Obama’s Critics on Missille Defense Shield Cancellation Are Wrong

BROOKS FOREIGN POLICY REVIEW ANALYSIS

September 27, 2009

“President Bush was right that Iran’s ballistic missile program poses a significant threat. That’s why I’m committed to deploying strong missile defense systems which are adaptable to the threats of the 21st century. This approach is also consistent with NATO’s missile defense efforts and provides opportunities for enhanced international collaboration going forward and we are bound by the solemn commitment of NATO’s Article V that an attack on one is an attack on all.”                                                                                 

Critics charging that President Obama’s cancellation of the missile defense shield system in Poland and the Czech Republic marked capitulation to Russia and weakened Europe’s defense against Iranian and Russian missile attacks are dead wrong. Quite the opposite, the President’s new plan deploys a more potent, high tech, land, sea and space-based system to defend all of Europe and the Caucuses. Obama’s revised “Star Wars” plan is more mobile, less detectable and will be deployed faster than the original plan for ten ground-based interceptor missiles in Poland and forward-based X-band missile radar in the Czech Republic. Arguably, the Obama-Gates universal interceptor missile system will put the United States on the cusp of uncontested global military superiority by making itself and its allies highly impenetrable to Russian, Chinese, North Korean and Iranian missile attacks.

Appearing with President Obama at the September 17 announcement, Defense Secretary Gates stated that “We have now the opportunity to deploy new sensors and interceptors in northern and southern Europe that in the near term provide missile defense coverage against more immediate threats from Iran or others.” Given that Iran is nowhere close to fielding long-range missiles, Gates reference to “others” was obviously directed at Russia. Gates outlined the new plan that will deploy Aegis class warships equipped with SM-3 mobile missile interceptors that can be moved from one region to another. The U.S. has fifteen destroyers and three cruisers equipped with the Aegis combat system which is being developed into a worldwide, sea based, rapid deployable missile shield structure. These new capabilities are being coordinated with Norway, Spain, Australia, Japan and South Korea. Indeed, in February 2008, the USS Lake Erie, an Aegis class guided-missile cruiser, shot down an American satellite in space in its testing phase.  Further, Gates said Phase 2 of the universal interceptor missile system will include “upgraded land-based SM-3s” by 2015.

In addition to deploying the universal interceptor missile system, the Obama Administration and NATO are upgrading the integrated European Medium Extended Air Defense System (MEADS) with current Patriot and Nike Hercules components.  MEADS will include forward-based X-band radar, 360 degree surveillance radar, missile launchers and next-generation Patriot interceptor missiles. MEADS will be interoperable with other defense systems, including the Terminal High Altitude Area Defense (THAAD) system and the Aegis sea-based missile defense systems. Obama has requested and will receive $600 million in funding from Congress for MEADS in the next fiscal year. Doubters concerned about President Obama’s commitment to missile defense should also take comfort in the August announcement of the Pentagon’s Missile Defense Agency that its modified Boeing 747-400F airplane was successfully deployed with a laser weapon that “found, tracked, engaged and simulated an intercept with a missile seconds after liftoff.’ This fall the first live attempt to bring down a ballistic missile will be tested. As for the “defenseless” Czech Republic and Poland, the Pentagon has already opened talks with both countries about hosting a land-based version of the SM-3 missile interceptors and other components of the system. American plans call for 96 Patriot Advanced Capability-3 (PAC-3) missiles in Poland, capable of selecting targeting and homing in on the warhead portion of an inbound ballistic missile. 

Obama’s detractors that claim Poland and the Czech Republic were betrayed in exchange for Russian support for sanctions against Iran’s nuclear program should think again. It’s true that Russian President Medvedev applauded President Obama’s decision to “cancel” the missile defense shield system. After all, he’d look foolish criticizing what Russia had so publicly demanded. On September 22, Medvedev also suggested Russia would consider supporter tougher sanctions against Iran. But behind the walls of the Kremlin there are growing concerns about Russia’s encirclement by the U.S./NATO buildup of a global missile interceptor system. Moscow has seen this movie before. President Reagan’s original Star Wars plan set off a run of defense spending in the USSR that contributed significantly to the economic hollowing out of the Soviet state. When Russia responded to the Poland-Czech Republic missile defense shield by threatening to place Iskander ballistic missiles in Kaliningrad on Poland’s border, it evoked a sense of an escalating Cold War buildup. If Russia ultimately supports damaging sanctions against Iran it won’t be because they feared ten fixed-site land based missile interceptors and a radar installation outside of Prague; Putin and company have a larger strategic problem to counterbalance.  

