Brookings: Up Front

Obama’s National Security Speech and Pakistan

Bruce Riedel — Wed, 22 May 2013 10:22:00 -0400

On Thursday, President Obama plans to deliver a speech on national security and counterterrorism issues. The speech comes at a particularly awkward time in Pakistan, the epicenter of the global jihad for more than a decade. Nawaz Sharif has just been elected for an unprecedented third term in a nation extremely unhappy with America's counterterrorism policies, especially the drone war fought in its skies from bases in Afghanistan.

President Obama faces the challenge of defending his policies and explaining why they are needed. He must do this without further alienating an angry Pakistan and its newly elected civilian government which is struggling to find its own way to deal with the terror Frankenstein that threatens the world and Pakistan itself. It may be mission impossible. Despite years of drone attacks and the death of Osama bin Laden, Pakistan remains the base for the top three most wanted terrorists on the U.S. Most Wanted list: al Qaeda leader Ayman Zawahiri, Taliban chief Mullah Omar and Lashkar e Tayyiba (LeT) boss Hafez Saeed.

In fact, Omar and Saeed enjoy the patronship and protection of Pakistan's army. More global terror plots have originated in Pakistan than anywhere else since 9/11. Without the drones, there would be little or no pressure on the terror infrastructure in Pakistan. Despite over $25 billion in American economic and military aid since 9/11, the Pakistani authorities cannot be relied on to fight the danger posed by al Qaeda, the Afghan Taliban, or LeT. Obama recognized that fact when he sent the SEALs to kill bin Laden without telling any Pakistani official that we had found him hiding inside the highly secure Pakistani city of Abbottabad.

But Pakistan is also a victim of the terror monster it has coddled for decades. Over 45,000 Pakistanis have died in terror-related violence since 9/11, and dozens more died in the election campaign just ended. Sharif has pledged to seek a political solution to the violence. He has campaigned against the drones and faces a national consensus that wants them to end. His main opponent Imran Khan promised to shoot them down if elected (probably with American supplied F-16s).

Obama significantly expanded drone attacks in 2009 and many dangerous terrorists have been eliminated by them. The price has been to further alienate the Pakistani people. His speech this Thursday is not likely to please many in Pakistan. The already very difficult U.S.-Pakistan bilateral relationship is at a crucial juncture with the first ever transition from one elected Pakistani civilian government to another in the country's history after a full term in office. Reconciling our counter-terror mission with our interest in promoting democracy in Pakistan will not be easy. If it is impossible, then the fate of U.S. relations with the most dangerous country in the world is headed toward an even more deadly outcome.

Authors

Bruce Riedel

Image Source: © Larry Downing / Reuters

Good Data: The Foundation of Open Government

Sally P. Paxton and George Ingram — Wed, 22 May 2013 14:36:00 -0400

It is not often one gets excited over a dry, hard-to-understand government memorandum, but the newly released executive order, Making Open and Machine Readable the New Default for Government Information, and its accompanying memorandum are grounds for applause. The open data and transparency community, both in Washington and internationally, have been quick to give much deserved praise for this effort to make U.S. government data truly open and accessible.

Led by U.S. Chief Technology Officer Todd Park and Chief Information Officer Steven VanRoekel, this policy makes open government and transparency core aspirations of the administration. It contains specific steps for agencies, including 1) making data readily accessible and useable, 2) using common, open standards; 2) modernizing information systems; 3) sharing best practices; and 4) reporting progress. As characterized by the Sunlight Foundation, the policy "signals a new era for open data in our government”.

This new policy applies to all executive agencies, with some exceptions for national security systems. For those of us focused on foreign assistance, however, the question is what it will mean for aid information – and more importantly – for improving our aid effectiveness?

The quick answer is quite a bit. If these approaches are adopted and implemented rigorously by U.S. agencies administering foreign assistance, it could pave the way for a revolution in the way aid information is shared and used throughout the delivery chain. Overall, this new policy strengthens the chances of the U.S. government delivering on its commitment to the International Aid Transparency Initiative (IATI), which U.S. agencies are beginning to implement, but whose progress has been very slow. The Office of Management and Budget Bulletin, published in October 2012, made some important steps forward for U.S. reporting on foreign assistance. By comparison, the executive order is a leap forward. Why? Here are some highlights:

For the first time, data will have to be in “open and machine-readable formats”, such as XML, the format that IATI uses. This is hugely important for ensuring that the data is as accessible as possible for all potential users. To date, the U.S. has only published partial foreign assistance data from two U.S. agencies – the U.S. Agency for International Development and the Millennium Challenge Corporation – in the machine-readable IATI XML format, so the new executive order should provide a strong impetus to kick-start progress in other agencies. The importance of machine-readable formats will also be reflected in how donor agencies perform in this year’s 2013 Aid Transparency Index. Data that complies with the IATI standard – in machine-readable, XML format – will be deemed most transparent, as recognized by the U.S. commitment to this internationally comparable data standard.

Agencies now have to support “downstream” users and systems, paying attention to how our own systems maximize information interoperability and accessibility. This means that U.S. systems need to take into account other complementary initiatives, such as IATI. It is therefore a prime opportunity to build IATI compliance into our systems. This supports IATI’s aim of “publish once and use often” for different purposes and different users. So, when doing system upgrades – as recommended in a number of reports, including by the General Accountability Office – we need to be smart about maximizing our IT investments.

Deadlines matter and the executive order sets them. Transparency commitments, such as the Foreign Assistance Dashboard, are great concepts but their implementation has been problematic. Almost two and a half years have passed since the Dashboard’s creation and it is still largely incomplete. It is encouraging, therefore, to see the executive order include the development of a “Cross-Agency Priority” (CAP) goal to track implementation progress with metrics and milestones. This should build on the goals set by the U.S. implementation schedule for IATI by urging agencies to produce good quality, IATI-compliant data.

Best practices will be shared online. Such a repository of agencies’ tools and methods helps us all solve problems and be more effective and efficient. To date, 37 official international donor agencies have signed IATI and 22 have begun publishing to the IATI standard. The sharing of concerns, system limitations and data issues have already proven to be useful in easing and speeding the process of adaptation to open data for all participants. The same holds on the U.S. domestic front. With over 25 U.S. agencies involved in some aspect of administering foreign assistance, it makes sense to bring all agencies into a common learning space to foster “government-wide communities of practice”.

This new approach to open data is both visionary and detailed, and we hope the data starts flowing soon. In the spirit of this new policy, we should embrace IATI as best practice in open aid information and learn lessons from others who have piloted this initiative before us. The president has set the goal of U.S. leadership in open data. It is now the task of the aid transparency champions within the administration to see this through to fruition.

