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  • Author: Ryan C. Berg
  • Publication Date: 07-2020
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Daniel Ortega’s suppression of protestors and civil society continues unabated. Since April 2018, Nicaragua’s security forces have killed hundreds of people, thousands have been injured or held as political prisoners, and more than 100,000 Nicaraguans have fled to neighboring countries or the United States. Ortega’s authoritarian consolidation began well before April 2018; the keys to his regime’s ruthless survival strategy are the National Police and Nicaraguan Army, co-optation of the judiciary, domination of the media, and a highly complicit private sector that long ago embraced a modus vivendi with his socialist government, among others. The US should ramp up its sanctions against the Ortega regime; target individuals and industries, especially those connected to Ortega or the military; sequence its sanctions rollout; and synchronize external pressure with the domestic opposition to develop an effective strategy for achieving key political and electoral reforms ahead of the general elections in 2021. Reinvigorated diplomacy, particularly with the European Union and other Latin America governments, should seek to expand the international coalition against Ortega’s repression to maintain steady pressure for a definitive change in the character of the regime.
  • Topic: Security, Foreign Policy, Defense Policy, Civil Society, Sanctions, Protests
  • Political Geography: Central America, Nicaragua, North America, United States of America
  • Author: Hal Brands, Tim Nichols
  • Publication Date: 08-2020
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: America is moving from one era of foreign policy to another: The primacy of counterterrorism has faded, and competition with authoritarian great powers is the dominant concern. While special operations forces (SOF) understand that they must play a role in great-power competition, they often lack a clear understanding of what that entails. SOF can support great-power competition in five ways: gathering information, working with allies and partners, imposing costs, handling crisis response, and undertaking strategic raids. In addition, retaining competency in counterterrorism is itself a crucial contribution to great-power competition, because suppressing non-state threats is the prerequisite to allowing the rest of the American government to focus on other things.
  • Topic: Foreign Policy, Power Politics, Armed Forces, Strategic Competition
  • Political Geography: North America, United States of America
  • Author: Danielle Pletka, Brett D. Schaefer
  • Publication Date: 08-2020
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: In a pandemic, a global health organization that is overly deferential to one nation and incapable of being an honest broker costs the very lives it exists to save. While China deserves primary blame for the devastation of COVID-19, the WHO also played a key role by failing to alert the world to Beijing’s lack of transparency. The WHO’s failures cannot be allowed to recur. Without change, it will fail again. It must implement reforms if it wants to restore confidence and earn US support.
  • Topic: International Cooperation, World Health Organization, Coronavirus, COVID-19
  • Political Geography: China, North America, Global Focus, United States of America
  • Author: Karen E. Young
  • Publication Date: 08-2020
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Much energy has focused on China’s Belt and Road Initiative and the debt-trap diplomacy it represents. But there is another set of players on the scene whose growth and influence in this sphere have been largely ignored. Gulf Arab states, particularly Saudi Arabia and the United Arab Emirates, have increasingly embraced an aggressive growth, investment, and development model for the broader Middle East. This report and the accompanying Gulf Financial Aid and Direct Investment Tracker are an effort to understand the breadth and scope of Gulf aid and financial intervention into a representative set of cases in the Middle East, the Horn of Africa, and West Asia. The objective is to demonstrate the competitive landscape for foreign investment in the receiving case countries and indicate the growing strength of Gulf capital investment, as it measures against a perception of Chinese capacity in the wider Middle East and emerging markets broadly. Most important, the comparative data here also demonstrate how private capital flows from the United States, United Kingdom, and European Union compete against flows of capital from state capitalism sources such as China and the Gulf.
  • Topic: Foreign Direct Investment, Belt and Road Initiative (BRI), Investment, Strategic Competition, State Capitalism
  • Political Geography: China, Middle East, Gulf Nations
  • Author: Emily Estelle
  • Publication Date: 08-2020
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Great-power competition and the terrorist threat intersect and interact with one another in Africa and the Middle East. US disengagement from these regions to prepare for great-power competition in other theaters will increase a growing vacuum that is drawing more regional and global actors—states and non-state extremist groups—into a series of vicious cycles that will pose grave threats to American national security in the coming decades. Breaking the vicious cycle will require the US and its allies to separate the Libyan and Syrian conflicts and disentangle and discourage proxy conflict by external players while supporting the development of responsive governance in the two countries. Preventing similar crises will require a proactive strategy to seal off localized conflicts and prevent them from becoming larger competitions between external players while taking action to improve governmental responsiveness in at-risk areas.
  • Topic: Foreign Policy, National Security, Power Politics, Violent Extremism, Strategic Competition
  • Political Geography: Africa, Middle East, North America, United States of America
  • Author: Michael Rubin
  • Publication Date: 08-2020
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Iran has embraced unmanned aerial vehicles (UAVs) as a major pillar of its military strategy. Iranian officials may exaggerate their capabilities, but Western analysts should not dismiss the threat posed by Iranian drones. Iranian authorities have invested in and experimented with drones for 35 years. Iranian authorities use drones for two main purposes: surveillance and attack. Iranian controllers now have the ability to conduct missions over the horizon and in most weather. Attack drones fall in two categories: Those with the ability to drop bombs or launch missiles and return to base and “kamikaze” drones that seek targets of opportunity. Iranian authorities have had more success with the latter. The biggest danger posed by Iranian UAVs, however, in years to come may be the result of Iranian proliferation of its drones to proxy groups, such as Lebanese Hezbollah, and the transfer of the ability to manufacture those drones. This will create some ambiguity in the operational environment as uncertainty about the identity of the drone’s controller can undercut momentum to hold that controlling country or group to account. This ability to escape accountability might actually make the use of drones more likely in surprise and terrorist attacks in the coming years.
  • Topic: Foreign Policy, Defense Policy, Weapons , Drones
  • Political Geography: Iran, Middle East
  • Author: Kenneth Pollack
  • Publication Date: 03-2020
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: For the first two to three decades after the 1979 Islamic Revolution, the Iranian-led “Axis of Resistance” was little more than rhetoric, ascribing greater unity of effort to an amalgam of states, semi-states, and non-state actors that opposed the Middle Eastern status quo than was ever the reality. Because of the events of 2014–16, when key Shi’a groups and governments faced severe threats, there has been a significant shift in the Axis’ composition and effectiveness. Today, the Axis is comprised of an increasingly cohesive coalition of groups functioning more directly under Iranian guidance. Iranian support for these groups has also shifted from covert terrorist collusion, funding, intelligence sharing, rhetorical support, and tacit diplomacy to overt force deployments, joint military operations, economic assistance, deterrence, and alliance solidarity. Nevertheless, Iran’s successes have led to additional problems. The Axis of Resistance strategy was born out of necessity, and it is unclear, especially without Soleimani, whether Iran will be able to adapt moving forward.
  • Topic: Foreign Policy, Defense Policy, Non State Actors, Qassem Soleimani
  • Political Geography: Iran, Middle East
  • Author: Ryan C. Berg
  • Publication Date: 03-2020
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Much of Brazil’s deadly urban violence is the direct result of territorial battles involving the country’s powerful transnational organized crime groups, many of which trace their origins to the country’s dangerous and overcrowded prisons. The Primeiro Comando da Capital (PCC), or First Capital Command, took shape in São Paulo during the early 1990s, as inmates organized against poor prison conditions to impose order and preserve lives. Eventually, the PCC developed an ability to project its influence and control well beyond prison walls and into Brazil’s sprawling urban slums. The PCC has vanquished many of its domestic rivals, enjoys a footprint in every state in Brazil, runs operations in almost every country of South America, and is now more globally minded than ever before, recruiting guerrillas from the Revolutionary Armed Forces of Colombia and Venezuelan refugees and partnering with European mafia groups and Lebanese Hezbollah. Law-and-order strategies that “stuff” Brazil’s crowded prisons with new inmates may actually exacerbate the problem, given that the PCC has effectively converted the country’s prisons into logistical hubs and training centers of illicit activity. To fight the PCC, the US should designate it as a transnational organized crime group to confer the benefits of multiple pieces of legislation and seek extradition of key PCC leaders.
  • Topic: Foreign Policy, Defense Policy, Non State Actors, Law Enforcement, Prisons/Penal Systems, Violence
  • Political Geography: Brazil, Latin America
  • Author: Katherine Zimmerman
  • Publication Date: 04-2020
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Sahel-based Salafi-jihadi groups including al Qaeda and the Islamic State coordinate and cooperate across organizational divides united by common objectives, shared histories, and ethnic ties, creating a unique ecosystem of ideology and terror. The Salafi-jihadi ecosystem in the Sahel is strengthening rapidly. The number of attacks will continue to rise and will become deadlier as groups’ capabilities improve. The groups’ coordinated effort to transform Sahelian society and governance into their vision under Islam has helped destabilize the region and has created additional opportunities for Salafi-jihadi growth.
  • Topic: Foreign Policy, Defense Policy, Non State Actors, Al Qaeda, Islamic State, Salafism, Jihad
  • Political Geography: Middle East, North Africa, Sahel
  • Author: Derek Scissors
  • Publication Date: 07-2020
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Partial decoupling from China is overdue. The People’s Republic of China (PRC) suppresses foreign competition and infringes intellectual property. It is an ugly dictatorship at home and increasingly aggressive overseas. Decoupling involves a range of tools and economic activities. Policymakers should quickly move to document and respond to Chinese subsidies, implement already legislated export control reform, monitor and possibly regulate outbound investment, and provide legal authority to move or keep supply chains out of the PRC. Decoupling has costs—higher prices, lower returns on investment, and lost sales. But they are dwarfed by the costs of continued Chinese economic predation and the empowerment of the Communist Party.
  • Topic: Foreign Policy, Defense Policy, Bilateral Relations
  • Political Geography: China, Asia, North America, United States of America
  • Author: Derek Scissors
  • Publication Date: 07-2020
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: As expected given COVID-19, China’s construction and, especially, investment around the world plunged in the first half of 2020. The decline may be exaggerated by Chinese firms not wanting to report global activity, but Beijing’s happy numbers are not credible. From what little can be discerned, the Belt and Road Initiative is becoming more important, primarily because rich countries are more hostile to Chinese entities. American policy needs to shift. Incoming Chinese investment is now extremely small, but technology is still being lost due to lack of implementation of export controls. Growing American portfolio investment in China is unmonitored and may support technology thieves, human rights abusers, and other bad actors.
  • Topic: Foreign Policy, Investment, COVID-19
  • Political Geography: China, Asia, North America, United States of America
  • Author: Derek Scissors
  • Publication Date: 01-2020
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Chinese investment and construction around the world contracted in 2019, regardless of Beijing’s claims to the contrary. However, the decline is concentrated in large, headline-winning deals, and Chinese firms remain active on a smaller scale. A contraction in acquisitions in rich economies has boosted the relative importance of greenfield spending. The number of countries in the Belt and Road continues to expand, and power plant and transport construction continues to be preeminent. American policymakers were initially spurred to act by intense Chinese investment in 2016. This has dropped sharply, but there are challenges related to investment review that are more important, starting with strengthening export controls.
