Are we doomed altogether? Abnegation's High Cost!

Mallaby suggests blaming de-regulation is more politics than reality. Might be successful in carrying the day but it does not square with facts. He starts the clock running in China and then follows the connection to The Fed and Greenspan's low interest rate policy. From there it begins to unwind but not because of de-regulation. (See 1 below.)

One day, when cooler heads prevail, history will show the Iraq War was justified and had we been more successful at executing the aftermath of our initial military success, support for it would have been an easier lay up. (See 2 below.)

When you are dealing with emotions and accept ignorance of history and facts, Biden comes out a winner. (See 3 below.)

The three articles I have cited below suggest what I have been saying about what happens when citizens do not know history, are unable to reason through facts and are driven by emotion.

I now quote Gandhi to make a point. He wrote about "Seven social sins as follows:

Politics without principles, Wealth without work,Pleasure without conscience, Knowledge without Character, Commerce without Morality, Science without Humanity, and Worship without Sacrifice."

~ Mohandas Karamch and Gandhi ~


We are moving in the direction of electing a man who grew up in a confused family environment and who was educated in schools and taught by professors who did not necessarily embrace Gandhi's expressed thoughts. Obama's world apparently was an angrier one. It focused on the ills of our society that needed "Change." In truth, a better campaign theme might be "A Nation That Must Return To Its "Roots." But such a theme is politically out of kilter because it demands we look inward, it evokes a message of self-responsibility. It is far easier to sell an empty inspirational one that suggests you sit back, do nothing because change is coming and will be brought to you by the "I Can Man." (See 4 below.)

A friend recently challenged me to think about my reaction had Palin been chosen by Obama. No doubt I would have reacted differently but I still would acknowledge her charm, her feisty ability to stand toe to toe and though, I might have placed more emphasis on her lack of knowledge, I would still see her as a breath of fresh air and would prefer her any day to a stale and fawning Hillary.

I find nothing particularly positive about my Republican choices but I find the Democrat choices even less redeeming. We are probably damned if we do, damned if we don't but hopefully not doomed altogether. If we are, we brought it on ourselves. We can recover but at a very high price to our national character and I fear we are too self-indulgent and divided to take the necessary steps or pay the steep price of abnegation. That said, I still am more comfortable with the culture of the Palins and McCains of our nation than the Obamas and Bidens.

The German Question and George Friedman's thoughts. Oil, cost of military re-building and the reality of a re-emerging Russia has Germany wiling to remain linked to Europe economically but they are paralyzed in terms of their foreign policy and going against Russia. They disagree with the U.S.'s position vis a vis expanding NATO - which is nothing but a fading paper tiger. (See 5 below.)

Time is more likely to heal our wounds than the "oinkment" supplied by the hogs in D.C.

Dick

1) Blaming Deregulation
By Sebastian Mallaby


The financial turmoil has pushed the Obama campaign into the lead, and this is mostly justified. Barack Obama is more thoughtful on the economy than his opponent, and his bench of advisers is superior. But there's a troubling side to the Democratic advance. The claim that the financial crisis reflects Bush-McCain deregulation is not only nonsense. It is the sort of nonsense that could matter.

The real roots of the crisis lie in a flawed response to China. Starting in the 1990s, the flood of cheap products from China kept global inflation low, allowing central banks to operate relatively loose monetary policies. But the flip side of China's export surplus was that China had a capital surplus, too. Chinese savings sloshed into asset markets 'round the world, driving up the price of everything from Florida condos to Latin American stocks.

That gave central bankers a choice: Should they carry on targeting regular consumer inflation, which Chinese exports had pushed down, or should they restrain asset inflation, which Chinese savings had pushed upward? Alan Greenspan's Fed chose to stand aside as asset prices rose; it preferred to deal with bubbles after they popped by cutting interest rates rather than by preventing those bubbles from inflating. After the dot-com bubble, this clean-up-later policy worked fine. With the real estate bubble, it has proved disastrous.

