I’ve just published a foreign policy-related post at Outside the Beltway:

A Harsh Editorial on the President’s Foreign Policy

The editors of the Washington Post published an editorial highly critical of the president’s foreign policy, generally, and his response to the situation in Ukraine in particular. What’s less clear: what he should do differently or why.

My wife and I are watching the Academy Awards this evening. We’ll probably just watch the first hour or so.

They don’t seem to be cutting off the acceptance speeches quite as ruthlessly as they have the last few years. Any bets on how long the Award ceremony will last? At this rate they’ll go ’til 1:00am.

As an example of why I’m concerned about the reactions of official Washington to the situation in Ukraine, consider this press release from Secretary of State John Kerry:

The United States condemns the Russian Federation’s invasion and occupation of Ukrainian territory, and its violation of Ukrainian sovereignty and territorial integrity in full contravention of Russia’s obligations under the UN Charter, the Helsinki Final Act, its 1997 military basing agreement with Ukraine, and the 1994 Budapest Memorandum. This action is a threat to the peace and security of Ukraine, and the wider region.

I spoke with President Turchynov this morning to assure him he had the strong support of the United States and commend the new government for showing the utmost restraint in the face of the clear and present danger to the integrity of their state, and the assaults on their sovereignty. We also urge that the Government of Ukraine continue to make clear, as it has from throughout this crisis, its commitment to protect the rights of all Ukrainians and uphold its international obligations.

As President Obama has said, we call for Russia to withdraw its forces back to bases, refrain from interference elsewhere in Ukraine, and support international mediation to address any legitimate issues regarding the protection of minority rights or security.

From day one, we’ve made clear that we recognize and respect Russia’s ties to Ukraine and its concerns about treatment of ethnic Russians. But these concerns can and must be addressed in a way that does not violate Ukraine’s sovereignty and territorial integrity, by directly engaging the Government of Ukraine.

Unless immediate and concrete steps are taken by Russia to deescalate tensions, the effect on U.S.-Russian relations and on Russia’s international standing will be profound.
I convened a call this afternoon with my counterparts from around the world, to coordinate on next steps. We were unified in our assessment and will work closely together to support Ukraine and its people at this historic hour.

In the coming days, emergency consultations will commence in the UN Security Council, the North Atlantic Council, and the Organization for Security and Cooperation in Europe in defense of the underlying principles critical to the maintenance of international peace and security. We continue to believe in the importance of an international presence from the UN or OSCE to gather facts, monitor for violations or abuses and help protect rights. As a leading member of both organizations, Russia can actively participate and make sure its interests are taken into account.

The people of Ukraine want nothing more than the right to define their own future – peacefully, politically and in stability. They must have the international community’s full support at this vital moment. The United States stands with them, as we have for 22 years, in seeing their rights restored.

The first paragraph:

The United States condemns the Russian Federation’s invasion and occupation of Ukrainian territory, and its violation of Ukrainian sovereignty and territorial integrity in full contravention of Russia’s obligations under the UN Charter, the Helsinki Final Act, its 1997 military basing agreement with Ukraine, and the 1994 Budapest Memorandum. This action is a threat to the peace and security of Ukraine, and the wider region.

is fine. It says what’s needed to be said and, if that were the complete statement, in my view it would be enough. Sadly, it does not. The conclusion:

The people of Ukraine want nothing more than the right to define their own future – peacefully, politically and in stability. They must have the international community’s full support at this vital moment. The United States stands with them, as we have for 22 years, in seeing their rights restored.

We may not see it that way but I believe that from the point-of-view of the Russians it’s both provocative and offensive. Sec. Kerry is speaking on behalf of the Ukrainian people here and his characterization does not appear to comport with the facts of the case or, at the very least, with the facts of the case as they are known to the Russians. From their point-of-view the fairly and democratically-elected president of Ukraine has been ousted by an armed mob. He was not removed according to Ukrainian law or even by an action of a majority of Ukrainians.