  • Topic: Foreign Policy, Economy, Belt and Road Initiative (BRI), Investment
  • Political Geography: China, Asia
  • Author: Frederick W. Kagan, Nicholas Carl, Marie Donovan
  • Publication Date: 01-2020
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The Islamic Revolutionary Guard Corps Ground Forces are organized around headquarters that are meant to coordinate the operations of Iranian paramilitary forces and support the Quds Force’s use of proxy groups such as Iraqi Shi’a militias abroad. Their basing in Iran indicates a primary focus on suppressing internal unrest and waging irregular warfare in the rear of an invader rather than on defending against an invasion conventionally. Their organizational structure and the pattern of their operations in Syria suggest that they might be challenged to coordinate large-scale (multi-division) operations abroad and possibly at home. The fact that the Iranian leadership has not yet had to use them on a large scale to suppress growing domestic unrest suggests that the regime still has a potent reserve force to ensure its survival even if the unrest grows considerably, as long as it does not also face a requirement for large-scale military operations abroad.
  • Topic: Foreign Policy, Armed Forces, Qassem Soleimani, Islamic Revolutionary Guard Corp (IRGC)
  • Political Geography: Iran, Middle East, Syria
  • Author: Aaron M. Renn
  • Publication Date: 02-2020
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The culture of particular places, often developed and cast into institutional form during their founding period, affects their economy in important and understudied ways. Case studies suggest several cultural traits can potentially help places be more economically successful over the long term: (1) open civic networks, which help places better adapt to change; (2) investment in civic leadership and institution building by local elites; and (3) an emphasis on education and rewarding excellence. Civic culture is difficult to change. Doing so requires first acquiring a deep understanding of it and then focusing on the most addressable areas for change, such as incubating new relationships and connections between different actors in the community.
  • Topic: Civil Society, Poverty, Culture, Cities
  • Political Geography: North America, Global Focus, United States of America
  • Author: Derek Scissors
  • Publication Date: 03-2020
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: There is a considerable chance China will stagnate by 2040, with gross domestic product growth at 1–1.5 percent. The process has started, seen most clearly in stark trends for debt and aging, but better-quality data on productivity would clarify how far along stagnation is and whether it at some point reverses. China shows no sign of adopting pro-productivity reform. It will not spur growth by leveraging or bolster a shrinking labor force through current population and education policy. Innovation will help, but a large economy requires broad innovation, and the party dislikes competition. A twist comes from China’s global position, which will not deteriorate much. Outbound investment has retrenched, and the yuan’s rise was exaggerated. Consumption exports and commodities imports will stall. But China will easily be a top-two market in most sectors, and other countries are not acting to displace it. Instead, localization will occur. Commodities producers and some developing countries will lose, the latter as Chinese capital dries up. Countries that make difficult reforms will win. Consumer goods will see inflation, but innovation will be healthier with less Chinese influence. American firms will seek new pastures, and Chinese stagnation means production may relocate to the US.
  • Topic: Foreign Policy, Defense Policy, GDP, Economic growth
  • Political Geography: China, Asia
  • Author: Vincent H. Smith
  • Publication Date: 03-2020
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The federal government annually appropriates funds for food aid programs that the US Agency for International Development manages to benefit some of the neediest individuals in the world. This report analyzes how one interest group, the US maritime industry, has managed to obtain rents from the Title II food aid program through cargo preference requirements in the name of national security. We find that removing cargo preference requirements would allow for between $36 and $64 million of already appropriated funds to go to feeding the hungry and would benefit US soft power globally.
  • Topic: Maritime, USAID, Mercantile Policy, Food Assistance
  • Political Geography: North America, Global Focus, United States of America
  • Author: Derek Scissors
  • Publication Date: 08-2019
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Contrasting China at various stages of reform to Japan and Korea at analogous stages shows China as less successful. The payoff is personal income, where China’s growth in local currency terms is similar to Japan’s. But it is slower than Korea’s, and, in comparable dollar terms, China is far behind Korea and Japan 40 years into the respective “miracles.” In evaluating key contributors to income gains—agricultural productivity, labor quantity and quality, leveraging, and innovation—China failed to extend education in the first 25 years of reform. A recent failure is the explosion in leveraging in the past decade. Other indicators of success roughly match Japan but trail Korea. China’s size makes it important even with less development success. For example, Chinese research and development spending affects the world while being inadequate to offset aging and indebtedness. When projecting economic size, though, trend extension is misleading. Korea and Japan illuminate how innovation and other factors will alter China’s trajectory.
  • Topic: Foreign Policy, Defense Policy, Economics, Reform
  • Political Geography: Japan, China, Asia, Korea
  • Author: Jessica Trisko Darden
  • Publication Date: 09-2019
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: US counterterrorism policy must draw on all available tools to succeed. This includes combining security, development, and humanitarian assistance when necessary to target environments that enable violent extremism to flourish. US foreign development assistance can effectively support counterterrorism efforts when centered on four pillars: (1) prioritizing local physical security, (2) responding to humanitarian need, (3) improving governance, and (4) targeting and tailoring programming to local contexts. A refined development approach to counterterrorism should more effectively target at-risk populations, address local governance concerns, and shape economic conditions in ways that support America’s counterterrorism goals.
  • Topic: Foreign Policy, Defense Policy, Terrorism, Development Aid
  • Political Geography: North America, Global Focus, United States of America
  • Author: Karen E. Young
  • Publication Date: 09-2019
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The economies of the Gulf Cooperation Council (GCC) remain heavily reliant on natural resource revenue as a source of government spending and a driver of growth. Diversification efforts now often include new ways to generate revenue through state investments in energy projects abroad (including refining and petrochemical production) and national oil companies. Since 2015, the GCC countries have become more competitive with each other in altering their policy landscapes to streamline fiscal expenditure and attract foreign investment and resident investors. There is significant variation in policy approaches to foreign labor and tax. Each of these governments faces enormous strains on public finances and challenging economic outlooks, due to depressed oil prices, demographic pressures, high unemployment rates, and a lack of economic diversification. Debt has become a tool of choice, but the capacity to repay and the capacity to grow are both beginning to differentiate the GCC states.
  • Topic: Foreign Policy, Defense Policy, Government, Natural Resources, Economy
  • Political Geography: Middle East, Gulf Cooperation Council, Gulf Nations
  • Author: Nicholas Eberstadt, Ashton M. Verdery, Zeng Yi, Wang Zhenglian, Wang Feng, Shen Ke, Cai Yang, David E. Scharff, Jacqueline Deal, Michael Szonyi
  • Publication Date: 09-2019
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Over 2,500 years of family tradition in China is on an unavoidable collision course with 21st-century China’s new demographic realities. The demographic forces transforming the Chinese family are extraordinary and historically unprecedented. Curiously, despite the small library of studies on population change in modern China, little has been written on what these changes in the Chinese family portend. This cross-disciplinary volume is an exploratory foray into that intellectual terra incognita. The chapters in this volume describe the demographic dimensions of the changes in family structure already underway and visible out to the horizon, as well as their implications for China’s people, economy, and role in the world. The volume features works by authors Ashton M. Verdery; Zeng Yi and Wang Zhenglian; Wang Feng, Shen Ke and Cai Yong; David E. Scharff; and Jacqueline Deal and Michael Szonyi—leading scholars in their respective fields.
  • Topic: Foreign Policy, Defense Policy, Demographics, Family
  • Political Geography: China, Asia
  • Author: Katherine Zimmerman
  • Publication Date: 10-2019
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The US is losing against al Qaeda, the Islamic State, and other like-minded groups, which are all part of the Salafi-jihadi movement. US counterterrorism efforts have made Americans safer, but the Salafi-jihadi movement is more than its terrorism threat. That movement now prioritizes developing its relationships with local Sunni communities, from which it draws its strategic strength, to transform the Muslim world. Winning today means adopting a strategy beyond counterterrorism that will defeat the Salafi-jihadi movement, instead of just countering the terrorism threat. The US must reframe its approach against al Qaeda, the Islamic State, and other groups. With the help of partners, the US must sever the ties of the Salafi-jihadi movement to local Sunni communities. America and its allies must offer these communities a viable alternative to these terror groups.
  • Topic: Foreign Policy, Defense Policy, Terrorism, Al Qaeda, Islamic State, Salafism, Islamism
  • Political Geography: Middle East, North America, United States of America
  • Author: Dalibor Rohac, Matt Browne, Max Bergmann, Ismaël Emelien, Karin Svanborg-Sjövall, Andreas Johansson Heinö, Agata Stremecka
  • Publication Date: 10-2019
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Since 2016, concern over the resurgence of illiberal populist political parties and movements has been palpable in Europe and the United States. The election of Donald Trump, the United Kingdom’s referendum to leave the European Union, and the electoral advances of far-right parties in many European states, including France and Germany, created the sense that populist parties were a new, unstoppable political force in democratic politics.1 Yet in 2019, the notion that populist parties are the future of European politics seems far less certain. The term “populism” itself may have outlived its usefulness. Originally, it referred to parties and leaders who described themselves as true voices of the people against self-serving, out-of-touch elites—and it was prone to run roughshod over established political norms and institutions. Over the past three years, differences in approaches, tactics, and outlooks between different populist parties have emerged, making it clear that there is no clear populist governing strategy. Accordingly, beyond disrupting the current order, anti-establishment political forces in Europe share no actual transnational policy agenda. Yet populist and anti-establishment forces have upended European politics and contributed to fragmentation and uncertainty. As the example of the record turnout in the 2019 European parliamentary election illustrates,2 the EU itself has become an important dividing line for voters. The high turnout and raucous nature of the 2019 election portends animated debates over European policies. Gone are the days when the EU could move initiatives forward without much public attention or concern. In short, Jean Monnet’s “salami-slicing” method of incremental, technocratically driven European integration3 is dead. A more engaged and aware European public is in itself a positive development. Yet simultaneously, for better or worse, the sudden salience of European policies can present an obstacle to policy initiatives that otherwise would be seen as uncontroversial. Just as partisan divisions in the United States have plagued Washington with significant policy paralysis, the emergence of a similarly contentious and partisan politics in Europe may make it hard for Brussels to act. Europe has proven resilient over the past decade, but that resilience should not be taken for granted. The EU largely has failed to address its structural weaknesses that were exposed following the 2008 financial and fiscal crisis, meaning that the EU would confront a future economic crisis with the same limited toolbox it had in 2008.4 To make matters worse, influential populist actors could also obstruct swift action while benefiting politically at home from the EU’s failings. Unlike only a few years ago, fears of the EU’s sudden unraveling seem farfetched. Yet a protracted death by a thousand cuts, caused by populist leaders undermining EU rules and norms, remains a distinct possibility. The new instability of European politics poses a real challenge to the trans-Atlantic alliance. Unity among free and democratic states of the West is hard to sustain in the current political environment on both sides of the Atlantic. Yet at a time when the alliance faces a rising challenge from autocratic powers such as China and Russia, the case for unity and cooperation is stronger now than at any point since the end of the Cold War. This report seeks to chart a course for the EU and for the trans-Atlantic alliance, while acknowledging that the anti-establishment sentiments that reverberate through European politics are here to stay. While there is a strong case to be made for a Europe that works together to defend democratic values at home and abroad as well as a trans-Atlantic alliance that is willing to work in proactive partnership to tackle big global challenges—from climate change to terrorism to nuclear proliferation—that goal is still a long way off.
