Mirage Followup: Pakistani Prospects

Anonymous questioned my analysis on the prospects of Pakistan getting the 62 Mirage 2000s from United Arab Emirates. Rumor says that UAE wants to swap the Mirages in exchange for new-built Rafaels from Dassault. I said that Pakistan is not likely to be a recipient of these planes. Anonymous disagrees, because Pakistan is the largest operator of Mirage IIIs and Vs in the world today, thus a long-term relationship with Dassault and in need of replacements. In addition, Pakistan is looking for advanced systems to arm its future JF-17s, such as RC-400 radars and MICA missiles.

Yes, Anon, Pakistan would absolutely love to have 62 Mirage 2Ks. However, as an analyst, we always need to separate wishful thinking from analysis based on facts. I will be upfront myself and admit my personal bias to see a Taiwanese Air Force strong enough to deter the PLA Nanjing military district. Even taking that into account, though, Taiwan still remains the most likely candidate for these Mirage 2Ks, eventually.

The most important factor to understand here, is the business imperative of the Dassault corporation. Dassault has been searching for an export customer for the Rafale. Without an export customer, Dassault will have to shutter the Rafale production line, at least temporarily. Having to restart the production line would raise the Rafale unit cost dramatically, further hurting its export prospects. Despite all the hype of the armed UAVs, the end of the Rafale may mean the end of high-performance fighter airplanes for Dassault [either manned or unmanned], with the attendant loss of the engineers and the craftsmen. Without the human capital, it will take Dassault a generation to rebuild its in-house capability to design and build airplanes capable of high-Angle-of-Attack maneuvers. Therefore, getting a Rafale export, and thus keeping the line warm, is synonymous with Dassault surviving in the fighter business.

Therefore, Dassault absolutely does not want to endanger its Rafale sales prospects. According to Wiki, the Rafale is in the running in India. Brazil has also supposedly chosen the Rafale. With this stock of Mirage 2Ks, Dassault may now offer the Mirages as temporary stand-ins to India and Brazil, while they waited on the Rafales.

With the business consideration, Dassault is unlikely to offer Mirages to Pakistan, at least for now. Dassault needs India's MMRCA order. A sale to Pakistan right now will shut Dassault out of the Indian market. Pakistan may get Mirages later, after MMRCA award, but by then, JF-17 production will be in full-swing in Pakistan. A Mirage 2K acqusition will be competing for funding against a more indigenous JF-17 production program. Egypt is also discussing a co-production deal with Pakistan for the JF-17s, which elevates the political importance of the JF-17 program. If JF-17 is fighting for funding against Mirage 2Ks, JF-17 will probably come out ahead. Pakistan may well buy RC-400s and MICAs, but that does not translate into Mirages.

Based on the business case, Dassault is unlikely to offer the UAE Mirages to Pakistan. Based on the timing and politics, Pakistan is unlikely to seek Mirages. Therefore, Pakistan is not a prospect for the UAE Mirages.

UAE's Mirage 2000s and Strategic Balance

Arabian Aerospace reports that, as a condition to purchase the Rafale fighter, UAE will require Dassault to buy back its 62 Mirage 2000-9s. The question then becomes, who will buy these 62 Mirages? These 62 Mirages may end up altering a strategic balance in the world.

This question is a tough one for Dassault because it no longer markets Mirage 2000s. It has staked its future on the Rafale, and its sales efforts focus on that. This batch of Mirages can interfere with Rafale prospects.

Wiki shows that the current operators of Mirage 2000s are: France, India, UAE, Taiwan, and Greece. Egypt, Qatar, Peru, and Brazil each operates less than a squadron of Mirage 2000s. We can knock off India and Brazil off the list right away, as they both have a current fighter competition in which Rafale is a contender. Greece is having economic difficulties and cannot spend its EU bailout on surplus aircrafts. We can probably say the same [economic difficulties] about potential new prospects such as Argentina, who currently operate older Mirages. Qatar Air Force and Peruvian Air Force are too small to absorb any significant quantities.

Egypt and Pakistan are good prospects. However, Egypt has been buying F-16s, and is talking with Pakistan to jointly manufacture the Sino-Pakistani JF-17. A Mirage sale to Pakistan may also upset India, whose Air Force got Rafale back into MRCA.

So the remaining customer, however improbable, is emerging as the most likely prospect: Taiwan. Taiwan already operates 60 2005s, and wants to retire the last 33 of its F-5s. Dassault is unlikely to sell Rafales to Taiwan anytime soon. Taiwan is shopping for more F-16s from Lockheed, but Obama has not been warm to a sale. The stars are lining up for Taiwan, so to speak. It has the money, the will, and the capacity to pick up as many 2000s as it can get. A direct sale from UAE to Taiwan is unlikely to draw major diplomatic heat from China, due to UAE's status as a petroleum exporter. Another 60 2000s would address the growing cross-strait military imbalance nicely.

If Obama continues to drag feet on F-16 sales, Taiwan may end up a Mirage 2000 country. France still has 300+ 2000s it would like to replace with Rafales at some point. India has 51 2000s that were supposed to be placeholders for the MRCA, and it could unload those to Taiwan to help balance against China. As the F-16 line closes down, these surplus 2000s will be Taiwan's only choice.

PS: Edited for links and labels 1JUN2010.

Take Back Your Kilometer!

MAJ Ehrhart's paper, "Taking Back the Last Half Kilometer", has been making the rounds these past few days. It is an interesting paper on the tactical and technical deficiencies of the American and allied infantry in Afghanistan, using a 5.56mm carbine against enemy mortar attacks up to 2km away.

However, this is not a new problem. Mountain warfare experiences from WW2 and Indo-Pakistan wars have shown the necessity to engage enemy infantry beyond 500m. Some writers had warned, for example, that the US Marines reinforcing the Scandinavian flank during a Soviet invasion should bring the 7.62mm M-14 rifles with them to handle the mountainous terrain of Norway. For infantry warfare, there are two extremes: the close range (within 100m) of most infantry combat, and the long range (500m-1000m) requirements of mountain warfare.

To meet this combat requirement, the 6.8mm booster club would like to push the 6.8mm intermediate-intermediate cartridge onto the military. [Intermediate-intermediate because 5.56mm was originally sold as the intermediate cartridge.] They've been looking to get rid of the 5.56mm since its inception, and this is about as good a chance as they're going to get. The 6.5mm club is getting some airtime, too, but they're really too small compared to the 6.8mm club. However, due to the Army's historical foot-dragging on topics like this, this is not likely to happen. [Iraq was too close-quartered for their arguments to be effective, whereas our long war in Afghanistan will bring them many more instances of 5.56mm ineffectivenss.]