There are other quibbles I could make about the statement. For example, I don’t think that Sec. Kerry is a particularly good spokesman to condemn violation of international law or national sovereignty. I have a vague recollection that as a senator he voted in favor of the Authorization to Use Military Force that empowered President Bush to invade Iraq, a country far from our borders and one in which we have national interests far less than Russia has in Ukraine. As my old business partner once put it, I may agree with what you say but I will condemn to the death your right to say it. But, as I say, that’s a quibble.

My point here is not that we should say nothing. It is that we should be careful in what we say.

I’ve just published a couple of foreign policy-related posts at Outside the Beltway:

The Russian People Demand Intervention in Ukraine

The Russian people just aren’t getting the same story on what’s going on in Ukraine as we are.

Update

The Ukrainian Demonstrations

In this post I take notice of a post at the New York Review of Books on the Ukrainian demonstrations. Although I think that the Russians’ view of the goings-on is largely based on propaganda, I think that our view probably is, too.

I’ve just published a foreign policy-related post at Outside the Beltway:

The Ukraine Crisis in Three Maps

Looking at a few maps is a pretty good way to get some quick understanding of the situation in Ukraine. The very name of the country means, roughly, “the border”, and you can guess whose border is meant. The situation is a lot more complicated than some of the commentary might lead you to believe.

I’ve long held a view that seems to be unpopular. Since Russia is the only country in the world that actually could destroy us, not to mention the entire world, it would be prudent for us to cultivate a good relationship with Russia. Instead, we’ve gone out of our way to insult and aggravate Russia with no particular gain for ourselves. For more in that vein see here.

I have a question. I can understand why Russia would be concerned about U. S. adventurism in its neighborhood. What I can’t understand is why we should be concerned about Russia pursuing what have been its interests in its own neighborhood for the last 300 years. Can someone explain that to me?

The editors of the New York Times and Washington Post have, more or less, come out on opposite sides on the proposed tax reform on which I posted yesterday. The NYT editors oppose the measure for what are to me short-sighted and puzzling reasons. Their first argument is that if tax expenditures are cut or limited, they can’t be cut or limited in the future for a more worthy goal, i.e. increasing revenues:

The plan, intended only to simplify the tax code rather than redistribute the burden, reduces the number of tax brackets from seven to three. Low-income taxpayers would pay a 10 percent rate, those in the middle would pay 25 percent, and families making $450,000 and above would pay 35 percent instead of the current 39.6 percent.

In many cases, that represents a tax cut, and to make up for the loss in revenue — since the plan aims to be revenue-neutral — a large number of deductions and breaks are eliminated. But ending those breaks just to reduce rates means the savings can’t be used for important expenses in the future — which is a Republican goal.

The second objection is that putting a cap on the home mortgage deduction and eliminating the deductibility of state and local taxes would be unfair to New York:

One big break that would be affected is the mortgage-interest deduction. By limiting it to $500,000, the plan would hurt many middle-class families that must borrow more than that to afford a house in expensive markets like New York. Even worse, it would repeal the deduction for state and local taxes, a deliberate attempt to make it more difficult for “blue” states to provide the services and safety-net protections that they have decided are necessary.

IMO this is flummery. According to the Census Bureau the median home price in New York County is more than $800,000 and, understandably, it has one of the lowest rates of home ownership—a bit over 50%. Nearly by definition people who buy homes valued at more than $800,000 aren’t middle income—they’re upper middle income or upper income. In New York middle income people rent. Additionally, I find it excessive to expect the federal tax code to solve New York’s problems with home affordability. That’s properly a role for the state.

However, the NYT’s complaints bring into sharp relief the problem with the home mortgage deduction and many of the other “tax expenditures”: they are subsidies to people with higher incomes. They go overwhelmingly to the 3% or the 1%. I would think that a tax code that reduced subsidies to the rich would be an improvement.

The editors of the Times do not seem to recognize that a simple tax code will itself be a better tax code, trimming the costs of compliance and reducing the opportunities for gaming the system, opportunities most available to the highest income earners.