It must also be said that after all the rhetoric about the Polish and Czech people being abandoned to the Russians, surveys consistently demonstrate that a majority of Poles opposed the stationing of American missiles inside their borders. In the Czech Republic, over two-thirds of the public opposed the basing of the interceptor missile radar. For those who are still not clear about President Obama’s capacity for flexing American military might, he defended his vision of the Star Wars 2 universal missile interceptor system by saying, “President Bush was right that Iran’s ballistic missile program poses a significant threat. And that’s why I’m committed to deploying strong missile defense systems which are adaptable to the threats of the 21st century. This approach is also consistent with NATO’s missile defense efforts and provides opportunities for enhanced international collaboration going forward and we are bound by the solemn commitment of NATO’s Article V that an attack on one is an attack on all.”  Commenting on the new missile defense system the conservative Wall Street Journal recently stated that “Never has Ronald Reagan’s dream of layered missile defenses – Star Wars, for short – been as close, at least technologically, to becoming realized.”

America’s military buildup of ground forces and the largest CIA station in Afghanistan and its aggressive push to place military installations across Central Asia are exerting enormous pressure on Russia, China and Iran. In the final analysis, President Obama will not be able to stop Iran’s drive to master the uranium enrichment cycle or develop a nuclear weapons program. What we witnessing now with the deployment of Obama’s Star Wars 2 missile defense system is a rapid buildup to contain the emerging Eastern Axis in Tehran, Beijing and Moscow.

The G-20 Communique/Statement – April 2, 2009 London, UK

1. We, the Leaders of the Group of Twenty, met in London on 2 April 2009.

2. We face the greatest challenge to the world economy in modern times; a crisis which has deepened since we last met, which affects the lives of women, men, and children in every country, and which all countries must join together to resolve. A global crisis requires a global solution.

3. We start from the belief that prosperity is indivisible; that growth, to be sustained, has to be shared; and that our global plan for recovery must have at its heart the needs and jobs of hard-working families, not just in developed countries but in emerging markets and the poorest countries of the world too; and must reflect the interests, not just of today’s population, but of future generations too. We believe that the only sure foundation for sustainable globalisation and rising prosperity for all is an open world economy based on market principles, effective regulation, and strong global institutions.

4. We have today therefore pledged to do whatever is necessary to:

restore confidence, growth, and jobs;

repair the financial system to restore lending;

strengthen financial regulation to rebuild trust;

fund and reform our international financial institutions to overcome this crisis and prevent future ones;

promote global trade and investment and reject protectionism, to underpin prosperity; and

build an inclusive, green, and sustainable recovery.

By acting together to fulfil these pledges we will bring the world economy out of recession and prevent a crisis like this from recurring in the future.

5. The agreements we have reached today, to treble resources available to the IMF to $750 billion, to support a new SDR allocation of $250 billion, to support at least $100 billion of additional lending by the MDBs, to ensure $250 billion of support for trade finance, and to use the additional resources from agreed IMF gold sales for concessional finance for the poorest countries, constitute an additional $1.1 trillion programme of support to restore credit, growth and jobs in the world economy. Together with the measures we have each taken nationally, this constitutes a global plan for recovery on an unprecedented scale.

Restoring growth and jobs

6. We are undertaking an unprecedented and concerted fiscal expansion, which will save or create millions of jobs which would otherwise have been destroyed, and that will, by the end of next year, amount to $5 trillion, raise output by 4 per cent, and accelerate the transition to a green economy. We are committed to deliver the scale of sustained fiscal effort necessary to restore growth.

7. Our central banks have also taken exceptional action. Interest rates have been cut aggressively in most countries, and our central banks have pledged to maintain expansionary policies for as long as needed and to use the full range of monetary policy instruments, including unconventional instruments, consistent with price stability.

8. Our actions to restore growth cannot be effective until we restore domestic lending and international capital flows. We have provided significant and comprehensive support to our banking systems to provide liquidity, recapitalise financial institutions, and address decisively the problem of impaired assets. We are committed to take all necessary actions to restore the normal flow of credit through the financial system and ensure the soundness of systemically important institutions, implementing our policies in line with the agreed G20 framework for restoring lending and repairing the financial sector.

