#57 REPLY to Article #50 Is Afghanistan the Right War?

As the Iraq War’s broad unpopularity causes a number of governments—including at least one branch in the United States—to consider the political consequences of continued participation, it's important to keep some perspective about the relative importance of the conflicts in which the West is now engaged. While a principled case must be made for continued American involvement in Iraq, it need not be done at the expense of the vital mission being carried out by NATO forces in Afghanistan.

In his March 14 piece for the Weekend Economist (#50 Is Afghanistan the Right War?), Westbrook Sullivan argues that the focus of the international community on the war in Afghanistan is disproportionate to that nascent democracy's impact on world affairs. Sullivan tells us that Afghanistan is “impoverished and isolated,” largely irrelevant to America's strategic interests, essentially no more than an inconvenient central Asian backwater. A failed state at the heart of Central Asia, Sullivan contends, “would be an annoyance to America and its allies, [but] would have little more effect than that on the international community.” This assessment could scarcely be more flawed.

There is little doubt that Iraq is the most significant conflict zone in which the U.S. is presently involved, if only as a consequence of the sheer numbers of American troops involved. A successful—or at least not-disastrous—resolution to the sectarian strife and anti-coalition insurgency there is absolutely vital to the maintenance of American security. While arguments abound about the legitimacy or necessity of the initial intervention in Iraq, the fact remains that the total collapse of the American-led enterprise there would have disastrous consequences for regional and global security.

Just the same, those reservations have helped to ensure that the war in Iraq is an American operation. One would be remiss not to mention the contribution of both combat forces and service-support troops from a number of coalition forces, but the fact remains that the invasion and occupation of Iraq would not have taken place without the specifically American rationale presented by the Bush Administration. The time to make he case for multilateral involvement and burden-sharing in Iraq was four years ago, not the spring of 2007. Most governments have long since reached the decision that further contributions to Multi-National Forces Iraq (MNFI) will needlessly erode their popularity without many of the attendant benefits associated with participation in the initial war effort. Americans should not be surprised that the Blair government would draw similar conclusions.

Sullivan dismisses this sort of calculation as nothing more than a form of political self-preservation, dismissing the redeployment of assets from Iraq to Afghanistan is merely a “relatively safe alternative” for politicians “not wanting to look weak on security issues.” How can we criticize the political leadership of another state when a politically expedient course of action also happens to help secure that nation's vital interests? Iraq is a sinking ship, and the UK is one of the last on the lifeboats. Few should be shocked that the Blair government is unwilling to go to the bottom of the sea.

Leaving aside the politically-charged question of whether or not preemptive war in Iraq was justified, one must concede that a great deal of international goodwill and moral force was squandered through the unnecessary and inaccurate conflation of the war in Iraq with the so-called Global War on Terror (GWOT). Few nations opposed the bombardment and subsequent occupation of Afghanistan, as such action was viewed as a necessary and natural response to the atrocities visited upon the U.S. on September 11, 2001. Operation Iraqi Freedom (OIF) was considerably less well-received. Even those allies who were convinced to make contributions to the war effort had little reason to suspect that they’d be involved in a multi-year occupation. So why now should those faithful members of the coalition be slandered for re-assessing their priorities? Have the preceding four years not convinced Mr. Sullivan that the U.S. should accept and encourage what contributions other nations choose to make to missions deemed important to American interests?

British patience for the mission in Iraq has waned, but the UK’s contributions in Afghanistan can still be vital. The International Security and Assistance Force (ISAF) in that country, composed of troops from 37 nations, not only makes an important contribution to mission accomplishment but also to the prospects of future security burden-sharing. As NATO allies and other states are compelled to develop broader capacity in support of ISAF’s mission, U.S. policymakers can be more confident in the capabilities of partner states when called upon in future conflicts. With a territorial defense mission seemingly obsolescent in the 21st century, NATO’s future utility to its member states will be defined by the ability of multinational, mission-focused task forces to conduct out-of-area operations. Further expansion of the alliance (and the attendant effect on U.S.-Russia relations) is an open question at present. As such, the future of NATO is in the balance; if ISAF fails in Afghanistan, so too does the institution that has formed the bedrock of European security and transatlantic cooperation for the last six decades.

