Tag: politics

Scoring the Iran War

What did we gain from the Iran war and what was the cost (so far)? Why did we launch this war? What was our objective and have we achieved it?

From a NYTimes article and JD Vance speech the US budgetary cost of our illegal attack on Iran was about $150 billion. This year’s conflict cost five to six thousand lives. This does not include the economic cost to the world from oil shortages and food shortages expected from the shortage of fertilizer, etc. NYTimes – Iran war costs

In evaluating what we gained from the war it is hard to know whether to treat the negative outcome as a negative gain or an additional cost. Prior to this war the Straits of Hormuz were open and passage was free. While Iran seems to have agreed to reopen them, they have now clearly demonstrated the potential to close them or charge for passage as potential future choke points. While Iran may be giving up its financing of friends in the neighborhood (Hamas, Hezbollah, Syria, Yemen), and this would be an import gain, it has established its military strength to defend itself while the US has demonstrated its vulnerability.

More importantly, Iran is now judged by many to be more likely to build an atomic bomb. The Iran Deal (Joint Comprehensive Plan of Action -JCPOA) negotiated by the Obama administration, which insured that Iran would not do so for at least ten years, was overturned during the first Trump administration. Hopefully such assurances can be reestablished during the 60 day negotiations still ahead. Though such a bomb would violate Islamic doctrine, the need for such protection has been greatly increased by US/Israel aggressions. But the MOU agreed to this week provides no assurance that a new agreement would be any better than the one Trump killed in May 2018. The Washington Post’s careful analysis suggests that it is not promising that a new agreement will be any better than the old one:  Trump condemned Obama’s Iran deal-here’s how his own compares

In an interview at the opening of his Presidential Library in Chicago, former President Obama stated that: “it feels like we are back where we were before we started the war, except maybe a little worse off…”  The Hill-Obama on Trump Iran war Obama’s assessment was not including the costs of the war noted above.

US support of Israel has been very costly. Virtually the whole amaworld, other than the US, has condemned Israel’s behavior in recent years. The number of Palestinians killed by Israel in Gaza alone since the Oct 7, 2023, attack on Israel by Hamas that killed 1,200, is hard to estimate in part because so many remain buried under the rubble. As reported in an interesting effort to estimate deaths, over half of those killed were women and children, Ralph Nadar stated that: “The recent report by Francesca Albanese, the United Nations Special Rapporteur on the Occupied Palestinian Territories, referred to a consensus of 680,000 deaths.  Fatalities by Israel-vast Gaza genocide-deliberately undercounted These deaths don’t include those in the West Bank, Lebanon, and Syria, which continue to this day despite a so-called cease fire.

More broadly the damage to America’s reputation because of our support of Israel’s bloody attacks of its Palestinian, Lebanon, and Syrian neighbors has been further increased by its illegal attacks on Iran. Our rapid decline continues.

According to Ian Bremmer: “The cease-fire does not mark the end of this chapter of conflict and regional division in the Middle East; it is instead driving a geopolitical realignment along new fault lines.

“More outcomes? A more polarized and fractured Middle East. Iran in a stronger strategic position. And American partners shaken by erratic and unpredictable conduct.

“The war has accelerated the collapse of the US-anchored order that held the Middle East together for decades. That arrangement kept oil flowing, rival powers out of the region, and Washington the broker of everything that mattered – from Iranian containment to the more recent Arab-Israeli normalization process. It was already fraying before the fighting started. The war broke it.”   Linkedin – What actually mattered

The General’s Son

In the book “The General’s Son: Journey of an Israeli in Palestine,” by Miko Peled, the General refers to Major General Mattityahu “Matti” Peled (1923–1995), an Israeli military commander who became a prominent peace activist, academic, and politician. A key architect of the Israeli Defense Forces’ (IDF) victory in the 1967 Six-Day War, he later transitioned into a radical advocate for Israeli-Palestinian dialogue and a two-state solution.

Like his father, Miko was also an avid Zionist who believed in peaceful relations with his Arab neighbors in two sovereign states. When Milo’s niece Smadar was killed by a Palestinian suicide bomber in 1997, Miko’s reaction to his grief tells us all we need to know to understand the heart of this book. Rather than expressing hatred toward the Palestinian murderer of his beloved niece, he felt shame and anger toward his fellow Israelis for driving a Palestinian boy to take his own life in this way. The book relays Miko’s journey upto and beyond this tragedy and sets out a more balanced history than you might have heard.

Having settled in San Diego to teach karate, Miko began to participate in mixed Jewish/Arab groups (San Diego Jewish-Palestinian Dialogue Group) discussing their experiences in and hopes for Israel and the West Bank and Gaza Strip (WBGS) and became hopeful for two sovereign states living peacefully next to each other. When Israeli Prime Minister Ehud Barak and Palestinian leader Yasser Arafat meet with President Bill Clinton at Camp David in Maryland, Miko was sure peace was at hand. When the talks fail to achieve agreement and Clinton seems to blame Arafat, Miko is shocked.