  • Topic: Foreign Policy, NATO, Authoritarianism, European Union, Populism
  • Political Geography: Europe, Eurasia
  • Author: Nicholas Eberstadt, Alex Coblin
  • Publication Date: 10-2019
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Due to extremely low levels of fertility over the past generation, urban China now requires a constant inflow of rural migrants to maintain, much less increase, the workforce in China’s cities. Beijing’s current official “urbanization drive” is attempting to bolster China’s flagging economic growth rates by accelerating the movement of peasants into the cities. But since most highly skilled labor from the countryside is already working in urban areas, the next wave of migrants may be less productive than authorities anticipate. “Migration with Chinese Characteristics” means police state controls on urban influx, including Beijing’s notorious hukou system for individual identification and registration. Since authorities still prevent most migrants from obtaining new hukou where they currently reside and work, China now has hundreds of millions of “illegal aliens” toiling in its cities. The urbanization drive does not plan to fix this problem.
  • Topic: Demographics, Migration, Urbanization, Population Growth
  • Political Geography: China, Asia
  • Author: Frederick W. Kagan
  • Publication Date: 10-2019
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The Yemeni al Houthi movement claimed the drone and missile attack on Saudi oil facilities on September 14, 2019, but the attack on Abqaiq was planned and executed by Iran. The al Houthi claim to have conducted the attack diverted the Western discussion away from Iran’s role and focused instead on the war in Yemen and on Saudi Arabia’s misdeeds. The Iranian attack on Abqaiq was part of a pattern of Iranian military escalation in response to the Trump administration’s “maximum pressure” campaign. The US should conduct a military strike to deter continued Iranian military escalation. Refraining from retaliation will embolden Iranian proxies and allies and encourage the regime to stand fast with its nuclear program, regional activities, and repression of its own people.
  • Topic: Foreign Policy, Terrorism, Military Strategy, Houthis
  • Political Geography: Iran, Middle East, Yemen, Saudi Arabia, United States of America, Gulf Nations
  • Author: Gary J. Schmitt, Michael Mazza
  • Publication Date: 10-2019
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The People’s Republic of China’s (PRC) interference in Taiwan’s democracy—efforts to influence politics in Taiwan through both overt and covert, both legal and illicit means—is a matter of importance not only for Taiwan but for the United States as well. As the Taiwan Relations Act (1979) states unequivocally, “It is the policy of the United States … to consider any effort to determine the future of Taiwan by other than peaceful means … a threat to the peace and security of the Western Pacific area and of gave concern to the United States.” The issue of PRC interference in Taiwan’s democracy came to a head in the November 2018 elections for local mayors, county magistrates, and township councils. Although the exact extent of the interference is difficult to quantify, that it existed is not difficult to see. And while the margins of electoral victories for the Kuomintang (KMT) suggest that the interference was unlikely to have been decisive in many or most instances, the PRC’s efforts almost certainly boosted KMT candidates and eased their paths to victory. Understanding the level and character of this interference is important if for no other reason than that future elections—such as the upcoming national election for president and the legislative assembly in January 2020—may be closer and, in such elections, Chinese Communist Party (CCP) influence operations could well make a real difference. For Americans, understanding what happened in Taiwan is undoubtedly informed by our own recent experience with foreign interference in elections. But there are important differences to be kept in mind and which make the case of China and Taiwan unique. First, China has the advantage of being ethnically and linguistically far more in sync with Taiwan than Russia could ever be with the United States. Second, the United States is a country of 330 million. As sophisticated as the Russian operation might have been, Moscow’s capacity to move the electoral meter in the United States was always going to be marginal, even if important in key instances.
  • Topic: International Relations, Politics, Democracy, Foreign Interference
  • Political Geography: China, Taiwan, Asia
  • Author: Vincent H. Smith
  • Publication Date: 10-2019
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The smallholder paradigm for economic growth underlies the US Agency for International Development’s (USAID) agricultural assistance, but it is flawed as an engine of growth. Smallholder farmers lack scale and are reluctant entrepreneurs. Midsize farms are emerging as the effective engine of commercial agricultural growth and rural transformation. Rural education policies are needed to ensure a successful economic transition out of agriculture and into other industries and occupations requiring more human capital and skills. The delivery of USAID programs exhibits massive leakage. US for-profit development firms, US universities, and urban interests in recipient countries mostly capture the resources.
  • Topic: Agriculture, Economics, International Development, USAID
  • Political Geography: North America, United States of America
  • Author: Joseph W. Glauber
  • Publication Date: 11-2019
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: In retaliation for adverse trade actions from the Trump administration against foreign imports, many countries have imposed tariffs on US agricultural exports. To shore up political support from an important constituency, the Trump administration has authorized an estimated total of $28 billion in 2018 and 2019 to farmers and ranchers in compensation packages for their losses in those years. This report uses estimates of the distribution and size of the 2018 and 2019 trade aid packages to evaluate how these programs will affect World Trade Organization domestic support limits and their potential consequences for US trade relations.
  • Topic: Agriculture, Humanitarian Aid, World Trade Organization, Tariffs, Trade
  • Political Geography: Global Focus, United States of America
  • Author: Neena Shenai, Joshua Meltzer
  • Publication Date: 02-2019
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The US–China economic relationship has reached a critical juncture. Over the past year, the US has imposed tariffs on $250 billion worth of Chinese imports and China has retaliated, raising tariffs on a similar amount of US exports. At the G-20 leaders’ summit in November 2018, Presidents Trump and Xi agreed to resolve the trade dispute within 90 days—by March 1, 2019, though this deadline has been recently extended. The US concerns that underpin these bilateral trade tensions stem from specific practices endemic to China’s economic model that systematically tilt the playing field in favor of Chinese companies domestically and globally. Progress on specific trade issues will require China to comply with its World Trade Organization (WTO) commitments and to make certain reforms that will likely touch on areas of state control over the economy. In addition, new trade rules are needed to address China’s economic practices not covered by its WTO commitments, including in areas such as state-owned enterprises (SOEs), certain subsidies, and digital trade. These issues also come at a time of increasing US concern over the national security risks China presents, particularly with respect to technology access. All of these matters underscore the complexity of US-China bilateral negotiations as well as the stakes at play. Resolving US-China differences in a meaningful way will take time. This policy brief assesses the state of the US-China trade relationship by first looking at the economic impact on the US The policy brief then looks at why the Chinese economic model is so concerning. Despite the challenges the US has had at the WTO, the policy brief argues that the WTO should be central to resolving US-China trade tensions. We outline a multi-prong strategy, including bilateral, multilateral, and unilateral actions as well as working with allies that together would constitute positive next steps for this critical economic relationship. In taking this multifaceted approach, the US needs to stay true to its values and not accept short-term gains or “fig leaf” deals. In particular, creating a managed trade relationship with China would not be a constructive outcome. Instead, the US should work with China to agree on long term solutions. The resulting deal should address the real issues at hand in a free market manner and strengthen the multilateral global trading system and rule of law that the US has championed in the post-World War II era.
  • Topic: Foreign Policy, Bilateral Relations, Economy, Trade
  • Political Geography: China, Asia, North America, United States of America
  • Author: Derek Scissors
  • Publication Date: 03-2019
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: When will China pass the US in economic size? “The year 2030” is not a bad estimate, but so is “never.” Claims that China’s economy is already the world’s largest may be exaggerated by up to 30 percent. They are also dubious because purchasing power parity often does not hold. National wealth is not well measured, either, but shows the American lead expanding. The more popular belief that China is smaller than the US but will catch up soon is similarly unconvincing. Chinese government statistics are unreliable, since Beijing publishes sanitized data and many transactions may be close to worthless. More important, projections of Chinese growth are sensitive to unjustified optimistic assumptions. Debt and aging indicate true Chinese growth is lower than reported, and low growth now could put off Chinese catch-up indefinitely.
  • Topic: Foreign Policy, Defense Policy, Economics, Bilateral Relations
  • Political Geography: China, Asia, North America, United States of America
  • Author: Jessica Trisko Darden
  • Publication Date: 05-2019
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Young people serve as a vital source of support for terrorist groups. Extensive youth participation creates an intergenerational terrorism problem and lays the foundation for future conflicts. Youth end up in terrorist groups through forced and voluntary recruitment. They perform a range of roles that vary according to age and gender, with girls and young women often being subject to gendered social roles and sexual and domestic violence. To effectively counter terrorists’ exploitation of youth abroad, governments should adopt a data-based approach to improve the targeting of terrorism prevention programs, move beyond a traditional focus on young men, address the potential for radicalization within the family, and emphasize attitudinal and behavioral change among those most vulnerable to recruitment.
  • Topic: Foreign Policy, Terrorism, Radicalization, Islamic State, Youth, Boko Haram
  • Political Geography: Africa, Middle East
  • Author: Michael Rubin
  • Publication Date: 05-2019
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The Trump administration’s Afghanistan strategy repeats mistakes made by the Clinton and Obama administrations. The Taliban repeatedly fail to keep diplomatic commitments. Treating the Taliban as independent from Pakistani command-and-control will undercut the utility of any peace deal struck with the Taliban. Diplomatic outreach and Taliban empowerment are directly proportional. The Afghan perception of Special Envoy Zalmay Khalilzad is colored heavily by a personal history about which many in Washington, DC are unaware.
  • Topic: Diplomacy, Taliban, Al Qaeda
  • Political Geography: Pakistan, Afghanistan, South Asia, North America, United States of America
  • Author: Karen E. Young
  • Publication Date: 05-2019
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Energy-dependent growth in the Middle East and North Africa (MENA) region, whether in traditional oil and gas exports or petrochemical production and global refinery operations, will be sensitive to shifts in Asian economies and new technology and efficiency innovation. Without structural reforms to subsidies and labor markets, a reliance on debt finance now kicks the can down the road toward difficult fiscal choices in the future. MENA economies are becoming more integrated into emerging markets not by increased trade but through state-led development partnerships and the use of aid and economic statecraft.
  • Topic: Foreign Policy, Development, Energy Policy, Economic growth
  • Political Geography: Middle East, North Africa, Gulf Cooperation Council, Gulf Nations
  • Author: Katherine Zimmerman
  • Publication Date: 06-2019
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Successes on the battlefields against al Qaeda, the Islamic State, and other like-minded groups have not led to their defeat or permanently reduced their threat to the United States. The deterioration of conditions in the Muslim world has made communities vulnerable to and created opportunities for the Salafi-jihadi vanguard to develop local ties. The reliance of the Salafi-jihadi movement on its relationship with Sunni communities to strengthen and expand beyond ideological supporters is a key vulnerability. The US should reorient its efforts to focus not only on disrupting and preventing active terror plots as a national security priority but also on severing the relationships the Salafi-jihadi movement has formed with Sunni communities.
