The alternative to war

As Israel continues to slaughter women and children in Gaze, Hezbollah continues to flatten norther Israel, Russia continues roll back Ukrainian troops in Ukraine, I have tried to follow the pronouncements from all sides. The solution proposed by each is to win the war.

But can winning the war bring peace and security to Israel, to West Bank and Gaza, or to Ukraine? Israel wants to eliminate the Palestinians, but Germany’s genocide of six million Jews did not eliminate Jews. Israel’s genocide of Palestinians will not illuminate them either and even its systematic assassinations of Hamas rulers (most recently Ismail Haniyeh in Iran) will not eliminate Hamas. Peace will not come to Israel, the WBGS, Lebanon, or Syria by winning THE WAR.

 “While Israel has not yet issued an official statement, with the attack [on Haniyeh], it has reinforced the message that it speaks with the language of force above all else…. Assassinating Haniyeh, perhaps the most important member of Hamas’s negotiating team, fits within Israel’s narrative that the only way to achieve an end to the Gaza war is to force Hamas to surrender militarily. To most of the rest of the world, the assassination of a lead negotiator for a potential peace deal is certainly viewed as a bloody sabotage of multinational efforts to end the genocidal war.” “Assassination of Hamas leader Haniyeh”  “From Paris to Beirut-Israels long record of assassinating Palestinians”

As long as the focus remains on winning wars, none of the Middle Eastern countries will be safe and at peace. The countries of the Middle East (or anywhere else) must determine and accept the terms for mutual treatment appropriate for good neighbor relationships. “Israel Hamas Iran Gaza Middle East”   Arriving at such agreements will not be easy, and will not be possible without large majorities of the populations of these countries truly wanting peace and security and being willing to treat each other fairly. “Best way to end Israels war with Gaza” “Why Palestinian unity matters”  But the search for such genuine peace must start with giving up the idea of winning the war and ending the current fighting.

The latest on Social Security Benefits

If no changes are made to the Social Security law: “Starting in 2034… Social Security will only have enough money to pay 79% of its promised benefits.” “Day of reckoning for Social Security draws closer”  The system promises a given pension upon retirement (a defined benefit) that is financed by a given payroll tax. It is not a pool of saving that is drown down at retirement. It is pay as you go. “Saving Social Security”.

This financial problem results from the fact that Americans are living longer and thus receive their SS pension for more years if there is no change in the retirement age. Moreover, the growth in the population has slowed so that the ratio of workers (i.e. those paying the tax financing the pensions of the retired) to retirees has fallen from approximately 3.3 in 1970 to 2.9 in 2020. It is projected to fall further to 2.0 by 2030.

The system must and will change, the only question is how. Legal immigration could be increased to increase the number of workers. The wage tax could be increased. Retirement age could be increased (20% voluntarily work after retirement already). As people live longer many choose to work longer for more than just the extra income. Pension benefits could be indexed to inflation rather than to wage growth (which has been greater than inflation). But more recently I have proposed replacing Social Security and other safety net programs with a Universal Basic Income for every man, woman and child without exception. Such a remake of our social safety net would have several very good features. “Replacing Social Security with a Universal Basic Income”

Econ 101: Trade balance

Everyone understands that we are each wealthier if we buy most of what we consume from others and pay for it with what we specialize in producing ourselves. But at dinner last night one of our guests (Chatham House Rules prevent me from revealing his identity) asked how we can compete with China when their workers are so cheap? The teacher in me rises up to unpack this statement and the related issue of trade balance. It is both complicated and simple.