“Arafat had been consistent for years. For the sake of peace he was willing to give up the dream of all Palestinians to return to their homes and their land in Palestine. He was willing to recognize Israel, the state that destroyed Palestine, took his people’s land, and turned them into a nation of refugees. He was ready to establish an independent Palestinian state in the West Bank and Gaza—which make up only 22 percent of the Palestinian homeland—with Arab East Jerusalem as its capital.

“He was ready to do all this, but he was not going to settle for anything less. He had always been clear about what he saw as the terms for peace.

“In the end, it turned out that… what the Israelis had demanded at Camp David was tantamount to total Palestinian surrender…. Barak demanded that Arafat sign an agreement to end the conflict forever and in return, he would be permitted to establish a Palestinian state on an area of land that could not be defined clearly because it was broken into pockets with no geographic continuity. Instead of Arab East Jerusalem, he would receive a small suburb of East Jerusalem as his capital. To that Yasser Arafat refused to agree.” (p. 126)

Miko’s love of Israel and increasing exposure to Palestinians (both in San Diego and in the West Bank, which he visited often to teach Karate and promote mutual understanding) exposed him to the shocking mistreatment of Palestinians in their own land. His compassionate heart and wisdom led him to strongly advocate the two-state solution to the struggles between the Arabs and Jews occupying the area.

During a visit to Ramallah to meet Abu Ali Shahin, Fatah commander and leader of the Palestine political prisoners for more the two decades, Miko exclaimed that: “Immediately after the war, while still in uniform, my father said that Israel must recognize the rights of the Palestinian people. He said that if we don’t do this, the Israeli army would become an occupation army and would resort to brutal means to enforce the IsraeliOslo occupation on the Palestinian people. He said this while still in uniform and he never stopped saying it and advocating for Palestinian rights till he died.” (p. 229)

In my own work with the IMF helping to establish the Palestine Monetary Authority called for by the Oslo Accord, I was disheartened to observe Israel’s abusive treatment of the Palestinians. The Oslo Accord itself did not provide for a fully independent and sovereign state for the Palestinians (themselves semitic children of Abraham). It provided what was hoped would be the first trust-building steps toward such a true state. However, Israel carved up the West Bank with highways only usable by Israelis. Palestinians driving to their new capital of Ramallah had to wait hours to enter via the Israeli-controlled check point. With my UN passport I could sail in via the Israeli entrance with no wait. Israel isolated the Palestinian population of the WBGS in every way imaginable.

Though declared illegal by the UN, Israeli Jews increasingly stole Palestinian land to establish Jewish settlements, carving up and often destroying Palestinian farms in the process. The number of Jews living in illegal settlements in the West Bank grew from about 80,000 in 1990 to almost 530,000 in 2025. But this pales compared to the shocking mistreatment reported by Miko.

At the end of Miko’s meeting with the 72-year-old Fatah leader, Abu, Ali Shahin, stated:

“We all belong to this land and need to live together. No one is safe in one Jewish state. Judaism is a religion, and I am speaking of a secular state of all its citizens. That is the only way to live here. Being Jewish or Muslim or Christian or atheist, that is a personal choice, not for me to dictate and not to be dictated to me. I don’t want a priest or a rabbi or a sheikh to govern my life. We belong in this land, and we need to live here as equals.”

Miko then writes: “This was not the first time I had heard someone talk of the ‘one secular democratic state,’ as the right solution. It was the part of the Fatah manifesto to create a secular democracy in all of Palestine. In the past, I could not stomach it, but the more I met impressive, intelligent people like Abu Ali, people who were driven by principle, the more I thought that there was no point, indeed no future, in dividing the people and the land. Not to mention the fact that the settlements and the facts on the ground had succeeded in erasing the West Bank as a viable area in which a Palestinian state could be established.”

In my book on my travels in the area, “Palestine: The Oslo Accords Before and After”, I still strongly supported a two-state solution. But when I asked George Abed, my IMF colleague then Governor of the Palestine Monetary Authority I was there to help create, if he would write the Foreword to my book, he declined, saying the book was unfair to the Palestinians. I have now come to accept that he was right.

This book was published in 2012. From that year (January 2012) until October 6, 2023 Palestinians killed about 300 Israelis, who killed about 3,900 Palestinians. From the October 7, 2023, attack on Israel until now (June 2, 2026), Palestinians killed about 1,400 Israelis (of whom 1,200 were killed during Hamas’s Oct. 7 attack), who then killed about 75,000 Palestinians. The status quo is clearly not working for Israelis or for Palestinians.

The United States, home to about as many Jews as there are in Israel, is a secular state with large populations of Jews, Protestants, Catholics, Muslims and other religious groups. Our constitution forbids the government from adopting any one of them. They have each flourished. I have reluctantly concluded that Israel must annex the West Bank of Gaza and give full and equal citizenship and rights to all Arabs and Jews living there. “A one state solution”,  “A one state solution – 2”.

The wars and ethnic cleansing now underway by the Netanyahu government is not only destroying Israel, but also dragging the United States down with it and I haven’t even mentioned Iran.

SCOTUS – Louisiana v. Callais

“The Supreme Court’s invalidation of Louisiana’s congressional map has triggered a swirling debate about just how fundamentally the justices altered the Voting Rights Act landscape.” This and following quotes are from The Hill article: the hill – regulating voting-rights-act-supreme-court – SCOTUS-Decision  

The court’s ruling in Louisiana v. Callais was adopted by 6 – 3 of the judges.

