath in the hope that l'affaire Strauss-Kahn will lead to anything different. The Obama administration may act for a while as if it wants to reform the selection process; in the end, Europe's adamant position will probably force Washington to back down, perhaps in exchange for undisclosed concessions on other issues. After squawking loudly, Asians, Africans, and Latin Americans will also fall into line, if only to avoid landing in the new IMF boss's doghouse.

That's the way the world works -- the strong dominate the weak. Sometimes, though, the price to be paid for doing so is stiff. It still isn't clear whether that lesson applies to Strauss-Kahn's personal problems, given his assertions of innocence. But it may well apply to Europe for its presumptuousness in calling dibs yet again on the top job at the IMF.