Authors

Sally P. Paxton
George Ingram

Image Source: © Jerry Lampen / Reuters

After 50 Years of the OAU-AU: Time to Strengthen the Conflict Intervention Framework

Julius Agbor and Tatah Mentan — Wed, 22 May 2013 16:19:00 -0400

2013 marks 50 years since the birth of the Organization of African Unity (OAU), which became the African Union (AU) in 2002. This week, as the continent’s leaders and other Africanists meet to commemorate this special occasion, it is also the appropriate time to reflect on some of the principles, successes and shortcomings of the organization. In particular, we would like to consider why the organization has been particularly slow in intervening in situations where the “responsibility to protect” is clearly mandated. The “responsibility to protect” is a United Nations (U.N.) principle endorsed by the AU (in what has come to be known as the “Ezulwini Consensus”) and represents the right to intervene in a member states’ internal affairs in situations where citizens’ welfare has been significantly undermined. Article 4(h) of the Constitutive Acts of the AU state that “[T]he Union has the right to intervene in a member state pursuant to a decision of the general assembly in respect of grave circumstances, namely, war crimes, genocide and crimes against humanity.” While the AU has been lauded for its multilateral peace-keeping initiatives, notably in Sudan, its ambivalent, and at best muted, response to the humanitarian crises in Côte d’Ivoire, Libya and, most recently, Mali—very similar to the OAU’s inaction in Rwanda, the Democratic Republic of Congo (DRC) and Somalia—has drawn much criticism. On the other hand, the AU has been quick to express reservations about the intervention of Western nations in its member states’ affairs, notably, with the recent French movements in Côte d’Ivoire and Mali, and NATO in Libya. This controversy about the timing of international interventions suggests the need for a fine line to be drawn between the AU’s long cherished principle of non-interference (stipulated in Article 4(g) of the Constitutive Acts) and the AU’s “responsibility to protect” framework, without which the continental body will increasingly lose its relevance. Following the AU’s inertia to respond to these situations, pundits have speculated on what would have happened to Côte d’Ivoire, Mali or Libya had France or NATO not intervened at all.

Although it is probably too early to pass judgment on the efficacy of the AU’s revised peace and security framework, the evidence over the past two decades does not suggest the pan-African body has been effective at mitigating humanitarian crisis on the continent. The reasons for the ineffectiveness of AU’s intervention are both ideological and logistic. On the ideological front, it seems that the principle of non-interference in member states’ internal affairs has had a preponderant influence on the organization’s decision-making process, and for genuine reasons. Many African states have weak governance structures, and cases of widespread human rights violations are still rampant on the continent. The evidence suggests that civil wars and most of the parameters which define a failed state are the result of poor governance. Similarly, Africa is the only continent that continues to experience famines in the 21st century, and the evidence linking famines to poor governance is compelling. Unfortunately, the AU lacks oversight over most of its member states with respect to governance, which continues to be treated as a domestic affair. As evidence, only 26 of its 54 member states have ratified the protocol establishing the African Court on Human and Peoples' Rights—the arm of the AU charged with ensuring the protection of human and peoples’ rights on the continent. This fact suggests that arriving at a consensus decision to intervene in a member state is often problematic. Thus, at the level of the AU general assembly, when it comes to voting in favor of or against an intervention to avert a humanitarian crisis, it can be expected that the overwhelming majority of governance-deficient AU member states would oppose such an intervention, even if the need is glaring. This difficulty in achieving consensus partly explains why the AU has been less proactive in mitigating conflicts and also why its response to crisis situations has been sluggish. Thus, a more proactive conflict prevention, mitigation and management strategy necessarily involves early warning monitoring, which includes the ability to identify governance failures and systematically address them. A good point of start in upholding continental best practices in governance could be by imposing on its member states the requirement that presidential term limits must not exceed two terms of a maximum of seven years each.

Logistical issues linked to inadequate resources, lack of technical know-how and poor planning have also impaired the AU’s ability to respond in a timely manner in order to avert humanitarian crises. To be able to prevent civil wars, there is need for a credible assessment of war signals. Also, a built-in system for evaluating success and failure has to be designed into the intervention process. Further, part of the problem with intervention in African conflicts is poor planning: An inadequate assessment of what it takes to succeed in each particular intervention often leads to huge casualties and resentment from member states to support future initiatives. Poor planning is also evidenced in unrealistic timetables for intervention. Sometimes, it is the lack of a critical diagnosis of the root cause of a conflict that hinders effective intervention. Considering the U.N.’s superior resources and comparative advantage in early monitoring, evaluation and conflict mitigation in general, the AU stands to gain from continued collaboration with the U.N. Sudan and the DRC are clear cases of the benefits of such collaboration. Of course, these examples do not necessarily suggest that the U.N. should take the front role in crisis prevention in Africa. Rather, the AU must be at the forefront of this prevention by stengthening the role of its regional economic communities (RECs) in transparently providing early warning signals. With proper coordination and collaboration, the RECs have proven to be an effective channel of intervention in conflicts as was seen in the recent case of the Economic Community of Central African States (ECCAS) intervention in the Central African Republic.

The case for strengthening the AU’s conflict intervention framework is further buttressed by the fact that, in Africa, transnational corporations (TNCs) compete with state institutions in the economic, political and social spheres. With increasing globalization, TNCs with more and more power and influence may be problematic for individual African states to handle in isolation. For instance, TNCs have been big players in fueling conflicts in mineral-rich African countries. Also, a recent phenomenon that is yet to be acknowledged is the potential role of big TNCs’ tax haven practices in further weakening the governance capabilities of African states, which would in turn nurture future conflicts. For instance, an investigation headed by former U.N. Secretary-General Kofi Annan has concluded that the practice of tax havens by TNCs is costing Africa $38 billion a year in lost revenue. Such activities clearly undermine the quality of life of African citizens, and therefore some structured intervention by the AU is warranted given the limited ability of individual African states to effectively address them.

In conclusion, although it is difficult to envision an AU where every domestic issue would be discussed and picked apart, there are certainly areas where some structured regional intervention is mandated. For this continental body to remain relevant, it will have to transparently restructure and strengthen its intervention framework to allow it to swiftly respond to humanitarian crises as well as enable it to cope with new challenges posed by a globalizing world economy.

Authors

Julius Agbor
Tatah Mentan

Image Source: © Joe Penney / Reuters

Marijuana Legalization: Early Lessons from Colorado and Washington

Beth Stone and Jonathan Rauch — Wed, 22 May 2013 15:16:00 -0400

Last November, in defiance of federal law, the states of Colorado and Washington legalized marijuana. What are the two states learning from implementation efforts so far?

On May 21, Governance Studies at Brookings and the Washington Office on Latin America (WOLA) held a Congressional briefing and released the paper Q&A: Legal Marijuana in Colorado and Washington. The related event and paper are products of a partnership between Brookings and WOLA focused on the marijuana legalization policy debate.

The panelists were Jack Finlaw (chief legal counsel for Colorado Gov. John Hickenlooper), Alison Holcomb (drug policy director, ACLU of Washington State), and Mark A. R. Kleiman (professor of public policy, UCLA). Congressmen Jared Polis (D-Colorado) and Steve Cohen (D-Tennessee) provided additional remarks. John Walsh of WOLA moderated the discussion.

Panelists said the states confront challenges in implementing legal marijuana, especially with respect to the issues of taxation, quality control and underage use:

Holcomb mentioned that Washington, in particular, faces challenges because, unlike Colorado, it did not start with a well developed regulatory structure for medical marijuana, so it can’t “copy and paste” specific policies.
Finlaw emphasized the difficulties faced by marijuana retailers who, due to marijuana’s illegal status under federal laws, often cannot conduct their businesses through banks. They also cannot deduct businesses expenses from their federal taxes. Both problems make it harder for Colorado to regulate and tax the industry.
Holcomb agreed on the tax issue and said that there is more work to be done on amending the federal law, particularly as attorneys are actually advising some marijuana dealers not to pay taxes in order to avoid self-incrimination under federal law.
Kleiman discussed the testing of marijuana products for quality and composition. He said this process is very difficult because no one audits the testing firms, especially troubling because they insist, “We’re honest, but everyone else cheats.”
Kleiman also pointed out that the more careful a state tries to be in laying down and enforcing clear rules for marijuana production and distribution, the more vulnerable it is to federal intervention. He also warned that policy makers in this space should be wary of making promises they can’t keep, particularly when it comes to underage marijuana use.