I am quite amazed how dramatically differently some people have characterized the decision’s result.

“Section 2 of the Voting Rights Act of 1965 [as Amended in 1982] has enabled groups to force states to draw additional majority-minority districts for decades,” despite the 15th Amendment to US constitution in 1870, which prohibited the federal and state governments from denying a citizen the right to vote based on that citizen’s “race, color, or previous condition of servitude”, effectively protecting the voting rights of Blacks.

Section 2 “bars voting maps that give a racial minority ‘less opportunity than other members of the electorate’ to elect their preferred candidate.”

In Thornburg v. Gingles (1986), the Supreme Court ruled that multi-member legislative districts in North Carolina violated Section 2 of the Voting Rights Act by diluting Black voting power. The landmark ruling established a critical three-part legal test to determine if an electoral map illegally discriminates against minority voters.

To prove a violation of Section 2, plaintiffs must satisfy the following three preconditions:

  1. Numerosity and Compactness: The minority group must be sufficiently large and geographically compact to constitute a voting majority in a single-member district.
  2. Political Cohesion: The minority group must show that it is politically cohesive, meaning they largely vote for the same candidates.
  3. Majority Bloc Voting: The plaintiffs must prove that the white majority votes sufficiently as a bloc to usually defeat the minority group’s preferred candidates

After Thornburg v. Gingles, plaintiffs could prove vote dilution by showing that a minority group was large and compact enough to form a majority in a reasonably drawn district, was politically cohesive, and faced bloc voting by the majority that usually defeated its preferred candidates.

That framework gave civil-rights groups a litigation template: draw an “illustrative” majority-minority district, show polarized voting, and argue that the state had cracked or packed minority voters so they could not elect their preferred candidate. If they won their case, the remedy often required the state to create an additional majority-minority district, even though Section 2 formally says it does not create a right to proportional representation.

In its recent Louisiana v. Callais ruling the Court held that Louisiana’s second majority-Black congressional district was an unconstitutional racial gerrymander and that Section 2 did not require Louisiana to draw it. The Court majority said that Voting Rights Act compliance can be a compelling interest only when Section 2 is properly construed, and it tightened the Gingles test by requiring race-neutral illustrative maps, closer adherence to state districting goals such as compactness, incumbency protection, and partisan objectives, and evidence separating racial bloc voting from ordinary partisan voting.

The practical effect is that plaintiffs can no longer easily say, “Here is a compact majority-minority district; therefore, the state must draw it.” After Callais, they must show that the alternative map satisfies the state’s nonracial redistricting criteria, that the voting polarization is racial rather than merely partisan, and that the totality of circumstances points to present-day legally relevant discrimination rather than mainly historical disadvantage.

A “majority-minority district” is one in which a racial minority (blacks, Asian, Hispanics, etc.) constitute a majority of the voters. The presumption seems to be that, for example, only (or mostly) blacks will vote for a black candidate. That is clearly a racist view. Barack Obama, for example, was elected President of the United States by a majority of white voters.

I am really shocked at how overtly racist the opposition to the court’s decision is. “’Unfortunately, we are talking about rolling back to an era of Jim Crow, and I don’t believe I’m overstating that,’ Sophia Lin Lakin, director of the American Civil Liberties Union’s voting rights project, But Jim Crow laws were used to segregate blacks and whites. Majority-minority districts move in the same direction. The court’s weakening of the arguments for such districts is the opposite of a Jim Crow law. Voters are motivated by many things, but I have more confidence than does Ms. Lakin in voters choosing the candidate they think best and most effectively supports the policies they support, whether the voter is black, white, or yellow whatever the color of the candidate.

“House Minority Leader Hakeem Jeffries (D-N.Y.) said the law was ‘largely gone,’ telling reporters the decision was ‘designed to undermine the ability of communities of color all across this country to elect their candidate of choice.’” Good grief.

Here is an excellent discussion of this issue: “The supreme court’s vote ruling empowers minorities”

National Science Foundation

On Friday, April 24, President Trump fired all 24 members of the National Science Foundation Board without saying why their staggered six year terms were not honored. Unlike executive branch departments, such as Treasury, Defense (now called Dept of War), Education, etc., which rightly should reflect the policy preferences of the President, the NSF, like the Board of Governors of the Federal Reserve, was carefully designed to be nonpartisan for good reason. A Forbes article by John Drake nicely explains the purpose of such design.

“Most people outside the research enterprise have never heard of the NSB, so it’s worth saying what it is. The National Science Foundation Act of 1950 created NSF with two heads: a director and a board. Jointly they set the strategic direction of an agency that now distributes roughly $9 billion annually in federal research funding, approve its budget submissions, and authorize new major programs. The board’s members are nominated for their distinguished records in science, engineering, education, and public affairs, drawn from industry and universities, and confirmed to staggered six-year terms so that scientific research priorities are set by the long arc of scientific progress rather than the election cycle. The statute requires that members be chosen “solely on the basis of established records of distinguished service.”