All this considered, the critical question addressed by Sullivan is whether or not a stable and well-governed Afghanistan is vital to international security. We shouldn’t be surprised to find that those who answer the question in the negative do so in the face of a staggeringly broad consensus to the contrary. Documentary filmmaker Sam Kiley, who recently spent time with NATO forces in Afghanistan, puts their mission in stark terms: “NATO and the Afghan government want to win this war to prevent Afghanistan returning to Taliban rule and becoming a base once again used by international terrorists.” There seems very little doubt that ISAF’s failure would result in exactly such a scenario.

American—and global—security is increasingly wedded to the maintenance of state control over territory; the future must be one of less failed states, not more. Sullivan’s dismissive reference to Afghanistan as “almost entirely impoverished and rural” is puzzling; do these two factors somehow render instability in the country less threatening? The geopolitical significance of Afghanistan is very real. Porous borders with Pakistan and the former Soviet republics of Central Asia destabilize important allies in the region, as well as making the task of tracking terrorists’ movement exponentially more difficult. Kidnapping raids launched into Iran by Baloch separatists (like Jundullah, which American intelligence community sources have recently alleged is financially and materially supported by the U.S. government) complicate the already-delicate relationship between Washington and Tehran. Ungoverned territory in Afghanistan provides further opportunity for these groups to take dangerous and destabilizing actions against Iranian targets, increasing tensions and the likelihood of a destructive and unintended war.

Abandoning Afghanistan to the Taliban and al-Qaeda, however attractive it may seem in light of the attention and effort commanded by the steady dissolution of the nascent free Iraq, would be a perfect public diplomacy storm of military failure, sacrificed international goodwill, and eroded American credibility. It seems absurd to suggest that the most appropriate way to secure the most robust future contribution of allied support for American interests is to abandon the war widely viewed as just and necessary in favor of the one most reject as an illegitimate flight of neoconservative fancy. The loss of moral force associated with such an abdication of a just and necessary mission is one from which the United States would not soon recover.

- This article was written in response to Westbrook Sullivan's #50 Is Afghanistan the Right War?. It was first published on CJMEWETT and provided to the Weekend Economist by the author, Christopher Mewett.

#56 Peer to Peer Finance: Threat or Opportunity?

Micro finance - associated with financial empowerment in developing countries - is making a commercial comeback in the developed world. This time in the form of peer to beer banking, albeit without banks as intermediaries. Peer to peer banking uses the Internet as a virtual marketplace where lenders meet borrowers. Taking out the bank as the middle man creates both a more personal and a more competitive business model.

Taking out large, powerful and influential institutions such as a banks may seem an unconventional move at first. There is a valuable logic behind the idea, however. Proof of its success lies in the growing popularity of peer to peer financing enterprises such as Prosper.com, the British Zopa and the Dutch Boober. With relative success, they have proven that their "bankless" model has merits capable of attracting a growing community of borrowers and would-be debt speculators.

Peer to Peer financing groups attain their strength by working together with credit rating and credit collection agencies, much in the same way that traditional banks do. Would-be borrowers are registered and receive a credit score, based upon which they get a rating. This is similar to the world of corporate and institutional borrowing and lending, where the credit scores of firms and institutions are rated by agencies such as Moodies and Standard & Poor. This rating, in the same way as in the corporate world rating, gives insight to the level of risk that a loan bears.

It is important to note that, even though peer to peer financing at first glance appears rather informal, the lending contracts are in fact legally binding contracts. This means that borrowers pay by direct debit and, when borrowers miss payments, the same recovery/collection process that banks rely on are used to recover the face value of the loan.

From the perspective of a lender, the most attractive and interesting aspect of peer to peer financing is that it allows lenders to take small positions in a large number of different loans. This allows lenders to diversify risk by spreading a lending position among a large group of borrowers, while at the same time earning competitive returns.

There is a dark side to peer to peer financing, however. For the most part peer to peer financing is a by product of the consumer debt era in which we live. Credit card debt is one of the largest contributors to the disease that American consumer debt has become. Nearly 2.5 million Americans are currently in debt counseling, creating a large demand for consumer credit. Much of this demand is fueled by out of control credit card debt. Americans often own multiple credit cards and in many cases use one credit card to pay off another, creating a downward spiral of debt.