So the first cause of the crisis lies with the Fed, not with deregulation. If too much money was lent and borrowed, it was because Chinese savings made capital cheap and the Fed was not aggressive enough in hiking interest rates to counteract that. Moreover, the Fed's track record of cutting interest rates to clear up previous bubbles had created a seductive one-way bet. Financial engineers built huge mountains of debt partly because they expected to profit in good times -- and then be rescued by the Fed when they got into trouble.

Of course, the financiers did create those piles of debt, and they certainly deserve some blame for today's crisis. But was the financiers' miscalculation caused by deregulation? Not really.

The key financiers in this game were not the mortgage lenders, the ratings agencies or the investment banks that created those now infamous mortgage securities. In different ways, these players were all peddling financial snake oil, but as Columbia University's Charles Calomiris observes, there will always be snake-oil salesmen. Rather, the key financiers were the ones who bought the toxic mortgage products. If they hadn't been willing to buy snake oil, nobody would have been peddling it.

Who were the purchasers? They were by no means unregulated. U.S. investment banks, regulated by the Securities and Exchange Commission, bought piles of toxic waste. U.S. commercial banks, regulated by several agencies, including the Fed, also devoured large quantities. European banks, which faced a different and supposedly more up-to-date supervisory scheme, turn out to have been just as rash. By contrast, lightly regulated hedge funds resisted buying toxic waste for the most part -- though they are now vulnerable to the broader credit crunch because they operate with borrowed money.

If that doesn't convince you that deregulation is the wrong scapegoat, consider this: The appetite for toxic mortgages was fueled by Fannie Mae and Freddie Mac, the super-regulated housing finance companies. Calomiris calculates that Fannie and Freddie bought more than a third of the $3 trillion in junk mortgages created during the bubble and that they did so because heavy government oversight obliged them to push money toward marginal home purchasers. There's a vigorous argument about whether Calomiris's number is too high. But everyone concedes that Fannie and Freddie poured fuel on the fire to the tune of hundreds of billions of dollars.

So blaming deregulation for the financial mess is misguided. But it is dangerous, too, because one of the big challenges for the next president will be to defend markets against the inevitable backlash that follows this crisis. Even before finance went haywire, the Doha trade negotiations had collapsed; wage stagnation for middle-class Americans had raised legitimate questions about whom the market system served; and the food-price spike had driven many emerging economies to give up on global agricultural markets as a source of food security. Coming on top of all these challenges, the financial turmoil is bound to intensify skepticism about markets. Framing the mess as the product of deregulation will make the backlash nastier.

The next president will have to make some subtle choices. In certain areas, markets need to be reformed -- by pushing murky "over-the-counter" trades between banks onto transparent exchanges, for example. In other areas, government needs to fix itself -- by not subsidizing reckless mortgage lending. But a president who has a mandate only to re-regulate will be a boxer with a missing glove. By going along with the market skepticism of his party, Obama may end up winning an election while compromising his presidency.

2) No, Iraq Wasn't a 'Distraction': What if FDR had stuck to fighting the Japanese in the Pacific?
By DAVID B. RIVKIN JR. and LEE A. CASEy

Whatever the much anticipated vice presidential debate may have told us about Gov. Sarah Palin and Sen. Joe Biden, it revealed clear differences in the foreign policy philosophies of the two tickets.

As Mrs. Palin pointed out, when it comes to foreign policy, the Obama-Biden team is backward looking. It continues to view international issues through the prism of opposition to George W. Bush. Nowhere is this more apparent than in Obama-Biden's continuing assertions that the Iraq war was a mistake, from beginning to the end, and that, at best, it constituted an irrelevant distraction from the combat that really matters -- in Afghanistan.

Osama bin Laden himself called Iraq the "central front" in his fight against the United States. Thousands of jihadists operated in Iraq where, with the help of Sen. John McCain's and Gen. David Petraeus's surge strategy, al Qaeda was resoundingly defeated. Its standing in the Muslim world has plummeted.

As in many other conflicts in American history, our enemies in this war operate in many geographically distinct theaters. The essence of being a good commander in chief is appreciating the connections among these theaters -- including the adversary's willingness to open new fronts -- rather than obsessing about where the last enemy attack originated.