  1. Are Chinese goods cheaper? Chinese workers are paid in their currency (RMB) and American’s buy China’s output in our currency (USD). If an LED light bulb made in China is sold for 140 RMB is that cheap for American’s? If the exchange rate of RMB for USD is 4 RMB per USD it will cost us $35 per bulb (expensive), but if the exchange rate is 10 RMB per USD it will cost us $14 per bulb (cheap).
  2. So will we buy everything from China? What will the Chinese do with the dollars they receive from exporting to us? They might buy goods from the US (made by workers who used to make LED light bulbs). If the exchange rate is “right”, the Chinese will spend all of those export dollars on imported US products. Trade (imports and exports) will balance.  An exchange rate that makes dollars more expensive in China (RMB cheaper in the US) will decrease China’s imports from the US relative to its exports (a Chinese trade surplus). What will they do with the remaining dollars held in China?
  3. What happens with Chinese trade surplus holding of USD? The Chinese can invest them in the US (buy US Treasury securities, stocks, property, etc.). Or sell them for their own currency driving the exchange rate of RMB for USD down (or up depending on what you put in the denominator). The reduced cost in China of US goods will increase Chinese imports and the higher cost of Chinese good in the US will reduce US imports from China. The Chinese trade surplus (US trade deficit) will vanish (or adjust to the rate of capital flow desired by cross border investors). The incomes of Chinese and American workers will be higher because each will be producing the goods for which they each have a comparative advantage (the win-win of free trade).
  4. Exchange rate manipulation or production subsidies distort the outcome. EU tariffs on Chinese EVs are explicitly set at a level to compensate for Chinese government subsidies of EVs. This is allowed by WTO trade rules to put Chinese and German car manufacturers on a fair, competitive basis. The US’s much higher tariff on Chinese EVs makes no mention of complying with WTO rules (the US again does whatever it wants to the detriment of the global trading system).
  5. Trade balance between US and China is used as a simplification. What matters is the balance between each country and the rest of the world but distilling the world into two countries simplifies the discussion.
  6. Time for the dessert.

The Right to Choose

I have always supported a woman’s right to choose whether to complete a pregnancy up to the point at which another person (her fetus) acquires existence and thus the protection of the law. In my view a fetus becomes a person when viable, i.e. when they are able to live outside the womb. In my opinion, laws that permit abortions that comply with that standard, should not force those who disagree to pay for such abortions. Thus I do not support allowing the Armed services to pay for its member’s wanting an abortion for the travel and related expenses of the abortion. Tax payers should not be forced to pay for such individual choices.

A similar argument has been made about taxpayer funding of elementary education. A Jewish taxpayer should not have to pay for a catholic child’s education in a catholic school or visa versa. But I also favor school choice. How do I defend this use of taxpayer’s money? An abortion up to the allowed age of the fetus is an individual choice. But elementary education is required for all children in the public interest. Thus, it is appropriate that the government (taxpayers) pay for it. But, providing public (i.e. taxpayer’s) money for each child’s education can and should leave the choice of school to each parent. It is appropriate that schools eligible to receive public funds meet minimum standards of curriculum to be covered. School choice not only maximizes the freedom of choice among parents with different religious beliefs and views on the most effect approach to education, but the competition among schools improves the over quality of education. https://wcoats.blog/2021/05/09/the-great-divide-who-decides/

Russia

Russia has become a pain in the ass. Why and what should we do about it? First we must realize and accept that Russia will always be here. Just as Nazi Germany’s Holocaust did not eliminate Jews and Israel’s effort to eliminate Palestinians (sufficiently to have a democratic Jewish Israel from the River to the Sea as stated in Zionist documents) will not succeed, it is not possible, nor would the world accept the morality of eliminating Russia.

So the goal must be to carrot and stick Russia into a neighbor we can live with—even productively and happily live with.  Our approach to Ukraine provides many lessons for what not to do. With the collapse of the USSR, Russia and the other former Soviet Republics passionately wanted to become part of Western “normal” world. It was great fun working with them toward that goal in the early 1990s.

Russia’s great cultural offerings were more open to us. Russia was added to the G7, which became the G8. Russians are a proud people, who had just been humiliated, and wanted respect. But our embraces were more stumbling than they should have been. After reassuring Russia that NATO would not expand one inch East in exchange for the reunification of Germany as a NATO. We lied. NATOs membership doubled from 16 to 32.