Credit card companies take advantage of the situation and earn considerable returns on high interest rate credit card debt. It is no surprise therefore that most loan or consolidation requests are instrumental in paying off expensive and out of control credit card debt. The sheer amount of refinancing actually underscores the true scope of of the cancer that has become credit card debt in America.

When investigating some of the Peer to Peer financing companies, one also sees that the level of riskiness is by no means uniform either. When correcting for U.S. and European interests rates, the American Prosper.com has much higher interest rates than the Dutch Boober.nl, suggesting that Peer to Peer financing does come with considerable risk, comparatively speaking.

For EU or other non U.S. citizens this means that the personal debt market is out of bounds, both in terms of the supply and demand of credit. This is a pity, as it is quite lucrative for European suppliers of credit to invest in American investment grade loans. For similar levels of risk, Europeans earn much lower returns.

In any case Peer to Peer finance is still very much in its infancy. The American Prosper.com, one of the largest Peer to Peer finance groups, claims to have more than 240.000 members and 49 million in loans. This would result in about 204 dollars worth of loans per member. Based on the 240.000 member base, that still amounts to a relatively low amount of loans spread among members. Nonetheless, the promise off Peer to Peer finance is one to be followed with close attention. Traditional banks would be wise to analyze what the development of Peer to Peer finance products means for their business models: is it a threat or an opportunity.

#55 The Weekend Economist Dot Com

Dear Readers,

We would like to bring your attention to the recent launching of our new dot com site: www.weekendeconomist.com!

This blog will continue to operate as usual and remains the flagship of the Weekend Economist Group. The World Beyond the Weekend Economist will also continue to serve its current purpose.

The principle function of the dot com site is to serve as an umbrella site for all the other elements of the Weekend Economist. Except for the blogs, for instance, the dot com site offers a WE Contribute section, where you can find out more about the Guest Authors and Editors that make up the Weekend Economist Group. The site also provides the latest news about what is going on at the Weekend Economist (WE News) and offers you a fun place to express your thoughts on world affairs in our global forum, sign our guestbook, or take part in a number of entertaining polls (WE Interact). In fact, there is a poll running right now about which global leader is most worthy of reverence, so please come and vote here! Additionally, WE Friends provides a number of links to sites that are well worth your time, while WE Sources is where we provide links to some of the world's top resources on financial, economic and political reporting. Finally, We Contact allows you to get in touch with us if you have any questions, requests, or would like to join the Weekend Economist Publishing Team.

So please have a look at our new site and explore, engage and interact! WE look forward to seeing you regularly,

The Weekend Economist Group

#54 A Near Eastern Conundrum

There are few problems that appear as intractable as the Arab-Israeli predicament and fewer still which are liable to produce a pessimism as intense as that which reigns among those individuals involved in attempts to bring about its end. Consequently, even the mere mention of a final peace deal is of sufficient gravity to attract a great deal of media attention and stoke the fires of hope in the hearts of well-meaning people everywhere. This is precisely what has happened in the wake of the decision at the March 27-28 Arab Summit in Riyadh, Saudi Arabia, to re-endorse the Arab Peace Initiative first launched at the Beirut Arab Summit of 2002.

Amid much fanfare, leading representatives of twenty-one of the twenty-two Arab states (Libya having boycotted the event) gathered in the Saudi capital and proceeded unanimously to revive the 2002 Peace Plan. Within moments of this decision, news services throughout the world were leading with stories of a potential breakthrough in the peace process. The Arab half of the Arab-Israeli conflict had come together in support of peace, and the onus was now on Israel to reciprocate. Or was it? Few people seemed to be asking why a peace offer that led nowhere in 2002 should prove more successful in 2007.

Superficially, the Arab Peace Plan is attractive. It demands of Israel that she withdraw in full from all territories occupied in June of 1967, that a just solution be found to the Palestinian Refugee problem, and that a Palestinian state with Jerusalem as its capital be created in the West Bank and Gaza Strip. In return, Arab states are to normalize relations with Israel and establish a comprehensive peace. This rough outline broadly parallels the Clinton Parameters which formed the basis of Israeli-Palestinian negotiations at Camp David in 2000 and reflects what any eventual settlement of the Arab-Israeli conflict is expected to resemble. Upon closer inspection, however, major problems with the Arab Peace Initiative become apparent.