Join Governance Studies at Brookings for an event next week, Wednesday, May 29, where Jonathan Rauch, E.J. Dionne, William Galston and others will speak on the politics of marijuana legalization and release a new study on marijuana, generational change and the future.

Watch the video of the event below »

Authors

Beth Stone
Jonathan Rauch

Image Source: © Nick Adams / Reuters

Barack Obama and China's Xi Jinping to Meet In California

Richard C. Bush III — Tue, 21 May 2013 11:37:00 -0400

Yesterday, the White House announced that President Obama will meet with China’s President Xi Jinping on June 7-8 in California. The announcement said that the two will hold “in-depth discussions on a wide range of bilateral, regional and global issues, . . . review progress and challenges in U.S.-China relations over the past four years and discuss ways to enhance cooperation, while constructively managing our differences, in the years ahead.”

Yet the purpose of this meeting is not to bargain or to solve specific problems, but to set a tone and create a sense of shared fate between the two leaders by allowing Obama and Xi to firmly establish a good personal relationship, a precondition for the successful conduct of their bilateral relations. The two got a start on that task last February, when Xi visited Washington as China’s vice-president. Two days in California allows both more time and an informal environment for each to talk about his domestic challenges and visions for the future, about his country’s role in the international system and how US-China relations fits with all of this.

Such an interchange is particularly important because each president sits atop a complex and sprawling governmental system that is not easy to monitor or control. This is one of the reasons for recent frictions between the two countries. Their California encounter meeting provides Xi and Obama the opportunity to identify and enlarge the areas of overlap in the interests of their two countries, and then, when they return to their capitals, to set priorities in their systems accordingly. Having seen the value of creating this opportunity, they should seize it.

Authors

Richard C. Bush III

Premier Li Keqiang of China Goes to India

Tanvi Madan — Sat, 18 May 2013 14:00:00 -0400

On Sunday, Chinese premier Li Keqiang heads out from Beijing for his first visit abroad in that role. His first stop: India. He’s probably wishing the trip had taken place about a month and a half ago. At that time, there was a sense in India that the new leadership in China was reaching out to India for a number of reasons. Over the last month, however, temperatures rose in the Himalayas, as the long festering China-India boundary dispute flared once again. The good news for those interested in stable Sino-Indian relations: the two governments seem to have got past the recent incident. They continued to communicate throughout the crisis. Pre-scheduled China-India talks on Afghanistan were held in the midst of the crisis—their first such dialogue focused on the subject. Chinese and Indian military officers held a border meeting. The Indian foreign minister traveled to Beijing. And Li’s visit is going ahead. The bad news: The border incident reinforced the mistrust that many in India feel toward China and its intentions. Furthermore, it was a reminder that despite increased engagement, bilateral differences have the potential to stall, if not, reverse progress toward more stable relations. Li’s challenge: to get the relationship back on a positive trajectory and begin to convince a skeptical Indian public that the border incident was not representative of the new Chinese leadership’s approach toward India. Overall, the premier has his work cut out for him.

Before mid-April, many observers of Sino-Indian relations noted that under the new Chinese leadership there seemed to be an “upswing in relations.” Chinese president Xi Jinping proposed a five-point formula to improve ties with India. The two countries agreed to discuss Afghanistan. “Positive vibes” were detected at Xi’s subsequent meeting with Indian prime minister Manmohan Singh on the sidelines of the BRICS summit in Durban. The Chinese government indicated that Li soon planned to travel to India.

This trend did not surprise observers. After all, there were enough reasons for Beijing to seek a stable relationship with India: economic ties, cooperation in the multilateral realm and a desire to limit India’s burgeoning relationships with the U.S. and Japan (reports indicated that Chinese officials were eager for the premier to visit India before the Indian prime minister headed to Tokyo in late May), as well as other countries in the region. There were also reasons for the political leadership not to want the relationship with India to deteriorate: such as preoccupation with China’s eastern maritime disputes and the North Korean situation, as well as the need for stability in the region with the impending American withdrawal from Afghanistan.

What did surprise observers was the border incident. Former U.S. deputy secretary of state James Steinberg, who was in India as the crisis played out, said “I don't know what the Chinese leadership is up to…confronting India and Japan, especially when they have been trying to build strong bilateral relations...The Chinese leadership should understand, it will not benefit them in the long run.” The opacity of Chinese decision-making meant that various theories were floated about why Chinese troops had taken the unusual step of setting up camp across the Line of Actual Control (LAC): differing perceptions of the LAC; “a rush of testosterone by local officers;” in response to India building up its border infrastructure; the desire of the People's Liberation Army to assert authority; the result of an internal political power struggle; Chinese expansionism; or Chinese strategic designs against India. One observer contended that a clear motive was near impossible to pinpoint: that “Chinese foreign policy is an enigma wrapped in a mystery.”

Since the resolution of the crisis, Beijing has tried to press a “reset” button, trying to return the relationship to its pre-crisis trajectory. The Chinese ambassador to India unusually took to the editorial pages of an Indian newspaper to emphasize, “To strengthen good-neighbourly and friendly cooperation with India is China’s strategic choice and established policy which will not change.” Chinese officials indicated that greater efforts should be made toward a boundary settlement.

The Chinese government also signaled that the choice of India as the premier’s first stop was very deliberate and a sign of the importance Beijing placed in the Sino-Indian relationship. Hosting an Indian youth delegation, Li put a personal spin on the choice, noting the “the seeds of friendship sown” when he visited India 27 years ago—a trip that he said left a “lasting impact.” Beyond trying to win hearts and minds, he also seemed to want to appeal to Indians’ pocketbooks, talking about the economic benefits of greater ties. Finally, he pointedly mentioned experiencing the “warmth and hospitality of Indian people.”

That hospitality will certainly be forthcoming on the part of key policymakers in the Indian government. Delhi has its own reasons for seeking stable relations with Beijing. Thus, Indian officials had joined their Chinese counterparts in playing down the border incident and seeking to resolve it speedily. Since it’s been resolved, both sides have sought to highlight their success in defusing the crisis, pointing to that as a sign of progress in the relationship. During that visit, they will work toward agreement on certain issues. Expectations are that there will be developments on the economic front. China-India watchers will also be looking for any sign of progress on the border and Brahmaputra river issues.

Among the Indian public, the welcome for Li is likely to be cooler. The recent tensions at the border—heavily covered in the Indian media—reinforced negative impressions of China among many in the Indian public. Many—even beyond the public—will take with a larger grain of salt the new Chinese leadership’s assurance that it intends for China to rise peacefully, be a responsible state, and seek good relations with India. The crisis has reinforced the narrative that has prevailed in many quarters since the 1962 China-India war: that China only understands strength; that while Beijing’s leaders say China and India “must shake hands,” they cannot be trusted—that one hand held out might just be a precursor to the other stabbing one in the back.

