Geopolitical Notes From India
M D Nalapat
Since 1948, the year when Israel was reborn in the sands of the desert, the IDF (Israel Defence Forces) and the US have been the twin guarantors of its security, and neither has let the country down. The sharp rise in prices of petro-products as a consequence of the Arab oil embargo following the 1973 conflict hurt the economy of Israel, but did no damage to that of the US. On the contrary, oil companies based in the US gained immensely from the rise in prices, just as they did during the years when George W Bush was President of the US. Bill Clinton had unlocked the doors to corporate greed by doing away with Glass-Steagal and other regulations designed to avoid speculation and profiteering, and the successor (Bush) administration made the path to riches even easier.
From the 1990s onwards, the US has become a more and more unequal society, where the richest gain at the expense of the rest of the population. In his second term, when Hillary Clinton was no longer the decisive force in his Cabinet, President Barack Obama sought to bring back social justice to an extent, especially through the Affordable Care Act. However, the hyper-rich in the US are similar to their counterparts in Switzerland or in India or China, and resent any expenditure that is not lavished on themselves. In particular, they have contempt for the poor, believing that poverty is self-inflicted the way certain social diseases are. As a reaction to their country’s first African-American President, poor whites across the US voted for Donald John Trump, who made no secret of the fact that his retinue was made up of individuals who were white and male.
Of course, after getting elected, Trump has placed a few non-whites in key positions, including Federal Communications Commission boss Ajit Pai and UN Ambassador Nikki Haley, besides appointing Ben Carson to his Cabinet. However, the budget proposals outlined by President Trump are certain to ensure a runaway victory for the Democratic Party in the 2018 election cycle, given that they follow the Chicago School model of taking benefits away from the poor in order to lower taxes on the rich. Just as Prime Minister Narendra Modi needs an annual growth rate of 12% in India to ensure that the bulge in the jobless gets absorbed into the labour market, President Trump needs a growth rate of 4% to avoid large-scale civil unrest as a consequence of the tax cutting, welfare reducing measures designed by the super rich and hyper rich individuals he has chosen to include in his team, where the only key players who are not millionaires are the former military personnel the new Head of State has appointed to his Defence and National Security team.
It must be said of Generals McMaster, Kelly and Mattis that each are of spotless integrity. Indeed, they have even stayed away from the lecture circuit or the lobbyist circuit that is commonplace in Washington. This is unlike General Flynn, who lobbied for Turkey and accepted $ 40,000 from Russia TV, although it must be added that neither of such ways of making extra cash is at all uncommon in the US or in several other countries. In India, for example, senior civil servants who retire from service very soon get chosen to serve on the Board of Directors of major private companies, including foreign entities, that find not only their domain knowledge but their access to those still in government to be worth the compensation paid. Had General Flynn been given $ 40,000 by a West European television outlet, no problems would have been encountered in his continuance as National Security Advisor. However, in that job he represented a potential risk to Bill and Hillary Clinton, as the NSA has access to a trove of intelligence reports.
Clearly there is appetite in Atlanticist Washington only to belabour Moscow and not any other Great Power. Had the Trump administration been less defensive and less clumsily reactive to the daily blows being administered on them by the Clinton machine, by now details of all contacts between Democratic Party insiders and diplomats and others associated with certain powerful countries other than Russia would have been made public However, there is good news for India, Japan and China coming from the Trump administration, and this is the 45th President’s bold removal of constraints on oil production. Not only has the Alaska pipeline been brought back to life but shale oil is being given a boost, as are reserves in locations across the US. Almost certainly, there will be a surge in oil production in the US, and this will keep rices way below $ 50 a barrel, indeed at around $ 30 a barrel, which is the natural price but for the Bush-Cheney boosts of the past, that saw prices reach the three figure range and remain there.
In the case of India, the fall in global oil prices has been a massive windfall to the Narendra Modi government, which has continued to levy taxes on petro-products designed to mop up almost all the savings caused by lower prices. The continuing low oil prices will help ensure that government finances do not deteriorate to levels seen during the time when Manmohan Singh was the Prime Minister. Prime Minister Modi has avoided the popular path of cutting taxes, instead increasing taxes in order to pay for social programs designed to give some sustenance to the poor. Of course, a contrary view is that lower taxes would boost growth, which in turn would ensure more taxes get collected than by high rates of tax. However, President Trump needs to resist calls from neo-cons in his team to launch military actions in Syria or even against Iran. The US President who in his campaign gave promise of resetting the US on an Indo-Pacific rather than an outdated Atlanticist course should continue to focus on Nuclear Threat Number 1,North Korea, rather than get sidetracked by domestic and international noise over Iran.
—The writer is Vice-Chair, Manipal Advanced Research Group, UNESCO Peace Chair & Professor of Geopolitics, Manipal University, Haryana State, India.