For one, no scope is provided by which Palestinians and Israelis can agree upon alterations to the border that take into consideration changes on the ground, either in Israel’s favor or in that of the Palestinians. There is no room for what was Israel before 1967 to become part of Palestine or for any of what was the Jordanian West Bank before 1967 to become part of Israel. Similarly, the call for a full return to the 1967 borders deprives Israel of control, shared or otherwise, of Jewish holy sites in Jerusalem, leaving them under the complete control of a Palestinian Authority with a very poor record when it comes to respecting Jewish holy places.

Far more seriously, the envisaged “just solution to the Palestinian Refugee problem” is linked to two provisos. First, it must be in accordance with UN General Assembly Resolution 194 which demands that every refugee who wishes to should be able to return to Israel without delay and that those who do not should be given financial compensation. Uniquely, the UN defines a Palestinian refugee as any direct descendant of one who fled what became Israel in the course of Arab-Israeli conflict between 1946 and 1948. According to this exceptionally broad definition which includes those with no more than one Palestinian great-grandparent, there are today over four million registered refugees and many more still who are eligible for the status. The second condition stipulated by the Arab Peace Initiative is that every form of Palestinian patriation which is not agreeable to the Arab states be rejected out of hand. That is, no Palestinian refugee can be settled permanently in any Arab country unless that country allows him to do so. Given the Arab record in dealing with Palestinian refugees, this is not very auspicious to say the least.

The rigidity of the Arab Peace plan is a cause for serious concern, especially as there has been no real indication that the Arab states are willing to countenance compromise on any of their demands for peace. For Israel, this is a real problem. Whether one likes it or not, roughly a quarter of a million Israelis live in the West Bank and some 200,000 more live in East Jerusalem. They cannot all be removed with ease from their homes, and evicting them will produce a refugee problem over half the size of the original Palestinian Refugee problem. Fortunately, a majority of these people live in large settlement blocs and minor adjustments to the border can prevent hundreds of thousands of people from being rendered homeless overnight. In return for such border adjustments, Israel might surrender equivalent territories in Israel proper to the Palestinian state or offer financial compensation in some form. Alternatively, Jews living in what might become the Palestinian state could be offered a choice between Palestinian citizenship and relocation, but it does not appear as though any of the Palestinian factions would be well disposed to such suggestions. Either way, unless it becomes possible to discuss such issues and reach perhaps more practical conclusions than those demanded by the Arab Peace Initiative there is little basis for optimism.

Likewise, no real progress can be expected as long as the Arab League continues to insist on a settlement to the Palestinian Refugee problem which includes a full return to Israel proper of those Palestinian refugees wishing to do so. It is striking that the Arab Peace Initiative entirely ignores the fate of upwards of three quarters of a million Jews who were expelled from Arab countries in the last sixty years or so while adopting a maximalist position with regard to Palestinian refugees, all of whom should be in their view repatriated or compensated. Whether as a result of the Arab peace plan four million, two million, or only half a million Palestinian refugees immigrate to Israel is irrelevant, as the consequence will inevitably be to make of Israel a binational state in one fell swoop. One fifth of Israel’s population is already Arab, and the addition of a million or more would paralyze the democratic political system and polarize the country between Jew and Arab.

Surely it is not in the interests of peace to create a new binational state on the model of Cyprus, Bosnia-Herzegovina, or even Kosovo? Still more, it seems counterintuitive to bring together two antagonistic peoples in one state when historical precedents like Yugoslavia, Lebanon, Turkey/Greece, and India/Pakistan all dictate otherwise. Indeed, Belgium too has in recent decades been home to violent clashes between its Flemish and Wallonian citizens, and one can hardly point to a history of hatred between these two populations akin to that which plagues the Near East. What cause is there then to assume that Jews and Arabs will be able to share power peaceably in one state? Be that as it may, it does not seem entirely correct for a resolution of the Arab-Israeli conflict to entail the establishment of a Palestinian Arab state with no significant Jewish population alongside a binational Israel with a possible Arab majority. Such a scenario would effectively dismantle the Jewish State of Israel.