  • Topic: Foreign Policy, Terrorism, Military Strategy, Al Qaeda, Islamic State
  • Political Geography: Middle East
  • Author: Clay R. Fuller
  • Publication Date: 07-2019
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The effects of authoritarianism are amplified and obfuscated by growing economic interconnectivity. Combating authoritarianism and addressing the dark networks that support its consolidation are the unavoidable strategic challenges to global security. The authoritarian-corruption nexus is the growing convergence of licit and illicit state and non-state actors that facilitates and launders the profits of illegal activity, reinforcing the strength and survival of authoritarian systems of governance everywhere. It depends on and resides in the complex and rapidly changing global economic currents flowing in and out of American markets and is the defining threat to freedom in the 21st century. Domestic and international efforts are needed to dismantle the authoritarian-corruption nexus, including addressing the (ab)use of anonymous shell corporations and reestablishing the Group of Seven.
  • Topic: Foreign Policy, Corruption, Authoritarianism
  • Political Geography: Global Focus
  • Author: Andres Martinez-Fernandez
  • Publication Date: 07-2019
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: National Liberation Army (ELN) guerrillas remain a potent challenge for regional security and development. The ELN is growing in Colombia and Venezuela, thanks to its involvement in illegal mining, now the most important revenue source for the guerrilla group. The ELN’s illegal mining remains virtually unrestricted in Venezuela, thanks to the Nicolás Maduro regime’s complicity. At the same time, despite the Colombian government’s recent efforts, illegal mining continues to take place throughout Colombia, benefiting armed groups like the ELN. To cut off the ELN from this vital revenue source, the United States and Colombia must work to expand the presence of the state in areas affected by illegal mining, formalize artisanal miners, strengthen the state’s enforcement and investigatory capacities, and isolate Venezuela from global gold markets.
  • Topic: Crime, Mining, Organized Crime
  • Political Geography: Colombia, Latin America, Venezuela, United States of America
  • Author: Derek Scissors
  • Publication Date: 07-2019
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: China’s investment and construction around the world plunged in the first half of 2019 and is unlikely to return to 2016–17 levels in the foreseeable future. The principal cause is fewer large transactions by state-owned enterprises. These firms rely on foreign currency provided by Beijing for global activities, and hard currency may be rationed indefinitely. There are brighter spots. The raw number of investments held up better than transaction size. The private share of China’s global investment climbed, and the greenfield share rose sharply. Investment in the Belt and Road Initiative outperformed that in traditionally favored rich economies such as Australia. Chinese investment in the US has been minor in size for two years. Policymakers should shift focus from screening to unwanted activity by Chinese firms, including intellectual property theft and other criminal acts. Enforcement targeting specific firms is superior to tariffs but should go beyond largely empty steps taken to date.
  • Topic: Foreign Policy, Economy, Business , Investment
  • Political Geography: China, Asia, United States of America
  • Author: Jason D. Delisle , Preston Cooper
  • Publication Date: 08-2019
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: An analysis of the higher education systems of 35 developed countries reveals that nations face trade-offs between large government subsidies for higher education and other desirable qualities, such as widespread degree attainment and well-resourced universities. The United States ranks 31st of 35 countries on government support for higher education but 11th on degree attainment and third on resources available to colleges. It is rare for a country to design a higher education system that combines high attainment and well-resourced schools with high government subsidies.
  • Topic: Education, Higher Education
  • Political Geography: North America, United States of America
  • Author: Derek Scissors
  • Publication Date: 01-2019
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Official Chinese economic data are often the only game in town, but they are untrust­worthy. Sometimes they prove inaccurate; during downturns they are falsified outright. Finding inconsistency in official statistics demonstrates the problem but offers no solution, since it is rarely clear which series is better. Examining 15 major indicators for importance and reliability shows that growth in gross domestic product (GDP) and GDP per capita should be deemphasized. To illustrate, China’s GDP per capita is twice as high as official per capita disposable income. The latter can be spent; the former is an accounting result. Another conclusion: Arguably the most valuable indicators are the worst measured. Debt is reasonably estimated at present, but factor productivity and human capital are vital to medium-term performance and receive far too little attention.
  • Topic: Foreign Policy, Monetary Policy, GDP, Economy
  • Political Geography: China, Europe, Beijing
  • Author: Derek Scissors
  • Publication Date: 01-2019
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Chinese investment around the world fell sharply in 2018. The decline was most evident later in the year and among state-owned enterprises. These companies also engaged in fewer power construction projects. The number of countries in the Belt and Road Initiative keeps expanding, but activity levels per country are flat. One explanation for weakness in various Chinese efforts to “Go Out” is caution in drawing down foreign exchange reserves. The US has restricted Chinese investment, but it was already small in size in 2018. Serious problems remain—for example, theft and coercive transfer of technology. Firms violating American law should face sanctions, not just investment bans.
  • Topic: Globalization, Foreign Direct Investment, Sanctions, Business , Investment
  • Political Geography: China, Asia, North America, United States of America
  • Author: Gary J. Schmitt
  • Publication Date: 01-2019
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Although changes in American and Chinese leadership have brought current tensions between the two nations to the fore, the underlying reasons for the tensions are not tied to either President Donald Trump or President Xi Jinping coming into office. Rather, the strategic competition between the US and China is principally the product of regime-driven differences over both what constitutes their national interests and what their respective visions were for the character of China’s rise. The administration’s Indo-Pacific strategy is a relatively coherent response to the challenge China poses. But questions remain about the administration’s ability to resource it sufficiently and carry it out steadily given President Trump’s own idiosyncratic America First policy views.
  • Topic: Foreign Policy, Bilateral Relations, Strategic Competition
  • Political Geography: China, Asia, North America, United States of America, Indo-Pacific
  • Author: Nicholas Eberstadt
  • Publication Date: 01-2019
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: We already have a fairly reliable picture of China’s population profile for the year 2040 because the overwhelming majority of people who will be living in China in 2040 are already alive and living there today. China’s population is on track to peak in the coming decade and to decline at an accelerating tempo thereafter. China is set to experience an extraordinarily rapid surge of population aging, with especially explosive population growth for the 65-plus group, even as its working-age population progressively shrinks. These trends can only make for serious economic headwinds, presaging the end of China’s era of “heroic economic growth.”
  • Topic: Foreign Policy, Demographics, Political Economy, Population
  • Political Geography: China, Asia
  • Author: Stephanie Mercier
  • Publication Date: 01-2019
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: This study outlines the evolution and history of US food aid programs including the Food for Peace program and provisions in recent farm bills. Early in their existence, these programs provided rents to interest groups through cargo preference requirements and purchasing requirements for in-kind aid. These requirements, along with monetization, shift program dollars toward commodity producers, shipping companies, and nongovernmental organizations in the United States, raising program costs. The result is that these programs are not efficiently achieving their goals of increasing US soft power and alleviating global hunger.
  • Topic: Agriculture, Economics, Humanitarian Aid, Foreign Aid, Hunger, Mercantile Policy, Rent
  • Political Geography: North America, Global Focus, United States of America
  • Author: Karen E. Young
  • Publication Date: 02-2019
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Arab Gulf states are expanding their political and economic ties with China as a bridge strategy to create a next-generation energy market in traditional oil and gas products, as well as petrochemical production and future market access in expected areas of consumer growth. China is also a competitor in some areas where Arab Gulf states are investing in infrastructure, ports, and political outreach to secure new security partnerships, particularly in the Horn of Africa. China and the Arab Gulf states share a model and vision of economic development that is state centered and profitable to state-owned enterprises and financial institutions.
  • Topic: Foreign Policy, Development, Economics
  • Political Geography: China, Middle East, Asia, Gulf Cooperation Council
  • Author: Dan Blumenthal, Michael Mazza
  • Publication Date: 02-2019
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The United States and Taiwan can create a free trade agreement (FTA) that serves the interests of both sides. Taiwan should seek to set the gold standard in economic openness, as well as in the legal, regulatory, and standards frameworks that will govern emerging technologies and industries such as 5G, the internet of things (IOT), artificial intelligence (AI), and the future industries to be built upon them. In pursuit of the United States’ vision for a “free and open” Indo-Pacific, it would be wise for the US to enlist in its effort countries that are, themselves, already free and open. Taiwan should be considered a crucial partner in the Trump administration’s strategy. This monograph serves to provide a framework for a US-Taiwan free trade agreement (FTA), outlining areas of concern for the United States, in addition to areas that provide opportunities for closer bilateral cooperation. Importantly, such cooperation could give greater impetus for free trade negotiations, advance the Trump administration’s Indo-Pacific strategy, and bolster the United States’ National Security Strategy. In order to deepen economic ties and to, at the same time, advance the Indo-Pacific strategy, the United States should prioritize a free trade agreement (FTA) with Taiwan. The US has not completed or ratified a free trade agreement since the U.S.-Korea deal. It is now negotiating with Japan and the Philippines. But, as this paper will show, an FTA with Taiwan would have substantial strategic benefits and would, moreover, be far easier to conclude than other agreements under discussion.
  • Topic: Foreign Policy, Bilateral Relations, Free Trade, Trade
  • Political Geography: Taiwan, Asia, North America, United States of America
  • Author: Neena Shenai, Joshua P. Meltzer
  • Publication Date: 02-2019
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The US–China economic relationship has reached a critical juncture. Over the past year, the US has imposed tariffs on $250 billion worth of Chinese imports and China has retaliated, raising tariffs on a similar amount of US exports. At the G-20 leaders’ summit in November 2018, Presidents Trump and Xi agreed to resolve the trade dispute within 90 days—by March 1, 2019, though this deadline has been recently extended. The US concerns that underpin these bilateral trade tensions stem from specific practices endemic to China’s economic model that systematically tilt the playing field in favor of Chinese companies domestically and globally. Progress on specific trade issues will require China to comply with its World Trade Organization (WTO) commitments and to make certain reforms that will likely touch on areas of state control over the economy. In addition, new trade rules are needed to address China’s economic practices not covered by its WTO commitments, including in areas such as state-owned enterprises (SOEs), certain subsidies, and digital trade. These issues also come at a time of increasing US concern over the national security risks China presents, particularly with respect to technology access. All of these matters underscore the complexity of US-China bilateral negotiations as well as the stakes at play. Resolving US-China differences in a meaningful way will take time. This policy brief assesses the state of the US-China trade relationship by first looking at the economic impact on the US The policy brief then looks at why the Chinese economic model is so concerning. Despite the challenges the US has had at the WTO, the policy brief argues that the WTO should be central to resolving US-China trade tensions. We outline a multi-prong strategy, including bilateral, multilateral, and unilateral actions as well as working with allies that together would constitute positive next steps for this critical economic relationship. In taking this multifaceted approach, the US needs to stay true to its values and not accept short-term gains or “fig leaf” deals. In particular, creating a managed trade relationship with China would not be a constructive outcome. Instead, the US should work with China to agree on long term solutions. The resulting deal should address the real issues at hand in a free market manner and strengthen the multilateral global trading system and rule of law that the US has championed in the post-World War II era.
  • Topic: Foreign Policy, Globalization, Bilateral Relations, Trade
  • Political Geography: China, Asia, North America, United States of America
  • Author: Jason D. Delisle , Preston Cooper
  • Publication Date: 07-2018
  • Content Type: Commentary and Analysis
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Contrary to popular perception, the share of students at the 200 most selective public and private colleges who are from low-income households did not decline over the past 16 years. However, the share of students at these institutions who are from middle-income families has steadily declined.