This is exactly what President Franklin Roosevelt did in World War II when he chose to dedicate initially the bulk of American resources to the European theater, believing that destroying Hitler's Reich was the most urgent task and that Imperial Japan could be dealt with in turn; history proved him right. Yet, under the Obama-Biden playbook, FDR blundered by getting distracted from the "real" war -- in the Pacific, where America had been attacked.

Another problem with the Obama-Biden foreign policy is its obsession with high stakes presidential-level diplomacy focused on the world's rogue states. Of course, high level diplomacy is a key tool of statecraft, but it risks devaluing the president's own capital on the international stage.

Having a president try and fail fundamentally damages the nation's own credibility. The textbook example of this phenomenon remains Soviet Premier Nikita Khrushchev's taking the measure of a young and inexperienced John F. Kennedy in the 1961 Vienna Summit meeting. Khrushchev found Kennedy to be ill-informed and weak, and consequently embarked on an aggressive policy in Berlin and Cuba. Although Kennedy ultimately proved that he was made of sterner stuff, the world was nevertheless brought to the very brink of a nuclear war during the Cuban Missile Crisis.

The next president will likely be similarly tested by Russia and by Iran. Iranian leaders are stubbornly pursuing a policy of acquiring nuclear weapons, despite years of dialogue with Western interlocutors. The chances that they would take any more seriously diplomatic advances from a new and untried President Barack Obama are remote. Most likely, they would interpret it as a sign of weakness, causing them to accelerate their nuclear program.

The best way to create a strong negotiating position vis-à-vis Tehran, would be to alter the strategic environment in its backyard, such that the Iraqi government has stabilized that country and maintains strong military and intelligence ties with the United States, while dramatically curtailing Iranian influence. This, of course, is precisely what Mr. McCain's Iraq strategy is in the process of accomplishing, and what Mr. Obama's Iraq policy can never achieve. It would be the McCain-Palin team that is best positioned to engage in fruitful diplomatic dialogue with the Iranians.

3) Biden's Fantasy World

Sarah Palin may not know as much about the world, but at least most of what she knows is true.

In the popular media wisdom, Sarah Palin is the neophyte who knows nothing about foreign policy while Joe Biden is the savvy diplomatic pro. Then what are we to make of Mr. Biden's fantastic debate voyage last week when he made factual claims that would have got Mrs. Palin mocked from New York to Los Angeles?

Start with Lebanon, where Mr. Biden asserted that "When we kicked -- along with France, we kicked Hezbollah out of Lebanon, I said and Barack said, 'Move NATO forces in there. Fill the vacuum, because if you don't know -- if you don't, Hezbollah will control it.' Now what's happened? Hezbollah is a legitimate part of the government in the country immediately to the north of Israel."

The U.S. never kicked Hezbollah out of Lebanon, and no one else has either. Perhaps Mr. Biden meant to say Syria, except that the U.S. also didn't do that. The Lebanese ousted Syria's military in 2005. As for NATO, Messrs. Biden and Obama may have proposed sending alliance troops in, but if they did that was also a fantasy. The U.S. has had all it can handle trying to convince NATO countries to deploy to Afghanistan.

Speaking of which, Mr. Biden also averred that "Our commanding general in Afghanistan said the surge principle in Iraq will not work in Afghanistan." In trying to correct him, Mrs. Palin mispronounced the general's name -- saying "General McClellan" instead of General David McKiernan. But Mr. Biden's claim was the bigger error, because General McKiernan said that while "Afghanistan is not Iraq," he also said a "sustained commitment" to counterinsurgency would be required. That is consistent with Mr. McCain's point that the "surge principles" of Iraq could work in Afghanistan.

Then there's the Senator's astonishing claim that Mr. Obama "did not say he'd sit down with Ahmadinejad" without preconditions. Yet Mr. Biden himself criticized Mr. Obama on this point in 2007 at the National Press Club: "Would I make a blanket commitment to meet unconditionally with the leaders of each of those countries within the first year I was elected President? Absolutely, positively no."