The border incident has also kept the focus on bilateral differences and even beyond the border issues there are many of those: China’s growing political and economic ties with India’s neighbors, its Indian Ocean ambitions, the overall lack of trust, cyber-security concerns, Tibet, the diversion of the waters of the Brahmaputra, a trade imbalance and restricted market access in China for Indian companies, the sense that China does not respect India and/or that it will seek to prevent India’s rise and, significantly, China’s relationship with Pakistan, which, of course, is Li’s second stop.

The incident also seemed to strengthen the hands of those inside and outside government who are skeptical of China’s intentions towards India and weakened the voices of those urging engagement with that country. Furthermore, the crisis negatively affected the credibility of the Indian government on issues related to security broadly and China in particular. This matters because significant bilateral progress on crucial fronts will require concessions from both sides—concessions that might now be harder for the Indian government to sell on its side.

Overall, that’s a lot of mistrust and skepticism to turn around in one visit. But if Li Keqiang wants to see the relationship prosper, the trip is a good time to start trying on two fronts. First, substance: progress on key issues will go a long way in building trust. Second, style: Li should take the opportunity to introduce himself and reintroduce the new Chinese leadership not just to Indian government officials and private sector leaders, but also to the Indian public—for it might be tempting to dismiss public sentiments, but they will play a key role in setting the limits of the relationship.

Authors

Tanvi Madan

Image Source: © China Daily China Daily Information Corp - CDIC / Reuters

The African Union Can Do More to Support Regional Integration

Michael Rettig, Anne W. Kamau and Augustus Sammy Muluvi — Fri, 17 May 2013 16:39:00 -0400

Earlier this May in Cape Town, South Africa, economists at the World Economic Forum reaffirmed that regional integration will play a key role in unleashing the continent’s growth potential. More than 10 regional economic communities (RECs) are working toward this goal in Africa, but the main framework behind this effort is the African Economic Community (AEC). The AEC was established by the Abuja Treaty in 1991 and ratified in 1994. The treaty aims to build the AEC gradually through harmonization, coordination and effective integration of Africa’s RECs, eight of which have been chosen as “pillars” of the AEC. It proposes the establishment of a continental free trade area (CFTA) by 2017, and integration of the RECs into a single customs union with a common currency, central bank and parliament by 2028. The Abuja treaty does not lay out precise, top-down steps for achieving this goal, but the African Union (AU) and the RECs have defined their relationship in working toward the AEC in the 2007 Protocol on Relations between the AU and the RECs. Towards this end, the Africa Union has embarked on various programs at the regional and sub-regional level to promote integration. Indeed, at the January 2012 AU Summit, heads of state from around the continent renewed this mission by agreeing to speed up plans for economic integration. The tone of the 2012 Summit implied an ambitious AU agenda of promoting and coordinating African integration and its accompanying benefits more quickly than before.

Like the European Union, the AEC would enjoy increased intra-African trade, improved self-sufficiency in meeting Africa’s import demand, lower poverty levels and a more peaceful interdependent existence. However, in contrast with these grand plans to move toward a CFTA, Africa’s RECs are grappling with numerous challenges. Though it is the responsibility of the RECs and individual countries to implement protocols and integrate, the AU Commission is charged with monitoring the continent’s integration process. The integration process has remained slow despite numerous efforts and working committees formed by the AU to coordinate the RECs, suggesting more work remains to be done. Now, many RECs have missed their target dates for implementing customs unions and common market requirements. For the RECs to achieve integration objectives and a CFTA to still take hold by 2017, the AU may have to play a more active role. Indeed, as the AU celebrates its 50th anniversary this May, the progress made and challenges encountered by Africa’s RECs offer valuable lessons as to how the AU can best act to improve integration, development and growth moving forward. Consider the progress of two RECs from Central and East Africa.

The East African Community (EAC) is composed of five countries in East Africa: Kenya, Uganda, Tanzania, Rwanda and Burundi. The EAC has achieved considerable milestones, having established a customs union in 2005 and a common market in 2010. It is scheduled to move to a monetary union by November of this year and ultimately to a political federation by 2017. In addition, the EAC has taken steps towards further economic integration by signing a free trade agreement with two other RECs, the Common Market for Eastern and Southern Africa (COMESA) and the Southern Africa Development Community (SADC). This progressive tripartite agreement eases the transitional problem of states’ memberships in multiple RECs and therefore multiple sets of requirements and regulations. Despite this progress, the EAC has not fully implemented their Common Market Protocol. While the EAC has made tremendous progress in eliminating tariffs, poor infrastructure and other non-tariff barriers remain. Lack of roads, railways and energy networks add to cost of doing business and make it difficult to increase intra-African trade and attract investment in the region. Moreover, neither the EAC nor the AU has effectively explained the benefits of economic integration to citizens, so the democratic leaders of member states do not feel pressure to improve their progress. In addition, national governments fear a loss in tax revenue, and, despite the elimination of border tariffs, different domestic tax rates still exist within the EAC. Indeed, harmonizing the various economic policies in the EAC has been challenging. As a result, member states are struggling to converge their macroeconomic policies in the prescribed time. Most notably, as the EAC has achieved its successes and struggled with its challenges, the AU’s efforts have barely influenced the integration process in the region.

Another REC, the Economic Community of Central African States (ECCAS), was first formed in 1983 and remained mostly dormant for 16 years until 1999. The group suffered first from states’ unwillingness to pay much-needed fees, and later from a war between some of its member states. Once the ECCAS began operating, it faced renewed challenges from competing economic communities—Rwanda left the group in 2007 to focus on its COMESA and EAC memberships. Unlike the EAC, which includes Kenya, the ECCAS lacks a high-growth country to provide leadership and capital in supporting regional infrastructure and pushing trade liberalization efforts. As a result, the ECCAS remains a group of states of varying levels of development focused on their own self-interests. The AU has an opportunity to educate the member states and apply informal pressure to make progress. In spite of these challenges, the ECCAS has achieved some successes. Many ECCAS members utilize a single currency, and capital moves freely across borders. Steps have been taken to eliminate tariffs as well, though these have yet to be fully implemented. The ECCAS has enjoyed more success in tackling peace and security—leading peace operations in the Central African Republic on two occasions and laying the foundation to host one of the AU’s planned Standby Forces. Indeed, the AU has been effective and proactive in assisting with these security gains (and also throughout the continent), yet the role of the AU in assisting with ECCAS’s economic integration successes has not been visible.

As the African Union reflects on its achievements 50 years since its creation, it should balance its successes in minimizing African conflict with the importance of doing more to promote economic integration. While addressing flashpoints of violence is an important short-term necessity, increasing intra-African trade, building an African consumer base, and networking African interdependence may offer great long-term promise. These are all steps toward the same goal of a prosperous and peaceful Africa. While the AU does not have the authority to overcome poor capacity, a lack of political will, or other challenges that African countries and RECs may face or bring to the table, it can and should better follow its mission in encouraging integration.