“That last phrase is the one I keep returning to.

“American scientist, inventor and administrator Vannevar Bush (1890 – 1974), whose ‘differential analyser’ was a forerunner of the computer, served as director of the Office of Scientific Research and Development throughout World War II and authored an influential report that led to the founding of the National Science Foundation. More American scientific preeminence is often discussed as if it were a product of talent or funding. It is really a product of institutions, the unglamorous architecture of boards, charters, terms of service, peer review and statutory independence that the postwar generation built deliberately. The structure traces to Vannevar Bush’s 1945 report Science, the Endless Frontier, which argued that federal science required governance insulated from political pressure and stability of support beyond any single budget cycle. The five-year fight to translate Bush’s vision into law turned largely on questions of independence and accountability, and the staggered six-year terms were part of the resulting compromise. Six-year terms exist for a reason. Staggered appointments exist for a reason. “Solely on the basis of distinguished service” is in the founding statute for a reason.

“The board’s function has been contested before, but always on the existing terms. As recently as 2022, scholars were debating how to modernize the board’s role, proposing to reduce its management duties and make NSF look more like other federal agencies. But other federal agencies are precisely the ones most exposed to political control. Their leaders serve at the pleasure of the president. Their priorities shift with each administration. The whole reason NSF’s structure is unusual is that the postwar designers did not want science funding to work that way. Even the would-be reformers recognized this: they proposed keeping the board’s staggered terms and statutory independence intact.

“These structures depend on a shared understanding, across administrations and across parties, that some institutions are worth preserving even when they constrain you. When that understanding lapses, the structures themselves do not survive long.

“On May 5, the National Science Board is scheduled to meet. There is no agenda, and at the moment, no board. That absence is the thing worth attending to, beyond the news of any particular firing. The question is not who sits on the board. The question is whether the kind of board the 1950 Act envisioned still exists in practice, and what American science looks like if it does not.” 2026/04/25/ “Trump fired the entire national science board-here’s why that matters”

At a minimum, when the President takes such action, the public should be given an explanation for why he thought it was justified. Ideally such a dramatic step should be preceded by a public discussion of the pros and cons of doing so.  This is not Trump’s style.

It my opinion Elon Musk’s DOGE downsizing of government (9% reduction in Federal employees before some had to be rehired and reducing the federal budget by claimed savings between roughly 160–215 billion dollars, counting job cuts, contract and lease cancellations, asset sales, and grant reductions) did more harm than good. Musk initially talked about cutting “at least 2 trillion dollars” from the federal budget, later revising goals down to around 1 trillion and then still lower, but actual savings fell far short of any of those targets.

A CBS‑covered analysis by a nonpartisan research group estimated that while DOGE claimed about 160 billion dollars in gross savings, its actions would also impose roughly 135 billion dollars in additional costs in the same fiscal year (for example through deferred‑resignation pay, disruption, and lost enforcement/revenue), implying a net savings nearer 25 billion dollars in that window.

But the real tragedy is that the opportunity to carefully evaluate and publicly debate whether government agencies were performing beneficial functions and doing so as efficiently as possible was totally missed. I offer the example of USAID, with whom I have worked both as a contractor and across the table as a collaborator. In my experience they have done an outstanding job serving America’s foreign policy interests:  https://wcoats.blog/2025/02/17/usaid/

The Trump administration has not operated in the traditional manor of our best (or even mediocre) Presidents. Even Kings are usually more careful in justifying and explaining their dictates.

Gerrymandering

The United States has flourished and grown to almost the highest GDP per capital in the world (exceeded only by tiny Luxembourg, Switzerland, Ireland, Singapore, and Iceland) because of the individual freedom of its citizens to act in their own interest and whose property and freedoms are protected by a government to which they gave limited powers. Historically individuals only had the rights and freedoms handed down to them by their Kings/rulers.

The preservation of the rule of law under our Constitution is essential for our continued flourishing. It is eroding.

The U.S. House of Representatives has 430 members of which currently 217 are Republicans and 212 are Democrats (one is independent). These numbers have changed slightly because of recent “resignations.” The number of representatives from each state depends on its population at the end of each decade’s Census. Each state is geographically divided into the number of congressional districts matching its number of representatives. While states may approach the drawing of its congressional districts in its own way, there are some criteria that must be observed.

1. Federal Mandatory Criteria

These rules apply to every state, regardless of their internal policies:

  • Equal Population: Based on the principle of “one person, one vote,” districts must be as nearly equal in population as practicable. This is rooted in the U.S. Constitution and upheld by Supreme Court cases like Wesberry v. Sanders.
  • Race and Ethnicity (The Voting Rights Act): Under Section 2 of the Voting Rights Act, districts cannot be drawn in a way that dilutes the voting power of racial or language minorities. In some cases, this requires the creation of “majority-minority” districts.

2. Traditional Districting Principles

Most states also follow “traditional” principles to keep districts logical and representative. These vary by state law:

  • Contiguity: All parts of a district must be physically connected. You shouldn’t have to leave the district to get to another part of it.
  • Compactness: Districts should be geographically “tight” rather than sprawling or having jagged, “finger-like” extensions (though this is frequently debated in court).
  • Respect for Political Subdivisions: Mapmakers often try to avoid splitting counties, cities, or towns between multiple districts.
  • Communities of Interest: This is the effort to keep groups with shared social, economic, or cultural interests together so they have a unified voice in Congress.