Irrespective of these many stumbling blocks, the Arab Peace Initiative remains positive in that it does promise a comprehensive resolution to the Arab-Israeli conflict. If only for this reason Israel should have embraced the Arab peace plan in theory, even if with reservations. Israel’s official response to the Arab summit was slow to materialize, but Prime Minister Ehud Olmert did announce within a week of the Arab Summit’s re-endorsement of the 2002 peace initiative that Israel was prepared to enter into negotiations immediately and that he was personally prepared to travel to Riyadh to meet with his Arab counterparts; in case they preferred a different setting, he also extended to them an invitation to come to Jerusalem. Unfortunately, the Arab response has not been conducive to confidence in a renewed peace process.

Even before Israel reacted to the Arab Peace Initiative, both Saudi Foreign Minister Prince Saud al-Faisal and Palestinian President Mahmoud Abbas threatened that should Israel reject their peace proposals it might trigger a new round of Arab-Israeli war. It is difficult to determine if this threat was simply rhetorical or indicative of a coming confrontation. After all, Hizb-Allah has been rearming diligently, Hamas is militarizing Gaza at an alarming rate, Syria seems to strengthening its military presence near the Golan Heights, and all of this is being directed in some degree by an increasingly outrageous Iranian regime. Even so, Prime Minister Olmert’s positive response to the Arab Peace Initiative has met with little more than skepticism and derision.

As is logical for any representative of the Jewish State, Olmert agreed to commence negotiations in the direction of a final peace settlement but did not endorse without objection the dubious stipulations of the Arab Peace Initiative. Accordingly, his offer to begin peace talks has so far been either ignored or decried, and not one Arab state has welcomed it. Essentially, the Arab message has been that Israel must first accept their peace offer and that only then can talks begin. This is a peculiar way of making peace. Not only that, but it is strange that Palestinian Foreign Minister Ziad Abu Amr has thought it helpful to respond to Olmert’s overtures by announcing in Vienna that, “I also believe, I can say here, that at this time we don't have an Israeli partner anymore.”

Without compromise there will be no progress in the struggle to resolve the Arab-Israeli conflict. If it is impossible in the view of the framers of the Arab Peace Initiative to conclude a settlement with Israel which allows her to continue to exist as a Jewish state alongside a Palestinian Arab state, which divides Jerusalem equitably, and which finds a practical and humanistic solution for both the Jews of the West Bank and the Palestinian refugees, then the Arab Peace Initiative is in every respect a false dawn.

- This article was written for and provided to the Weekend Economist by Jonathan Valk

#53 Ahmadinejad: An Adroit Twerp

Rarely in modern history have there been figures who, like Mahmood Ahmadinejad, have managed to fabricate countless fairy tales, insult millions of people, defy the so-called most powerful international body in the world, laugh in the face of America, pose a serious threat to peace and stability, and get away with it all. It seems no matter how low or how provocative the man becomes, the world refuses to do a thing about it. Mahmood even manages to win a few friends in the process.

Perhaps his most notable feat was accomplished just recently, culminating in the release of the British sailors. Ahmadinejad knew full well that the British would do little more than talk big. I seriously wonder whether the 15 men (including 1 woman) would have been arrested/captured had they been American troops. Then again, given his unpredictability, he might as well have. Either way, it was a serious plus point for Iran that they were British.

The way Ahmadinejad and the rest of the Iranian leadership dealt with the situation was incredibly belligerent, offensive and menacing. And yet, the Iranians scored a major political victory, making the British lose face and appear weak. Not only were "confessions" and "apologies" aired, but Ahmadinejad managed to make it seem as though it was the British who were being arrogant in maintaing they did nothing wrong, while Iran was essentially doing the exact same thing in saying they had every right to arrest the crew. Furthermore, upon releasing the soldiers, Mahmood made it seem as though it was a personal gift to the British. "We have every right to put these people on trial," Mr Ahmadinejad asserted. "But I want to give them as a present to the British people to say they are all free." The occasion? Prophet Muhammad's birthday, the Easter holiday and perhaps even Persian New Year.

Naturally Ahmadinejad was clever enough to give the sailors the absolute best treatment possible in captivity. He can now show the 'stark contrast' between how poor the West treats her Muslim captives versus how benevolently the Iranians treat their Christian prisoners. Of course the apparently wonderful treatment bestowed upon the British is the complete opposite of how the regime treats any Iranian dissidents. But that is not for the outside world to see, as it would hurt the propaganda machine (yes you skeptical reader you; not only the USA has a smoothly flowing propaganda engine). Iran comes out as the more saintly party, which will only further boost her image, particularly in the Muslim world.

