Joseph E. Stiglitz
Americans increasingly believe that the troop “surge” in Iraq has cowed the insurgents, bringing a decline in violence. But the surge deserves little of the credit, is unlikely to bring long-term stability, and has diverted attention from the huge economic, military, and strategic costs of occupying another country in order to determine its future.
NEW YORK – The Iraq war has been replaced by the declining economy as the most important issue in America’s presidential election campaign, in part because Americans have come to believe that the tide has turned in Iraq: the troop “surge” has supposedly cowed the insurgents, bringing a decline in violence. The implications are clear: a show of power wins the day.
It is precisely this kind of macho reasoning that led America to war in Iraq in the first place. The war was meant to demonstrate the strategic power of military might. Instead, the war showed its limitations. Moreover, the war undermined America’s real source of power – its moral authority.
Recent events have reinforced the risks in the Bush administration’s approach. It was always clear that the timing of America’s departure from Iraq might not be its choice – unless it wanted to violate international law once again. Now, Iraq is demanding that American combat troops leave within twelve months, with all troops out in 2011.
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For four decades, China has achieved unprecedented economic growth under a centralized, authoritarian political system, far outpacing growth in the Western liberal democracies. So, is Chinese President Xi Jinping right to double down on authoritarianism, and is the “China model” truly a viable rival to Western-style democratic capitalism?
Artificial intelligence could be either the best or the worst thing that ever happened to mankind. To prepare for the profound changes to lives and livelihoods that lie ahead, the European Union should start establishing rules to protect all Europeans – and give the rest of the world a model to follow.
The global economy today is dominated by three major players – China, the EU, and the US – with roughly equal trading volumes and limited incentive to fight for the rules-based global trading system. With cooperation unlikely, the world should prepare itself for the erosion of the World Trade Organization.
Globalization, which was supposed to benefit developed and developing countries alike, is now reviled almost everywhere, as the political backlash in Europe and the US has shown. The challenge is to minimize the risk that the backlash will intensify, and that starts by understanding – and avoiding – past mistakes.
Despite all of the doom and gloom over the United Kingdom's impending withdrawal from the European Union, key manufacturing indicators are at their highest levels in four years, and the mood for investment may be improving. While parts of the UK are certainly weakening economically, others may finally be overcoming longstanding challenges.
With Brexit looming, the UK has no choice but to redesign its future trading relationships. As a major producer of sophisticated components, its long-term trade strategy should focus on gaining deep and unfettered access to integrated cross-border supply chains – and that means adopting a multilateral approach.
Many leading Republicans who stand by Donald Trump, and even the multi-billionaires who fund them, may have misgivings about the US president, just as the industrialists of Germany's Herrenklub probably once despised Hitler. But with few exceptions, they continue to support him – and for similar reasons.
The Year Ahead 2018
The world’s leading thinkers and policymakers examine what’s come apart in the past year, and anticipate what will define the year ahead.