Or how about his rewriting of Bosnia history to assert that John McCain didn't support President Clinton in the 1990s. "My recommendations on Bosnia, I admit I was the first one to recommend it. They saved tens of thousands of lives. And initially John McCain opposed it along with a lot of other people. But the end result was it worked." Mr. Biden's immodesty aside, Mr. McCain supported Mr. Clinton on Bosnia, as did Bob Dole even as he was running against him for President in 1996 -- in contrast to the way Mr. Biden and Democratic leaders have tried to undermine President Bush on Iraq.

Closer to home, the Delaware blarney stone also invited Americans to join him at "Katie's restaurant" in Wilmington to witness middle-class struggles. Just one problem: Katie's closed in the 1980s. The mistake is more than a memory lapse because it exposes how phony is Mr. Biden's attempt to pose for this campaign as Lunchbucket Joe.

We think the word "lie" is overused in politics today, having become a favorite of the blogosphere and at the New York Times. So we won't say Mr. Biden was deliberately making events up when he made these and other false statements. Perhaps he merely misspoke. In any case, Mrs. Palin may not know as much about the world as Mr. Biden does, but at least most of what she knows is true.

4) Me and Obama, and to hell with America
By BD Pisani

In the course of recent times, a malignancy has slowly but inexorably infused itself within the tissue of our national persona, a me-first mindset that runs contrary to our centuries-old heritage of America First, American self-reliance, and liberty above all else.

Some blame this on the dilution of our distinctly unique constitutional Republic by the influx of tens of millions of illegal immigrants who can't or won't assimilate into our society, much less embrace our common and uniting English language. Others condemn the decades-long socialization of our government schools, where American youth are no longer taught those critical civics lessons that define the original, venerable principles of our Founding, our unrevised history, our national identity, and the machinations of constitutional governance.

But perhaps it's something simpler, something generational. For more than forty years, ever-increasing numbers of Americans have insisted upon governmental nannying in any capacity, demanded societal artificiality, or expected nurturing via social entitlements. Complacency, greed, and indifference become the rule when challenges are removed.

Absurdities become reality

We now have a presidential candidate who, along with his wife, matured under the teachings of very angry, very militant, very anti-American mentors -- and they are raising their children in the same fashion. The MessiahThis in itself is extremely troubling because each of you reading this understands just how influential your teachers were in helping to form the adult you are today -- and yet Obama is currently leading in the polls.

We now have a Democrat Party that has managed an effective propaganda campaign bursting with nebulous slogans, false promises, outright lies, and subliminal messages, creating a Messiah-like figure in a man who falls short in every measure -- and yet Obama is currently leading in the polls.

We now have a media class that has finally come clean with America -- baring its outright support of and devotion to the Democrat Party. Hollywood and Mainstream Media have ignored or glossed over Obama's undocumented childhood, nefarious past, troubling associates, lifelong role models, campaign lies, and complete lack of experience while at the same time savaged and ruthlessly demeaned his opponents and their families. Most Americans now realize the truth of this -- and yet Obama is currently leading in the polls.

This propaganda coup is reminiscent of the Vietnam era, when so-called peace radicals successfully supported Communism in Southeast Asia -- by saying anything, doing anything, and at any cost. They ultimately helped butcher more than three million people in Laos, Cambodia, and South Vietnam after the United States departed. Long after permanently dividing America and assuring the destruction of South Vietnam, they complacently and indifferently ignored the human slaughter that was of their creation.

The architects of that bloodshed are in power today -- in Congress, in the courts, teaching our children at universities and government schools, manipulating our daily news, and even promoting bias throughout the entertainment industry.

Self-centered socialism

One wonders in baffled amazement how an empty suit like Obama can be leading in the polls. One wonders, that is, until one looks at the mindset of what appears to be a majority of Americans today.

For two generations, many Americans have been busy proving themselves to be soft and spoiled, weak and whiny, but most of all self-centered and greedy. They demand that everything be given them without cost, without sacrifice — and they want it right now. They forcefully intrude in the lives and social circumstances of others without caring enough to indulge in the same when it comes to raising their own children.
They see nothing wrong with stealing from the wealthy in the form of oppressive taxation in order to placate the unworthy and those who do not care enough about themselves to care for themselves. They think this even though:

* 36 percent of adult Americans pay no income tax whatsoever;
* The 64 percent who do pay taxes are stuck supporting the freeloaders; and
* 86 percent of all income taxes are paid by the top 25 percent of income earners.

