Jun 28

Weather or Not

Recently part of the reasoning given for the significantly low GDP numbers that were announced by the Bureau of Economic Annalists within the Department of Commerce is that the cold weather was a significant factor in the decline. I believe, weather is a reoccurring argument made to fit circumstances when no other probable explication exists.  GDP regardless of reason still declined 2.9%.

As human beings we have an incessant need to explain events and will even embrace false narratives over the unknown or unexplained.  With research I may be able to deterinime for my mother who ate her prized tomatoes but she still doesn’t have her tomatoes. During my time in public sector forecasting many individuals would explain sales by determining that weather was the main culprit with out providing meaningful data or reasoning.  No doubt this line of thinking also infects business news and political talking points.

That is not to say weather has no effect on economic activity, in a dynamic economy almost everything maters, but the question for data analysts is if it is a determining factor. When examining the harshest winters in US history since the fifties when there is more reliable GDP and weather data there is not a single quarter with negative economic growth in fact the average for the harsh winters mirrors that of the whole sample of Q1 at 3.2%. In other words, not a single harsh winter saw negative economic growth.  When looking at GDP growth we actually see only a few times where negative GDP growth is an isolated event.  Never has there been a negative isolated quarter greater than 1% in recorded economic history much less -2.9% we saw in Q1 of 2014.  The narrative that this is an isolated event due to a harsh weather is not supported by the data but unfortunately may be the pretext of negative things to come.

Jun 17

Why Invoke the War Powers Act?

The announcement from the White House that Obama is beefing up security for our embassy and assets and invoking the War Powers Act is a partial truth.  No doubt, many of the forces are going in to reinforce the embassy, which is the wise thing to do.  But, the War Powers Act is not needed to buff up security at facilities that are US soil.  I expect some segment are going to be used for targeting for planes, bombers, and drones.  

Also, I am interested that they are even invoking the War Powers Act.  Both the authorizations for use of force in 2001 and 2003 would allow for this action, I think.  It seems the White House sees a set time limit on these authorizations when Congress didn’t set one.

This though effects operations on the ground because now the 60 day operational clock is ticking.  That is why I suspect in about a weeks time we will see air strikes, could be substantial, in Iraq.  This could all be part of the leverage between US and Maliki. Think about it from the US  perspective of the best time to get pol reforms would be right before bombing.

Jun 16

Russia’s Gazprom reduces gas to Ukraine after deadline passes - Bing Reuters

Jun 12

To Err in Chess and Global Politics

Abraham Lincoln said in his message to Congress, “The struggle of today, is not altogether for today — it is for a vast future also.”  The role of making mistakes in chess, and in foreign relations, can be an important element in analysis, reflection, correction, and planning.  In an interview with television host David Frost, former World Chess Champion Garry Kasparov was asked about some of the important elements of success for master chess players, and he explained a willingness for players to review and learn from mistakes is very important.  Kasparov continued in pointing out that many players are emotionally unwilling to subject themselves to rigorous self or external criticism. 

Few individuals enjoy the process of self-criticism, but leaders, who overwhelming possesses strong egos, may themselves be unwilling to reflect on an area rivals are more than willing to explore. In chess, like life, mistakes are often made and learning from them leads to better decision making. As current World Chess Champion Magnus Carlsen remarked, “I have to work on relatively simple mistakes. When I can lower the percentage of such mistakes then things are going to be much better.” This a remarkable statement from a player who is known for forcing others to make mistakes.

Winston Churchill, who possessed an active and reflective mind, learned from his mistakes as First Lord of the Admiralty and his decision to attack the Ottoman Empire.  Churchill had an elaborate global objective of opening up supplies to the Russians during World War I, in order to expand an Eastern Front to split German resources.  The crux of his plan to take Gallipoli failed miserably and resulted in the British losing nearly 50,000 men.  Churchill learned lessons in planning and reasonably associating ends with means. But, his strategic nature and bold behavior never changed.  Also, after this disaster, as Eliot Cohen in Supreme Command lays out, the Prime Minister was a little more accepting of military experts, although he continued to have a high opinion of his abilities.

In, How to Reassess your Chess, author Jeremy Silman talks about looking at the chess board objectively.  These lessons include reviewing pawn structure, comparative piece value, piece development, piece projection, and imbalances.  As the great chess players are very aware of their own playing styles, some global leaders are as well.  Returning to Lincoln, his internal anguish is well known but many believe his moments of reflection made him a stronger leader who could deal with the greatest of challenges: The Civil War. As Megan McArdle in, The Upside of Down, points out Harland Sanders had experienced numerous business failures until starting a fried chicken establishment.  She argues it was his bad luck that forced him to be, “always looking around the corner”.

