Syria. What Next?

I wonder whether any of my American readers are aware that last night, a vote in the British Parliament defeated the government of the day and rejected military action by the British in Syria. This will have ramifications for the Obama administration. If America is to take military action against the Syrian government, it will not have the British as an ally or as part of a coalition.

There are so many issues that have arisen as a result of the Syrian conflict. First, it is a civil war. The Taliban and Al Qaeda are reportedly fighting on the side of the “rebels” so if the West sides with the rebels, it will have as an ally the people it is fighting in Afghanistan. Experience should tell all politicians that you don’t get involved in a civil war. Second, there have been numerous outrages in Syria during the past two years. Why are these deemed to be acceptable whereas the use of chemical weapons is not? I suspect this has more to do with the fact that Syria is not strategic, i.e. it has no significant oil resources. Third, would the action contemplated by the West be legal? If the action is taken on humanitarian grounds to save life and is proportionate, evidently it would be lawful, even if the United Nations does not pass an appropriate resolution in support.

Fourth, where is the evidence that the Syrian government used chemical weapons? Secretary of State Kerry and Vice-President Biden have both made strong statements to the effect that the evidence is compelling but none has been disclosed. In 1962, when the Russians placed missiles in Cuba, Senator Adlai Stevenson produced photographic evidence of the Russian actions at the United Nations, thus proving to the world the truth of America’s allegations. I accept that UN inspectors are investigating but until they have reported, does the American government expect us to rely solely on its word? What has convinced me that the American allegations are true is that the last thing President Obama wants is to commit to military action in Syria. His government is raising the rhetoric because the President’s own red line, the use of chemical weapons, has indeed been crossed. 

In UK, the big issue has been fudged. What action do you take? What is proportionate? I think this is nonsense. What has to be decided is whether or not to do anything. If the decision is to do nothing, “rogue” government and terrorist groups will be encouraged to use chemical weapons or tactical nuclear weapons in the knowledge they are unlikely to be challenged.

What has not been discussed, at least in public, is a response that is disproportionate. The Syrian government is not going to change its mind about the use of chemical weapons if the response from the international community is limited to the firing of a few Tomahawks and Cruise missiles. The disproportionate response would be an all-out bombing campaign against strategic targets in Syrian government held cities, until those Syrians in charge realise that the apocalypse has arrived. Such a proposal is unlawful. I am also aware that Russia and China will be less than happy were their Middle East client to be attacked. However, the disproportionate response is an option, albeit an extremely dangerous one.

Let us assume that no action is taken. The Middle East continues to be a powder keg. What threat would stop Iran from firing a tactical nuclear weapon at Israel? If Israel believes this is a real risk, what would prevent them from pre-emptive action?  Possibly, the knowledge that the West will deliver killer blows from its massive weapons arsenal might make regimes think twice, or they may retaliate in ways that will escalate and prolong a tragic situation.

In the nineteenth century, the British leadership referred to foreign affairs as “the Great Game.” More than a century later, it is no longer a game. I don’t get scared easily but the situation in Syria and its potential consequences are truly frightening. We don’t need knee-jerk reactions from politicians. What we need is clear thinking and decision making. After all, military solutions, as in Iraq and Afghanistan have not worked. Political solutions have a better chance.

JFK – A President in Pain

My thoughts today are with the late John Fitzgerald Kennedy. My reason is personal and has nothing to do with the fact that in a few short weeks, the media will bombard us with stories of his life and the assassination which took place almost fifty years ago.

On Sunday morning, I rose from the bath and felt a huge pain in my back. I could have taken myself to the ER but this would have meant a three hour wait at least, in chairs or on a trolley that would have compounded the agony. By the evening, I could neither sit nor lie in any comfort at all. There was just too much pain. I did not sleep that night. Fortunately, the following day I was given painkillers which worked and the physiotherapist practised his arts to good effect. However, it has taken me three days to get to my computer. Sitting in my office chair remains uncomfortable.

JFK had chronic back problems. He was often in great pain and since his death much has been made of how his doctor took a virtual pharmacy into the White House to treat the President. You have to give credit to JFK. Despite the level of pain he endured, he still managed to conduct his life – and his affairs - and act as the chief executive and commander-in-chief. I am impressed by his fortitude, although it has to be said that apart from one or two successful initiatives, his record as a president is poor. For example, he had huge difficulties getting his legislative program through Congress. Doesn’t that have a familiar ring! Further, his record on black civil rights left much to be desired.