The editors of the Washington Post on the other hand seem favorably predisposed to the plan, would be even more favorably disposed to beginning a discussion of tax reform, but are mournful about tax reform’s chances of being enacted into law:

In a properly functioning Washington, the tax reform plan unveiled Wednesday by House Ways and Means Committee Chairman Dave Camp (R-Mich.) would kick off a major debate over how to fix the federal government’s inefficient system of revenue collection. Mr. Camp proposes to overhaul both the corporate and individual tax codes, based on the principle that lower rates should be applied to a broader base of income — that is, one that is purged of many loopholes and deductions that litter current law.

[…]

In the actual Washington, alas, Mr. Camp’s proposal has basically no chance of passage, or even of being acted upon this year. Much of the blame for that belongs with the leaders of his party, who smell victory in the November elections and don’t want to do anything controversial — such as committing themselves to an actual positive agenda — that might put that prospect at risk. Instead of praising their fellow Republican’s plan, House Speaker John A. Boehner (Ohio) and Senate Minority Leader Mitch McConnell (Ky.) threw cold water on it.

I have a question about the politics of the ongoing, interminable unfolding of the IRS scandal, based upon comments in this post. I think it’s obvious why the House Republicans aren’t giving Lois Lerner immunity in exchange for her testimony. It keeps the ball up in the air, she remains prosecutable for any crimes she may have committed, and they can always give her immunity later if it’s useful.

What’s not so clear to me is why the Senate Democrats aren’t eager to grant her immunity in exchange for her complete testimony. If there’s nothing there, wouldn’t think they would?

I didn’t want to let this paper by Robert E. Scott from the progressive Economic Policy Institute go by without comment. I’ve made no secret of my belief many of the United State’s economic woes can be dated to China’s effectgively pegging the yuan to the dollar in the early 1990s and Dr. Scott’s article documents the costs that the actions of China and other countries that have engaged in currency manipulation have had on us. As he points out the currency manipulation practice not only by China but by Denmark, Hong Kong, South Korea, Malaysia, Singapore, Switzerland, Taiwan, and Japan have increased our trade deficit beyond what it would otherwise have been and cost us a significant number of manufacturing jobs:

Overall, reducing U.S. goods trade deficits would create between 891,500 and 2,337,300 jobs in manufacturing (38.8 percent to 40.3 percent of jobs gained across industries), representing the largest jobs gain of any major industry. Within manufacturing, the largest gains would occur in durable goods, specifically “machinery, except electrical,” with 170,500 to 353,900 jobs gained (respectively, 7.4 percent and 6.1 percent of total jobs gained). Jobs gained in non-electrical machinery would increase total employment by 14.4 percent to 29.8 percent in that sector. Other manufacturing industries with large gains would include transportation equipment (164,100 to 352,400 jobs), computer and electronic parts (127,600 to 338,000 jobs), fabricated metal products (104,200 jobs to 251,800 jobs), and miscellaneous manufactured commodities (99,400 to 243,300 jobs).

Major job winners outside of manufacturing include agriculture, forestry, and fisheries (246,800 to 486,100 jobs); health care and social assistance (167,900 to 430,600 jobs); administrative and support industries (166,700 to 413,900 jobs); professional, scientific, and technical services (140,300 to 357,100 jobs); and accommodation and food services (142,500 to 358,600 jobs).

It could be retorted that the out-sized purchases of dollars by various other countries is the price that the U. S. pays for the dollar being the world’s reserve currency. That could well be true but

1. All of the countries listed above with the possible exception of Switzerland (the Swiss have a tendency not to be participants in international accords) have engaged in trade in dollars in violation of commitments they’ve made.
2. It’s not enough to point out that the dollar is the reserve currency. Critics of the analysis have an obligation to quantify the net costs to us incurred by the dollar being a reserve currency and IMO the individuals and companies that benefit from that should be taxed by that amount and the proceeds used to support wage subsidies, apprenticeship programs, and other policies that would foster job creation here.