Of course, some reflection can be counterproductive when the weight of an overwhelming mistake, especially one that cost lives, leaves an individual frozen in a moment.  Secretary of Defense under Kennedy and Johnson, Robert McNamara, is an example of a self-critic who may have been crippled by past decisions to the point he resigned late in Johnson’s Administration.  Years later McNamara wrote, In Retrospect, where he outlined mistakes in thinking, management, and decision-making.  Specifically, McNamara was unwilling, to challenge Presidential thinking.  He also, for the sake of cohesion, significantly limited view points of the Joint Chief’s of Staff in reports to the President regarding options in Vietnam.  Unfortunately, these realizations came after the event but still provide an outline for future self-assessments.  Hopefully, world leaders can make future self-assessments when the course of action can still be corrected. No doubt, some policy makers are fully aware that, as chess great Tartakower remarked, “blunders are all there on the board, waiting to be made.”

May 11

Putin and Tal Aggressive Actors

In chess and geopolitics we draw very unique lessons from the style of play of the great Mikhail Tal.  While Tal and Russian President Vladimir Putin have different backgrounds and domains of interest, I believe looking at the nonconventional chess style of Tal will provide some insight into Putin.  Even though his matches were played decades ago, the element of Tal’s chess was aggressive and contrary to orthodox thinking.  This style earned Tal the ongoing distinction of being in the top twenty chess players in history.  It is clear that Putin has his historic designs.

Some masters, like Nimzovitsch, were methodical in controlling the board and slowly forced their opponents into unfavorable choices.  Tal brought unfavorable choices to his opponents, but his moves were often unexpected.  This had the psychological effect of stressing an adversary, and frequently forced errors on them as a result. Tal once remarked, “one must also make every effort to combat the thoughts and will of the opponent.”  Even the players who were not rattled still had to fend off an attack, where he often gained momentum through sacrificing a piece.  In chess at the highest levels, where the players are of comparative strength, frequent sacrifices are rare.  Many, though not all, are adverse to such risk taking because they understand being down one piece, even a pawn, at the master level can usually cost the game. Tal turned convention on its head by recognizing that games didn’t have to be won by incremental precision, but from direct force. 

Many Western leaders have built a construct of the world system that does not meet up with the thinking of Putin.  Recently, at the Atlantic Council meeting hosted by Nicholas Burns,former National Security Advisor Hadley remarked that Putin was skilled at capitalizing on opportunities that present themselves. Drawing a similar observation in a recent interview on NPR,  Chess Grandmaster Rogoff commented on Putin as, “a master of the tactics. He sort of sees a few moves ahead and he’s very good at it. But what is the long-term strategy? It’s really hard to see.”

In the West, some analysts only view the situation superficially and conclude Putin is weakened due to the economic strain of the sanctions, increased responsibilities for Crimea, and the resulting comparative electoral gain for the more EU aligned groups in Ukraine. While economic market strength and political strength are elements of real power, especially in democratic systems, they are not the only factor. Living during a time of general global stability and the absence of great wars between major powers has obscured the other elements of power.  Absolute power in the form of territory and wealth remain significant.  Like Tal, Putin is sacrificing global public sentiment and the ruble to have a more favorable end game that incudes territorial expansion (with the drilling rights) and the benefit of  increased domestic support.  Putin would certainly understand the quote from Tal, “many sacrifices don’t require concrete calculation at all. It is sufficient to only glance at the arising position to convince us that the sacrifice is correct.”

The recent four party talks between the EU, US, Russia and Ukraine included support for a more regionalized system of government within Ukraine, after the election. In any scenario, whether Russia maintains forces in or out of Ukraine, with this arrangement there will be enough continuing instability in Ukraine to make it almost impossible for it to be a member of NATO.  As a result, this approach would serve Russia and Putin’s ultimate objective. This behavior is more of an outgrowth of thinking of both Russian nationalism, but also the challenges presented by authoritarian capitalist systems.  In this case the state is stronger due to the advantages and wealth gained from a capitalist system.  If this struggle escalates, and no one can be certain it will, it could form into a long challenging struggle like the Cold War with one of the elements of Russia’s own demise, communism, replaced.