  • Topic: International Political Economy, Poverty
  • Political Geography: America
  • Author: Chad Michael Briggs
  • Publication Date: 07-2018
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Paid parental leave can provide important health and educational benefits to children while enabling mothers to remain attached to their prior jobs, which can increase earnings substantially once the mother returns to work
  • Topic: Finance, Domestic politics
  • Political Geography: America
  • Author: Derek Scissors
  • Publication Date: 07-2018
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: China is investing much less in the US than it did just a year ago. It has never invested much in the Belt and Road. Yet China’s global investment spending remains healthy, with impressive diversification across countries and the reemergence of private firms.
  • Topic: International Political Economy, International Affairs
  • Political Geography: China
  • Author: Joseph Antos, Robert Moffit
  • Publication Date: 07-2018
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Medicare’s financial outlook has deteriorated in the past year, according to the latest annual report by the program’s trustees. The Medicare Hospital Insurance trust fund is projected to be depleted in 2026, three years earlier than estimated in last year’s report. That understates the policy challenge. Every year, the program relies more on general revenues to cover its costs. In total, Medicare will receive $324 billion in general revenues this year. That will more than double by 2026. Prompt action is needed to put Medicare on a sound financial footing.
  • Topic: International Organization
  • Political Geography: Global Focus
  • Author: Daniel Shoag, Stan Veuger
  • Publication Date: 07-2018
  • Content Type: Working Paper
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: We report three findings. First, using evidence from chain bankruptcies and data on 12 million to 18 million establishments per year, we show that large retailers produce significant positive spillovers. Second, local governments respond to the size of these externalities. When a town’s boundaries allow it to capture a larger share of retail spillovers, it is more likely to offer retail subsidies. Third, these subsidies partially crowd out private sector mechanisms that also subsidize large retailers, such as shopping malls. These facts provide powerful evidence of the Coase theorem at work and highlight a concern for local development policies even when externalities can be targeted.
  • Topic: International Affairs
  • Political Geography: America
  • Author: Danielle Pletka
  • Publication Date: 06-2018
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: In connection with an assessment of AEI’s work on the Middle East over the past two decades, I drafted the following survey. The arc of our scholarship in this critical region is fascinating and illuminates the continuity and evolution of the challenges the United States faces in the Middle East. What is ultimately clear is that in the region both the challenge of destructive ideas and the fostering of better ones will shape outcomes.
  • Topic: International Affairs
  • Political Geography: Middle East
  • Author: Andrew Saultz
  • Publication Date: 06-2018
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: A majority of teacher dismissal cases in Atlanta from 2011 to 2017 were related to issues of professionalism, including not showing up for work, not following a directive from a supervisor, or not completing tasks (i.e., grading).
  • Topic: International Affairs
  • Political Geography: America
  • Author: Gary J. Schmitt
  • Publication Date: 06-2018
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The North Atlantic Treaty Organization (NATO) was established to meet the security threat posed by the Soviet Union. Often overlooked, though, are the ways in which it has provided the material and behavioral grounds for the larger liberal order in Europe to emerge.
  • Topic: International Affairs
  • Political Geography: Global Focus
  • Author: Frederick M. Hess, Lanae Erikson Hatalsky
  • Publication Date: 06-2018
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Only about half of students who begin college actually complete their degree, which makes it increasingly difficult and expensive to brush the college completion problem under the rug.
  • Topic: International Affairs
  • Political Geography: Global Focus
  • Author: Bradford Wilcox, Wendy Wang, Ronald Mincy
  • Publication Date: 06-2018
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Over the last decade, much of the racial news and academic research on black men in America has been sobering, if not downright depressing. But negative news isn’t the only story about race or even about black males in the United States. In Black Men Making It in America, we report some good news:
  • Topic: International Political Economy, Race, International Affairs
  • Political Geography: Global Focus
  • Author: Dalibor Rohac
  • Publication Date: 08-2018
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: What distinguishes the governments of Hungary and Poland are not their views on immigration nor their defense of national sovereignty or Europe’s Judeo-Christian heritage. Rather, it is their distinctly authoritarian and anti-market features. With a new Fundamental Law, electoral reform, and other far-reaching changes adopted in Hungary on strictly partisan lines, as well as a politicization of the judiciary and attacks on free media and civil society in both countries, the Law and Justice Party (PiS) and Fidesz governments have sought to entrench themselves and prevent meaningful democratic contestation of their power. In both countries, key achievements of the post-1989 transition to the free enterprise system are being reversed. In Poland, for example, 40 percent of all banking-sector assets are now held by the government. Hungarian and Polish authoritarianism, as well as the rise of political kleptocracy in Hungary, pose a direct threat to the values on which the transatlantic alliance was built and America’s interest in the region. The United States cannot afford to become a cheerleader for either Fidesz or PiS, no matter how convincing their conservative bona fides might seem.
  • Topic: Foreign Policy, Government, Politics, Authoritarianism
  • Political Geography: Europe, Eurasia, Poland, Hungary
  • Author: Michael Mazza
  • Publication Date: 08-2018
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Southeast Asia is no mere strategic sideshow. For centuries, it has been geopolitically important due to the sea lanes that pass through it, its proximity to and abutment of India and China, and the resources to which it plays host. The United States should strive to shape a Southeast Asia that is at peace with itself and its neighbors; is characterized by states that are strong, independent, and prosperous; and is home to governments that are resilient, responsive, and accountable. Washington should adopt a comprehensive strategy—with security, economic, and governance pillars—to achieve those ends. Should the United States succeed, it will ensure a regional balance of power favorable to the United States and its friends and allies, shore up the liberal international order, deepen prosperity at home and in Southeast Asia, and advance freedom in the region.
  • Topic: Foreign Policy, Geopolitics, Economy
  • Political Geography: Asia, Southeast Asia, United States of America
  • Author: Karen E. Young
  • Publication Date: 09-2018
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The six states of the Gulf Cooperation Council (GCC)—Saudi Arabia, Qatar, Kuwait, Bahrain, the United Arab Emirates (UAE), and Oman—are in a period of profound change, both economic and social. The economic changes are a long overdue reaction to natural resource revenue dependency in their fiscal policies, while the social changes are a reaction to compounded migration and demographic shifts. The resilience of Gulf political economies will be defined by the ability to change both fiscal governance and policies of inclusion. Inclusion, in the context of Gulf political economies, means social protection for vulnerable groups, but it also means access to compete in a rule-based economy. The promise of economic reform, therefore, is a promise to reconfigure relations between citizen and state, and to renegotiate the provision of benefits to citizens in the form of subsidies of fuel, electricity, and water, as well as generous health and education services. And there will be taxes and new fees on everything from toll roads to sugary drinks to tobacco, and employment fees for foreigners. In exchange, citizens are promised—in some way—a retreat of the state from its predatory control over economies, though not its control over the political space and activism. Nonetheless, for many political economies of the GCC, the opening of opportunities in private ownership and investment in the sale of state assets—such as power and water plants, ports, and airports, as well as schools and hospitals—poses a challenge to the state’s track record in the provision of services. These privatizations also pose a risk to a constituency unaccustomed to fees-based service and corporate liability. Will citizens accept services from private entities at cost? Will citizens jump at the opportunity to own new companies that meet the needs of their compatriots for profit? And, perhaps most importantly, who will be left behind? The concept of resilience is often used in the literature on economic development to describe how governments can protect both citizens and their economies from external shocks, whether in the form of natural disasters, black swan events, or dramatic policy shifts. The regulatory environment and the capacity of the state to react and respond to different needs of its population, especially vulnerable groups, are key. For Gulf states, the current reform agenda is not so much a shock as a delayed reaction to a problem identified long ago. Diversification from oil-based revenue is necessary, and population growth has created an oversupply of candidates for public-sector employment that is not very productive. Generating growth has to shift, in its source and its deployment among a larger and more diverse population. The Gulf states have created their own middle-income development trap. This paper offers a wide-ranging analysis of some aspects of the reform agenda underway across the GCC. It explores specific case analyses of challenges facing individual countries (Saudi Arabia and Oman), and the organization of the GCC as a whole. It also addresses subsidy reform, the introduction of taxes and fees, and some experimental policies related to regulating labor markets and encouraging citizens to move out of public-sector employment.
  • Topic: Foreign Policy
  • Political Geography: Middle East, Kuwait, Saudi Arabia, Bahrain, Qatar, United Arab Emirates, Gulf Cooperation Council
  • Author: Katherine Zimmerman
  • Publication Date: 11-2018
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The Salafi-jihadi movement shifted to prioritizing local over global objectives during the Arab Spring. Analysts wrongly understood this as a weakening of the groups. Groups have hidden their true nature by hiding their ties to global jihadi groups, such as al Qaeda and the Islamic State, and by rebranding and reorganizing on the ground. Movement leaders design and execute attacks in ways that create doubt and ambiguity about the responsible party. This new technique exploits US counterterrorism policy, which is not designed to pursue anyone other than the individuals directly responsible for the attack. American officials are countering a dynamic enemy with an irrelevant and outdated strategy.
  • Topic: Counter-terrorism, Al Qaeda, Islamic State, Salafism, Arab Spring, War on Terror, Sunni, Jihad
  • Political Geography: Afghanistan, Iraq, Middle East, Libya, Yemen, Syria, North America, Arabian Peninsula
  • Author: Mike Saidi
  • Publication Date: 12-2018
  • Content Type: Special Report
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Iran’s protest scene is evolving and has become more complex and demographically encompassing since the late-December 2017 widespread riots known as the Dey Protests. Economic problems, government mismanagement, and ethnic, labor, sectarian, and environmental issues have driven distinct and overlapping demonstrations, but they have not cohered into a unified protest movement capable of overthrowing the regime. Although the Iranian protest movement does not remotely threaten the regime, an evolved protest scene will undoubtedly shorten the life span of the Islamic Republic.
  • Topic: Protests, Revolution, Islamic Revolutionary Guard Corp (IRGC)
  • Political Geography: Iran, Middle East
  • Author: Frederick M. Hess
  • Publication Date: 03-2015
  • Content Type: Video
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: How have views toward sex education changed over time, and how does sex education around the world compare to that in the United States? On Thursday, AEI hosted a conversation with New York University professor Jonathan Zimmerman on his new book, “Too Hot to Handle: A Global History of Sex Education,” which addresses the differences in sex education across countries and throughout history, finding that as countries become more democratic, sex education becomes increasingly contentious. Zimmerman recalled how the United States was originally a pioneer in sex education, which originally tended to emphasize the dangers of sexual activity. In the 1970s and 1980s, members of the international community began to focus on sex education as a way to help liberate individuals from societal norms, leaving them free to make their own choices. He pointed out that the developing world, however, did not embrace this notion of individual autonomy being granted to teenagers, and so those countries' version of sex education came to look quite different. As immigration increased closer to the present day, then, this created strange bedfellows in many Western countries as white conservatives and immigrants joined forces against sex education. Zimmerman closed by describing how schools are necessarily limited in their efficacy on this particular subject, both because it is intensely personal and because the mass media plays such a strong informative role on the topic. Consequently, he suggested that the discussion of sex education likely ought to be expanded into environments outside the school.