On the other hand, there are a couple of fixes we can implement fairly quickly, to meet this combat requirement of engaging enemies 500m to 1000m, with infantry squad weapons. The answers are the 40mm grenade and, surprise, the 5.56mm M-4 carbine.

Currently the 40x46mm unguided, low velocity grenade has a maximum range of 400m with an elevated trajectory. By putting a pair of pop-out fins and a laser seeker on the grenade, we can easily double the range of the grenade out to 800m. It's good timing, too, because the US Army just transitioned from the sliding breech M203 launcher to the swiveling breech M320 launcher. The M320 launcher can accommodate the increased length of the guidance package. Due to the low muzzle velocity of the grenade (76m/s), which is well-below that of common missiles, guidance integration should not be an issue. This development effort would take some time, but will be relatively fast due to the low technical risks involved. A smart grenade would be a "leap-ahead" technology the brass will love, so there will be few bureaucratic obstacles to its adoption. Long-term this grenade is the ideal solution to the mortar ambush scenario. The area effect of the grenade will easily suppress the insurgent mortar crews.

While we are waiting on the smart grenade, the infantry in the field can use their 5.56mm M-4 carbine to suppress the far-away enemy. But wait, you say, isn't the whole problem we're facing that 5.56x45mm cannot reach beyond 500m? Actually, the 5.56mm can go all the way out to 2,000m. The only problem is that you cannot aim it accurately beyond 500m, because the bullet is too light and will drift off course. Back in World War I, the bolt-action rifles all had sights that ranged out to 1,000m, even though few people can aim that far without scopes. [Even today, AK-47 sights can adjust out to 1,000m.] Back then, infantry often had to provide its own fire support, sometimes without help from artillery. The whole regiment would line up, adjust the sights out to 1km, then fire at that target together. The massed rifle fire would blanket that far away target with a rain of lead bullets. The mass fire compensates for the inaccuracy of the individual rifle and man at that distance. Similarly, the machine guns of the era had long range sight markings for indirect-fire, area suppressions. Machine guns were organized in batteries then, and they would mass arcing fire on targets kilometers away.

We can do the same thing today. A squad or two can mass their fire against the suspected insurgent position. A squad of M-4s can generate the fire volume of a WW1 battalion by aiming together. With a bit of range experimentation, you can easily figure out how to shoot out to 1km. I did a bit of calculation and I found that you probably need to elevate your muzzle by 0.28 degrees to shoot 1km. According to online ballistic calculators, you will need about a 1 degree elevation. So work with that and try it out. A bit of Kentucky windage in the field will get you close enough to the target to suppress them. A rain of steel and lead will make the insurgents think twice of mortaring you.

Of course, you still need to close with and assault the enemy. A squad can suppress the position while other squads maneuver to close the distance. You will need at least a squad to generate the fire volume to suppress out to 1km.

Some people will say that the 5.56mm cartridge does not have enough energy to kill a man at 1km. However, try standing out there, without a helmet, while bullets rain down around you. The 5.56mm still has enough energy to lodge inside your braincase at that distance.

So, write your Congresscritters to start this smart grenade program. In the meantime, start experimenting with the sights of your M-4 carbine. Your squad can still suppress that insurgent mortar team, despite what your training told you.

ETA: links and paragraph breaks

Afghanistan: Hearts & Minds vs Security

Today's bombing in Kabul illustrates both India's investment in the Afghanistan Enterprise(tm) and the tradeoffs of waging a proxy war. I have previously commented on the neighbors' involvement in Afghanistan, so I will focus on this low-intensity side war for this article.



As I said before, Afghanistan is a war on multiple levels. Like Shakespeare, warfare theorists of all stripes can draw a favored conclusion from the Afghan war. China and India are waging a low-intensity war of influence in Afghanistan, and today we see the limitations of that approach.



All of the neighboring states have a strategic interest in a stable Afghanistan. India in particular needs a moderate and prosperous government in Kabul to both contain Pakistan and contest Central Asian states [against China]. However, due to its "Third World, Non-Interventionist" ideology, India is afraid of a direct intervention in Afghanistan. (A phobia China shares.) Therefore, India wages a war of proxy means, with money, tribes, and merchants. To date, India appears to have a moderate success in buying allies, though it has no better luck (than NATO) at fostering governance in Kabul. Therefore, we can charitably grade the Indian Campaign a C- at meeting their strategic goals. [The Americans, on the other hand, get a D+ for its Afghan governance goals, and a C for its counter-terrorism goals.]



In waging this proxy war, India accepts certain vulnerabilities. India cannot guarantee security of its embassy staff, let alone that of its citizens in-country. Without its own military boots on the ground, India has to rely on its allies and mercenary proxies to provide mediocre security. [India's own ridiculous gun laws also mean that Indian mercenary/security firms have difficulty training in India, instead must go to, say, Afghanistan, to get firearm training.] [ITBP's deployment is too small to meet all security needs.]



Therefore, India is literally paying the price for the American failure to stabilize Afghanistan, in terms of both the security "tax" its development projects and business pay, and its casualties thus far.



This isn't to say that India will stop losing people only if it deploys the Regulars. Or that allies and mercenaries cannot provide effective security. [See Xe] To meet its strategic goals, India must get close to the Afghan people. Which means that Indians must get off secure zones and into villages and bazaars to do business. Which means that they face risks of ambushes and kidnapping. India's security problem is its secured zones, or what Americans would call Forward Operating Bases.



A secured zone is where your people live and sleep, such as the hotel attacked today. The biggest reason India lost people today is because their security posture is too open. India's desire to be a "non-intervention, self-determination" soft power in Afghanistan dictates a low-profile, open, passive security posture. India's effort at pioneering "Third Way" diplomacy and differentiating themselves from the hardened American FOBs made them vulnerable to an attack like this.



[Of course, in the wake of the Mumbai attacks, the competence of Indian security services is an open question.]



The point of my analysis is that an open, passive security posture is foolish and does not contribute toward your "Hearts and Minds" political goals at all. It just helps your enemies to kill you faster. Letting your guards slouch at their post and waving people through the checkpoint does not win you any points. An alert guards who pats people down with respect and a smile, however, does.



"Hearts & Minds" politicians and consultants often fail to realize that it is not the macro-level initiatives, such as blast barriers, check points, gun-toting security, etc, that turn the natives against you. It is the micro-level, man-to-man details that gets you, like yelling at people, manhandling through a pat down, etc. Soft power is all well and good, but security is the enabler for your soft power capabilities. Being aggressive in your security posture allows you to complete your projects and help people.



As Bryan McGrath has pointed out, "Hearts & Minds" are nice, but it easily degenerates into slogans and feel-good seminars. You are not going to make people like you, if they hate you to begin with. However, you can build trust and respect, even with enemies. Pussyfooting around security will not change anybody's minds.