Under the 2007 Protocol, the AU is directly charged with working to facilitate and implement regional integration. If the AU hopes to realize its goal of a united Africa by 2028, it must better engage the continent’s RECs and assist in resolving the numerous obstacles they face. It should consider expanding its efforts to coordinate regional initiatives within low-capacity countries and work to ensure that future programs are better targeted and more visible. Further, the AU should exercise leadership in countries that seem not to have the domestic political will to move towards integration. It could also move from biannual meetings to more common ones and more vigorously assist in mobilizing resources and coordinating their application toward regional infrastructure projects to boost trade. The AU could even consider launching voluntary international governance initiatives, such as a two-term limit for political leaders or the teaching of a common language base. It can also more closely oversee and facilitate the long and difficult negotiations of protocols, and may use scorecards and penalties while monitoring their implementation to ensure that states feel pressure to meet their benchmarks. A continental free trade area in Africa holds as much potential as the one seen in Europe, but achieving success of this goal by 2017 will require the African Union to engage its regional economic communities more robustly.

Authors

Michael Rettig
Anne W. Kamau
Augustus Sammy Muluvi

Image Source: © Thierry Gouegnon / Reuters

Mukhisa Kituyi to Head the United Nations Conference on Trade and Development (UNCTAD)

Mwangi S. Kimenyi — Thu, 16 May 2013 11:26:00 -0400

The United Nations Secretary-General Ban Ki-moon has appointed Dr. Mukhisa Kituyi to be the next secretary-general of the United Nations Conference on Trade and Development (UNCTAD). An UNCTAD press release on May 16, 2013 stated that Dr. Kituyi will serve a four-year term beginning September 1, 2013. Dr. Kituyi has held several senior positions including Kenya’s minister of trade from 2003-2008. He is currently a nonresident fellow in the Africa Growth Initiative (AGI) at the Brookings Institution and was a resident scholar in 2011. Dr. Kituyi is well versed in the global trading system and, in the past, was considered a potential candidate to head organizations such as the World Trade Organization (WTO) and UNCTAD, but instead opted to join politics. A dynamic politician and intellectual, Dr. Kituyi is an excellent choice to head UNCTAD.

For AGI, the appointment of Dr. Kituyi is significant not only because he is one of our fellows but also because AGI has been emphasizing the need to increase informed African voices in global governance. We believe that African interests are not effectively represented in major global institutions, and this deficiency has contributed to the broader marginalization of the continent in global affairs. Dr. Kituyi should be an effective voice in representing Africa and other developing countries. And, as I know him, I believe this is one informed voice that the international community is unlikely to ignore.

But it will not be a smooth ride for the new secretary-general; a host of challenges await him in Geneva. First, more than in most global organizations, UNCTAD requires effective management and intellectual leadership. An internal report published last year—the Joint Inspection Unit Report—showed that UNCTAD has been suffering from a lack of effective governance. It is important that Dr. Kituyi focus on raising the bar in terms of professionalism at UNCTAD. This task will require looking into the recruitment and promotion of employees strictly based on merit. Dr. Kituyi will need to carefully evaluate personnel issues and provide the necessary motivation to ensure that the organization delivers on its mandate. Most importantly, he will have to steer the organization towards more transparency, rewarding performance instead of simple loyalty to senior management. The new secretary-general will also need to offer the intellectual leadership necessary to guide the institution through a time of major global economic change and a shifting of economic power to the South. He must therefore lead intellectually in offering alternative ideas to those emerging from traditional development institutions.

An even a more daunting challenge that the new secretary-general will face is to ensure that UNCTAD remains relevant and credible. Over the past few years, questions have been raised as to what should be the institution’s focus. Some have gone to the extent of insisting that UNCTAD should not be involved in macroeconomic and financial areas. But as its name suggests, UNCTAD was created to deal with issues relating to trade and development with a particular emphasis in developing countries. There is no doubt, therefore, that macroeconomics and finance squarely fit in the institution’s mandate. Indeed, UNCTAD used to be the forum where these issues would be negotiated in order to ensure some balance in the global economy. However, since the creation of the WTO, UNCTAD has experienced a progressive erosion of its voice. It will be the responsibility of Dr. Kituyi to reverse this trend so that UNCTAD can play its rightful role in the global economic policy scene. The new secretary-general must also position UNCTAD to better address the imbalance and unfairness in the multilateral trading rules that have shaped globalization. In UNCTAD, it is often the case that developing countries feel bullied by their developed country partners. It will be imperative for Dr. Kituyi to identify the best way to navigate issues that have come to divide developed and developing regions.

The secretary-general must also position UNCTAD so as to assist developing countries in seizing the opportunities presented by the global economy. With all the changes taking place in the world, UNCTAD has to focus on how developing countries can reap the benefits and minimize the negative effects arising from trade and globalization. This focus requires that UNCTAD take on the hard topics that are of particular interest to developing countries, including investment policy, trade in services and commodities—which it has always done—but it should also come out clearly on what path developing countries should follow. Likewise, we are likely to see an acceleration of regional trade arrangements. Most challenging are agreements involving Northern and Southern partners who cannot be considered equal partners when they negotiate. The jurisprudence on the rules governing such agreements is not commonly agreed upon. Hence, there is a need for UNCTAD to demonstrate, based on evidence, how to ensure that balanced development is achievable, especially in respect to North-South agreements.

With an incoming director general at the WTO and Dr. Kituyi at UNCTAD, the global environment offers an opportunity for the two institutions that drive trade and development to establish the missing dialogue. For this to happen, UNCTAD needs to be credible when articulating its voice in this changing global economy. This is the greatest challenge that Dr. Kituyi faces.

Authors

Mwangi S. Kimenyi

Image Source: © Ronen Zvulun / Reuters

Lessons and Context of the Navy’s First Carrier Drone Flight

Peter W. Singer — Wed, 15 May 2013 16:33:00 -0400

The U.S. Navy recently made history with its flight of the X-47B UCAS, the first unmanned carrier drone (unmanned systems) to launch from an aircraft carrier. In 2009 and 2011, the Center for 21st Century Security and Intelligence at Brookings had the pleasure of hosting then Chief of Naval Operations, ADM Gary Roughead, to discuss the future of unmanned operations. The vision he laid out is well on its way to fruition, making it especially useful to place what happened today in the context of the larger U.S. defense strategy and to look at what lessons have been learned in the development of unmanned systems. As I explored in a look at the past and future of naval aviation after 100 years of flight, this success is only one part of a much bigger story.

What this history tells us is that, now that the Navy has crossed yet another step that the naysayers said could never be done, the challenges are as much organizational and political, as they are technical. For example, now that unmanned systems have shown they can fly off a carrier, what will be their exact role? Whether they will be delegated to take on tasks on their own or paired with manned planes, for a package that is greater than the sum of its parts, is a crucial question of naval air combat doctrine moving forward. It is akin to the questions that early warplanes faced as to whether they were to be tethered to the existing surface force of battleships as scouts or serve as their own, as a new form of a battle fleet.

We are only at the start of this robotic revolution at sea, just around the World War I stage of things, if manned airplanes are a parallel. Just as the first Navy planes started out doing only observation, but soon began to be used for everything from bombing runs to carrier onboard delivery (COD), so we are seeing a similar expansion in the roles of unmanned systems. UCAS originally started out being just in the observation ISR role, but clearly has a more lethal future, while the Marines are already using robotic helicopters for roles like cargo delivery in Afghanistan. But just like back then, we don’t yet have all the answers as to the optimal doctrine. Even the basic design of this technology remains to be learned and adopted.