How great players responded to Tal can provide some meaningful guidance to direct challenges posed by Putin.  First, do not display an emotional response through speeches and policy. Tal and Putin capitalize on this weakness effectively. Second, Tal’s moves often had the effect of breaking down a position and dividing defending forces.  Thus, he made it difficult to defend critical pieces, namely the king. Putin is effective at dividing NATO and the EU through natural gas contracts.  NATO needs to work more collaboratively, and the EU needs greater energy exploration and calibration to minimize Putin’s leverage over individual states.

Most importantly, a comprehensive short-term and long-term strategy must be put into place.  There continues to be a popular argument in US foreign policy circles that the US does not need a strategy. The point includes statements that the world is too complex to understand, or the US can’t create a comprehensive strategy and should therefore just focus on domestic goals.  The foreign policy community is doing a great disservice to society by not properly preparing for future challenges. As Tal teaches us, it is certain that the side who has an aggressive plan will always beat the one who has no plan.

Viewing Putin’s behavior through the prism of the royal game can give us new insights into his actions.  He once remarked, “chess makes man wiser and clear-sighted”.

May 02

KY Home

My favorite part of the Kentucky Derby is not the field, hats, mint juleps or even the horses it is the singing of, “My Old Kentucky Home”.  We all enjoy the event as a great tradition for the Commonwealth but singing our anthem in unison stirs up great feelings and sometimes sadness.  In the times I am fortunate to be living in Kentucky when singing I am filled with a sense of happiness and thankfulness to be near so many family and friends. But when I sing “My Old Kentucky Home” when I am away from the Commonwealth it really sets in a sense of longing for those home.  My voice has been known to crack when repeating Foster’s closing,
"We will sing on song for the old Kentucky home, for the old Kentucky home far away".
I am thankful to be home this year but know other years I may not be:   Happy Derby Day!!

Chess and Global Politics I

In an effort to find the points of intersection between chess and international relations we focus on the concept of prophylactic, which was first used by early chess great and author Nimzowitsch. The word prophylactic is frequently used in the medical context where a treatment is designed to prevent disease. Within the realm of chess, it takes on a slightly different meaning that, I believe, helps shed light in the interactions of nations.  In chess, a prophylactic move is a move that prevents an opponent from taking action in a certain area.

In concept this like inherent constraints, except where actions are actively taken to minimize options.  Examples of constraints evident in all chess games are the rules of the game, the pieces, the strengths and weaknesses of the pieces, the board, and time.  In the same way, nations have constraints, culture, domestic politics, economic conditions, political systems, leadership, and military capabilities, to name a few.  How these assets are employed in order to limit the options of the opposition is an example of a prophylactic move.  Nimzowitsch is known through his work, My System, to encourage the reader to utilize the chess pieces in a positional manner (not tactical) in order to limit the options of the rival.  This concept permeates throughout the game of chess, where individual squares are controlled and contested from the opening to the end game.

In the same way, in statecraft countries work to limit the options of their rivals in a zero-sum framework.  While many view the Marshall Plan through primarily the eyes of an aid program (and thus a model to easily duplicate), it was largely about contesting open (nonaligned) territory that Russia and the West were vying for. This struggle resulted in the formation and regular maneuvering between NATO and Warsaw Pact countries.  For each country, an alliance with one side eliminated its association with the other.  In fact, during the formulation of the Marshall Plan George Kennan advocated policies to empower individual countries to determine the priorities for their aid dollars.  This had the effect of marginalizing the influence and angst stirred up by communist movements that were common in many of the contested parts of Europe.  As a result this limited the initiative (another chess term) that many Marxists found vital to the spread of the economic system.  This focus on detail also mirrors Nimowitsch’s words that an, “isolated pawn casts gloom over the entire chessboard.”

During the Cold War, a hyperactive concern for prophylactic was employed at times in the defensive sense when considering the “domino theory”.  This concept, when applied universally like Nimzowitsch’s idea of over protection, allowed the adversary to control the terms of the engagement.  If a country is defensive and assigns high value on all territory, it allows the aggressor to set the environment and select territory most advantageous for draining a rival’s resources and morale. 

This use of prophylactic is also employed through dialogue and negotiations where rivals and even allies seek to limit the options or viewpoints of a country to maximize results.  A contemporary example was early use by the Europeans in 2009 in their interactions with a new Administration. They gave few options for how Washington could support struggling EU members other than loans.  They took this step, knowing the new President could not not support Europe after frequently referring to working with allies in a more positive light.  The Europeans narrowed the field of moves that could be utilized to their maximum benefit.