If district lines are drawn to concentrate likely Republican or Democrat voters into one or a few districts, their voting strength in other districts would be reduced. In this way the likely number of Republican or Democrat representatives from the state can often be increased or decreased, a practice known as gerrymandering. Such political concentration has also favored the election of candidates with more extreme views within their party hollowing out the center.

 “Ordinarily, states draw new congressional lines once every 10 years, at the start of the decade when they receive new data from the U.S. Census Bureau. Last year, Trump pressed Republican-led states to break with that tradition and gerrymander their districts to help his party maintain its narrow control of the House.

“The push resulted in better lines for the GOP in five districts in Texas, two in Ohio and one each in Missouri and North Carolina. Democrats responded by persuading voters to approve new maps that would give Democrats the edge in five seats in California and four in Virginia.”  Washington Post  Redistricting in Virginia

While I have been a free market, limited government Republican all my life until Trump’s first campaign in 2016, I was not willing to vote for him and changed my party to Libertarian. Given my disappointment with the Republican Party’s unwillingness to use its constitutional authority to vote on tariffs and war among other things, I am hopeful that the Democrats will take control of Congress in the midterm elections later this year. None the less I voted No on Virginia’s referendum on a midterm redistricting that is expected to give Democrats 4 additional seats in the House. Why? Gaining House seats by questionable (The Supreme Court may reverse all of this) mid-decade redistricting rather than by convincing voters to change their votes diminishes the rule of law I so strongly defend.

Democratic Sen. John Fetterman (Pa.) reacted with dismay Tuesday evening when informed during an appearance on NewsNation’s “Cuomo” that a Democratic redistricting initiative had passed in Virginia, declaring, “We all lose at this point.”

“Even The Washington Post has said the ‘yes’ campaign is, in their words, brazenly dishonest.”  David Weigel, Semafor

My Blogs

From the time I could vote (1964) I have indevoured to evaluate each president’s policies on their merits (as seem by me of course). Thus, at one time or another I have praised or criticize policies of LBJ, Richard Nixon, Gerald Ford, Jimmy Carter, Ronald Reagan (my favorite president), George H.W. Bush, Bill Clinton, George W Bush, Barack Obama, Joe Biden, and Donald Trump. I often condemned a policy but not the President promoting it, in the belief that each President thought his policy was for the welfare of our country even if I disagreed. The exception is Donald Trump. 

Unique in my lifetime, we have a President whose primary interest is in seeing his name on things (Kennedy Center, Peace Institute, maybe Dulles Airport), filling the White House with gold to look like a palace, being praised by strong men (Putin, Orban, Mohammed bin Salman), dropping bombs where ever he chooses (having given up begging for the Nobel Peace Prize) and throwing his weight around (bullying), irrespective of the considerable damaging he is doing to our country. Now he wants his name on US currency (not to mention his likeness on gold coins).

Since 1861 the US treasurer’s signature has appeared on bank notes, along with the likeness of a deceased President.  In 1866, Congress passed what is commonly called the Thayer Amendment, which forbids the likeness of any living person from appearing on U.S. securities and currency. “Donald Trump is set to become the first sitting US president to have his signature on US banknotes, the treasury department has announced…. Trump’s signature will appear alongside Treasury Secretary Scott Bessent, an unprecedented move that the department said would mark America’s 250th anniversary…. The first $100 bills with the signatures of Trump and Bessent will be printed in June, with others to follow.  Notes currently being printed bear the signatures of former President Joe Biden’s Treasury Secretary, Janet Yellen, and Treasurer Lynn Malerba.” Just in case you didn’t know that we have a Treasurer in addition to the Secretary of the Treasury https://www.bbc.com/news/articles/cz0el909yp3o  

Trump is an egoist with the tastes and desires of a spoiled child. Unfortunately, as President of the United States his childish behavior is doing great damage to the U.S. and global order.

Bosnia

In my last blog I condemned the US’s illegal attack on Venezuela and worried about what might follow given the apparent lack of a broadly considered and agreed plan. In this blog I will contrast it with the approach taken at the end of the vicious civil war between the Croat, Serb and Bosnian populations of Bosnia and Herzegovina.

The fighting in Bosnia and Herzegovina ended with the signing of the Dayton accords. “Three decades ago, in November 1995, the U.S.-brokered Dayton accords ended the Bosnian war, a three-and-a-half-year ethnic conflict that killed roughly 100,000 people and displaced two million. The settlement imposed a complex power-sharing structure on a divided country, promising the state of Bosnia and Herzegovina a new start.” This quote is from an excellent assessment of that agreement and the new constitution for Bosnia and Herzegovina that it created by Elmira Bayrasli in Foreign Affairs: “Bosnia’s Unfinished Peace”

I drafted the monetary section of that constitution, which established a central bank bound by currency board rules (i.e. no monetary policy as the money supply is determined by the public’s demand for and willingness to purchase its currency). I also led the IMF teams that drafted the Central Bank Law that merged the existing three central banks (Croat, Serbian and Bosnian) into one national bank and currency. The negotiations with the three (obviously) future governors of the Central Bank of Bosnia and Herzegovina (CBBH) lasted for over a year of heated discussions of the CBBH’s powers and the details of its currency notes. For details see my account in “One Currency for Bosnia”  Surprisingly to many the CBBH’s currency board rules were accepted instantly by all three with no debate. The reason was that the three didn’t trust one another and currency board rules eliminate an monetary policy discresion.