A second lesson is that despite its relentless advancement, there are no signs that technology will end the central role of humans in war and at sea any time soon. However, not “ending”, isn’t the same thing as not “changing.” The specifics of the human roles will be altered, but again, this is nothing new. Most Navy warplanes today don’t have tail gunners or navigators. The skill sets and ranks of those who wear the wings of gold might be altered, which opens up the kind of internal identity and qualification questions in the Navy that have also recently challenged the Air Force. Does the remote operator (note: “operator,” not “pilot” is the terminology so far in the Navy, as opposed to how the Air Force views the requirement) of a plane that can take off and land on its own, who is sitting behind a computer screen, actually need 20/20 eyesight or the ability to do 50 sit-ups? Do they even need to be an officer (akin to how the Army has handled UAS versus the Air Force)? The next few decades will be an exciting time, with new paths being forged, much like they were by the first generation of naval aviation pioneers.

This leads to a third challenge that may be the most vexing to the Pentagon in the years ahead. In an article entitled U-Turn, I explored how there are a series of speed bumps that loom for unmanned systems, not so ironically just as they are making their mark. These range from internal cultural resistance to budgetary battles, in which the new is often disadvantaged against the old. We are seeing this play out here again. Few realize that (according to figures from the DoD UAs office), at the very same time the X-47 knocked down yet another technical barrier, the Navy’s planned UAS budget is being cut by 24%, several times greater than the rest of the budget cuts. Indeed, the tension that the successful UCAS test created for F35’s longer term buy numbers is much like Voldemort in the Harry Potter books, not to be spoken about, but palpable.

Bottom line: Congrats to the Navy and the team behind the X-47B on yet again making history, but this history tells us we have an array of questions to explore in the years ahead.

Authors

Peter W. Singer

Image Source: © Jason Reed / Reuters

The Affordable Care Act: From Hiccups to Repeal

Elaine Kamarck — Wed, 15 May 2013 17:34:00 -0400

Note: On Monday, May 20, Elaine Kamarck, director of the Management and Leadership Initiative at Brookings, will moderate a public forum on "Implementing the Affordable Care Act: Organizational and Political Challenges."

It's been a long time since the federal government had to implement a large, new, federal program. Ten years ago we saw the implementation of Medicare Part D and the creation of a new cabinet department, the Department of Homeland Security. In each instance there were predictions of disaster and substantial growing pains. In the case of Medicare Part D implementation exceeded expectations and costs have not been nearly as high as feared. In the case of DHS, implementation was bumpier, nonetheless, ten years later both operate more or less smoothly and, in retrospect, the crisis now seems overblown.

This year, the Obama administration needs to finalize implementation of the Affordable Care Act—a historic piece of legislation and the most significant domestic policy achievement of the Obama administration to date. And the question of how it goes is front and center. Even the president has admitted that there will be “hiccups” along the way. Compared to earlier pieces of health care legislation, the ACA is incredibly complex, involving activity by fifty states, the jurisdiction of fifty state insurance regulators and changes in the entire health care industry. Added to the inherent complexity of the bill is the fact that it had no Republican support and is still adamantly opposed by the Republican party and by half of all those polled.

So the question is: how bad will it be? Imagine a continuum that goes from “hiccup” on one end to repeal on the other end. With plenty of points in the middle. What would that look like?

The hiccup scenario is the most optimistic. Hiccups are more or less normal. If the implementation is successful, the exchanges will be up and running. There will be glitches. Some people who qualify won’t get their subsidies; some who don’t will. The number of companies on the exchanges won’t be as big as hoped for but will grow. Premiums for health care will rise only modestly and the enhanced services in the new health care plans will make most people okay with the price increase.

The delay scenario is not really good nor is it fatal. A less successful outcome is one where the feds and states find they have to pull back from key provisions in the bill at least for a while. There may be delays in opening exchanges which would necessitate delays in enforcing the mandate that everyone buy insurance. The federal hub may not be able to interface with statewide data and eligibility could become a lengthy bureaucratic process. HHS might adopt a generous waiver policy while states work out their systems. Premiums may rise, leading to complaints from the public but no substantial drops in insurance buying.

The repeal scenario is fatal. Obviously Republicans, especially in the House, are rooting for this one. In fact they seem to like taking the repeal vote so much that they’ve done it 37 times in the past three years. So the question is: what would it take to move support for repeal beyond the Republican base? In 1989 Congress repealed the Medicare Catastrophic Coverage Act a short sixteen months after it was passed. Why? It increased costs to seniors and offered them things that they didn’t want. In the context of ACA the repeal scenario is feasible if premium prices rise so high that people who don’t qualify for subsidies (there are more of them than those who do) decide that they really don’t want the enhanced packages envisioned in the law and then get really mad and let their representatives know it.

Where will we end up? Stay tuned.

Authors

Elaine Kamarck

Image Source: © Jonathan Ernst / Reuters

And They’re Off: The Campaign for a New Iranian President Has Begun

Suzanne Maloney — Mon, 13 May 2013 09:26:00 -0400

The race to replace Iran’s deeply polarizing president, Mahmoud Ahmadinejad, officially opened last week with the registration of prospective candidates, and already the campaign promises an utterly fascinating ride through the unpredictable politics of the Islamic Republic. The shock and awe surrounding the last-minute decision by Iran’s iconic former president, Ali Akbar Hashemi Rafsanjani, to throw his hat into yet another race has only been topped for drama by the latest antics of the current incumbent aimed apparently at elevating a controversial protégé to succeed him. At least at the outset, these sensational developments have overshadowed the emerging shape of the real race among an array of regime functionaries, most notably nuclear negotiator Saeed Jalili.

With 686 would-be candidates and an array of insidious regime mechanisms for influencing the outcome, it is literally impossible to predict today who the ultimate contenders will be, much less who will win the race. However, what is clear is that Iran’s presidential election represents the opening salvo in another historic turning point in the volatile evolution of the revolutionary theocracy.

The application period is a deliberately chaotic process, designed to justify the pretense behind the clerical vetting process and bolster the credibility of the nominees who are ultimately tapped by Iran’s Guardians’ Council, a 12-member unelected clerical oversight body. There is also a keen dimension of political theater, as the prospective candidates seek to gauge their relative prospects and the leadership endeavors to maintain an uneasy balance between galvanizing popular interest in the campaign and inciting the kind of electoral exuberance that has generated instability in the past. Over the course of the next 10 days, the field will be narrowed from several hundred to a mere handful who are assessed to meet the constitutional standards for the office.

This time around, the chaos has been intensified by the lingering memories of the upheaval that ensued in 2009, when an implausibly rapid vote-count and wide margin in favor of Ahmadinejad’s reelection instigated the largest and most sustained protests in Iran’s post-revolutionary history. The ensuing crackdown left Iran’s burgeoning reform movement estranged, imprisoned or scurrying into exile. Predictably, however, no sooner had the conservative wing of the Iranian political spectrum achieved uncontested dominance than deep fissures emerged within them. For the past two years, frictions among Iranian hard-liners have been directed, full bore, at Ahmadinejad himself, which greatly heightens the significance of the current contest to succeed him.