Because this system does not face the same guidelines or rules, as in chess more ambiguities can result.  Yugoslavia under Tito was not affiliated with Russia though it was socialist in its political systems.  The west capitalized on the friction (driven in part by nationalism), and while not a NATO member Tito was aligned with the West, thus denying an ideological ally to the Soviet Union. 

There are also obvious military comparisons, where occupying the tactical high ground (or in the US strategic air dominance) the options available to the opposition are limited.  Furthermore, in counter insurgency it is often said that the struggle lies more within the hearts and minds of a populace.  From a prophylactic perspective providing stability and security in the mental and physical domain is also a way of denying access to rebel forces. As Russian Chess Champion in 1914, Nimzowitsch, once remarked his method of positional play was to, “first restrain, next blockade, lastly destroy”. 

Apr 25

How Not To Alter Putin’s Calculus

Former Director of the Policy Planning staff Anne-Marie Slaughter presented a case recently for US intervention in Syria.  Slaughter has been an ongoing proponent of intervention in the situation in Syria and further believes US involvement would undermine Russian interests. In her recent piece in Project Syndicate she asserts that “A US strike against the Syrian government now would change the entire dynamic”.  The author’s points should be considered, but I believe rejected.

Slaughter advocates enforcing UN Resolution 2139 through force and asking for permission after the military operation.  How can it be reasonable to often support the institutions of the UN and then argue for not adhering to its fundamental tenants on use of force?  Also, how many cases can something be legally legitimized after the act? Regardless of the Kosovo example, this approach would seem to make the UN completely irrelevant.  Another challenge with this approach would be a certain Russian veto before or after the action took place. 

The editorial also assumes military operations would have the support of the British and French. However, that is very questionable given the vote in the British House of Commons and general French unease. In fact, it would be reasonable to consider the opposite effect of this proposal.  The operation would prove divisive within NATO, which would play to Putin’s fundamental interests and would be much more valuable to Russia than any outcome in Syria.
Many other authors have pointed to the decline in the ruble and the stock market as points of leverage over Russia. No doubt economic growth matters, but what is more significant is a population witnessing and supporting a more prominent Russia at comparatively low cost.  How can the threat of force in Syria transfer to implied action in Ukraine, where NATO leaders have been explicit in their tepid support?

Later in the piece Slaughter states, ”mystery soldiers can fight on both sides”. Is she suggesting Ukraine or NATO could employ unidentified soldiers to counter pro-Russian forces?  This provocative statement lacks clarity and strategic direction.  Would not the presence of unidentified pro-Ukrainian forces be provocative to Russia and thus undermine Ukraine’s central tenant of not agitating Putin?  The strength of these mystery forces lies within the legal and political ambiguities they take advantage of as well as the implied backing of the army divisions just across the border.  Ukraine knowingly cannot directly challenge at this level.

While the author correctly argues US action would not lead to Assad’s downfall, she is under the impression it could lead him to negotiate.  It may not.  Also the author neglects to consider how Al Nusra and other terrorist elements would likely strengthen from a weakened Syria.   

Slaughter’s dogged persistence to intervene in Syria overshadows the situation in Ukraine to lead the author to overestimate the connections between the two situations. From the Russian perspective Ukraine is of primary importance while Syria is a useful pawn to distract others.  This proposal to indirectly undermine Russia through US force in Syria would likely backfire and cause division in NATO thus having the opposite outcome to what Slaughter is suggesting.


Apr 19

Random Polling Thought

When reading polling it is often reported that “jobs and the economy” are a top issue for voters.  This is an interesting phrase and while it could be argued an appropriate grouping I have noticed an unintended feedback to the practice.  While surveying voters I have noticed how many will say that “jobs and the economy” are the most important issue to them when prompted with an open ended question.  I wonder how many voters grouped this phrase before political sciences and practitioners did so.  Before I imagine most people would have simply said “jobs” I think it is a small example of how following and reporting on polls influences polls themselves.  

The broader question I believe is worth exploring.

Apr 10

US Carrier Group PositionA few months ago with alarm I noted how according to open source data compiled by Stratfor the US had only one carrier deployed.  Currently about half of the carriers are at sea with three of the carriers in port undergoing scheduled maintenance.

US Carrier Group Position
A few months ago with alarm I noted how according to open source data compiled by Stratfor the US had only one carrier deployed.  Currently about half of the carriers are at sea with three of the carriers in port undergoing scheduled maintenance.