Russia swallowed hard and offered conditions for Ukrainian neutrality that were larging acceptable to Ukraine and in any event negotiable. But we didn’t support/encourage Ukraine to negotiate so Russia invaded it. Even two months later when Russia and Ukraine had virtually agreed on the terms for ending the war, we discouraged it. Two and a half years later 100,000 have been confirmed dead. About 60% of the total were Russian. Twice that many are estimated to have died. And damage to Ukrainian cities and country side will take trillions of dollars to repair. https://wcoats.blog/2022/05/15/ukraines-and-russias-war%ef%bf%bc/

A May 24 report from Reuters, stated that Putin himself “is ready to halt the war in Ukraine with a negotiated ceasefire that recognizes the current battlefield lines.” We seem to prefer that “they” continue fighting to the last Ukrainian. After all we have been able to test our military equipment in the field without the loss of American lives. But we must remember the lessons of the Holocaust and Gaza. We can’t wipe Russia off the map. They will be here five, ten, twenty years from now. What do we want our relationship with Russia to be then? What carrots and sticks will get us there?

From the River to the Sea–One State

Under Benjamin Netanyahu and his far-right coalition government, Israel is committing suicide. These are my thoughts on how it might be saved.

Israel’s response to Hamas’s brutal attack on Israel on Oct 7 has been the most inhuman effort to wipe out a people since the Holocaust. Netanyahu called for revenge “implementing a ‘full siege’ of the densely populated Gaza Strip — ‘no electricity, no food, no fuel,’ said Defense Minister Yoav Gallant — as part of a campaign that is aimed at destroying Hamas’s military capabilities” Wash Post “Israel-Gaza war Hamas”  As of May 14th “Palestinian health authorities say Israel’s ground and air campaign in Gaza has killed more than 35,000 people, mostly civilians, and driven most of the enclave’s 2.3 million people from their homes.” https://www.reuters.com/world/middle-east/gaza-death-toll-how-many-palestinians-has-israels-campaign-killed-2024-05-14/

Virtually every country in the world except the US has condemned Israels genocide as have many Jews. The Washington Post has an excellent account of a mother and son coping with opposite views on these events: https://www.washingtonpost.com/nation/2024/05/19/israel-gaza-university-protests-arrests/

The International Criminal Court (ICC) has applied for warrants for the arrest of Hamas leader Yehiya Sinwar, Izzedine al-Qassam Brigades leader Mohammed Diab Ibrahim al-Masri and Hamas political chief Ismail Haniyeh, as well as Israeli Prime Minister Benjamin Netanyahu and Defense Minister Yoav Gallant for alleged war crimes and crimes against humanity in their conduct in these attacks. US congressional and administration officials have attacked the ICC’s initiative (though it is supported by every legal authority I respect) and threatened retaliation in a display of the hypocrisy increasingly undermining US status in the world.

Patrick Leahy, author of the Leahy Law, which “prohibits U.S. aid to any unit of a foreign security force if the secretary of state has “credible information” the unit has committed a gross violation of human rights: murder, rape, torture, forced disappearance or other flagrant denials of the right to life, liberty and personal security.” states that Israel is guilty of such violations and the law should prevent Biden from sending weapons to Israel. https://www.washingtonpost.com/opinions/2024/05/20/israel-leahy-human-rights-aid/

The recent attack and counterattack were continuations of 70 years of unresolved relations between the areas Palestinian and Jewish residents. Netanyahu remains adamantly against revising the Two State Solution (Oslo Accord) future and Saudi Arabia is equally insistent on it. Ireland, Norway, and Spain will officially recognize Palestine as a state from next week and other countries are expected to follow. 

The so far unsurmounted challenge was not a result of the gathering of Jews in what is now Israel, but the determination to make it a democratic Jewish State. Religious states, such as Iran, are always problematic. Israel can only be a democratic Jewish state by eliminating one way or another most Palestinians. American’s founding fathers had the wisdom to prohibit that by putting the separation of church and state in our constitution.

If Israel gave up being a Jewish state it could remain democratic and absorb the entire area from the River to the Sea. And every resident would receive the same protection of the law and equal rights. It should consider a federal structure in which smaller districts with local administrations might well be predominately Muslim or Jewish. https://wcoats.blog/2024/01/19/one-state-solution-for-palestine-israel/

Happy Birthday to me

Today I have lived for 82 years (29,848 days plus however many leap year days there have been). So please indulge my reflections on that life.  If you are really interested in more details, you can read my Autobiography being assembled by my friend Odell Huff on Kindle books (probably available in July). And or you can read any or all of my five travel books on my work in Afghanistan, Bosnia, FSU, Iraq, Kosovo, and Palestine, https://www.amazon.com/s?k=warren+coats&i=digital-text&crid=WKE7LWMI6LNS&sprefix=warren+coats%2Cdigital-text%2C74&ref=nb_sb_ss_fb_1_12  