After having the heat of the world turned on Iran for the nuclear issue, the arrest of the sailors and the Iranian insistence that they face trail seemed to be enough material to isolate Iran completely. But just two weeks later, nobody is talking about the nuclear standoff and Ahmadinejad is seen smiling and chatting with 15 highly apologetic British servicemen. Could it have gone any better for the Iranians?

#52 "Google is Your Friend"

The information age has put us adrift on an infinite ocean of information. Yet, without an able navigator, we either fail to leave the shore or we become consumed by its infinite nature. Fortunately, a number of navigation (search) tools have been developed to help us filter and find our way: Google Search and Yahoo Search to name the most prominent ones.

Search is all about finding knowledge, ranking disseminating and distributing that knowledge to the inquiring parties. Whereas in ancient times such tools and skills came at a hefty price, we are led to believe that these services are provided to us by search clients for free. But this is not the case. There is a price being paid and there is an implicit, almost invisible contract in place that relatively few people seem to acknowledge or realize.

What we are perhaps forgetting is that by making what we search known to enterprising parties, albeit in aggregate, it says an awful lot about who we are and what our interests are. The key is that the sum of that information is in fact more valuable than what we are searching for. There is no philanthropy in search. In fact it is big business. The value of Google alone as of the 31st of March 2007 was 127 billion US dollars and counting. Just to put that into perspective; 127 billion is larger than the GDP of countries such as Egypt, New Zealand, Israel or Colombia.

Companies like Google make these billions today because people believe that they are making use of a "free" service. Sure it is free in a financial sense in that one is not paying cash to do a search. But one is paying with privacy and knowledge. The difference between you and Google is that they have turned the collective of knowledge and privacy into a hundred billion dollar asset and you find whatever you were "googling" for. In fact, thinking that using Google search (or any other search provider for that matter) is "free" is just plain misleading yourself. You are inadvertently paying for that search by selling pieces of your life.

The action of search companies equate to that eavesdropping train passenger, gently leaning over, so he/she can hear your conversation, quietly taking notes. Even if the curious passenger doesn't know your name he will know a lot about you after listening in. Even if caught in the act, the eavesdropping passenger can easily claim that since he doesn't know who you are it doesn't matter what you said specifically. In actuality, the eaves dropping passenger is only interested in the words you've used, not your name.

Looking at Google’s privacy and cookie policy, you can ask yourself the question “if Google doesn't need to know who I am, then why does it collect the address of my computer, the system I use and the internet browser I use, on top of what I am searching and clicking.” The eavesdropping passenger by now is starting to look a lot more than the Gestapo than those brightly colored and friendly shaped letters that make up the Google logo.

Search companies like Google are taking advantage of a society that is changing faster than people realize. Knowledge remains an important commodity today. However, what has changed is the scope of what we consider knowledge. The public just hasn't realized this yet and smart companies such as Google are quick to take advantage of something we don't consider a commodity: our privacy.

From the perspective of a Google shareholder, one would like to see Google doing even more to optimize the use of their information. The problem is that what can and could be done with specific information or even the aggregate of such information would be on the boundary of what is morally and legally right. Technology moves a lot faster than our legal system, so it is possible that there are enough loopholes that can be exploited in which "googlified" information could be used against our interests. This would call for interesting legal cases, but, even those would be difficult to beat. Who can beat the legal team of a 120 billion dollar company? Due to the low level of my budget, the only defense council I would be able to afford would probably have to rely on Google search to build my case!

It must be said that the intent of this article was not to bear any hostility towards search enterprises such as Google. It is merely a rhetorical reply to a professor who stated that if all else fails "Google is your friend." At first it did seem that way; the friendly web page, ready with thousands upon thousands of search results just a click away. However, as an economist trained to believe that the only thing free in life is sunlight and the air we breathe (for now at least), I did have my hesitation with the definition of Google as a friend.

At the end of the day you as a user just have to keep in mind the implicit nature of the seemingly invisible contract you are colluding with Google as you make use of their services. Even if most people won't be bothered to think about this, do measure what you are giving and what you are receiving for it in return. Just as beauty is in the eye of the beholder, so is information. And yes, knowledge IS power.