Annual China-Taiwan-US Rituals

Sorry for the few updates recently. Have been busy at work with assignment changes.

I saw this protest from China over the proposed Taiwan foreign military sales currently pending in Congress. This happens everytime that it is practically a ritual of form.

Perhaps, to keep face, China needs to make some noise. And perhaps it is a slow news day for the news media, who have to report this kind of stuff. However, it struck me that China should be happy about all sales to Taiwan. In fact, it is in China's strategic interest to encourage Taiwan to buy as much stuff from the US as possible.

To understand this logic, you need to accept the premise that re-unification is the inevitable conclusion. 70 years is a blink in the eye of the Chinese culture. The people across the strait shares too much to keep up the separation. The independence movement has support from some parts of Taiwan, but Taiwan is too enmeshed in the Chinese economic system to make that a political reality. It may be in the strategic interests of some countries to keep Taiwan separate, but do not confuse strategic interest with reality.

Anyway, if Taiwan will eventually re-unify with China, [and a peaceful reunification looks more hopeful everyday], then any Taiwanese technology will eventually become Chinese technology. If Taiwan buys or builds submarines, they will become Chinese subs down the road. If Taiwan gets some F-16 technology from the US, that will end up in Chinese hands anyway. So whatever Taiwan can get from the US, is a net-plus to China.

The US needs to consider this possibility in its FMS process. But it does not materially change the FMS calculus. The US is officially for a peaceful reunification, and the FMS package supports that end. The US and China are not adversaries yet, just competitors and symbiots. Some parts of the US national security apparatus are arguing for an adversarial interpretation of the Sino-American relationship, but that remains a non-official view. Above all, the US strives for stability in the global economic system to foster economic growth. An ascendant China, in itself, is agnostic to that strategic goal.

So here is another way to interpret the on-going China-Taiwan-US soap opera.

Russia: Climbing the Export Tree?

Galrahn at Information Dissemination analyzes more news on the Russian Mistral LHD purchase and talk about the Russian shipbuilding industry and why it is importing French shipbuilding technology. He also talks about the US Senate reaction to this pending purchase.

I have earlier talked about the Mistral purchase as reviving the historic Franco-Russian relationship. Galrahn's discussions reminds me that France may be actively pursuing this geo-political realignment as well. France is betting on Russia becoming the next China.

For all the abuses of the Soviet era, it has left Russia with a relatively well-educated work force familiar with modern manufacturing technology. Although Russian quality control was deplorable, its heavy industries sustained the mighty Red Army for decades. Even today Russian metallurgy is still state of the art. Compared to India and Brazil, Russia is probably best prepared to take on China in mass manufacturing. Moreover, China itself is trying to climb the export tree and leaving the export manufacturing business behind. If France injects capital and technology into Russia, it stands to profit from Russia's re-industrialization and China's de-exportation.

At the same time, France is trying to balance a multipolar world. From France's perspective, an economically ascendant Russia is a nice counter against China. Russia is a potential ally who shares France's distrust of both the US and China. With the communist party still popular in both countries, they share a social affinity as well.

Therefore France hopes to re-industrialize Russia, starting with its ship-building sector. They may be working on a Korean model, where the heavy industries spin off into the light manufacturing industries. There are certainly many challenges, not the least of which is Russia's demographic collapse. But the time is right for a geo-economic/political partnership between France and Russia.

The Chinese Not-Recession-To-Be

I want to clarify my earlier article by saying that, if you were a pessimistic investor like me, you will need to start hedging against the possibilities that the economy will really take off soon, given that employment may pick up soon. For example, you should start getting back into the stock market, if you recently moved your 401k and IRA into money market in anticipation of that W-shaped stock market.

One issue from the employment article is on world trade. Specifically, the deficit spending in China and India to stimulate domestic spending, and to make up for the deglobalization. I can't speak for India, since its economy is not much in the American news. However, China is continuing its real estate boom. So I want to visualize its end state, to help with policy responses.

The Chinese real estate boom will end in a couple of years. The mega-cities of Shanghai and Beijing cannot expand forever. The primary input into the Chinese economy, export, is declining. So they're becoming a closed economic system, and real estate value cannot rise forever in that. They can grow the money supply by issuing more currency or increase monetary velocity. Due to the excess production capacity, inflation is not a big issue. However, real estate is a sinkhole and will limit the velocity growth. So the point is that the real estate will either flatline or dip a bit. Until the world re-globalize and China export again.

Many China watchers and Chinese economists downplay the effects of a real-estate recession in China, because, they say, that Chinese banks do not give out home mortgages, that most Chinese pay cash for the condos, and that they hold the condos to rent out, instead of speculating on a rising value.

The above assertions are true, and these characteristics have constrained the velocity of the real-estate market. However, real estate investment is still tying up a big chunk of the Chinese savings. House purchase is a clan affair in China. The banks may not be lending money, but a shadow-financing system is operating in China to make up for it. A clan (or extended family) will pool its savings to buy a house. People can borrow money from relatives and good friends to put up the cash for the houses. They use the rent payments to pay back the informal mortgages they've incurred.

If the Chinese housing market deflates, all that savings is tied up in these informal mortgages. There may not be a precipitous crash, but there will be a sudden slow-down of the monetary velocity. Economic activity will slow down. And China will have few tools to start it up again, short of an economic-stimulating event (Like World War II) or increased global trade.

Because the lending is informal, the central bank cannot just lower the interest rate to stimulate lending (or mortgage re-financing). Because the saving is not liquid, China will have to borrow money from abroad if it wants to deficit spend its way out. Which does not seem favorable, and which may prompt China to start unloading its T-bills.

I supposed that the banks can start doing home equity loans to increase the liquidity of the real estate market, but that would require a culture change, and start China down a difficult path we've just tread.

Therefore, China may soon hit that real estate asymptote. And it will have to start aggressively export or face economic ennui.

Economic Forecast Contrarianism

Daniel Gross has an interesting article on Slate, arguing that we are about to turn a corner on American unemployment. It is interesting because it is so optimistic, and against my personal feelings on this matter. It is at times like this that we need to stop and check our own assumptions, when our feelings ask us to ignore the opposing point of view.

The strongest reason I do not believe we are turning a corner, is because the US economy has not fixed its structural problems. The recent report on the mortgage rescue program showed that, of the subprime applicants so far, only about 12(?)% are capable of paying the re-negotiated fixed-rate mortgage. Many more houses will go onto the foreclosure block in the near future. Maybe the banks have already wrote down all these mortgages, but I doubt it.

A related problem is with the velocity of money and savings. In America, the savings rate is going up, which reduces the velocity of money. The Fed rate is already near zero, and Obama is going up against the limit on deficit spending, so they are almost out of tools to re-inflate the US money supply. The contracted money supply means the US domestic economy has contracted.