9. Taken together, these actions will constitute the largest fiscal and monetary stimulus and the most comprehensive support programme for the financial sector in modern times. Acting together strengthens the impact and the exceptional policy actions announced so far must be implemented without delay. Today, we have further agreed over $1 trillion of additional resources for the world economy through our international financial institutions and trade finance.

10. Last month the IMF estimated that world growth in real terms would resume and rise to over 2 percent by the end of 2010. We are confident that the actions we have agreed today, and our unshakeable commitment to work together to restore growth and jobs, while preserving long-term fiscal sustainability, will accelerate the return to trend growth. We commit today to taking whatever action is necessary to secure that outcome, and we call on the IMF to assess regularly the actions taken and the global actions required.

11. We are resolved to ensure long-term fiscal sustainability and price stability and will put in place credible exit strategies from the measures that need to be taken now to support the financial sector and restore global demand. We are convinced that by implementing our agreed policies we will limit the longer-term costs to our economies, thereby reducing the scale of the fiscal consolidation necessary over the longer term.

12. We will conduct all our economic policies cooperatively and responsibly with regard to the impact on other countries and will refrain from competitive devaluation of our currencies and promote a stable and well-functioning international monetary system. We will support, now and in the future, to candid, even-handed, and independent IMF surveillance of our economies and financial sectors, of the impact of our policies on others, and of risks facing the global economy.

Strengthening financial supervision and regulation

13. Major failures in the financial sector and in financial regulation and supervision were fundamental causes of the crisis. Confidence will not be restored until we rebuild trust in our financial system. We will take action to build a stronger, more globally consistent, supervisory and regulatory framework for the future financial sector, which will support sustainable global growth and serve the needs of business and citizens.

14. We each agree to ensure our domestic regulatory systems are strong. But we also agree to establish the much greater consistency and systematic cooperation between countries, and the framework of internationally agreed high standards, that a global financial system requires. Strengthened regulation and supervision must promote propriety, integrity and transparency; guard against risk across the financial system; dampen rather than amplify the financial and economic cycle; reduce reliance on inappropriately risky sources of financing; and discourage excessive risk-taking. Regulators and supervisors must protect consumers and investors, support market discipline, avoid adverse impacts on other countries, reduce the scope for regulatory arbitrage, support competition and dynamism, and keep pace with innovation in the marketplace.

15. To this end we are implementing the Action Plan agreed at our last meeting, as set out in the attached progress report. We have today also issued a Declaration, Strengthening the Financial System. In particular we agree:

to establish a new Financial Stability Board (FSB) with a strengthened mandate, as a successor to the Financial Stability Forum (FSF), including all G20 countries, FSF members, Spain, and the European Commission;

that the FSB should collaborate with the IMF to provide early warning of macroeconomic and financial risks and the actions needed to address them;

to reshape our regulatory systems so that our authorities are able to identify and take account of macro-prudential risks;

to extend regulation and oversight to all systemically important financial institutions, instruments and markets. This will include, for the first time, systemically important hedge funds;

to endorse and implement the FSF’s tough new principles on pay and compensation and to support sustainable compensation schemes and the corporate social responsibility of all firms;

to take action, once recovery is assured, to improve the quality, quantity, and international consistency of capital in the banking system. In future, regulation must prevent excessive leverage and require buffers of resources to be built up in good times;

to take action against non-cooperative jurisdictions, including tax havens. We stand ready to deploy sanctions to protect our public finances and financial systems. The era of banking secrecy is over. We note that the OECD has today published a list of countries assessed by the Global Forum against the international standard for exchange of tax information;

to call on the accounting standard setters to work urgently with supervisors and regulators to improve standards on valuation and provisioning and achieve a single set of high-quality global accounting standards; and

to extend regulatory oversight and registration to Credit Rating Agencies to ensure they meet the international code of good practice, particularly to prevent unacceptable conflicts of interest.

16. We instruct our Finance Ministers to complete the implementation of these decisions in line with the timetable set out in the Action Plan. We have asked the FSB and the IMF to monitor progress, working with the Financial Action Taskforce and other relevant bodies, and to provide a report to the next meeting of our Finance Ministers in Scotland in November.