The Dayton accord was the product of intense negotiations between the Presidents of Croatian, Serbian and Bosnian provinces of B&H and diplomates from the US, UK, EU and Russia culminating with the agreement at the Wright-Patterson Air Force Base in Dayton Ohio—the Dayton Accord. To lay out the sharp contrast between these negations and the lack of them in the current “take over” of Venezuela, I will quote extensively from Wikipedia:

“During September and October 1995, world powers (especially the United States and Russia), gathered in the Contact Group, pressured the leaders of the three sides to attend settlement negotiations; Dayton, Ohio was eventually chosen as the venue.

“Talks began with an outline of key points presented by the US in a team led by National Security Adviser Anthony Lake in visits to London, Bonn, Paris and other European stops 10 – 14 August 1995. These included Sochi, to consult Russian Foreign Minister Andrei Kozyrev. Lake’s team handed off to a separate US inter-agency group led by Assistant Secretary of State Richard Holbrooke, who went on to negotiate with Balkan leaders in their capitals. The Holbrooke crew conducted five rounds of intense shuttle diplomacy from August to October, including short conferences in Geneva and New York that resulted in the parties’ adoption of principles for a settlement on 8 and 26 September respectively.

“The Dayton conference took place from 1–21 November 1995. The main participants from the region were the President of the Republic of Serbia Slobodan Milošević (whom the Bosnian Serbs had previously empowered to represent their interests), President of Croatia Franjo Tuđman, and President of Bosnia and Herzegovina Alija Izetbegović with his Foreign Minister Muhamed Šaćirbeg.

“The peace conference was led by US Secretary of State Warren Christopher, and negotiator Richard Holbrooke with two co-chairmen in the form of EU Special Representative Carl Bildt and the First Deputy Foreign Minister of Russia Igor Ivanov. A key participant in the US delegation was General Wesley Clark. The head of the UK’s team was Pauline Neville-Jones, political director of the Foreign and Commonwealth Office. The UK military representative was Col Arundell David Leakey. Paul Williams, through the Public International Law & Policy Group (PILPG) served as legal counsel to the Bosnian Government delegation during the negotiations.”

The history and situation of Bosnia and Herzegovina was dramatically different than Venezuela. Ending its civil war required extensive negotiations and considerable international oversight of compliance to the agreed arrangements. As noted in the Foreign Affairs article sighted above, a serious mistake was holding national elections far too earlier. The intense hatreds of the three national groups were not given enough time to soften resulting in the election of hardliners and the continuation of the war by other means. The second mistake was the failure of international oversight (the UN High Representative) to fully exorcise its powers. None the less the three nation country has held together peaceably for three decades following its civil war.

While the political situation in Bosnia remains fragile (see the excellent article sited above in Foreign Affairs) the central bank itself has been a great success, widely trusted and respected by most citizens from the three provinces. I attribute this to its enlightened leadership and the central bank law with its currency board rules. Tragically the DOGE chain saw seems to have eliminated US capacity for effective diplomacy. “At the breaking point”

Venezuela

The only time I have been to Venezuela was in 1981 with Friedrick Hayek to speak at some conference. At that time it had the highest per capita income in south America ($4,951 in 2024 dollars). Today (i.e. 2024) it has dropped to 11th place with a per capita income of $4,218, while Uruguay has risen to $23,089. How and why did this happen?

Venezuela become an independent country in 1830 and a democracy since 1958. But with the election of the socialist Hugo Chávez in 1998 Venezuela’s economy turned South. He oversaw the adoption of a new constitution and the “socialization” of the economy.  Chávez was reelected three more times before dying in office of cancer. He was succeeded by Nicolás Maduro. Their governments were characterized by hyperinflation, famine, disease, and crime, which lead to massive emigration from the country (roughly 8 million).

Maduro’s reelection May 20, 2018 was disputed by his opposition. After being sworn in for a second term on January 10, 2010, the Organization of American States approved a resolution in which Maduro was declared illegitimate as President of Venezuela, urging that new elections be held. On January 19, 2019, the president of the National Assembly, Juan Gerardo Antonio Guaidó, was declared the interim president by that body. Guaidó was immediately recognized as the legitimate president by several nations, including the United States. President Trump threatened to remove Maduro.