Cue Ahmadinejad’s first electoral adversary, Rafsanjani, whose entrance has sparked an intense debate about his motivations as well as about the competition to come. In a prospective field comprised mostly of second-tier Iranian political figures, mostly former ministers and parliamentarians, he is vastly better known and boasts a political machinery that spans factions and decades. For many within Iran’s dispirited reformist and opposition ranks, the former president offers their best hope of political redemption and national salvation, a hint of their own marginalization given their past differences with him. Rafsanjani’s reputation for pragmatism is well-earned; he was tasked by Ayatollah Khomeini, the revolution’s founder, with ending the futile war with Iraq and later endeavored against stiff opposition to rehabilitate the country and reform its economy. He has carefully navigated fidelity to the system while critiquing both Ahmadinejad and the 2009 election, and his return to the presidency would likely revive now-dormant diplomatic fantasies in Europe and perhaps even Washington.

However, the former president faces powerful impediments that had persuaded many observers that his recent hints about the race were just a tease. Mostly notable is his age – almost 79 – which raises questions of capacity but also may undermine his appeal in a country with a disproportionately young population. More problematic is the unfortunate reality that he appears to have a more effusive constituency in the Western media than in Iran. Among the Iranian establishment, Rafsanjani is widely perceived as wildly corrupt and ideologically untrustworthy, and the population at large rejected his bid for a parliamentary seat in 2000 and favored Ahmadinejad in the 2005 presidential run-off. Now his unexpected entrance has incited a firestorm among the most doctrinaire of the hardliners, who have accused him of conspiring to delegitimize the system by daring the clerical supervisors to reject his candidacy.

Whatever happens, though, the calculations of the politician nicknamed “The Shark” (a reference to his lack of facial hair as well as his wily political skills) have already upended a race expected to rely on a motley array of second-tier Iranian political figures. His close ally, former nuclear negotiator Hassan Ruhani, had previously pledged to quit if Rafsanjani ran; Ruhani is a sharp-elbowed politician who has been an early and consistent critic of Ahmadinejad’s nuclear diplomacy and economic policy. So far that withdrawal has not come, despite much Twitter speculation to the contrary, and other similar pacts among conservative contenders also appear to be fraying under the weight of a suddenly reconfigured competition.

The Rafsanjani wild card is only one novelty in a race replete with interest. The other aspirant whose registration on Saturday has electrified Iranian poll watchers is Esfandiar Rahim Mashaei. Mashaei, a close advisor to Ahmadinejad, has long been the focus of fierce clerical ire as a result of his eclectic religious and political views. He was forced out of a vice presidential slot in 2009 and is routinely scorned as the mastermind of a ‘deviant current’ that has infiltrated the Islamic Republic in an effort to undermine it. Mashaei’s ambitions have been telegraphed over many months through increasingly unsubtle efforts of Ahmadinejad to stack the deck in his favor, culminating in the tandem appearance at Mashaei’s registration. That move prompted a legal complaint against the president – either a quaint nod at legalism in a patently manipulated electoral framework or the first step in a process of silencing the unpredictable Ahmadinejad via intimidation or imprisonment.

The calculations of Rafsanjani, Mashaei and Ahmadinejad are compelling in their own right, and they will no doubt influence Iran’s future. However, the drama associated with them has diverted attention from the likely electoral landscape, which features a less thrilling but still significant roster of contenders. For several months, some speculation has centered on former foreign minister Ali Akbar Velayati, a pediatrician by original training whose entire 32-year political career is the product of patronage by Iran’s supreme leader, Ayatollah Ali Khamenei. Others have long fixated on Tehran mayor Mohammad Baqr Qalibaf, a former Revolutionary Guards commander who has assiduously restyled himself as a moderate, modernist problem-solver. Another dark horse to watch closely Gholamali Haddad Adel, a parliamentary leader and literature professor whose daughter is married to Khamenei’s powerful son Mojtaba.

The real heavyweight in the pack, however, is Jalili, who was virtually unknown beyond a small circle of the Iranian leadership until his appointment as secretary of the Supreme National Security Council in 2009. In leading the contentious negotiations with the international community over Iran’s nuclear program, he has personified Iran’s quixotic mix of defiance with occasional bursts of pragmatism. One of his early forays in the high-stakes talks featured a discursive lecture on the Prophet Mohammad’s diplomacy, the subject of his doctoral dissertation. But Jalili was also responsible for signing onto a Western confidence-building step in 2009 that was quickly disavowed by Tehran. He survived the ensuing outcry among conservatives unscathed, a testament to his primary patron, Khamenei, whose office he directed for four years. Of all the would-be aspirants for the presidency in this round, Jalili appears to benefit from an air of ordination, and already talk has emerged among other conservatives of withdrawing in order to bolster his competitiveness.

Setting aside the personality politics, the most astonishing, and important, dimension of the campaign is simply that we care at all. Four years ago, many observers – including myself – argued the blatant orchestration of Ahmadinejad’s reelection had all but extinguished the relevance of the electoral dimension of Iran’s convoluted governing system. Then-Secretary of State Hillary Clinton and many academics forecast that Iran was descending into a military dictatorship. So many of these predictions now appear off the mark, as external analysts and politicians all too often find when interpreting Iran.

Let’s be clear – the 2013 ballot will be rigged to a greater or lesser extent depending on how the campaign evolves, and the winner will undoubtedly benefit from unabashed assistance from the institutions, including the Guard. However, as the initial maneuvers of the 2013 presidential race underscores, politics in Iran remain competitive, unpredictable, and captivating. So stay tuned, and watch this space. One week from today, Brookings will be launching Iran @ Saban, a new blog that will focus on political and economic developments within Iran as well as the threats posed by its current policies and the strategic responses of the international community. The blog will showcase the deep bench of Brookings scholarship on the Middle East and issues such as proliferation, terrorism and, of course, electoral politics and the future of Iran.

Authors

Suzanne Maloney

Image Source: © Stringer Iran / Reuters

Why We Still Think College Isn't for Everyone

Isabel V. Sawhill and Stephanie Owen — Mon, 13 May 2013 15:41:00 -0400

Is a college degree worth it? Not for everyone, according to our newly-released Center on Children and Families policy brief. The value of a college degree can vary dramatically, depending on factors such as field of study, type of college, graduation rate and future occupation. Here’s our final follow-up blog post, where we take a closer look at the conclusions we come to in the brief. (Read the first, second, and third parts here.)

Last week, the Center on Children and Families released a policy brief on making smarter decisions about higher education. We have welcomed the ensuing spirited debate from policymakers, students, colleges, and fellow researchers. The title of our policy brief, “Should Everyone Go To College,” is intentionally provocative and was chosen to start a conversation around the question. In favor of simplicity, we used the blanket term “college” to argue that a traditional four-year bachelor’s degree is not for everyone. We do think that some sort of postsecondary training is a good idea for almost everyone. This includes associate’s degrees, technical and vocational certification, apprenticeships, and worker training programs.

Some suggest that encouraging marginal students to pursue some of these non-academic paths creates a tracked system that keeps low-income and minority kids out of the upper echelons of our society. For that reason, vocational education has largely fallen out of favor in the United States, but gaps in academic performance between rich and poor and blacks and whites have persisted or, in the case of income, even grown. Closing these gaps has been one goal of the research done by the Center on Children and Families at Brookings, and we agree strongly that more needs to be done to prepare students to be college ready at the end of secondary school. But for the students we focus on in our brief—teenagers and young adults planning their educational and career paths—it is often too late to make up this lost ground.