Although the personal savings rate is up, the foreclosure market is sucking up a lot of the savings. Being an "asset-rich, cash-poor" enterprise, real estate investment is a sinkhole on the money supply. This is money that might otherwise be available for business investment.

Therefore, going forward, businesses may want to expand, but the credit market will be expensive. They will have to rely on their own funds, and some foreign investment, to fund the expansion. With the rise in savings, we cannot rely on the consumer spending to grow the economy. The business spending side of the house does not look too hot, either.

One growth mechanism Gross identified is the export route. With the decline in the dollar, export is definitely paying for the recent gains in the American economy. However, Gross himself just wrote about the decline in global trade over this past year. With the worldwide loss in savings this past year, and the decline in global demand, I'm not sure if export will be enough.

One semi-bright spot from the Black Friday shopping report is that the rich are spending again. I wonder if it's enough.

Afghanistan & the Geopolitical Game

The recent suicide bombing on the Indian Embassy in Kabul and the attacks in Pakistan reminds us, that Afghani violence is not purely a function of American military input, ie, Violence != Function( American Soldiers, Talibans). The violence there is a combination of tribal vendettas, Taliban/Al Qaeda ideology, American/Western presence, and Indian/Pakistani/Iranian competitions. We need to keep this complexity in mind as we debate our strategic aims for Afghanistan.

One thing people may not know much is the presence of Indian and Pakistani contractors and NGOs in Afghanistan. India is spending quite a bit of money on Afghanistan, both in buying influence and assisting its merchants in making American military money. Pakistani vendors and ISI operatives are, of course, already on the ground in Afghanistan. So part of the violence there is this low intensity conflict between Indian and Pakistani factions. The Karzai administration is embroiled in this battle, as well.

Robert Kaplan has a nice opinion piece on China's efforts in Afghanistan as well.

Therefore, many anti-coalition militants may be fighting to kick the Yankees out, but the recipe is there for the fighting to continue, long after we leave.

Thoughts & Re-Thoughts on the Afghanistan Campaign

Since Afghanistan is in the news lately, with the McChrystal report to the President, everybody is talking about Afghanistan, again. I guess I need to join the fray, too. I do not have much new to contribute to the current strategic debate, other than my earlier proposal to focus on refugee camps as an alternative, economy-of-force, population-centric tactic. We do not have the resources to save every Afghan, not to the standards we want. We need to focus on the ones we can help, and build a refuge that people can turn to. A refugee camp, which is self-sustaining (a place that gives inhabitants the means to make money and feed themselves, and allows them to organize themselves to administer shared resources), will give the displaced Afghans a place to live, and oppressed Afghans a place to go to.

In addition, such a refugee camp will provide a wealth of human intelligence for the Coalition.

In 2007, I asked the commanding general of the Joint Contracting Command-Iraq/Afghanistan about their plans for civilian "internally displaced people"; he said there was none. It was a Department of State mission, and the US military is authorized only to assist when State asks. At the time, State didn't ask, so the military didn't prepare. Luckily for the Iraqi people, Iraq kind of sorted itself out. However, Afghanistan is still a wreck. If the military really wants to "win" Afghanistan, then they need to break down the bureaucratic walls and seize this mission for themselves. We can't wait for State to get its acts together.

[Perhaps, with Hilary Clinton in charge, the State Department will do something about this. However, they do not have the money in FY2010 to do this mission. The latest they can is FY2011, and we do not have a year to wait.]

The current Afghanistan strategic debate has two levels: Build the Country vs Disrupt the Insurgents, and Top-down vs Bottom-up. Obviously, we need to go with the Bottom-up strategy, which unfortunately has not been in vogue with the Nation-State-Centric Paradigm crowd. I personally would prefer that we build the Afghanistan state; but that's not realistic, so I'm settling w/ the Disrupt the Insurgent camp.

In terms of strategic location, Afghanistan is in an interesting location. It borders Iran, Pakistan, and China, and close to India, all four states of interest to the US. A US presence in Afghanistan can thus influence nearby events. The only problem is that it is expensive to sustain our presence there.

Attack: Helicopter vs OV-10

It's nice to see the return of the OV-10. I know that it's an Army fad to have a fleet of anti-tank helicopters. Hell, we even convinced the Russians and the Chinese to build such a fleet. However, pound for pound, and dollar for dollar, an attack helicopter is much less capable than a light attack aircraft. All armies would be better served to relegate their anti-tank mission to light attack aircrafts.

In terms of the runway requirement, the modern attack helicopter company occupies such a large area that it is simple to plop a runway down the middle. If you think about the payload of an AH-64 (about 2 tons), it is a ridiculously expensive platform for the payload. This article summarizes many of the advantages of a light attack aircraft over an attack helicopter.

The reason the Americans started down the road of an attack helicopter fad, was because the Key West agreement took away the Army's fixed-wing attack aircrafts. So the political agreement steered the Army into the rotary wing CAS alternative. For some reason (maybe Fire Bird?) this political compromise became an international military fad, still going strong. The Israeli have one; the Russians have 3; the Chinese and the Indians are working on it.

This fad proves that groupthink will transcend bureaucratic boundaries. It is so sad it is scary.

Mortgage: A Still Ticking Time Bomb

This story yesterday from CNN is very interesting and confirms my suspicions and observations on our current economy. Basically, it says that the regulatory uncertainty surrounding the whole "Mortgage Bailout" has frozen the mortgage industry in its tracks.

Last year, people were predicting left and right that the coming wave of foreclosures will devastate the housing market and push the US into the Second Great Depression. Today, there have been some foreclosures, but definitely not the tsunami waves predicted by the Cassandras. What happened to all those ARMs?

Bush and Obama launched the "Mortgage Bailout" to rescue all those ARM homeowners. The Bailout was supposed to help these homeowners to stay in their homes. By converting the ARMs into fixed rate mortgages, the Bailout aimed to arrive at the unhappy median where both the bank and the "homeowner" lose some money, but still stay in the house and pay the bills.

The Bailout failed to rescue all ARMs. Banks and homeowners do not like to realize their paper losses. Both the banks and the homeowners are expecting the government to give them a better deal later on, so they do not have to write down their losses. So in that respect, the Bailout failed in conclusively resolving the ARM problem, and thus allowing the US economy to "Move On" toward full recovery.

On the other hand, the Bailout accomplished its political purpose, which is to hold off that tsunami of foreclosures for now. In that respect, it is "Mission Accomplished". Banks are reluctant to foreclose all those houses, because they will definitely have to write off those profits from the 10% ARM mortgage rates. Homeowners are reluctant to move in general. The Bailout gives them the expectation of a better deal in the future, so they wait the best they can.