It was certainly action packed (from a year in Germany as an high school exchange student, a member of the UC Berkeley Free Speech Movement council in 1964, marriage to Louise Wilkinson while teaching at the U of Hawaii, a Ph.D. from U of Chicago under Milton Friedman, Assistant Prof at UVA, birth of my son and daughter, 26 years at the International Monetary Fund during which I divorced Louise and married Ito Briones and led technical assistance missions to the central banks of over 20 countries). The teacher in me prodded me to share my economic and political thoughts with you in hundreds of blogs https://wcoats.blog/

I genuinely cared about trying to make the world a better place. In some ways it is but in many it is not. America’s role in the world has peaked and is in decline.  Others have tired of being pushed around by a bully who doesn’t pay that much attention to their interests. Sadly, most of the countries I worked in are no better off. On the other hand, the way God made me is now more widely accepted as OK and I have been able to married Ito. What concerns me most today is the lack of civil discourse and the mutual understanding discourse facilitates. Too often we consider those we disagree with bad rather than just wrong, which undermines rather than promotes understanding and cooperation.

But the real reason I, and people my age are generally happier than our younger friends, is, I think, because we have let go and stopped worrying about what we should do next. The fight for us is over (not that we don’t care anymore, but that we know we can no longer do anything about it). So, the political prospects for the next election, the attacks on free speech in the US, the shrinking of the free trade on which our prosperity has depended, the new holocaust in Gaza, while saddening events, wash over us without much personal pain.

What we have and can enjoy are wonderful and entertaining friends with whom we can visit, and dine and chat. Thank you all.

What to do about Social Security

Sixteen years ago I wrote about problems with the U.S. Social Security System. The system promises a given pension upon retirement (a defined benefit) that is financed by a given payroll tax. It is not a pool of saving that is drown down at retirement. It is pay as you go. https://wcoats.blog/2008/08/28/saving-social-security/

When Franklin Roosevelt established it, average life time after retirement was only about two years. Today life expectancy in the US is 79 years, or 14 years of retirement pension payments for those retiring at age 65. This fact, plus the declining population growth rate, means that the workers being taxed to pay for the currently retired are shrinking relative to those already retired and receiving benefits. The worker to beneficiary ratio of 3.3 in 2005 is projected to fall to 2.1 in 2040. At that point wage taxes will not be enough to cover the current benefits promised at that time.

Various proposals have been made to address this problem. The wage tax could be increased. Retirement age could be increased (20% voluntarily work after retirement already). As people live longer many choose to work longer for more than just the extra income. Pension benefits could be indexed to inflation rather than to wage growth (which has been greater than inflation). But more recently I have proposed replacing Social Security and other safety net programs with a Universal Basic Income for every man, woman and child without exception. Such a remake of our social safety net would have a number of very good features. https://wcoats.blog/2020/08/20/replacing-social-security-with-a-universal-basic-income/

Effective protest

In the face of rising arrests on university campuses of protesters against Israel’s war in Gaza and West Bank, I will explore what forms of protest are proper and effective. I will not address the merits of one view or another as I have already done so in several earlier blogs. I support the measures that will best achieve Israel’s security and prosperity as well as those measures that will best achieve Palestine’s security and prosperity. The two are inseparable.  https://wcoats.blog/2023/10/10/israel-and-the-wbgs-next-steps/

As with international relations more generally, diplomacy is preferred and invariably more successful in the long run to war. War should be the absolute last resort when every effort at diplomacy has failed, if at all.

What does this mean for the war in Gaza and between Israel and its West Bank and Gaza Strip (WBGS) neighbors more generally? Diplomacy begins with correctly understanding the views of the other side. It involves talking with each other. American University protests are largely by students protesting Israel’s behavior vis a vis Hamas and more broadly its Palestinian neighbors.