Strengthening our global financial institutions

17. Emerging markets and developing countries, which have been the engine of recent world growth, are also now facing challenges which are adding to the current downturn in the global economy. It is imperative for global confidence and economic recovery that capital continues to flow to them. This will require a substantial strengthening of the international financial institutions, particularly the IMF. We have therefore agreed today to make available an additional $850 billion of resources through the global financial institutions to support growth in emerging market and developing countries by helping to finance counter-cyclical spending, bank recapitalisation, infrastructure, trade finance, balance of payments support, debt rollover, and social support. To this end:

we have agreed to increase the resources available to the IMF through immediate financing from members of $250 billion, subsequently incorporated into an expanded and more flexible New Arrangements to Borrow, increased by up to $500 billion, and to consider market borrowing if necessary; and

we support a substantial increase in lending of at least $100 billion by the Multilateral Development Banks (MDBs), including to low income countries, and ensure that all MDBs, including have the appropriate capital.

18. It is essential that these resources can be used effectively and flexibly to support growth. We welcome in this respect the progress made by the IMF with its new Flexible Credit Line (FCL) and its reformed lending and conditionality framework which will enable the IMF to ensure that its facilities address effectively the underlying causes of countries’ balance of payments financing needs, particularly the withdrawal of external capital flows to the banking and corporate sectors. We support Mexico’s decision to seek an FCL arrangement.

19. We have agreed to support a general SDR allocation which will inject $250 billion into the world economy and increase global liquidity, and urgent ratification of the Fourth Amendment.

20. In order for our financial institutions to help manage the crisis and prevent future crises we must strengthen their longer term relevance, effectiveness and legitimacy. So alongside the significant increase in resources agreed today we are determined to reform and modernise the international financial institutions to ensure they can assist members and shareholders effectively in the new challenges they face. We will reform their mandates, scope and governance to reflect changes in the world economy and the new challenges of globalisation, and that emerging and developing economies, including the poorest, must have greater voice and representation. This must be accompanied by action to increase the credibility and accountability of the institutions through better strategic oversight and decision making. To this end:

we commit to implementing the package of IMF quota and voice reforms agreed in April 2008 and call on the IMF to complete the next review of quotas by January 2011;

we agree that, alongside this, consideration should be given to greater involvement of the Fund’s Governors in providing strategic direction to the IMF and increasing its accountability;

we commit to implementing the World Bank reforms agreed in October 2008. We look forward to further recommendations, at the next meetings, on voice and representation reforms on an accelerated timescale, to be agreed by the 2010 Spring Meetings;

we agree that the heads and senior leadership of the international financial institutions should be appointed through an open, transparent, and merit-based selection process; and

building on the current reviews of the IMF and World Bank we asked the Chairman, working with the G20 Finance Ministers, to consult widely in an inclusive process and report back to the next meeting with proposals for further reforms to improve the responsiveness and adaptability of the IFIs.

21. In addition to reforming our international financial institutions for the new challenges of globalisation we agreed on the desirability of a new global consensus on the key values and principles that will promote sustainable economic activity. We support discussion on such a charter for sustainable economic activity with a view to further discussion at our next meeting. We take note of the work started in other fora in this regard and look forward to further discussion of this charter for sustainable economic activity.

Resisting protectionism and promoting global trade and investment

22. World trade growth has underpinned rising prosperity for half a century. But it is now falling for the first time in 25 years. Falling demand is exacerbated by growing protectionist pressures and a withdrawal of trade credit. Reinvigorating world trade and investment is essential for restoring global growth. We will not repeat the historic mistakes of protectionism of previous eras. To this end:

we reaffirm the commitment made in Washington: to refrain from raising new barriers to investment or to trade in goods and services, imposing new export restrictions, or implementing World Trade Organisation (WTO) inconsistent measures to stimulate exports. In addition we will rectify promptly any such measures. We extend this pledge to the end of 2010;

we will minimise any negative impact on trade and investment of our domestic policy actions including fiscal policy and action in support of the financial sector. We will not retreat into financial protectionism, particularly measures that constrain worldwide capital flows, especially to developing countries;

we will notify promptly the WTO of any such measures and we call on the WTO, together with other international bodies, within their respective mandates, to monitor and report publicly on our adherence to these undertakings on a quarterly basis;

we will take, at the same time, whatever steps we can to promote and facilitate trade and investment; and

we will ensure availability of at least $250 billion over the next two years to support trade finance through our export credit and investment agencies and through the MDBs. We also ask our regulators to make use of available flexibility in capital requirements for trade finance.