  • Topic: Education, Environment, Immigration
  • Political Geography: United States
  • Publication Date: 04-2015
  • Content Type: Working Paper
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: <p>Brazil's economic malaise and corruption scandals present significant challenges to President Dilma Rousseff's ability to govern, just four months into her second four year term. Latin America's largest economy is rediscovering that stimulating growth and creating jobs requires controlling government spending, increasing trade, and attracting investment by adopting a host of free market reforms. The United States and Brazil should jump start efforts to improve their commercial and diplomatic relations to bolster economic development in a region crucial to both countries.</p>
  • Publication Date: 04-2015
  • Content Type: Working Paper
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: <p>In US education, with all its rich human dynamics, what matters is not whether a reform is attempted, but rather how it is executed. The states, given their sufficient control over schools and colleges and their proximity to their communities, are in a far better position than the federal government to effectively execute policies. Although many education reform efforts have fallen flat over the years, there are promising initiatives on the horizon that state leaders would be well-advised to pursue. Governors and legislators are right to look for strategies that can provide the highest-quality education to the largest number of students. In pre-K, state leaders have a rare opportunity to build a system from the ground up; in K-12, they have the chance to remove barriers to give more freedom to teachers and parents; and in higher education, they have the opportunity to look beyond the existing system to create new, more affordable postsecondary options that allow more flexibility for students and innovation for course providers.</p>
  • Publication Date: 04-2015
  • Content Type: Working Paper
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: <p>One of the recommendations of the 9-11 Commission was that Congress focus on the danger of weapons of mass destruction proliferating to terrorist groups. So in 2007 Congress created a Commission to study the danger and report on measures that could be taken to minimize it. I was asked to co-chair the Commission with Senator Bob Graham of Florida. There were a total of nine members on our bi-partisan Commission. Shortly after our Commission was formed, we met with Senator Harry Reid at his request. Senator Reid explained his interest in the subject of our work, and encouraged us to highlight clearly those aspects of the WMD terrorism threat which we believed were the most significant; he urged us in the strongest terms to tell us what we thought Congress most needed to know about the danger. We did so in a Report released at the end of 2008 called "World at Risk."</p>
  • Publication Date: 04-2015
  • Content Type: Working Paper
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: <p>China's proposed counterterrorism law, which applies to all information technology (IT) companies operating in China, and US "legal-intercept" regulations, which govern all IT companies operating in the United States, are officially acknowledged frameworks to counter terrorist and criminal behavior. Despite the similarities in these regulations, President Obama has criticized China's law. The US must prepare to see practices that it has already adopted become prevalent elsewhere or be ready to modify US surveillance behaviors that US authorities do not want to see spreading around the globe.</p>
  • Publication Date: 04-2015
  • Content Type: Working Paper
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: <p>Many adults without a college degree aspire to some higher credential, but most overestimate the cost of higher education, which could deter them from furthering their education. Many adults without a degree in our survey were uncertain as to the wage returns to different postsecondary pathways. Those who did offer estimates tend to see the bachelor's degree as the most valuable credential and certificates as the least valuable. Adults without a postsecondary degree do not always see the value in returning to school, and efforts to encourage education and training should clarify the benefits to various postsecondary pathways.</p>
  • Publication Date: 04-2015
  • Content Type: Working Paper
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: <p>In April of 2015, AEIs Claude Barfield authored a preliminary paper entitled The Political Economy OF TTIP: The View from the United States. The paper was presented at UC Berkeleys conference, The Political Economy of the Transatlantic Trade and Investment Partnership (TTIP): Origins, Evolution, and Implications, with the aim of providing a set of hypotheses regarding the immediate US trade agenda. The paper raises more questions than it answers, at a time when it is particularly challenging to render judgment on this agenda./p
  • Publication Date: 04-2015
  • Content Type: Working Paper
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: <p>Malicious Iranian cyber activity has increased significantly since the beginning of 2014. Data collected by AEI and the Norse Corporation indicate that attacks launched from Iranian Internet protocol (IP) addresses increased 128 percent between January 1, 2014, and mid-March 2015. The number of Norse sensors hit by Iranian IPs rose by 229 percent, while the number of distinct IPs used to execute these attacks rose by 508 percent. Iranian companies are renting and buying IT resources in the West, despite sanctions. Hundreds of thousands of domains registered to Iranian people or companies are hosted by companies in the US, Canada, and Europe as a result of Western failures to enforce IT sanctions and regulations governing technology transfers. Some of these resources are then used to conduct cyberattacks on America and its allies. The Islamic Republic is using networks within Iran to conduct sophisticated cyberattacks. Investigations have uncovered efforts launched by the Islamic Revolutionary Guard Corps and Sharif University of Technology to infiltrate US systems. The technical nature of the attacks makes it more likely that Iran's cyber capabilities are expanding and could pose a risk to US critical infrastructure.</p>
  • Publication Date: 04-2015
  • Content Type: Working Paper
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: <p>For many years, we have reviewed polls about leading political figures, including Hillary Clinton. For this AEI Public Opinion Study, we have examined almost 5,000 questions asked about her and compiled views on Clinton as a first lady, senator, presidential candidate, and secretary of state. Polling data on Hillary Clinton include several long trends, including ratings of her favorability. The first such questions about her were asked in early 1992, when many people knew little about her. In Gallups trend, her favorable rating hit 51 percent in July 1992 after the Democratic convention. Gallup noted that the campaigns effort to improve her image had paid off. She did not receive a post-election bounce as Bill Clinton did, and Gallup reported that her favorable ratings had dipped slightly. Gallup noted that 26 percent of both men and women said they were worried that she would play too large a role in the administration. Forty percent in a November 1992 poll said she came closer to their own views than previous First Ladies, but 40 percent said she did not. Her marks went down in the 1994 to1996 period, hitting an all-time low of 43 percent in January 1996 (Gallup). During her Senate tenure, her national favorable ratings ranged from a low of 43 percent to a high of 58 percent. Her national favorable ratings when she served as Secretary of State were consistently high, though they have declined slightly since she resigned from office. Without a doubt, questions specific to the issues in the presidential race will emerge in the polling data as the race to 2016 heats up, and Americans views of Hillary Clinton will evolve as the presidential election season progresses. See the latest public opinion data on her in AEIs infographic and Public Opinion Study, Public Opinion on Hillary Clinton, 1992-2015./p
  • Publication Date: 03-2015
  • Content Type: Working Paper
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: <p>Do Americans feel less threatened by terrorism now than they did when President Obama took office? The April issue of AEI's Political Report compares public opinion on the George W. Bush and Obama administrations' handling of terrorism, assesses how much terrorism concerns Americans, and assesses Americans' opinions on how the United States should respond to the threat of ISIS. This issue also examines public opinion on taxes, and where slight shifts have begun to emerge in the polls.</p> <p>/p p/p
  • Publication Date: 03-2015
  • Content Type: Working Paper
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: <p>Chairman Johnson, Senator Carper, and Members of the Committee, thank you for inviting me to appear here today to discuss unauthorized immigration to the United States and guest worker programs. In the testimony that follows, I will first discuss why people become unauthorized immigrants. I will then discuss what we know about unauthorized immigrants in the U.S. labor market. At the end, I will discuss how future guest worker programs can affect immigration flows and the U.S. economy.</p>
  • Publication Date: 02-2015
  • Content Type: Working Paper
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: <p>The States of Change: Demographics and Democracy project is a collaboration supported by The William and Flora Hewlett Foundation that brings together the Center for American Progress, the American Enterprise Institute, and demographer William H. Frey of the Brookings Institution. The projects goals are: To document and analyze the challenges to democracy posed by the rapid demographic evolution from the 1970s to 2060 To project the race-ethnic composition of every state to 2060, which has not been done for 20 years To promote a wide-ranging and bipartisan discussion of Americas demographic future and what it portends for the nations political parties and policy This report presents the first tranche of findings from this projectincluding detailed analyses on the nation as a whole and on every statewhich we hope will both inform and provoke discussion. We outline 10 broad trends from our findings that together suggest the scale of the transformation our country is living through and the scope of the challenges it will face in the future. These changes admit to a wide variety of interpretations, and as with any report as extensive as this one, it should not be surprising that there are some differences in interpretation among the participating institutions. We believe, however, that differing interpretations are to be welcomed and that they will be useful in stimulating discussion both within and outside our project on the implications of demographic change./p
  • Publication Date: 02-2015
  • Content Type: Working Paper
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: <p>In the 42 years since the Supreme Court decided Roe v. Wade (1973), pollsters have asked hundreds of questions about abortion. This AEI Special Poll Report, excerpted from our long AEI Public Opinion Study Attitudes About Abortion, covers some of the highlights.</p>
  • Publication Date: 02-2015
  • Content Type: Working Paper
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: <p>Testimony of Thomas Donnelly, Co-Director, Marilyn Ware Center for Security Studies, American Enterprise Institute</p>
  • Author: Roger F. Noriega
  • Publication Date: 02-2014
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: El Salvador will choose a new president in a runoff election on March 9. The nation's decision may prove critical to Salvadoran democracy and regional security, in light of substantial evidence linking the ruling party candidate to narcotraffickers, terrorist groups, and violent street gangs. Moreover, foreign interference in the form of billions of dollars in Venezuelan oil revenues has given the ruling party an advantage, despite the fact that its economic policies have increased poverty and stunted economic growth.
  • Topic: Corruption, Crime, Democratization, Narcotics Trafficking
  • Political Geography: Latin America
  • Author: Katherine Zimmerman
  • Publication Date: 02-2014
  • Content Type: Working Paper
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Yemen is at a pivotal moment today, three years after the outbreak of popular protests, and the future of America's strategy against al Qaeda in the Arabian Peninsula (AQAP) is on the line. Yemen is in the midst of a political transition process that will eventually reform and decentralize the government. But the success of the effort is by no means assured. The reforms will not, in any case, address the deteriorating socioeconomic conditions that provide fertile ground for al Qaeda. Moreover, the central state, never fully able to exercise its sovereignty throughout the country, is weaker than it was before 2011. Opposition groups, which have turned to violence in the past, may still seek to form independent states of their own, potentially collapsing the fragile Yemeni state structure entirely. American interests are bound up in this process by the fact that AQAP is among the most virulent al Qaeda affiliates that poses a direct threat to the U.S. homeland. Syria, Iran, and other foreign and domestic policy issues are distracting the United States and its regional partners from sustained engagement in Yemen. Without international support, the country is much less likely to ride this transition process smoothly and our security interests will be severely harmed.
  • Topic: Islam, Terrorism, Armed Struggle, Insurgency, Governance
  • Political Geography: United States, Middle East, Yemen, Arabia
  • Author: Derek M. Scissors
  • Publication Date: 02-2014
  • Content Type: Working Paper
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Reactions to the Chinese Communist Party's announcement of major economic reforms in November have ranged from unbridled optimism to skepticism about the party's ability to implement sweeping change. In fact, the reforms themselves are flawed in multiple ways-most are inauthentic, uncredible, or nonviable. However, the areas of land and finance offer more limited prospects for true reform. The primary means of judging reform progress should be progress in reducing excess capacity. The most likely outcome is that the party will claim success but the economy will slowly stagnate, harming China's partners.