But let me return to the Kennedy back. The fact that he suffered from back pain was known to the public. But how would the public have reacted had the painkiller problem been aired by the press? Would the public have accepted a president who lived with painkillers? Did the press know? I think not but my researches have not established the truth, either way.

President Roosevelt’s infirmity was well known to the press. The media chose not to publicise it, as it was personal, merely gossip. Mind you, FDR had excellent relations with the gentlemen of the press. This friendliness would not have stopped publication had any newspaper considered his health newsworthy. The point was that FDR governing abilities were not hampered by his paralysis.

Woodrow Wilson’s illness was different. Exhausted by the Great War and negotiating the Treaty of Versailles, he ran himself into the ground as he tried to persuade Congress to ratify the treaty. The last months of his life found Wilson unable to do anything. It is said that Mrs. Wilson became the de facto president. I doubt this but certainly the press was kept in the dark about the health of the chief executive.

I don’t want to go into the infirmities of 19^th century presidents. In those days, Congress was the most powerful branch of government and the presidency, excluding Lincoln’s administration, had comparatively little importance. However, it is worth noting that President Grant was an alcoholic!

Undoubtedly, the media has changed in its attitude towards the health of prospective chief executives. If Chris Christie runs in 2016 and doesn’t reduce his girth substantially, the Democratic-leaning press will be merciless about his physical appearance, regardless of his record as governor of New Jersey. Mind you, it seems that Christie realises that his avoirdupois will be an issue as he is already dropping the pounds. What has his weight got to do with his ability to govern? The problem seems to be that since JFK, presidents are meant to look like matinee idols. In this context, when Hillary Clinton became Secretary of State, her appearance was older and plainer.

Why is the ability to govern subsumed by the need to look good, so far as parts of the media are concerned? Perhaps this is about appealing to the lowest common denominator or it could be prompted by needing something, anything, to chat about on 24/7 television.

Governing is a serious business. It is also very difficult. There are parts of the American media that now trivialise the presidency. What saddens me is that the British media is following suit, preferring the cosmetic to the concrete and complex.

Tough on Crime. So What?

Attorney General Eric Holder has announced he will seek to get rid of mandatory minimum sentences for some low-level drug offenders. This is welcome but how effective will it be?

Over the past thirty-five years, notions of retribution and deterrence have dominated the criminal justice policy, by removing offenders from society. The rhetoric of “getting tough on crime” exercises a powerful hold on American society. The prison population of US exceeds two million, the highest rate in the world now and approximately one quarter of all people imprisoned in the world.

Since early 1990s, various pieces of legislation have been introduced in various states, basing a sentencing system on the principle of “three strikes and you’re out.” i.e. on the third felony conviction, there will be a long prison sentence.

The law was first introduced in Washington State but the most influential was in 1994 in California. Under the Jones Law, strikes one and two must be for serious felonies, usually involving violence or a threat of violence, but strike three is for any felony at all. The sentence for such third conviction is a mandatory twenty-five years with 20% remission for good behaviour. Subsequently, forty states have introduced the law of lengthier sentences for repeat offences, with a majority of states having some form of the three strikes law. However, California is the only state where a twenty five-year sentence is automatic.

And here lies the problem for Holder. If offenders are prosecuted under federal law, their sentences might be more lenient should the Holder reforms be passed. However, if perpetrators are prosecuted by a state which has a three strikes law, the federal rules will not apply.

Why has “three strikes” enjoyed support? Public concerns about violent crime are high and the media emphasises violent crime in its reporting, as well as raising fears of victimisation. In California, the high profile of the child murder of Polly Klaas raised public outrage. The murder of Klaas was committed by a repeat offender. Had the three-strike law been in place, he would have been incapacitated and unable to commit the crime.  

Some years ago, the three-strike law was reviewed by the Supreme Court. In the case of Leandro Andrade, his third offence was for shoplifting. The US Appeals Court ruled the sentence unconstitutional because it breached the 8^th Amendment, in that the punishment was cruel and unusual. The Supreme Court disagreed. The 10^th Amendment and states rights were found to be the dominating factor.

America’s jails are populated by repeat drug offenders who have no crimes of violence on their sheets. They are also populated now with elderly men suffering from physical and mental health problems. Why are these circumstances helpful to American society?

I am also troubled by the obvious breach of separation of powers. The judiciary has been stripped of its sentencing rights. On a third strike conviction, a judge has no individual discretion in sentencing. How is this right or just?