President Trump falsely claimed that Maduro was responsible for large illegal drug shipments to the US (very little of which came from Venezuela) and prepared to remove him, offering him safety outside Venezuela. However, the Trump administration’s bombing of speed boats it claims were carrying drugs to the U.S. and its attack on Caracas and kidnapping of its President were illegal in the U.S. and internationally and bad for America. “war” “The military operation, undertaken without UN Security Council authorization, without congressional authorization, without a claim of self-defense, and without even a plausible legal rationale, represents the most harmful attack yet on the rules-based order.” Foreign Affairs: The World Without Rules”

In a recent interview about the U.S. operation to seize Nicolás Maduro and “run” Venezuela, Trump was asked if there were any limits on his power; he replied: “Yeah, there is one thing. My own morality. My own mind. It’s the only thing that can stop me.”  In the same exchange, he added that he does not “need international law,” signaling that he does not view international legal rules as binding limits on his use of military or coercive power abroad. If you love America, this much concern you.

The adherence to acceptable norms of behavior– the rule of law at home and abroad– is an incredibly important contributor to our well-being. Weakening or destroying it is bad for the U.S. and the world. Trump’s threats to expand the US invasions to Cuba, Panama, Mexico, Iran, and Greenland further damaged America’s image and cooperation of previously friendly countries. “A world in which the powerful no longer feel the need to justify themselves is not merely unjust. It is barbaric: operations to kill, steal, and destroy are severed from any claim of right. That world does not have a legal order at all. It has only force, guided by one man’s whims.”  Ibid. German President Frank-Walter Steinmeier warned us that we are in the midst of a “breakdown of values” that is turning the world “into a den of robbers, where the most unscrupulous take whatever they want” 

While Maduro’s kidnaping was impressively well planned and executed, it’s unclear what is planned for the day after.  U.S. experiences with the follow ups to our attacks on Libya, Afghanistan and Iraq were not good.

In Iraq, a hard to understand invasion based on lies, the ruling Coalition Provisional Authority, led by the U.S., removed not just Iraq’s leadership but a very large part of its bureaucracy including disbanding the Army (who were then going to do what??) with disastrous results. I describe my experiences there in: “Iraq-An American Tragedy-My Travels to Baghdad”  

In Venezuela the Trump Administration has left the Maduro government in place allowing Vice President Delcy Rodriguez to assume the Presidency, the opposite of our earlier approaches after our invasions of Afghanistan, Iraq and Libya. This decision seems to have been based on consideration of the options: an evaluation that Ms. Rodriguez, while an important member of the Maduro government, is widely respected and pragmatic, and that the U.S. via its oil sanctions has considerable leverage without the need for boots on the ground. “Rajan Menon: here’s what Trump really wants”

At the White House press conference following the very well planned and execute attack on Caracos, Secretary of State Marco Rubio described America’s strategy for the period ahead: “Step one is the stabilization of the country. We don’t want it descending into chaos. Part of that stabilization, and the reason why we understand and believe that we have the strongest leverage possible is our quarantine. We are going to take between 30 and 50 million barrels of oil. That money will then be handled in such a way that benefits the Venezuelan people, not corruption, not the regime.

“The second phase will be a phase that we call recovery, and that is ensuring that American, Western, and other companies have access to the Venezuela market in a way that’s fair.  Also, at the same time, we begin to create the process of reconciliation nationally within Venezuela so that the opposition forces can be amnestied and released from prisons or brought back to the country and begin to rebuild civil society. And then the third phase, of course, will be one of transition.”

Friday Trump summonsed the main US oil producers’ leaders to seek their agreement to move back into Venezuela’s oil fields. When ExxonMobil’s chief executive Darren Woods said that Venezuela was currently uninvertible, Trump, in typical bully style, stated on Airforce One that: “I didn’t like Exxon’s response. I’ll probably be inclined to keep Exxon out. I didn’t like their response.”  “Trump threatens to block ExxonMobil in Venezuela”  He declared that he would make all the decisions. Putin couldn’t have said it better.

Rather than accepting Vice President Rodriguez becoming President and seeming to toss aside the legitimately elected President Juan Gerardo Antonio Guaidó, why didn’t we convene discussions with all of the relevant parties in Venezuela (Guaidó, Rodriguez, key generals, members of Parliament, etc.), and include in the dialog the relevant members of the US Congress and key allies—especially Brazil, Mexico, Colombia, EU and agree on a path back to democracy and prosperity.  Unfortunately, the DOGE chainsaw has eliminated many of the US DOS officials with knowledge and expertise on Venezuela as well as US experts capable of helping to implement the resulting plan (e.g., “USAID”).

The attack on Venezuela can’t be undone. Unfortunately, we already sold out the Venezuelan opposition, fired all our Venezuela experts and staff capable of negotiating and executing the day after, irretrievably alienated all the allies whose support we need (and even threatened them with attack as well!). The prospects for restoring a successful and peaceful democracy to Venezuela are challenging to say the least.  The U.S. is in a much weaker position that we were a year ago. “Fukuyama: The problem with America’s Venezuela policy”

How to be Safe

Much can be said about how and why almost everyone on earth has risen from poverty to affluence. Two of the most important are free markets that allow entrepreneurs to invent and build, and peace and security that allow our work to build consumer goods and services rather than weapons of war.

Taking the second of these, the safety of our persons and our property allows us to specialize and trade – an absolutely critical condition for flourishing. The more broadly we can trade the greater is the wealth producing potential of our efforts. So a key question and the focus of this blog is how we maximize our safety in order to maximize trade the production of consumer goods and services rather than weapons of war.