  • Topic: Economics, International Trade and Finance, Reform
  • Political Geography: China, East Asia
  • Author: Dorothée Fouchaux
  • Publication Date: 02-2014
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The following National Security Outlook is the ninth in AEI's Hard Power series, a project of the Marilyn Ware Center for Security Studies. In it, Dorothée Fouchaux examines the state of French forces and France's most recent effort to prioritize its strategic goals and square them with its military capabilities.1 Certainly since Charles de Gaulle's presidency, France has maintained a tradition of thinking strategically for itself-often, admittedly, to the aggravation of its allies. This tradition remains strong and, if anything, has been reinforced in recent years by the sense that the United States is pivoting away from Europe and would like to reduce its footprint in Europe's troubled periphery. With its latest defense white paper, Paris has laid out a program to maintain its "strategic autonomy" through a combination of nuclear deterrence, enhanced intelligence efforts, and discrete power-projection capabilities. But France faces flat defense budgets, the increased cost of its military interventions in Africa, and prospects that budget shortfalls will not be overcome by the sale of public shares of national defense companies or export sales of military hardware. Consequently, some doubt that an even smaller French force will have sufficient resources to address existing problems in readiness and needed capabilities while sustaining a defense research-anddevelopment base sufficient to keep future French forces armed with advanced equipment. In short, France really is living on the strategic edge.
  • Topic: Foreign Policy, Defense Policy
  • Political Geography: Europe, France
  • Author: Michael Rubin
  • Publication Date: 01-2014
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Since Azerbaijan regained its independence in 1991, it has been only the world's second Shi'ite-led state after Iran. Azerbaijan respects separation of mosque and state, and despite pressure from its neighbors, remains independent from political domination. Given its strategic importance, safeguarding the country's independence remains a US priority. And the threat from Iranian meddling is particularly acute. From Tehran's perspective, the combination of Azerbaijan's pre-19th-century Iranian past, modern Azerbaijan's embrace of secularism, and its relative economic success challenge Iran's legitimacy. As Iranian authorities have sought to undermine and destabilize Azerbaijan through political, clerical, charitable, and media channels, Azerbaijan's counterstrategy has been both restrained and effective.
  • Topic: Foreign Policy, Islam, Sovereignty, Governance
  • Political Geography: United States, Iran, Middle East
  • Author: Leon Aron
  • Publication Date: 01-2014
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Every Olympiad is a complex and, until the end, uncertain endeavor. In the case of the 2014 Winter Games, which begin February 7 in Sochi, Russia, the challenges and vulnerabilities are far more significant and numerous than usual. It will be the first (and almost certainly the last) Winter Games in the subtropics. Virtually the entire infrastructure had to be built from scratch and in haste, with abuse of laborers and corruption overhead likely further compromising the construction. While various interest groups exploit every Olympiad to draw international attention to their causes, protests in Sochi could be particularly intense. Finally, and most ominously, Sochi is next door to a fundamentalist Islamic uprising in which terrorism claims victims almost daily. For the sake of the athletes and millions of fans, one hopes that none of these potential problems will precipitate a disruption, much less a crisis or bloodshed. Yet in their choice of location and the manner in which they have gone about organizing the Games, the Russian authorities have greatly increased that risk. By highlighting some key features and practices of Vladimir Putin's regime, a major setback at the Olympiad could deal a serious blow to the regime's legitimacy, prompt national soul searching, and trigger another round of civil resistance in search of reforms.
  • Topic: Corruption, Islam, Insurgency, Infrastructure, Governance
  • Political Geography: Russia
  • Author: Danielle Pletka, Frederick W. Kagan, J. Matthew McInnis
  • Publication Date: 02-2014
  • Content Type: Working Paper
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: A review of the soft-power strategies of both the United States and the Islamic Republic of Iran in the Middle East and Afghanistan makes clear a disturbing fact: Tehran has a coherent, if sometimes ineffective strategy to advance its aims in the Middle East and around the world. The United States does not. This project began with two tour d'horizon reviews of Iranian activities throughout areas Iran has, by its actions, defined as its sphere of influence. From the Persian Gulf through the Levant and into neighboring Afghanistan, the Islamic Republic has consistently invested in soft- and hard-power activities designed not only to extend its own influence but also to limit both American and hostile Arab aims. And while the latter part of the Ahmadinejad administration saw waning rewards for Tehran's efforts-a result more of the growing Sunni-Shia divide in the Middle East than of changes in strategy-the continued existence of a coherent Iranian strategy to dominate or destabilize the region should not be ignored. This report, the culmination of a process of both examining Iranian actions and surveying American policy, policy responses, and soft-power strategies in the region, focuses on the US side of the equation. Despite the Obama administration's commitment to replace hard power with smart power, what the United States pursues in the Middle East is a set of incoherent, ineffective, and increasingly irrelevant policies.
  • Topic: Foreign Policy, Defense Policy, Islam, Bilateral Relations
  • Political Geography: Iran, Central Asia, Middle East
  • Author: Derek M. Scissors
  • Publication Date: 01-2014
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: New data published in the American Enterprise Institute-Heritage Foundation China Global Investment Tracker show that China continues to invest heavily around the world. Outward investment excluding bonds stood at $85 billion in 2013 and is likely to reach $100 billion annually by 2015. Energy, metals, and real estate are the prime targets. The United States in particular received a record of more than $14 billion in Chinese investment in 2013. Although China has shown a pattern of focusing on one region for a time then moving on to the next, the United States could prove to be a viable long-term investment location. The economic benefits of this investment flow are notable, but US policymakers (and those in other countries) should consider national security, the treatment of state-owned enterprises, and reciprocity when deciding to encourage or limit future Chinese investment.
  • Topic: Security, Foreign Policy, Development, Economics, Emerging Markets, International Trade and Finance, Foreign Direct Investment, Sovereign Wealth Funds
  • Political Geography: United States, China, Asia
  • Author: Michael Rubin, Ahmad Khalid Majidyar
  • Publication Date: 07-2014
  • Content Type: Working Paper
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Shi'ism has a public relations problem, at least, in the United States. Most Americans formed their perception of Shi'ism not by reading its rich internal debates or exploring its diversity and cultural heritage, but rather by seeing Ayatollah Ruhollah Khomeini lead chants of "Death to America" after the 1979 Iranian revolution and Iranian hostage takers scaling embassy walls and then parading blindfolded, abused diplomats on television. Less than four years later, Shi'ite operatives in Lebanon rammed a truck bomb into the headquarters of US Marines serving as peacekeepers in Beirut, killing 241 in an incident that propelled suicide terrorism to the forefront of the American conscience.
  • Political Geography: United States, America, Middle East
  • Author: Frederick W. Kagan
  • Publication Date: 07-2014
  • Content Type: Working Paper
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Iran's national security decision-making process is not remotely as opaque as it sometimes appears. The recent crisis in Iraq and the nuclear negotiations in Geneva have opened a fascinating window into the efforts of Supreme Leader Ayatollah Ali Khamenei to bring rival groups within his government together behind a single set of policies. He appears to have been remarkably successful in mediating tensions between President Hassan Rouhani and the Islamic Revolutionary Guard Corps senior leaders. They have come together, at least for the moment, behind a coherent set of strategies for dealing with a number of thorny problems in Iraq, the nuclear negotiations, and even economic reforms. It remains to be seen if these accommodations will survive the current crisis, of course, but the success of Khamenei's efforts so far is impressive.
  • Topic: Security, Foreign Policy, Diplomacy, Nuclear Weapons, Politics, Governance, Nuclear Power
  • Political Geography: Iran
  • Author: Mary Habeck
  • Publication Date: 04-2014
  • Content Type: Working Paper
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Current national security policy is failing to stop the advancement of al Qaeda and its affiliates throughout the Muslim-majority world. While there are many reasons for this failure, three key issues stand out: a poor definition of the enemy, an incorrect view of its objectives, and the adoption of a strategy that will not defeat the latest evolution of this adaptive organization. If the US understood al Qaeda as it is: the leadership and field army of an insurgency with worldwide linkages that hopes to impose its extremist version of shari'a , govern territory, and overthrow the leaders of every Muslim- majority country, the current national strategy for combating al Qaeda would not be confined to counter - terrorism and attrition, but would instead make counterinsurgency-without large numbers of American ground forces-its main technique for confronting and defeating the organization.
  • Topic: Defense Policy, Islam, Terrorism, Military Strategy, Counterinsurgency
  • Political Geography: United States, America
  • Author: Leon Aron
  • Publication Date: 05-2014
  • Content Type: Working Paper
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Vladimir Putin is exploiting the Ukrainian revolution-specifically, by manufacturing "crises" in Crimea and eastern Ukraine and nationalist euphoria and anti-Western paranoia at home-to fashion a more repressive and increasingly unpredictable Russian dictatorship for life. With the Russian economy heading for recession, the Putin regime's popularity largely depends on Russia's foreign policy successes, which Putin hopes to achieve by humiliating, destabilizing, and eventually derailing Ukraine; by cajoling the West into rejecting sanctions against Russia; and by fueling Russian patriotism. The West should, in an effort spearheaded by the United States, aim its sanctions at increasing the costs of the regime's malignant transformation rather than simply attempting to dissuade Moscow from further action in eastern Ukraine.
  • Topic: International Law, Sovereignty, Territorial Disputes, Governance
  • Political Geography: Russia, United States, Ukraine
  • Author: Roger F. Noriega, José R. Cárdenas
  • Publication Date: 07-2014
  • Content Type: Working Paper
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The recent influx of illegal Central American immigrants (including a surge of unaccompanied minors) into the United States stems in part from violent, sophisticated drug trafficking operations in those nations and governments that are either unwilling or unprepared to confront organized crime. These operations are not only driving many more immigrants to the United States but also threatening US national security. Investing additional money in fences and border patrol agents alone will not solve US illegal immigration problems. Short-term steps for the US should include thwarting human smuggling, addressing human rights and refugee concerns before people abandon their countries, and mobilizing international cooperation and funding. To address immigration and security problems in the long term, a US-led multinational initiative is needed to better equip Central American governments to confront criminal organizations and drug trafficking and to hold corrupt officials accountable.
  • Topic: Narcotics Trafficking, Immigration, Border Control, Reform
  • Political Geography: Central America
  • Author: Derek M. Scissors
  • Publication Date: 07-2014
  • Content Type: Working Paper
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Chinese foreign investment declined through mid-2014 for the first time since the financial crisis. By sector, energy draws the most investment, but a slump in energy spending means that metals and real estate have been more prominent so far in 2014. The United States has received the most Chinese investment since 2005, followed by Australia, Canada, and Brazil. China invests first in large, resource-rich nations but has also diversified by spending more than $200 billion elsewhere. Chinese investment benefits both China and the recipient nation, but host countries must consider thorny issues like Chinese cyberespionage and subsidies.
  • Topic: Economics, Human Rights, International Trade and Finance, Terrorism, Foreign Direct Investment
  • Political Geography: United States, China, Canada, Asia, Brazil, Australia
  • Author: J. Bruce Jacobs
  • Publication Date: 06-2014
  • Content Type: Working Paper
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: China has recently attempted to use military force to back up alleged historical claims to the South China Sea and East China Sea; however, upon closer examination, the claims do not hold up. China's belligerent attempts to enforce its claims in the South and East China Seas endanger peace in Asia. China appears unlikely to accept any reasonable proposals that respect history and geography. Southeast Asian nations and other interested countries, like the United States and Australia, must maintain a military presence to deter Chinese aggression while attempting to negotiate a peaceful settlement with China.