For years, I have despaired at British politicians who emote how their policies are tough on crime, yet there is no credible evidence that punishment alone works. Why can’t these people understand that brain power is a far better option? The inequalities that lead to crime should not lead to long terms of incarceration for minor offences.

Any politician who can convince me that he will be smart on crime and truly smart on the causes of crime gets my vote.

Ben Bradlee. A Force of Nature

Last week, Benjamin C. Bradlee, the former executive editor of The Washington Post, was included in a list of honorees who will be awarded The Presidential Medal of Freedom, the country’s highest civilian award. Between 1972 and 1974, Bradlee oversaw the Watergate coverage the helped bring down Richard Nixon, the only President to resign the office. Interestingly, the list of honorees includes the late Senator Daniel Inouye of Hawaii, who sat on the Senate Watergate Committee, chaired by the great Sam Irvin.

A decade ago, I was researching Watergate, in particular whether the impeachment provisions in the Constitution worked. I had concerns about the impeachment process and the extent to which it was flawed. I theorised that impeachment relied as much on the need for individual effort and determination and political will, as the process itself.   

It cannot be denied that the American press led the inquiries and investigations of the Watergate burglary. The Post was at the forefront, reviving investigative journalism. Bob Woodward and Carl Bernstein became household names as their stories of administration wrongdoing were published. Eventually, their book, All The President’s Men, became a best seller and a major motion picture. Standing behind these journalists, backing them against enormous pressure from Nixon and his team, was Bradlee and his owner, Katharine Graham.

I asked Bradlee if he would allow me to interview him. To my surprise, he agreed to half an hour. I’m an old hand at these things. If he liked what I was doing, I would get longer. So, I took a risk and a vacation in USA and shortly before the appointed hour, I presented myself at The Post’s offices.

I had a five minute wait and suddenly I knew Bradlee was approaching, although I had my back to him. Don’t ask me how I knew? I felt electricity. Seconds later, we said ‘hello’ and started to talk. I took an instant liking to him. Early in the interview he told me, “I am much more dogged than I am intellectual. I don’t give a shit about whether it was Nixon or not. It was just such a good story and the reporting was so good.”

Over the next two hours, I listened to Bradlee as he gave me a Watergate history lesson. I asked him whether there ever a moment when you thought: ‘Oh, I’d better back off.’ His response: “None. You don’t know Katherine Graham and you don’t know the people who own this great paper.  It would have been anathema to them.” Katherine Graham herself wrote of Bradlee: “As Executive Editor, Ben Bradlee was the classic leader at whose desk the buck of responsibility stopped.” 

Towards the end of the interview, we talked personalities. Of Nixon, he said, “he was plainly guilty.  He did it, he did it.” But my favourite was his characterisation of Sam Irvin. “Right out of central casting wasn’t he?   I mean he was perfect.  You know, hell has no fury like Sam Ervin.”

Bradlee’s award was announced shortly after news broke that The Post had been sold to Amazon owner, Jeff Bezos, who has been quoted as saying that print will be a thing of the past in two decades. Bradlee has not commented on the sale, save to say, “any change is difficult to discuss.”

I confess that after two hours with Ben Bradlee, I had no doubt he was a true force of nature. I can describe him as a clear thinker, a determined man who is not easily pushed off the track, a leader who backs his people all the way and extremely good company. I congratulate him on his award.

Will We Recover From Investment Banking?

Is President Obama being smart about financial regulation? The Republicans in Congress objected to new financial regulation rules. These laws challenge the complete freedom hitherto enjoyed by the economic elite to conduct the hedge fund industry as they wish. Obama’s response was straightforward and well taken. He told Wall Street, “Unless your business model depends on bilking people, there is little to fear from these new rules.”

The federal government seeks to introduce transparency and fairness into the hedge fund market. Republicans are protesting on grounds of “more socialism” and “denial of freedom.” Not so long ago, these same Republicans were very keen to have the federal government bail out their banker friends. Then they stood mute whilst the bankers paid themselves huge bonuses, to the disgust of the American taxpayer. Freedom for the few should not be subsidized by the sacrifices of the many.

Five years after the worst world banking crisis since 1929, little or no action has been taken by western governments against those to blame. I have to ask, who do these bankers think they are? There seems to be a parallel with the way some Premier League soccer players are treated in England and an acceptance that a separate set of social rules applies. The soccer stars can rightfully claim to entertain hundreds of thousands every Saturday or Sunday as they play the beautiful game, but this is no excuse for some pretty deplorable behaviour on their part. One well-known Liverpool player descended to cannibalism last season. He deemed it justifiable ear-nibbling!