“The students are protesting against Israel’s actions in the war with Hamas. The Columbia University Apartheid Divest coalition, which consists of more than 100 student groups, is calling for the university to financially divest from companies and institutions that ‘profit from Israeli apartheid, genocide and occupation in Palestine’…. Protesters camping on the university lawn say they believe the war in Gaza amounts to ‘genocide’ of Palestinians….

“’I’m here continuing the Jewish tradition of standing against oppression and injustice, especially as we approach Passover, a holiday that celebrates our own liberation and commits us to fighting for everyone else’s,’ the Jewish Voices for Peace at Columbia said in an online statement.”  https://abcnews.go.com/US/columbia-university-student-protests-israel-gaza-war-continue/story?id=109493377

These protestors clearly have something to discuss with U of Columbia’s Administration. I have no idea whether they are or not. Peaceful public demonstrations of support for demands to impress the other side with the existence of broad support is certainly an appropriate and often effective part of pressing demands. Public debate of the pros and cons of these demands, as guaranteed by our First Amendment right to free speech, can be a powerful way to refine demands and to educate the public of their merits.

But our freedom of speech has limits. We may not yell “Fire” in a theater in which there is no fire. We may not credibly threaten physical harm as in “Kill the Jews.”  On the other hand, the charge that damning the Israeli government for its war in Gaza (or any other unwanted policy) is antisemitic is as wrong as charging me with anti-Americanism for damning some of President Biden’s policies (such as using my tax money to provide the Israeli army with weapons with which they are killing women and children in Gaza).

But many protestors at Columbia U sat up tents on the campus in violation of university rules and on April 18th more than 100 of them were arrested and removed from the campus. The right to free speech is not the right to violate the law and Universities (or other property owners) have the right to remove violators. The boundaries for the proper right to free speech are set out in the following article by FIRE’s President Greg Lukianoff https://greglukianoff.substack.com/p/hypocrisy-projection-civil-disobedience?r=1n8osb&utm_medium=ios&triedRedirect=true

When protestors feel so strongly about an issue that they knowingly break the law to dramatize their position, they must expect and accept the legal consequences. But this is the equivalent of going to war when the prospects for diplomacy have been exhausted. An extreme example was the self-immolation of US Airforce officer, Aaron Bushnell, in front of the Israeli Embassy in Washington DC. “He was a 25-year-old serviceman who, on February 25, 2024, set himself on fire as a form of protest against what he described as the experiences of Palestinians at the hands of their colonizers and declared that he would no longer be complicit in genocide.” Self-immolation of Aaron Bushnell – Wikipedia

Today’s student protests, most of which have been peaceful and legal, are often compared to the Free Speech Movement at the University of California, Berkeley in 1964, in which I participated. Traditionally, meaning at least during the time I was a student there, we sat up our recruiting tables along Bancroft Avenue near its intersection with Telegraph Avenue just outside the campus.

On September 14, 1964, Dean of Students Katherine Towle “announced that existing University regulations prohibiting advocacy of political causes or candidates, signing of members, and collection of funds by student organizations at Bancroft and Telegraph would henceforth be ”strictly enforced.” FSM Leaflet: Chronicle of the Free Speech Controversy (fsm-a.org)

We, and by we I mean students across the entire political spectrum, protested. Within a week most all student groups, including the University Young Republicans of which I was President, loosely organized into a United Front for presenting our “demands” to the Dean.

On September 27, 1964, the United Front held an all-night vigil on the steps of Sproul Hall. These steps, which became a major staging place for Free Speech Movement (FSM) speeches and demonstrations, are midway between the Telegraph and Bancroft Avenue intersection and Sather Gate. On September, 30 five students who refused to remove their card table were indefinitely suspended from the University. The next day, October 1, during a rally in front of Sproul Hall, Jack Weinberg was arrested for refusing to leave his CORE table. When he was put into a police car, students immediately surrounded it and prevented it from leaving as students began to speak to the crowd from the roof of the police car and the Sproul Hall steps. The next day the student crowd grew to 3,000 and the Alameda Country police force had grown to 500.