#51 Modernization, Myanmar Style

Today's most famous examples of reclusive states with hard handed dictators are most probably Zimbabwe and North Korea, while others would add Cuba to the list (personally I think Cuba and Castro in no way compare to the brutality found in Mugabe and Kim Jong Il's respective nations). Less famous garrison states include Turkmenistan and Myanmar. It is Myanmar that beckons attention in this article.

Few people know more about Myanmar than that it is ruled by the military, it used to be called Burma, and Democracy activist Aung San Suu Kyi is held in house arrest. As with every country, there is a lot more to it than first meets the eye, but Myanmar's recent decision to abruptly move their capital to a city that didn't even exist two years ago, particularly merits special attention. To be sure, the country has undergone a tremendous amount of changes in her long history.

On 4 January 1948, Myanmar gained independence and was named the Union of Burma, with Sao Shwe Thaik as its first President and U Nu as its first Prime Minister. After a period of relative stability, the country found itself unable to remain Democratic and experienced repeated name changes. In 1962 Democratic rule was ended with a military coup d'état, followed by a name change to the “Socialist Republic of the Union of Burma” in 1974, another coup d'état in 1988 by General Saw Maung, a name change back to the "Union of Burma" the same year and it was finally renamed the "Union of Myanmar" in 1989.

Free elections were held the following year, in 1990 and were decidedly won by Aung San Suu Kyi's political party, the National League for Democracy (NLD). The military junta (known as the "State Law and Order Restoration Council," or SLORC) refused to accept the result, however, nullifying it and seizing power. They later changed their official name official name to the "State Peace and Development Council" (SPDC) in 1992, remaining in power until today. The country has known two rulers since the military junta seized power by force in 1990: General Saw Maung and current leader, Senior General Than Shwe.

Until March 27 of this year, the capital of Myanmar was Yangon. As can be expected based on the country's history, Yangon was not always known by that name. The old name, Rangoon, was officially changed in 1989 to Yangon. Officially, the new administrative capital, Naypyidaw, was proclaimed on 6 November, 2005, but it was not named or shown to the outside world until March 27 of this year. Naypyidaw lies 3 kilometers west of Pyinmana and approximately 460 kilometers north of Yangon. It translates to the "abode/city of the kings" and, judging by the first pictures of the city, it certainly appears to befit kings.

According to Information Minister Kyaw Hsan, 924,608 people now live in the 7,000 square kilometres that has become Naypyidaw, in central Myanmar. The city is expected to be competed in a year, with all the buildings constructed, the green flourishing and road and rail links improved. The city is divided into three zones; one for the military, one for government administration, and one for residences.

While the reason for moving the capital remains unclear (perhaps it is nothing more than following an old tradition where ancient Burmese rulers used to dismantle the capital of their predecessor and build a new one meant to outshine all those that came before), it appears certain that it will be an economic failure. For one, all government employees were forced to move to Naypyidaw a year and a half ago. The countless apartments are being developed for these workers, who now find themselves with reliable water and electricity supply and newly paved roads - all rarities in the impoverished nation. Furthermore, government officials have seen a major increase in their salaries, with some top-ranked officials seeing their salary soar more than 1,000%, according to the BBC. This might sound nice, but seeing that there is no real economic shift or progress in the country and thus no solid basis for funding this project, it will surely lead to disillusionment among the people and possible economic disaster. Resentment might also increase among the populace, as those who are not government officials will be left with no benefit and increased inequality. The luxury cars and uniformed men on motorcycles in the "Military Zone" of the new capital, where a fortress-like complex houses Myanmar's leader, won't help either.

Talk from the military remains highly anti-Western, with blame for most everything being laid on imperial powers on a daily basis. Simultaneously, however, talk of Democracy surfaces occasionally, as it did in the speech of Senior General Than Shwe at the Armed Forces Day parade. Than Shwe said "The people, together with the military must also strive hard to build a modern, developed state where disciplined democracy flourishes." So far, this kind of talk has been little more than empty words. Unless the government truly changes its ways and allows space for proper business initiatives and investment, not only is Naypyidaw doomed, but the country as a whole stands little chance of rebounding.

For pictures of the new capital, Naypyidaw, have a look at the following link:

http://svaradarajan.blogspot.com/2007/01/naypyitaw-photo-album.html