However, investment bankers play their game only for the very few and can make no claim for “the beautiful deal.” Over the past five years, we, the taxpayer bailers of the banking system, have been treated to disclosure of the behaviour that got the global financial world into the disaster from which we all suffered, something regrettably some Americans still don’t seem to understand.

In 2007, as the American housing market showed signs of weakness, Goldman Sachs, the doyen of Wall Street investment bankers, sold an investment product based on the housing mortgage market. The product was inherently bound to fail, something which Goldman knew but failed to mention. Worse, another Goldman client and customer, John Paulson Inc, was certain to profit from the in-built failure of the Goldman investment. I have no doubt that within the hundreds of pages of small print attached to the investment in question, Goldman will have warned buyers that investments can result in losses, that independent advice should be sought before buying and, possibly, a few words buried deep in the documentation even described the reality of the deal, namely that the buyer would almost certainly lose.

What is clear to me, as one who worked in the City of London for many years, is that Goldman behaved unethically and certainly breached conflict of interest principles. Goldman claimed that an individual rogue director was solely to blame, asserting that this person was working on his own. That won’t fly. Did Goldman not have a vetting process for financial products? Surely, its lawyers would have written the small print. Methinks this banker doth protest too much.

Lehman Brothers failed, Merrill Lynch got taken over and the American taxpayer bailed and bailed. On this side of the pond, the Labour government took a majority shareholding in two big banks, Royal Bank of Scotland and Lloyds, investing billions of pounds to shore up the failures. And what has happened since? I understand the American government has been repaid but our government has not. Yet the underlying principle of investment banking has held firm. Never mind ethics, ignore the shareholders, let’s make huge profits from risky trading so we can be paid huge bonuses. Life for investment bankers doesn’t seem to have changed. For savers and investors, however, life is very different. Annuities are on the floor, interest earned by savers is pitiful and there is no encouragement to save, which in turn weakens any economy. And the bloody investment bankers carry on as if nothing can touch them.

There is a proposal before Parliament to ring fence the savings side of UK big banks from the investment side but no legislation has yet been passed. I’m delighted to report that the Bank of England has imposed new rules on leverage ratios. I’m no expert but I believe leverage equates to retaining in capital a percentage of equity to the money lent. Barclays screamed “foul” but the regulator told this Bank to shut up, causing it to go to the market to seek some £7 billion in new capital. I know Barclays’ shareholders will be hurt but the remedy is in their hands. Why don’t they tell management that the bonus culture is ended? If all the investment banks did this, then maybe we would get some sense in the industry.

When the crisis was at its height, I found myself in North Carolina. Chapel Hill, home of the University of North Carolina, a wonderful campus, provided a delightful interlude. Then I moved on for a few days to Beaufort, pronounced “Bo-Furt,” a jewel of a town in the jewellery box that is North Carolina’s Crystal Coast. Here I must pause and invite the reader to Google both places for information. Don’t rely on me.

They are very polite people, the North Carolinians. On my last morning in “Bo-Furt,” I took a stroll to a coffee place, some two hundred yards away from my B & B. It took me a full twenty minutes, as I passed people who not only wanted to say “hello” but who enquired after my well being and wanted to engage me in conversation. True, it was small talk but it gives one a strong sense of bonhomie.

I stayed at the Inlet Inn, a delightful place with a view of a pretty yacht harbour. My spacious room had a veranda with his and her rocking chairs and a great view of the harbour, the river Newport inlet and unspoilt islands beyond. At $94 plus tax (a hefty 13%) per night – including a “continental breakfast” – it was a good deal. I am not being paid by the Inlet Inn for this review and the discounted room rate was achieved by being a senior, not for writing this piece. A Health Warning:  I wouldn’t come to NC in high summer, too hot and definitely too buggy.

Beaufort is part of the Inner Banks. The town was settled in colonial times and there is much architecture to admire. I took a boat ride to the Outer Banks, an Oceanside wilderness which has hardly changed since the founding fathers’ time. I have seen wild horses, all kinds of bird life, dolphins and maybe a whale – the glimpse was too quick to confirm. The boat ride, the beauty and peace there, the restaurants – don’t miss Front Street Grill - and the sights and sounds of the coast provided a refreshing change to large American and European cities.

Furthermore, it is my clear, immutable opinion that life on the Inner Banks and Outer Banks of North Carolina is infinitely better than any of the Wall Street and City of London banks, on any view imaginable.