  • Topic: International Law, Sovereignty, History, Territorial Disputes, Governance
  • Political Geography: United States, China, Asia, Australia, East China, South China
  • Author: Andrew A. Michta
  • Publication Date: 12-2013
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The following National Security Outlook is the eighth in AEI's Hard Power series-a project of the Marilyn Ware Center for Security Studies that examines the state of the defense capabilities of America's allies and security partners. In it, Andrew Michta outlines the case of Poland, which he notes is determined both to expand its indigenous defense industrial capabilities and to increase overall defense spending. As numerous accounts of NATO defense trends over the past two decades elucidate, Poland's decision to increase defense spending is far more the exception than the rule when it comes to America's other major allies. This is largely driven, according to Michta, by Poland's desire to fend as much as it can for itself in light of what it sees as Russian revanchism and Washington's growing disengagement from Europe in defense matters. Not surprisingly, this has led to a shift in Warsaw's security agenda since Poland joined NATO in 1999. Despite Poland being one NATO ally that has responded positively to Washington's calls for increasing defense capacities, today Warsaw increasingly feels compelled to look to its own resources and to neighboring capitals as potential security partners. Whether this drift in transatlantic ties is permanent or inevitable remains an open question, and will to a large extent depend on how US security relations with Europe develop in the coming years.
  • Topic: Security, Defense Policy, NATO
  • Political Geography: Europe, Washington
  • Author: William C. Greenwalt
  • Publication Date: 12-2013
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The Pentagon has been undergoing major procurement reform since 1984, but hoped-for results have not been achieved. Bipartisan acquisition reform legislation was passed in the 1990s, but these positive changes did not hold. At the heart of the current procurement dilemma is too much faith in central planning and too little faith in the free market. Policymakers must first remedy the incentives underlying reform, and five overarching categories are driving the misplaced incentives: trust in central planning leading to increased bureaucracy, preference for defense-unique versus commercial solutions, distrust of the defense industry and profit motives, fear that the workforce is incapable of exercising discretion, and finally, preoccupation with cost certainty and maintaining low prices over achieving results and value. By reaching out to and incentivizing the private sector, the Pentagon can help reform the procurement system by lowering costs, restoring competition, and delivering taxpayers the best value for their money.
  • Topic: Defense Policy, Economics, Markets, Reform
  • Political Geography: United States
  • Author: Bruce E. Bechtol
  • Publication Date: 11-2013
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: South Korea is in a unique position. It is an economic powerhouse and a thriving democracy that faces the most ­ominous and imminent threat on its borders of any democracy in the world. Moreover, this is a threat that continues to evolve, with increasing missile, cyber, special operations, and nuclear capabilities and a new leader who shows no signs that he will be any less ruthless or belligerent than his father. To meet this threat, Seoul has undertaken a number of efforts to better deter and defend against North Korean capabilities and provocations, including increasing the defense budget, upping training with US forces, creating new command elements, and establishing plans for preemptive strikes against imminent North Korean missile launches. However, in part because of administration changes in Seoul, the South Korean effort has been uneven. And decisions remain to be made in the areas of missile defense, tactical fighter aircraft, and command-and-control arrangements that will be significant for not only South Korea but all states that have an interest in Northeast Asia's peace and stability.
  • Topic: Conflict Resolution, Security, Democratization, Development, Emerging Markets, Nuclear Weapons, Bilateral Relations, Territorial Disputes
  • Political Geography: United States, East Asia, South Korea, North Korea
  • Author: Jon Kyl, Jim Talent
  • Publication Date: 10-2013
  • Content Type: Working Paper
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: When President Obama took office, the armed services of the United States had already reached a fragile state. The Navy had shrunk to its smallest size since before World War I; the Air Force was smaller, and its aircraft older, than at any time since the inception of the service. The Army was stressed by years of war; according to Secretary of Defense Robert Gates, it had been underfunded before the invasion of Iraq and was desperately in need of resources to replace its capital inventory.
  • Topic: Defense Policy, Economics, Politics, War
  • Political Geography: United States, Iraq
  • Author: Ahmad Khalid Majidyar
  • Publication Date: 10-2013
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The Persian Gulf states of Oman, Qatar, and the United Arab Emirates (UAE) have largely been immune to the rising tide of sectarianism that has rocked the Middle East in the wake of the Arab Spring. The three monarchies have successfully integrated their Shi'ite minority populations into their countries' sociopolitical and economic spheres, giving those populations little reason to engage in violence or seek political guidance from Iran or Iraq. Omani, Qatari, and Emirati Shi'ites strongly identify themselves as citizens of their respective countries and remain loyal to their ruling regimes. However, the spillover effects of the Syrian civil war—a sectarian conflict between the Shi'ite Iran-Hezbollah-Assad axis and the opposition groups backed by regional Sunni governments—are threatening Sunni-Shi'ite stability in the UAE, Qatar, and to a lesser degree, Oman. The United States should help maintain harmony in these states by reaching out to independent Shi'ite business communities and by working with regional leaders to ensure equal citizenship, political rights, and religious freedom among minority populations.
  • Topic: Conflict Prevention, Security, Islam, Post Colonialism, Insurgency, Sectarian violence
  • Political Geography: Iraq, Middle East, Arabia, Oman, United Arab Emirates
  • Author: John L. Kokulis
  • Publication Date: 10-2013
  • Content Type: Working Paper
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The rise in military health care spending has been a primary driver of the large growth in military personnel compensation over the past decade. Left unchecked, these costs will impact the ability of the DoD's Military Health System (MHS) to support its three critical missions: 1. Readiness for deployment: Maintaining an agile, fully deployable medical force and a health care delivery system so they are capable of providing state-of-the-art health services anytime, anywhere; 2. Readiness of the fighting force: Helping commanders create and sustain the most healthy and medically prepared fighting forces anywhere; and 3. The benefits mission: Providing long-term health coaching and health care for 9.7 million DoD beneficiaries.
  • Topic: Defense Policy, Economics, Health, Governance
  • Political Geography: United States
  • Author: Leon Aron
  • Publication Date: 10-2013
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The 2008–09 financial crisis demonstrated that gas and oil exports could no longer serve as Russia's engine of economic progress and the source of a steady rise in personal incomes. Russia needed to dramatically change its investment climate through deep institutional reforms that would boost economic liberty, expand the rule of law and property rights, diminish corruption, and create more political choices for its citizens. Such reforms are all the more urgent now as Russia's economy is slowing to a crawl and trust in President Vladimir Putin is steadily declining. Yet the Kremlin has chosen to address these challenges with authoritarian consolidation, buying short-term stability at the expense of the country's longer-term prosperity and progress. Elements of the Kremlin's massive propaganda campaign include militarized patriotism and patriotic education; a selective recovery of Soviet symbols and ideals; the ultraconservative Russian Orthodox Church as the moral foundation of the regime; the promotion of a culture of subservience; and the intimidation, stigmatization, and repression of civil society and its vanguard, nongovernmental organizations. Yet instead of producing the consolidation and unity expected by the Kremlin, this campaign may yield polarization, radicalism, and violence that will prevent the country's peaceful and inclusive transition to a more dignified version of citizenship.
  • Topic: Corruption, Emerging Markets, International Trade and Finance, Oil, Natural Resources, Governance, Authoritarianism, Reform
  • Political Geography: Russia
  • Author: Patrick Keller
  • Publication Date: 10-2013
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The "grand narrative" of German security policy since the end of the Cold War has oscillated between Germany's reluctance to use hard power and Germany's desire to be seen as supportive of its American and European allies. This is reflected in the varying decisions it has made during foreign military operations and in the manner in which Germany's military has conducted those operations. At the same time, the German military has undergone a series of reforms designed to modernize German forces and to make them more flexible and deployable. But a stagnant and low level of defense expenditures has made carrying out these reforms an ongoing challenge to the German military and German defense ministry. Germany has a vital interest in a stable and liberal international order and, hence, in having a military capable of helping maintain that order. As Europe's leading economic power and, increasingly, as Europe's central political actor, Germany could and should take the lead in reversing the precipitous decline in European hard power.
  • Topic: Defense Policy, Economics, International Security, Reform
  • Political Geography: Africa, Europe, Germany
  • Author: Aparna Mathur, Sadanand Dhume, Julissa Milligan, Hemal Shah
  • Publication Date: 10-2013
  • Content Type: Working Paper
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Two decades after the end of the Cold War, US–India relations stand at a crossroads. Not so long ago, many in Washington viewed the signing of the historic US–India civil nuclear deal as the advent of a dynamic partnership with the potential to transform Asia and the world. Today US–India ties are just as often characterized as unrealistic or oversold.
  • Topic: Democratization, Development, Diplomacy, Emerging Markets, International Trade and Finance, Treaties and Agreements, Bilateral Relations
  • Political Geography: United States, South Asia, Washington, India
  • Author: Roger F. Noriega, José Javier Lanza
  • Publication Date: 09-2013
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: As stepped-up counternarcotics policies in Colombia and Mexico have increased pressure on regional drug trafficking networks, organized crime syndicates have relocated operations to Central America, where law enforcement agencies and institutions are ill-equipped to withstand the onslaught. These multibillion-dollar gangs are making common cause with some local politicians who are following a playbook honed by Hugo Chávez in Venezuela. The result in Venezuela was the birth of a narcostate, and similar dramas are playing out in Central America. Like Chávez, caudillos are using the democratic process to seek power, weaken institutions, and undermine the rule of law—generating turmoil that accommodates narcotrafficking. Making matters worse for Honduras is that left-wing activists abroad, in support of ousted president and Chávez acolyte Manuel Zelaya, are waging a very public campaign of outlandish claims seeking to block any US assistance to help the Honduran government resist the drug cartels. It is imperative that US policymakers vigorously support democracy, the rule of law, and antidrug programs in Honduras.
  • Topic: Corruption, Crime, Democratization, War on Drugs, Narcotics Trafficking, Fragile/Failed State
  • Political Geography: America, Latin America, Mexico
  • Author: Bryan McGrath
  • Publication Date: 09-2013
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Despite the North Atlantic Treaty Organization (NATO) taking its name from the ocean that ties Canada and the United States to their European allies, for most of NATO's history the alliance focused primarily on land power. However, with continental Europe at peace, the drawdown in Afghanistan, the rise of general unrest in North Africa and the Levant, and the American intent to pivot toward Asia, questions are increasingly arising about the capabilities of NATO's European navies to project power and sustain operations around their eastern and southern maritime flanks. These questions have grown even more urgent in the wake of those same navies' uneven performance in the 2011 military campaign against Muammar Gaddafi's Libya. Examining the major navies of America's European allies reveals a general desire, with the exception of Germany, to maintain a broad spectrum of naval capabilities, including carriers, submarines, and surface combatants. But given the significant reduction in each country's overall defense budget, procuring new, sophisticated naval platforms has come at the cost of rapidly shrinking fleet sizes, leaving some to wonder whether what is driving the decision to sustain a broad but thin naval fleet capability is as much national pride as it is alliance strategy.
  • Topic: Foreign Policy, Defense Policy, NATO, Cold War, Treaties and Agreements, War
  • Political Geography: United States, Europe, North America