23. We remain committed to reaching an ambitious and balanced conclusion to the Doha Development Round, which is urgently needed. This could boost the global economy by at least $150 billion per annum. To achieve this we are committed to building on the progress already made, including with regard to modalities.

24. We will give renewed focus and political attention to this critical issue in the coming period and will use our continuing work and all international meetings that are relevant to drive progress.

Ensuring a fair and sustainable recovery for all

25. We are determined not only to restore growth but to lay the foundation for a fair and sustainable world economy. We recognise that the current crisis has a disproportionate impact on the vulnerable in the poorest countries and recognise our collective responsibility to mitigate the social impact of the crisis to minimise long-lasting damage to global potential. To this end:

we reaffirm our historic commitment to meeting the Millennium Development Goals and to achieving our respective ODA pledges, including commitments on Aid for Trade, debt relief, and the Gleneagles commitments, especially to sub-Saharan Africa;

the actions and decisions we have taken today will provide $50 billion to support social protection, boost trade and safeguard development in low income countries, as part of the significant increase in crisis support for these and other developing countries and emerging markets;

we are making available resources for social protection for the poorest countries, including through investing in long-term food security and through voluntary bilateral contributions to the World Bank’s Vulnerability Framework, including the Infrastructure Crisis Facility, and the Rapid Social Response Fund;

we have committed, consistent with the new income model, that additional resources from agreed sales of IMF gold will be used, together with surplus income, to provide $6 billion additional concessional and flexible finance for the poorest countries over the next 2 to 3 years. We call on the IMF to come forward with concrete proposals at the Spring Meetings;

we have agreed to review the flexibility of the Debt Sustainability Framework and call on the IMF and World Bank to report to the IMFC and Development Committee at the Annual Meetings; and

we call on the UN, working with other global institutions, to establish an effective mechanism to monitor the impact of the crisis on the poorest and most vulnerable.

26. We recognise the human dimension to the crisis. We commit to support those affected by the crisis by creating employment opportunities and through income support measures. We will build a fair and family-friendly labour market for both women and men. We therefore welcome the reports of the London Jobs Conference and the Rome Social Summit and the key principles they proposed. We will support employment by stimulating growth, investing in education and training, and through active labour market policies, focusing on the most vulnerable. We call upon the ILO, working with other relevant organisations, to assess the actions taken and those required for the future.

27. We agreed to make the best possible use of investment funded by fiscal stimulus programmes towards the goal of building a resilient, sustainable, and green recovery. We will make the transition towards clean, innovative, resource efficient, low carbon technologies and infrastructure. We encourage the MDBs to contribute fully to the achievement of this objective. We will identify and work together on further measures to build sustainable economies.

28. We reaffirm our commitment to address the threat of irreversible climate change, based on the principle of common but differentiated responsibilities, and to reach agreement at the UN Climate Change conference in Copenhagen in December 2009.

Delivering our commitments

29. We have committed ourselves to work together with urgency and determination to translate these words into action. We agreed to meet again before the end of this year to review progress on our commitments.

Brooks Sunday Global Review Interview With Sabina Dewan: President Obama and the G-20 Summit

Sabina Dewan

BROOKS SUNDAY GLOBAL REVIEW: THE G-20 SUMMIT – April 5, 2009

On Sunday, April 5 Ms. Sabina Dewan, Associate Director of International Economic Policy at the Center for American Progress discussed the critical outcomes of the London G-20 Summit and President Obama’s role in the proceedings. Ms. Dewan is a co-author of the Center for American Progress’s recently releasedbriefing paper “The Case for Leadership: Strengthening the Group of 20 to Tackle Key Global Crises.”

Ms. Dewan works on economic issues ranging from the role of globalization to international trade and technology; the nexus between innovation, productivity and growth, to the role that development assistance, monetary policy and international financial institutions play in raising living standards around the globe. Prior to joining American Progress, Sabina was a research analyst at the International Labour Organization (ILO) in Geneva, Switzerland where she worked on various projects promoting the ILO’s decent work agenda within the context of globalization and international development. She then worked as an independent consultant based in Brussels, Belgium undertaking a variety of projects for institutions including the ILO Regional Office in Thailand and the Directorate-general on Employment, Social Affairs and Equal Opportunities of the European Commission.