On October 3, leaders of Berkeley’s political organizations met on the Sproul Hall steps and formed the Free Speech Movement. Each group had a member on its council and thus I was a member of the FSM Council by virtue of being President of the University YRs. Days of speeches on these steps followed. On one occasion my address to the crowd followed that of Mario Savio the de facto leader of the FSM. Mario was an inspirational speaker and never called for violence. I also stressed the importance of peaceful discussions with the University administration aimed at restoring our traditional political activities on Bancroft.

It should not be surprising that with such a diversity of members on the FSM Council views differed on how to proceed. An important misunderstanding, which persists in the general public to this day, was that Dean Towle’s banning of political activity was not actually a reference to campus activities. The Telegraph and Bancroft location of our club tables was off the campus on city territory and the city had complained to the University that it had not approved such use of its sidewalks.

When control of the FSM Council was taken over by the radical left, Marxist faction, led by Bettina Aptheker, I resigned and joined with the presidents of four other groups genuinely fighting (peacefully) for free speech on campus to help steer student protest toward genuine free speech. It was clear from Bettina’s speeches that she wanted to steer the movement toward violence. Our small group consisted of the presidents of the University Conservatives, University Young Democrats, Young Peoples Socialist League, Young Socialists and myself. We meet at 2:00 am every few days in the office of Professor Seymour Lipset because the YPSL president was his research assistant and had a key to Lipset’s office. Our goal was to represent to the University administration the broader student body commitment to genuine free speech and the exchange of different ideas.

December 2, two to three thousand students peaceably occupied Sproul Hall sitting in for two days. Mario Savio led the occupation with the following words:

“There is a time when the operation of the machine becomes so odious, makes you so sick at heart, that you can’t take part; you can’t even passively take part, and you’ve got to put your bodies upon the gears and upon the wheels, upon the levers, upon all the apparatus, and you’ve got to make it stop. And you’ve got to indicate to the people who run it, to the people who own it, that unless you’re free, the machine will be prevented from working at all! Now, no more talking. We’re going to march in singing ‘We Shall Overcome.’” 

And Joan Baez stood there singing it as they walked in. In the early hours of December 4 Alameda police carried out and arrested 800 students.

For some reason our group of five moderate left and right wing groups were never interested in meeting with the Chancellor of the Berkeley campus, Edward Strong. Clark Kerr was the president of the whole university system and we ultimately met with him and made our case that his administration had not done a very sensible thing in clamping down on all of our traditional political activities. We argued that we thought there was a way of both satisfying the law and re-establishing our tradition of open, free speech that would satisfy everybody except Bettina Aptheker. Happily, this is what happened, in part by clarifying that student activities needed to be on the campus and not on the streets of Berkeley.

Sadly, we too often choose war when diplomacy would produce a better outcome.

Playing by the rules

This morning’s NYTimes proclaimed that:“The Biden administration, responding to the death of Aleksei A. Navalny, unveiled its largest sanctions package to date as the war in Ukraine enters its third year.”

On November 30, 2023, Phillip Dean Hancock was executed in Oklahoma. As the death penalty has been eliminated in most countries and such killing is considered immoral by millions of people around the world, what sanctions would be appropriate for them to impose on the U.S.?

A quite different case arises from killing an enemy in someone else’s country (aside from in war, where anything seems to be “allowed.”)  On February 13 of this year, Maxim Kuzminov, a former Russian military pilot who defected to Ukraine, was found dead with multiple bullet wounds in Villajoyosa, a city on Spain’s Mediterranean coast. The murder is suspected to have been organized by Moscow. What measures should Spain take against Russia in response (hopefully the U.S. will keep its nose out of other people’s business—fat chance)?

On January 3, 2020, the U.S. assassinated Qasem Soleimani, an Iranian major general and the commander of the Iranian Quds Force, in Baghdad. More recently, on February 7, 2024, Abu Baqir al-Saadi, a senior commander in Kataib Hezbollah, an Iran-backed Iraqi militia, was killed in a U.S. drone strike in Baghdad. What measures should Iraq (and Iran) take against the U.S.?

The rule of law is a fundamental aspect of our freedoms and the prosperity it has made possible. The international rules based order is an extension of those principals internationally and has served, though imperfectly, the same purposes globally. The U.S. has become an Imperial power who doesn’t obey the rules it tries to impose on others. Thus, American influence in the world is declining rapidly. We will all suffer as a result.