However, the mortgage time bomb is still ticking. The hope behind the Bailout was that, by delaying the foreclosures, the economy will improve, lifting the housing markets, and thus make the ARM problem go away. "Hope and Change", in a sense.

So now we are in a race against time, as I mentioned in the agriculture and economy in general articles. The ARMs from the crazy home real estate 2006 year are resetting right now, so the full scope of the problem is coming to the surface. The commercial real estate time bomb is still ticking away. The economy is improving. The Whales now have some money to spend in Las Vegas, but not the rest of the gambling market. The other real estate hot spots are suffering similarly.

So the question now facing the economy is: Can the US multi-nationals make enough money from the Chinese and Indian economic stimulii to save us from the mortgage time bomb? Will the Chinese and Indians buy enough American wheat, industrial machinery, airplanes, and financial consulting man-hours? Or, will they and the oil sheiks be crazy enough and start playing the American stock market again, that other great "export" of our economy?

[Note: That crazy Wall Street market is our invisible export. Its promise of riches lures in investors around the world. Their active stock trades generate tons of trading fees for the traders in New York, et al, who in turn spread the wealth to the rest of the US. We will have to place our faith in the hope that foreign investors do not wise up to the wisdom of Passive Management.]

Chinese PLA Officer Corps Promotion Cycle, and Some Notes on India

Here is an observation thread about China today. Most of the observations are valid, coming from different perspectives. The observation about their selective enforcement of laws can be jarring to a Westerner, but not news to anyone else. The Rule of Law is definitely one of the larger issues the international aid community is struggling with now.

One commenter there noted the rapid promotion cycle of PLA officers, compared to the US Army. American officers generally have made Lieutenant Colonels (O5) by their 20th year in commissioned service. [We're not talking about the guys who are retiring.] However, the People's Liberation Army expects its officers to make "Division-Commander-Equivalent" (O8-equivalent) by their 20th year. That is fast indeed.

The speed of promotion in PLA has several effects. One is that the pressure for promotion is correspondingly high. You are not only preparing for the promotion coming up, you're also preparing for every subsequent promotions. With the intense competition, every little mistake or blemish has huge consequences (Think Zero-Defect Mentality in the post-Cold War US Military.) So the officers are always afraid of stepping away from the group norm.

Another effect is that the sycophancy gets magnified. China has a gift-giving culture that Americans might call bribery, but similar to every other non-Western nation. In the PLA the officers obviously cannot afford much given their salary, but they're still expected to give something. Coupled that with the sycophancy natural in a political organization, even someone who wants to stay clean cannot do so.

On the other hand, their generals do become very good at reading people. To survive the promotion system, they have to be good at reading body language and socializing. That may give them an edge in certain military and political situations.

With so short a promotion cycle, the officers hardly spend any time at any position. In the US Army, battalion command is supposed to be a three year job, giving the lieutenant colonels some time to make their mark on the team. The staff also have time to learn and anticipate the commander's intent. In the PLA, commanders hardly spend any time on their post (probably a year at most). Just when the commander and his staff have gelled as a team, it's time for the commander to move on to his next position. He also does not have much time for schooling, definitely not the year-long CGSC and War Colleges American officers are accustomed to. He has to depend a lot on On the Job Training.

Another effect of the fast promotion system is that the PLA has to kick out a lot of young officers along the way. If you do not make that first promotion list, you probably will not be on the next one, either. With many government-owned companies in the defense sector and elsewhere, this provides a steady stream of employees.

Another effect is that the PLA has a small staff system. The US military let many not-likely-to-promote officers stick around to make their 20 years and qualify for retirement, in part to fill the many staff jobs. The PLA does not have that pool of bodies to draw on.

However, sycophancy does not imply mindless sucking up. The PLA does think about the future and values scholarly activity (a carryover from Confuscianism), as opposed to the anti-intellectual US Army. Combine that with the obedient officer corps. If the political leadership or the PLA brass needs to change their doctrine or organizational direction (eg, from centralized corps formations to decentralized battlegroups), the officer corps will quickly adapt and adopt their orders. That organizational flexibility cannot be discounted.

Some people in that observation thread mentions nepotism. It does exist, but its effect on the PLA is limited these days. With the economic growth of the past thirty years, there is a lot of money in the non-military sector. Generals are more likely to place their children in the government enterprise or private companies, to make money, than to groom them to follow the family tradition.

Compare and contrast the PLA system with that of India. Bharat-Rakshak recently had an interesting thread that touches on Indian Army's promotion system. [Another one talks about officer commissioning sources and touches on promotion, too.] The Indian promotion cycle is definitely slower than the PLA's, maybe slightly longer than America's. So the battalion commanders have more time to gell with their staffs.

Two features of the Indian system are worth noting though: Its top-heavy chain of command, and its emphasis on a full career.

The Indian Army is remarkably brass heavy, when compared to NATO formations. On the line units, they have majors (O4) commanding companies, colonels (O6) battalions, and brigadiers (O7) brigades. Coupled with the 5 to 6 years you typically spend in each rank, that makes for a long time between command billets. While the line commanders definitely get more maturity and "wisdom" for being so senior in their military career, they may also be more set in their ways.

Another part of the Indian system is their emphasis on career. Most of the Short Service Commission officers get out of the Indian Army at the five year mark. However, the permanent commissioned officers (like the Regular Army officers of yore) usually stay on until retirement. So the Indian Army has a big population of the field grade, permanent commissioned, officers on the payroll. This is as opposed to the American system where most officers separate from service between the fifth year mark and the twelfth year mark, with the rest holding out for the 20th year retirement. The "iron rice bowl" mentality associated with government career service makes the Indian Army more rigid, less mentally flexible, than the US military. Indian Army's military operations around the country keep its line units on their toes, but the institutional and support side of the army are slow and inflexible. The slower tail of the Indian Army may hold the line units back in an extended campaign.

Edited to add labels and remove signature.

Thanks for Reading!

To the Readers:

Thank you for subscribing to this blog. I noticed that many people have subscribed to this blog over this past week. Thank you so much for reading. Y'all have inspired me to further procrastinate at work and write articles!

If I come across biased against India, it is because I don't know much about India, its cities, nor its people. Please let me know anything I got wrong!

Thank you,

Jimmy

The Post-Recession Geopolitics, Trade, and Global Guerrillas

Galrahn of Information Dissemination posted a great speech by Stephen Carmel, VP of Maersk. Mr. Carmel talked about how interconnected we have become as a world, and how mundane activities in Bolivia and Africa, for example, have global, economic, and strategic repercussions.