Since 9/11 almost one million people have been killed in wars and when including indirect deaths from wars the number rises to around 4.5 million. The U.S. alone has spent over $21 trillion dollars on defense since 9/11.  This is 5.25% of the U.S.’s cumulative GDP over that period of $400 trillion.

If we could trust every country in the world, we could get rid of our military complex and add that amount to our incomes. Obviously that would be unrealistic thus some defense spending will always be necessary. However, with the deployment of skillful diplomacy it can be greatly reduced and the losses from actual wars could potentially be eliminated.

We must live among other people. If we are good neighbors, we will be safer from attacks (verbal or worse) by those around us. Being a good neighbor requires being trustworthy (honest) and behaving in ways that take into account and respect the interests of our neighbors. What is true on the block and village is true globally as well. The adoption of mutually agreed rules/norms for our interactions with others is an important aspect of our safety and productivity.

Within each country, at least, agreement has been reached on which side of the road to drive, what frequency we can broadcast on, and what voltage our electricity will be. Across boarders we have agreed on setting dates and time (the calendar), airline overflight rules, and the orbits our satellites will occupy. After WWII, in addition to the UN and its many agencies, NATO, the World Bank, the IMF, and World Trade Organization, countries established the International Organization for Standardization (ISO), International Telecommunication Union (ITU), and the International Electrotechnical Commission (IEC). Moreover, the US and most every other country have established embassies in each other’s countries in order to serve the needs of their own citizens abroad and to maintain dialog and informed relations with each other’s governments.

An important part of soft power diplomacy are the supportive relationships with “allies” who contribute to mutual defense, thus lowering its cost. But good (cooperative) relationships in general are an important contributor to our safety and commercial interaction with other countries. To a large extent formal rules of war and treatment of others have promoted peace in the world.

Violating these rules (e.g. Russia’s invasion of Ukraine and U.S. invasion of Venezuela) raises the cost of our security. It makes us less safe and less wealthy. https://wcoats.blog/2026/01/03/war-2/

President Trump has angered our friends and allies with his tariff and other threats and a generally bullying approach to our relations with other countries. He has created enemies where we didn’t have them before. After bombing Venezuela and kidnaping its President, he is now threatening the same for Cuba, Panama, Columbia, Iran, and Greenland. Denmark’s government, which controls Greenland’s foreign affairs and defense, has told the White House to “stop the threats.”

Protests of US lawlessness is growing. As but one example:

JOINT DECLARATION BY THE GOVENMENTS OF

BRAZIL, CHILE, COLOMBIA, MEXICO, SPAIN, AND URUGUAY

“The governments of Brazil, Chile, Colombia, Mexico, Spain, and Uruguay, in light of the gravity of the events that have occurred in Venezuela and reaffirming their commitment to the principles enshrined in the United Nations Charter, make the following joint declaration:

“We are deeply concerned and reject the military actions unilaterally carried out on Venezuelan territory, which infringe fundamental principles of international law, in particular the prohibition of the use and threat of force, and respect for the sovereignty and territorial integrity of States, as enshrined in the United Nations Charter. These actions set an extremely dangerous precedent for peace and security in the region and endanger civilian populations.”

Trump has isolated the U.S. by breaking the rules and angering our friends and alias. We are much less secure than in the past.  WP: “Venezuela-Trump-Global Law and Order”

Trade

Without trade each household/family would have to be self-sufficient, i.e., would only have to consume what they themselves could make, grow or do. No one would doubt the dire poverty the world would endure. Even trade limited to your neighborhood, with each household specializing in a few things to trade with other families specializing in other needs or wants would significantly increase everyone’s income. The wider the range of trade the greater the degree of specialization and increased income possible.

Expanding the potential for trade requires the ability to transport goods and serves over longer distances. The benefits of such connectedness extend well beyond higher incomes. Quoting from George Will’s wonderful book The Conservative Sensibility: Referring to the:

“Erie Canal. [Dewitt] Clinton [the sixth governor of New York] saw this project as a means of preventing states in the West from detaching themselves from the Union. The canal would “bind the union together by indissoluble ties” because the people would be “habituated to frequent intercourse and beneficial inter-communication,” and all Americans would be “bound together by the golden ties of commerce and the adamantine chains of interest.” The canal also, and inadvertently, helped to bring down the old order in Europe. By bringing cheap wheat from America’s Great Plains, the canal struck at the roots of Europe’s landed aristocracy.”

Implicit in the above is private ownership of one’s production. People work hard for their own benefit but to benefit from trade they must take account of the needs and wants of others. Trade must be win-win or it will not take place. I benefit from selling my production and you benefit from buying it. Communism—communal production—lacks the personal (selfish) incentive to work hard and has broadly failed as a system. Also from George Will: “In China, once collective farms were disbanded in 1978 under the leadership of the reformer Deng Xiaoping, agriculture output doubled in the space of just four years.”

The topic of trade keeps returning and I have written about it often. Rather than repeat myself, yet again, I will share some of those earlier blogs:

Econ 101—Trade in very simple terms
The politics of Trade
Econ 101: Tony Judt on Trade