Obviously, the 36 percent of non-contributing Americans in Obama's fairy tale of 95 percent will be given even more unearned and undeserved income stolen from the pockets of America's hard-working producers -- not tax cuts -- because they don't pay taxes at all.

Give me change at the expense of others

This apparent new American majority that supports Obama gives only the briefest, merest nod to the ideas and ideals of freedom, individualism, and independent thought. They could care less about the Constitution and the loss of individual liberty, as long as they have their mortgages paid for by somebody else.
They demand that the loathesome consequences of their irresponsible behavior be borne by others.

Obama supporters condone special-interest groups or government bureaucrats choosing our holidays and how we must act, where we work and how we must act, what and where we eat, what and where we smoke, what and where we drink, what we are allowed to wear, what we say and where we say it, and when, how, and where we worship.
Obama supporters applaud and support agenda-driven elected officials and ideologically-driven "progressive" groups as they mandate what is taught or not taught to our children in government schools and universities, what we earn for our labor, which doctors our managed health plans allow us to see, how much we must pay for our regulated medical care, and how much we are allowed for our retirement income.

Obama supporters think nothing of inhumanely killing millions of innocent babies each year but express outrage at the inhumanity of executing a convicted murderer.
The manipulation of an American election

Obama was educated to understand that this new majority can be manipulated because it is too petulant, too lazy, too hedonistic, and too pampered. He knows they no longer possess the will, the pride, or the courage to take care of themselves, let alone their children. He knows that his supporters will gladly embrace a bureaucratic nanny state to mother them and in return be given shiny but worthless trinkets with which to play. All at the expense of the the remaining Americans who actually make the country work.

Obama understands that this new majority can be manipulated by buzz words and 20-second sound bites, repeated incessantly by an obliging media. His supporters have already enabled or are in the process of enabling the generations that follow to mock authority, ridicule American values, debase our common heritage, and abuse what little freedoms remain.

And the most maddening aspect of Obama's egregiously brilliant strategy? It's working. It's working because his propaganda is attractive to those who want everything at the expense of others, regardless to the harm it causes the nation.
It's hard to believe that someone as shallow and diminutive as Obama who, in other times and with an ethical media, could not survive a one-week primary battle may utter the presidential oath of office in 2009.
Don't Tread On Me

5) The German Question
By George Friedman

German Chancellor Angela Merkel went to St. Petersburg last week for meetings with Russian President Dmitri Medvedev. The central question on the table was Germany’s position on NATO expansion, particularly with regard to Ukraine and Georgia. Merkel made it clear at a joint press conference that Germany would oppose NATO membership for both of these countries, and that it would even oppose placing the countries on the path to membership. Since NATO operates on the basis of consensus, any member nation can effectively block any candidate from NATO membership.

The fact that Merkel and Germany have chosen this path is of great significance. Merkel acted in full knowledge of the U.S. view on the matter and is prepared to resist any American pressure that might follow. It should be remembered that Merkel might be the most pro-American politician in Germany, and perhaps its most pro-American chancellor in years. Moreover, as an East German, she has a deep unease about the Russians. Reality, however, overrode her personal inclinations. More than other countries, Germany does not want to alienate the United States. But it is in a position to face American pressure should any come.

Energy Dependence and Defense Spending

In one sense, Merkel’s reasons for her stance are simple. Germany is heavily dependent on Russian natural gas. If the supply were cut off, Germany’s situation would be desperate — or at least close enough that the distinction would be academic. Russia might decide it could not afford to cut off natural gas exports, but Merkel is dealing with a fundamental German interest, and risking that for Ukrainian or Georgian membership in NATO is not something she is prepared to do.

She can’t bank on Russian caution in a matter such as this, particularly when the Russians seem to be in an incautious mood. Germany is, of course, looking to alternative sources of energy for the future, and in five years its dependence on Russia might not be nearly as significant. But five years is a long time to hold your breath, and Germany can’t do it.