For example, he mentioned that the electric/hybrid car is all the rage in the United States, right now, which is a good thing [Oil and all that.] Electric cars use lots of lithium batteries. 40% of the world's lithium supply comes from Bolivia, and much of the rest in other Latin America countries. Bolivia's president does not like the United States much. He is also facing economic and political unrest in Bolivia. In comes the mining industry. Because the government there is not very effective and plagued by corruption, the mining companies pay bribes and fund private security, company town's utilities, etc. Essentially, the mining companies maintain stability at the mines by exporting instability to the rest of the country, in the form of bribes, prostitution, alcohol problems (of transient miners), resentment of non-accountability, etc.

We then will re-ignite a Maoist movement in the country against foreign domination. We will try to prop up the government there, because lithium is now strategically important to the United States. It will be Banana Republics all over again.

Another big point he made is the bottlenecks in our global supply system. In addition to the physical bottlenecks like the Malacca Strait and Hormuz Strait, there's also the capacity bottlenecks of Ports of Los Angeles and Hong Kong and railroad systems, the information bottlenecks of the undersea fiber optic cables, network-node bottlenecks of our power grids, etc. The Just-In-Time philosophy of capacity over-utilization has taken out the slack in our global economic system. This tautness made our system vulnerable to Global Guerrilla attacks, and magnifies the effect of the attacks on our economies.

The speech is long, and full of interesting reflections. It's a must read for anyone thinking about the future.

China, India, Brides, and War

Kenneth Anderson wrote an interesting post on Volokh Conspiracy about Surplus Males in China and Libertarian thoughts. The comments were very interesting as well and covered most of the common angles.

One of the commenters brought up the burgeoning mail-order bride industry in China, specifically touring Cambodia and other Southeast Asia countries. His remarks got me thinking about the geopolitical implications of this development.

As many of you know, Southeast Asia has a complex attitude toward China. Vietnam, for example, drove out many ethnic Chinese as “boat people” in the late ‘70s and early ‘80s. Indonesia and Malaysia periodically have anti-Chinese riots. Vietnam and the Phillipines have claims against China on the Spratly Islands. Yet Indonesia is cooperating with China in the defense industry, and Burma is using China to balance against Thailand and India.

As China and India both have a surplus male population (explored in Bare Branches), both are experiencing social stress as men compete for mates. Entrepreneurs are pushing the mail-order bride industry in both countries, with a large target demographic.

I believe that bride importing countries generally provoke resentment among the bride exporting populations, due to increased competition for mates in the exporting populations. I don’t have evidence to back up this claim.

However, this sentiment can easily become coupled to local nativist sentiments in the Southeast Asian states. Thailand and Myanmar have cross-border insurgencies and drug trade problems. Vietnam has disputed territories with Laos and Cambodia. Indonesia has ethnic separatist movements. The region has suffered economically over the past 20 years, from competition with the Chinese and Indian export economies and from the currency crises. These are all factors that can lead to war.

China and India both possess nuclear weapons and thus are unlikely to directly confront each other. However, the Southeast Asian states have many flash points and have been balancing against each other. If a crisis were to erupt, demagogues will drag anti-Chinese and anti-Indian sentiments to the surface. India and China will get dragged into such a crisis because of the complex bilateral defense relationships in the region, and because of domestic responses to the nativist sentiment in the crisis countries. The conflict can quickly widen across the penninsulas. Such a conflict will be difficult to resolve, because the belligerents can easily claim seemingly legitimate causii belli in this environment.

Therefore, the bare branches in China and India may indirectly destabilize Southeast Asia. We need to recognize this and increase our crisis response capability in the region.

A Humane Strategy to Support Our Afghan Policy

In this post I am advocating a strategy to protect the Afghan civilian population from the ongoing violence in Afghanistan, as far as we can. Population protection will no longer be a mission for the Coalition forces. However, we still have the moral imperative to protect Afghan civilians. Therefore, the Coalition forces need to construct, staff, and protect refugee/resettlement camps to shelter the "Internally Displaced Persons" in Afghanistan. We need to give Afghan civilians a place to get away from the fighting.



The American government appears to be changing our policy direction in Afghanistan. Our stated policy has remained the establishment of a civil, democratic society in Afghanistan. The US Army is planning a "surge" of forces into Afghanistan to drive out the Taliban. However, COL(ret) Lang believes that President Obama is revising our policy aim in Afghanistan away from Nation-Building(tm). Obama's ideological faction is generally opposed to a Big Military solution, more congenial to surgical strikes and commando raids. With the appointment of LTG McChrystal as ISAF Commander, we may be giving up on building a Western society in Afghanistan as a policy goal. Instead, our Afghanistan policy is focusing on destroying the Al-Qaeda leadership.


With this change in policy focus, the special operation forces become our strategic main effort in Operation Enduring Freedom. Our conventional forces and the Afghan National Army/Police become the strategic supporting effort. As the supporting effort, their mission is not to establish central government control in the provinces or other population-centric COIN goals. [Although they may conduct population-centric COIN operations to gather intelligence to support the SOF, for example.]


The Afghan people may lose out under our policy change. Under the original policy, securing the Afghan population was a strategic goal, whereas under the new policy, we may cede the Afghan countryside to the Taliban. Some Afghan tribes and families have risked Taliban retaliation to cooperate with the Coalition forces. Under the new policy, we will reduce our operational support, and maybe logistical as well, to our local allies. The reduced support leaves our local allies vulnerable to Taliban attack. As the Taliban has murdered entire families to make an example of "traitors", our strategic retreat from the country side makes us culpable, to a degree, for their deaths as well.


The families of the ANA and ANP are vulnerable to Taliban reprisal as well. If the Afghan soldiers and policemen worry about their far away families, they are less combat effective. We need to secure the families of the ANA and ANP.

In addition, our new policy means that we will start favoring certain warlords over others. Currently, we are officially supporting some warlords who covertly sponsor the Taliban. Instead, we will starting playing one warlord against another to disrupt Taliban safe heavens. In the renewed Afghan Civil War, civilians will get caught in the crossfire.


We need to do something to protect the Afghan civilians from the coming violence; that is the moral thing to do. We will not station basecamps throughout the country to protect the population, because the resulting cost in blood and treasure outweighs our strategic gain. However, we will have enough spare resources to protect refugees and internally displaced persons. We need to include refugee camps in our campaign plan, to minimize our impact on civilians' lives and livelihood. In addition, the unsupervised refugee population is destabilizing the region and further stressing Pakistan.

Therefore, I am proposing that we set up refugee camps near Kabul, for any civilian that needs a place to go. We should organize these camps on the model of John Robb's Resilient Communities, where the residents will work for a living. Idle refugees are susceptible to extremist propaganda of all stripes. Make it a place where the people can stay and make a new life, or catch their breath then go home, whichever they choose. Keep the place safe from insurgent violence so that the people can get on with their lives.