The German move is not just about natural gas, however. Germany views the U.S. obsession with NATO expansion as simply not in Germany’s interests.

First, expanding NATO guarantees to Ukraine and Georgia is meaningless. NATO and the United States don’t have the military means to protect Ukraine or Georgia, and incorporating them into the alliance would not increase European security. From a military standpoint, NATO membership for the two former Soviet republics is an empty gesture, while from a political standpoint, Berlin sees it as designed to irritate the Russians for no clear purpose.

Next, were NATO prepared to protect Ukraine and Georgia, all NATO countries including Germany would be forced to increase defense expenditures substantially. This is not something that Germany and the rest of NATO want to do.

Finally, and perhaps most importantly, Germany spent 1945-1992 being the potential prime battleground of the Cold War. It spent 1992-2008 not being the potential prime battleground. Germany prefers the latter, and it does not intend to be drawn into a new Cold War under any circumstances. This has profound implications for the future of both NATO and U.S.-German relations.

Germany is thus in the midst of a strategic crisis in which it must make some fundamental decisions. To understand the decisions Germany has to make, we need to understand the country’s geopolitical problem and the decisions it has made in the past.

The German Geopolitical Problem

Until 1871, Germany was fragmented into dozens of small states — kingdoms, duchies, principalities, etc. — comprising the remnants of the Holy Roman Empire. The German-speaking world was torn apart by internal tensions and the constant manipulation of foreign powers.

The southeastern part of the German-speaking world, Austria, was the center of the multinational Hapsburg Empire. It was Roman Catholic and was continually intruding into the predominantly Catholic regions of the rest of Germany, particularly Bavaria. The French were constantly poaching in the Rhineland and manipulating the balance of power among the German states. Russia was always looming to the east, where it bordered the major Protestant German power, Prussia. (Poland at the time was divided among Prussia, Russia and Austria-Hungary.) Germany was perpetually the victim of great powers, a condition which Prussia spent the roughly half-century between Waterloo and German unification trying to correct.

To unify Germany, Prussia had to do more than dominate the Germans. It had to fight two wars. The first was in 1866 with the Hapsburg Empire, which Prussia defeated in seven weeks, ending Hapsburg influence in Germany and ultimately reducing Austria-Hungary to Germany’s junior partner. The second war was in 1870-1871, when Prussia led a German coalition that defeated France. That defeat ended French influence in the Rhineland and gave Prussia the space in which to create a modern, unified Germany. Russia, which was pleased to see both Austria-Hungary and France defeated and viewed a united Germany as a buffer against another French invasion, did not try to block unification.

German unification changed the dynamic of Europe. First, it created a large nation in the heart of Europe between France and Russia. United, Germany was economically dynamic, and its growth outstripped that of France and the United Kingdom. Moreover, it became a naval power, developing a substantial force that at some point could challenge British naval hegemony. It became a major exporting power, taking markets from Britain and France. And in looking around for room to maneuver, Germany began looking east toward Russia. In short, Germany was more than a nation — it was a geopolitical problem.

Germany’s strategic problem was that if the French and Russians attacked Germany simultaneously, with Britain blockading its ports, Germany would lose and revert to its pre-1871 chaos. Given French, Russian and British interest in shattering Germany, Germany had to assume that such an attack would come. Therefore, since the Germans could not fight on two fronts simultaneously, they needed to fight a war pre-emptively, attacking France or Russia first, defeating it and then turning their full strength on the other — all before Britain’s naval blockade could begin to hurt. Germany’s only defense was a two-stage offense that was as complex as a ballet, and would be catastrophic if it failed.

In World War I, executing the Schlieffen Plan, the Germans attacked France first while trying to simply block the Russians. The plan was to first occupy the channel coast and Paris before the United Kingdom could get into the game and before Russia could fully mobilize, and then to knock out Russia. The plan failed in 1914 at the First Battle of the Marnes, and rather than lightning victory, Germany got bogged down in a multifront war costing millions of lives and lasting years. Even so, Germany almost won the war of attrition, causing the United States to intervene and deprive Berlin of victory.

In World War II, the Germans had learned their lesson, so instead of trying to pin down Russia, they entered into a treaty with the Soviets. This secured Germany’s rear by dividing Poland with the Soviet Union. The Soviets agreed to the treaty, expecting Adolf Hitler’s forces to attack France and bog down as Germany had in World War I. The Soviets would then roll West after the bloodletting had drained the rest of Europe. The Germans stunned the Russians by defeating France in six weeks and then turning on the Russians. The Russian front turned into an endless bloodletting, and once again the Americans helped deliver the final blow.

The consequence of the war was the division of Germany into three parts — an independent Austria, a Western-occupied West Germany and a Soviet-occupied East Germany. West Germany again faced the Russian problem. Its eastern part was occupied, and West Germany could not possibly defend itself on its own. It found itself integrated into an American-dominated alliance system, NATO, which was designed to block the Soviets. West and East Germany would serve as the primary battleground of any Soviet attack, with Soviet armor facing U.S. armor, airpower and tactical nuclear weapons. For the Germans, the Cold War was probably more dangerous than either of the previous wars. Whatever the war’s outcome, Germany stood a pretty good chance of being annihilated if it took place.

On the upside, the Cold War did settle Franco-German tensions, which were half of Germany’s strategic problem. Indeed, one of the by-products of the Cold War was the emergence of the European Community, which ultimately became the European Union. This saw German economic union and integration with France, which along with NATO’s military integration guaranteed economic growth and the end of any military threat to Germany from the west. For the first time in centuries, the Rhine was not at risk. Germany’s south was secure, and once the Soviet Union collapsed, there was no threat from the east, either.

United and Secure at Last?

For the first time in centuries, Germany was both united and militarily secure. But underneath it all, the Germans retained their primordial fear of being caught between France and Russia. Berlin understood that this was far from a mature reality; it was no more than a theoretical problem at the moment. But the Germans also understand how quickly things can change. On one level, the problem was nothing more than the economic emphasis of the European Union compared to the geopolitical focus of Russia. But on a deeper level, Germany was, as always, caught between the potentially competing demands of Russia and the West. Even if the problem were small now, there were no guarantees that it wouldn’t grow.

This was the context in which Germany viewed the Russo-Georgian war in August. Berlin saw not only the United States moving toward a hostile relationship with Russia, but also the United Kingdom and France going down the same path.

French President Nicolas Sarkozy, who happened to hold the rotating EU presidency at the time, went to Moscow to negotiate a cease-fire on behalf of the European Union. When the Russians seemed unwilling to comply with the terms negotiated, France became highly critical of Russia and inclined to back some sort of sanctions at the EU summit on Georgia. With the United Kingdom being even more adamant, Germany saw a worst-case scenario looming on the distant horizon: It understood that the pleasant security of the post-Cold War world was at an end, and that it had to craft a new national strategy.

From Germany’s point of view, the re-emergence of Russian influence in the former Soviet Union might be something that could have been blocked in the 1990s, but by 2008, it had become inevitable. The Germans saw that economic relations in the former Soviet Union — and not only energy issues — created a complementary relationship between Russia and its former empire. Between natural affinities and Russian power, a Russian sphere of influence, if not a formal structure, was inevitable. It was an emerging reality that could not be reversed.

France has Poland and Germany between itself and Russia. Britain has that plus the English Channel, and the United States has all that plus the Atlantic Ocean. The farther away from Russia one is, the more comfortable one can be challenging Moscow. But Germany has only Poland as a buffer. For any nation serious about resisting Russian power, the first question is how to assure the security of the Baltic countries, a long-vulnerable salient running north from Poland. The answer would be to station NATO forces in the Baltics and in Poland, and Berlin understood that Germany would be both the logistical base for these forces as well as the likely source of troops. But Germany’s appetite for sending troops to Poland and the Baltics has been satiated. This was not a course Germany wanted to take.
Pondering German History

We suspect that Merkel knew something else; namely, that all the comfortable assumptions about what was possible and impossible — that the Russians wouldn’t dare attack the Baltics — are dubious in the extreme. Nothing in German history would convince any reasonable German that military action to achieve national ends is unthinkable. Nor are the Germans prepared to dismiss the re-emergence of Russian military power. The Germans had been economically and militarily shattered in 1932. By 1938, they were the major power in Europe. As long as their officer corps and technological knowledge base were intact, regeneration could move swiftly.