Such a place is a low cost endeavor. It is centrally located with Kabul, so it is close to military bases. The Afghan National Army can train and protect the settlement at the same time. They can practice patrolling and checkpoint operations at the settlement. The Afghan soldiers and policemen can keep their families at the settlements, where they know they'll be kept safe from reprisals. We will involve the refugees in constructing and operating the settlement. These tasks keep them occupied, and give them a stake in the resulting city. By utilizing refugee labor, we reduce the need of expatriate labor, which is expensive and adds to camp life support needs. By having the refugees organize and govern themselves, we give them the opportunity to practice clean government. We will have a centralized place to teach them advanced agricultural techniques, machine repair skills, and other training that can make their lives back home easier, should they ever leave.

The current Afghan refugee population is impeding our policy goals by stressing the social welfare systems of surrounding countries and providing a fertile recruitment ground to Al-Qaeda. We need to at least try to sway them to our side. The ANA and ANP need a sanctuary where their families will be safe from reprisals. We have a moral obligation to give the civilian an alternative from the Taliban-controlled towns and Pakistani slums. These factor argue for Coalition support to refugee camps near Kabul. Moreover, this is an endeavor in which money is more important than American boots on the ground, and for which donor countries are sympathetic.

Edited to add: This post builds on my earlier statement of policy paradigm change. We cannot depend on the host nation bureaucracy to implement our policy for us. Instead, the US military may have to take on the job of city manager/administrator from time to time. Refugee camp is a prime example of the capability the US military needs in the post-Nation-State World we live in.

Chinese Weapon Engineering Textbooks

Just came back from a personal trip to Beijing. The bookstores there are very impressive. Of course they have the small hole-in-the-wall, mom-and-pop bookstores. The super-bookstores, though, are multi-story affairs. They have at least three floors dedicated to books, one or two floors for CDs and DVDs, and floor space for stationery and other products. The bookstore in Sidan district has 1.5 floors for consumer electronics, with a focus on electronic dictionaries. Each of these floors is about the size of a one-floor Barnes & Nobles. And these stores are all packed! The three super-stores I visited are all filled with people browsing and purchasing books. Even on a weekday during school hours the stores are still busy. I just don't know if I can go back to Barnes and Nobles anymore after this trip.

One particularly impressive area is in the engineering textbooks. As an engineer, I just had to go check that out. If you go to a Barnes & Nobles here in the states, you will find about 8 to 16 shelves (1-2 short aisles) for engineering, programming, and "technology" books. In the Beijing super stores, the engineering section takes up at least a quarter of a floor. Mechanical engineering itself takes up at least 8 shelves. Food processing/manufacturing takes up several shelves, too. Even weapons/military/aero/astro engineering has about 3 to 4 shelves, more if you include the shipbuilding shelves. Civil engineering and architecture/construction occupies half of the whole engineering section, which is notable from an American perspective, where the undergrad civil engineering departments are usually the small departments in the engineering schools (approx 10-20 students/class year).

The military engineering books seem good. You get some fluff there, like a "modern weapon catalog" that is the size of a pocket book, but the rest are pretty solid. I saw "Principles of Submarine Design", "Principles of Fire Control System Design", "Design of Automatic Firearms", and "Introduction to Propellant Design", to name a few. I flipped through these books and they all seemed to cover the basics, with plenty of equations to start component designs and instructions on how to make the design tradeoffs. Good textbooks. It is sad that books like these are not more accessible to the American public, or even the American engineering students.

Because of the current Chinese emphasis on space flights and ballistic missiles, rocketry is pretty big in the military/aero&astro engineering book section. The books cover all segments of rocket/missile design. They even have an "Artillery Rocket Design" translated from the original Russian textbook.

All in all, it was very impressive visiting these bookstores. They are definitely on the to-see list for anybody visiting Beijing.

Does any of you know how the bookstores are like in India's major cities? How are their engineering books selling?

PS: edited for grammar

India & China in the News

Here are two good articles bannered by Slate today: Foreign Policy's profile on China's leadership, and Newsweek's trend piece on rising religious violence in India.

The trend piece seemed to be a good look into India's religious-political scene. Unfortunately, it failed to meet Jack Shafer's trend story standards. If there is indeed a rise in religious violence, perhaps that would be reflected in number of incidents. However, the author, Sumit Ganguly, failed to include any numbers in his analysis. He simply recounted three "adventures" of two bigoted groups over a two month period. He did not cite an increase in membership of these groups. No number of incidents beyond the three described. Nor a comparison to number of incidents in prior years. Thanks for your public service, Sumit.

The piece on Chinese leadership is interesting. It says that the Chinese leaders are balancing the two interest groups and seeking to expand the solution space. Let's hope they succeed in keeping social harmony.

Paradigm Shift: The US Foreign and Security Policies in Flux

This is something I've been meaning to talk about for awhile now. I will just sketch out my idea for now.

The US foreign and security policies/strategies are at a historical moment right now, the moment of paradigm shift. The paradigm is this: Nation-State Centric versus Nation-Tribe Centric.

Failures of Nation-State Centric Paradigm
US policies used to be, and still nominally is, Nation-State centric. Everything the United States does has to be channeled through states and official governments. For example, we know that terrorists reside in, say, Sudan. However, we can't just go in and grab them. We have to petition the Sudanese government for extradition, even though the Sudanese government does not have that much control over the terrorists. Once the terrorists get the wind of an impending extradition, they can use bribes and their contacts in the government to get out of Sudan. And there's nothing we can do about it [except the CIA].

Or, another example, the Iraqi Oil-For-Food program. Right after Gulf War I, we embargoed Iraq's trade. Officially, Iraq was not getting anything through the UN embargo. Unofficially, smugglers moved oil out of Iraq and food/medicine into Iraq. Saddam Hussein and his people were getting a handsome cut of the smuggling trade. But he chose not to give the food and medicine to his people, because he knew that the suffering of his people made great TV. And it did. The UN started the Oil-For-Food program. Iraq now could export as much oil as necessary to feed its people. However, Iraq never came close to its export quota. Saddam chose to sell less oil than he could so that his people would continue to suffer privation. Critical medicine remained short in Iraqi hospitals. On the black market, however, Saddam continued selling oil to line his coffer and buy some weapons.

Because of our Nation-State centric paradigm, the United States (and the UN) could not go into Iraq and run the Oil-For-Food program directly. We had to wait for Iraq to sell however much oil it wants to. Give Iraq the food and medicine. And watch the Iraqi government divert food/medicine shipments away from its people, and into the black market. We also ccould do little to stop Iraq's black market oil export, because Saddam was exporting his oil to countries like Syria and Turkey, our putative allies. We had to depend on the grace of the Syrian and Turkish governments to police their own black market activities.