The Soviet Union collapsed in 1991 and its military power crumbled. But as was the case in Weimar Germany, the Russian officer corps remained relatively intact and the KGB, the heart of the Soviet state, remained intact if renamed. So did the technological base that made the Soviets a global power. As with Germany after both world wars, Russia was in chaos, but its fragments remained, awaiting reconstruction. The Germans were not about to dismiss Russia’s ability to regenerate — they know their own history too well to do that.

If Germany were to join those who call for NATO expansion, the first step toward a confrontation with Russia would have been taken. The second step would be guaranteeing the security of the Baltics and Poland. America would make the speeches, and Germans would man the line. After spending most of the last century fighting or preparing to fight the Russians, the Germans looked around at the condition of their allies and opted out.

The Germans see their economic commitment as being to the European Union. That binds them to the French, and this is not a bond they can or want to break. But the European Union carries no political or military force in relation to the Russians. Beyond economics, it is a debating society. NATO, as an institution built to resist the Russians, is in an advanced state of decay. To resurrect it, the Germans would have to pay a steep economic price. And if they paid that price, they would be carrying much of the strategic risk.

So while Germany remains committed to its economic relationship with the West, it does not intend to enter into a military commitment against the Russians at this time. If the Americans want to send troops to protect the Baltics and Poland, they are welcome to do so. Germany has no objection — nor do they object to a French or British presence there. Indeed, once such forces were committed, Germany might reconsider its position. But since military deployments in significant numbers are unlikely anytime soon, the Germans view grand U.S. statements about expanded NATO membership as mere bravado by a Washington that is prepared to risk little.
NATO After the German Shift

Therefore, Merkel went to St. Petersburg and told the Russians that Germany does not favor NATO expansion. More than that, the Germans at least implicitly told the Russians that they have a free hand in the former Soviet Union as far as Germany is concerned — an assertion that cost Berlin nothing, since the Russians do enjoy a free hand there. But even more critically, Merkel signaled to the Russians and the West that Germany does not intend to be trapped between Western ambitions and Russian power this time. It does not want to recreate the situation of the two world wars or the Cold War, so Berlin will stay close to France economically and also will accommodate the Russians.

The Germans will thus block NATO’s ambitions, something that represents a dramatic shift in the Western alliance. This shift in fact has been unfolding for quite a while, but it took the Russo-Georgian war to reveal the change.

NATO has no real military power to project to the east, and none can be created without a major German effort, which is not forthcoming. The German shift leaves the Baltic countries exposed and extremely worried, as they should be. It also leaves the Poles in their traditional position of counting on countries far away to guarantee their national security. In 1939, Warsaw counted on the British and French; today, Warsaw depends on the United States. As in 1939, these guarantees are tenuous, but they are all the Poles have.

The United States has the option of placing a nuclear umbrella over the Baltics and Eastern Europe, which would guarantee a nuclear strike on Russia in the event of an attack in either place. While this was the guarantee made to Western Europe in the Cold War, it is unlikely that the United States is prepared for global thermonuclear war over Estonia’s fate. Such a U.S. guarantee to the Baltics and Eastern Europe simply would not represent a credible threat.

The other U.S. option is a major insertion of American forces either by sea through Danish waters or via French and German ports and railways, assuming France or Germany would permit their facilities to be used for such a deployment. But this option is academic at the moment. The United States could not deploy more than symbolic forces even if it wanted to. For the moment, NATO is therefore an entity that issues proclamations, not a functioning military alliance, in spite of (or perhaps because of) deployments in Afghanistan.

Everything in German history has led to this moment. The country is united and wants to be secure. It will not play the role it was forced into during the Cold War, nor will it play geopolitical poker as it did in the first and second world wars. And that means NATO is permanently and profoundly broken. The German question now turns into the Russian question: If Germany is out of the game, what is to be done about Russia?