Iraq and Afghanistan
Nation-State paradigm is the main reason our strategies in Iraq and Afghanistan were not working for much of the 21st Century thus far. The paradigm dictates that our policies have to go through the state governments of Iraq and Afghanistan. So for the longest time, we waited for the Iraqi national government to dither about its constitution, then waited some more as they stood up the ministries and carved up patronages. We knew, in the back of our minds, that the Iraqi parties don't have much representation on the ground. That the Iraqi parties were antagonizing the more popularly based insurgencies. However, we could not go against the Iraqi government. If the governing coalition refused to bring more Sunnis into the government, then the most we could do is talk some more.

However, it is also Iraq that has spurred the paradigm shift that we are undergoing. Sometime in early 2006, the US military came to a concensus that we needed to ignore the national parliament and start engaging the local insurgents politically. In the Anbar province, we started negotiating with the sheiks ourselves. We paid the "Sons of Iraq" to provide local security. We paid the sheiks to clean the streets and dig ditches. We dragged the mayors and police chiefs with us to meet the sheiks, sometimes. And everything flowed from that Anbar Awakening.

The difference here is a bottom-up approach versus top-down in imposing security. Before the Awakening, we were recruiting Iraqi soldiers and policemen from a national perspective. We looked at the overall number and depended on the Iraqi ministries to recruit. If the recruiting drive missed, say Fallujah, there was nothing we could do. We gave the ministries Iraqi and US money, and if the ministry bureaucracy does not apportion funds equitably, the most we could do is complain.

In the bottom-up approach, we by-passed the ministries and engage the local level directly. If the recruiting drive missed Fallujah, we could work with the local dignitaries to put security on the street. Americans could hire Fallujan rent-a-cops if there are not enough Fallujan cops.

Because we are in the midst of this paradigm shift, we do not have a clear policy and strategy. The US State Department had always depended on the Host Nation bureaucracy to execute US aid and assistance. Today DoState is trying to stand up Provincial Reconstruction Teams on an ad hoc basis without clear direction. It cannot find enough people to staff these Teams, even though they are a national priority.

Many commentators have commented negatively on the various Awakening movements. They noted the improvements in local security, but always worried that we are undercutting the authority of the Iraqi central government; that we are embracing former Baathists; that we are setting up local warlords. Their concerns generally stem from the Nation-State centric paradigm: if Iraq does not have a strong central government, then the government cannot impose security on its people. Our original policy and strategy was to stand up the central government, able to guarantee internal security, which would allow the US to stand down in Iraq. The Awakenings conflicted with that policy by setting up alternate centers of power. However, the central government had not been able to impose security. The Shiite insurgency and the Sunni insurgency were signs that the Iraqi people did not accept a central government staffed by Iraqi expatriates. We had to grow the local centers of power, co-opting them and steering them in a peaceful direction, thus pressuring the central government to accede to local demands. In embracing the Awakening, the US military adopted a bottom-up tactic when the national policy and strategy remained top-down. The result is strategic confusion, as planners try to reconcile policy with tactic.

The same thing is happening in Afghanistan, tho more slowly. We rushed to set up the central government and the army, without much focus on the local government nor police. The warlords carved up the country and controlled the provinces as they like. Karzai could count on their nominal support, but they always kept high their own interests and those of their constituents. Afghanistan has a more severe problem than Iraq because there are many more factions in Afghanistan, with more regional sponsors. With the "Awakening"-approach, we're again trying to apply bottom-up tactics without seriously reviewing our top-down policy. People like those at Abu Muqawama say that we don't have a clear strategy for Afghanistan. Of course we wouldn't if our tactics and policy conflict with each other.

Paradigm Shift Implications
So it is clear that we are struggling our way through this paradigm shift. Eventually we will have to update our policy to account for bottom-up, non-state approaches. But as the world is full of nationalist feelings and semi-functioning state bureaucracies, we will have a hybrid policy for years to come. We will start with bottom-up, Nation-Tribe approaches toward failed states and semi-failed states (which have nominal state governments).

[In a sense CIA has always practiced a version of this Nation-Tribe approach. However, their shenanigans in the 50s soured the taste of bottom-up paradigm for everyone. A major part of the reluctance to engage in nation-tribe paradigm stems from that historical lesson.]

The Nation-Tribe paradigm is dangerous on the international stage because it directly threatens the governments of the Non-Aligned Movement, namely China, India, and thugs like Mugabe. If the Tibet question comes up for the United States, for example, the nation-state paradigm says, it's an internal problem for China, tho we will protest human rights abuses. The nation-tribe paradigm, on the other hand, can say something like this: We support Tibetan self-determination, and will actively support a process that can lead to Tibetan independence. That is an unlikely outcome of the paradigm, as we need to balance other interests, but that would be foremost on the mind of Chinese leaders as they oppose our paradigm shift. India shares many US strategic goals, but they too have many separatist movements and will oppose a Nation-Tribe paradigm.

A Nation-Tribe paradigm, tho, can lead to a powerful outcome in dealing with humanitarian crisis [edited: crises] like Zimbabwe. For example, we can de-recognize the Mugabe regime as it does not represent all of Zimbabwe. We will carve out a sanctuary on Zimbabwe territory, by force if necessary, internationally preferrably, where the MDC is in charge. We will then provide humanitarian assistance and set out to make the sanctuary self-sufficient in food production. If the MDC decides to raise an army and invade Mugabe territory, we would not intervene. If Mugabe attacks the sanctuary, we will defend. The policy goal is humane governance in Zimbabwe, with the sanctuary as the example and training ground on local governance.
[Yes, this is similar to the Kurdistan model we set up after Gulf War I.]

As we move further into the 21st Century, failed states will proliferate. As John Robb commented, Mexico is sinking inexorably into failed state territory and becoming the US's numero uno security challenge. The nation-tribe paradigm will be essential in dealing with the 21st Century Mexico, as the nation-state pradigm failed in dealing with the 20th Century Mexico. If Iraq is where the US military learned the tactics of bottom-up security, and Afghanistan will be [hopefully] where the US military learns the strategy of bottom-up security/governance, then Mexico will be where the US federal government learns to formulate and execute bottom-up policy in pursuit of US interests. Or we will get to practice COIN tactics on our own soil. Let us hope that we learn fast enough.

Edited to Add: One useful way to think about this shift is on the question of sovereignty: We used to be on the "Theory of Sovereignty", that we assumed every government had full sovereignty, even if reality conflicts with that claim. Now we will operate on "the Test of Sovereignty", where we only acknowledge your sovereignty after you have demonstrated it credibly. To use a dated example, we will acknowledge Indonesia's sovereignty over East Timor only if Indonesia can exercise its sovereign powers over East Timor.

Thanks to Joe for the link.