The goal should be to help them make the choices that will turn out best for them given their individual strengths at the end of high school. For a student who has performed poorly in the classroom, the most bang-for-the-buck may come from a vocationally-oriented associate’s degree or career-specific technical training or from a period of work before returning to school with stronger motivation to learn what academic institutions teach. Think of the alternative: this student’s poor grades and possible ambivalence about classroom learning means he is likely to never finish his degree, and will have wasted time and money that could have been spent learning an employable skill. On the other hand, there are plenty of low-income students who are smart enough to succeed in college but who tend to choose schools that are beneath their ability and are more likely to drop out. The correlations of family background with college entry, persistence, and graduation have been rising, meaning it is especially important to help low-income students with the requisite abilities and preparation to enroll in a high-quality institution. Those individuals could benefit from better information about financial aid, graduation rates, and expected earnings.

Unfortunately, that information is not currently available: no one single comprehensive dataset containing information on earnings by school (let alone by major or program) exists. The Student Right to Know Before You Go Act, which we mention in our brief, has bipartisan support and would be an improvement on the status quo. The PayScale dataset we used for our brief has significant limitations, including questions about the reliability of its calculations and its representativeness.

Finally, some have rightly pointed out that our findings are descriptive, and should not necessarily be interpreted causally. It is likely true that smarter students self-select into engineering majors, so not every student will do better if she studies engineering rather than English. The same logic applies to more selective schools: part of why students at elite schools do better later on is that they are more talented before they ever enter college. Even so, careful economic research suggests that students do best when they attend the best school they can get in to, and that certain majors have real benefits.

Ultimately, higher education decisions are made by individual students and their families, and are based on their unique interests, strengths, and personal values, not only income and career prospects. Students need to have realistic expectations about what they’re likely to get out of pursuing higher education. Rigorous economic research has found that there is a sizeable proportion of people who experience a negative return to their education. That doesn’t mean they may not excel at other pursuits. It just means that one size doesn’t fit all high school students.

Authors

Isabel V. Sawhill
Stephanie Owen

Image Source: © Jessica Rinaldi / Reuters

Helping Young People Make Better Higher Education Choices

Isabel V. Sawhill and Stephanie Owen — Fri, 10 May 2013 09:00:00 -0400

Is a college degree worth it? Not for everyone, according to our newly-released Center on Children and Families policy brief. The value of a college degree can vary dramatically, depending on factors such as field of study, type of college, graduation rate and future occupation. Here’s the last in a three-part blog post series, where we take a closer look at findings from the policy brief. (Read the first part and second part here.)

Even though we often talk about college as a monolith, the truth is that not all college degrees are created equal. There is huge variation in the return to a bachelor’s degree, depending on choice of major and occupation; school type and selectivity level; and likelihood of graduating. All of this suggests that it is a mistake to unilaterally tell young Americans that going to college—any college—is the best decision they can make. If they choose wisely and attend a school with high graduation rates, generous financial aid, and high expected earnings, they can greatly improve their lifetime prospects. The information needed to make a wise decision, however, can be difficult to find and hard to interpret.

We lay out a three-pronged approach that would help every young person make a smart investment in their future: better information, performance-based scholarships, and better alternatives to a traditional four-year degree.

Authors

Isabel V. Sawhill
Stephanie Owen

Image Source: Mike Segar / Reuters

Policymakers Get Serious About Student Loan Interest Rates

Matthew M. Chingos and Beth Akers — Fri, 10 May 2013 11:25:00 -0400

At about this time last year, we saw President Obama and Republican challenger Mitt Romney engage in a pandering contest on student loan interest rates. Cheap political theater produced a shortsighted political solution—a one-year extension of the 3.4% interest rate on subsidized federal student loans.

That one-year “fix” is due to expire on July 1, setting up another round of debate about whether to extend the lower rate once again or come up with a permanent solution. Under current law, Congress sets the interest rates on loans (which are then fixed for the life of the loan). This leads to political fights over the interest rate on a regular basis, especially when market rates become out-of-sync with the rate set by Congress.

This time around, the Obama administration and several members of Congress have produced serious proposals, most of which propose allowing the interest rates on federal student loans to vary with market conditions rather than having a fixed rate that is set by Congress. An excellent summary of these proposals appears in today’s Inside Higher Ed. The key elements of each of the proposals (and current law) regarding the federal Stafford loan program are:

1) Obama administration proposal: interest rate varies with market rates (10-year Treasury rate plus 0.93% for subsidized loans and 2.93% for unsubsidized loans) but is fixed for the life of the loan. There is no cap on interest rates.

2) House Republican proposal: interest rate varies with market rates (10-year Treasury plus 2.5% for subsidized and unsubsidized loans) and varies over the life of the loan (as the Treasury rate increases or decreases). Interest rates are capped at 8.5%.

3) Sens. Reed and Durbin proposal: same as House Republican proposal, except market rate is defined as the 91-day Treasury rate plus a percentage determined by the Education Secretary to cover administrative costs, and the cap is 6.8%.

4) Sen. Warren proposal: one-year fix in which the rate on subsidized loans is set at the rate the Federal Reserve changes to banks (currently 0.75%).

Sen. Warren’s proposal should be quickly dismissed as a cheap political gimmick. It proposes only a one-year change to the rate on one kind of federal student loan, confuses market interest rates on long-term loans (such as the 10-year Treasury rate) with the Federal Reserve’s Discount Window (used to make short-term loans to banks), and does not reflect the administrative costs and default risk that increase the costs of the federal student loan program.

Setting aside this one embarrassingly bad proposal, the remaining proposals raise a set of questions that need to be answered in order to select the ideal policy:

First, should the interest rate on federal student loans be set by Congress or allowed to fluctuate with the market? Market rates reflect the cost of borrowing to the government. Consequently, rates below-market rates indicate a subsidy to students. In our view, subsidies of college-going should be administered through programs that bring about the greatest changes in enrollment behavior, such as grant programs, and not through subsidies to interest rates that are much less transparent. Indexing the interest rate to the market also has the advantage of lessening the role of politics in student loan programs.

Second, should the interest rate be fixed for the life of the loan or allowed to vary with the market? In the market for other kinds of loans, such as home mortgages, consumers can choose between fixed- and variable-rate loans. But many students are not sophisticated consumers of financial products. In our view, the federal program is best operated with a fixed-rate model because it shields the student from the risk that the rate will increase in the future (usually at the cost of a higher interest rate to make up for that risk). Although the actual risk associated with a variable rate loan may be small, fear of this uncertainty might discourage some students from taking the loans that they need to enroll in postsecondary education.

Third, should there be a cap on student loan interest rates? One of the criticisms of a move to market-based interest rates is that times of extraordinarily high market rates will make college inaccessible to many students (by making it prohibitively expensive to borrow). In our view, a cap on interest rates is a reasonable approach to ensure student access to college and to make a market-based system politically feasible.

Where does that leave us? It turns out the ideal policy is also a political compromise: it takes the market-based proposal of both President Obama and the House Republicans, the fixed-rate proposal of the President, and the interest rate cap of the House Republicans and Senate Democrats. Of course there are still details to be worked out, such as how much should be added to market interest rates to finance the administrative costs and default risk of the federal student loan program. But this is a rare example where proposals from our two political parties seem close enough that compromise on a good policy should be possible.

Authors

Image Source: © Jonathan Ernst / Reuters

For Some, College May Not Be a Smart Investment

Isabel V. Sawhill and Stephanie Owen — Thu, 09 May 2013 09:00:00 -0400

Is a college degree worth it? Not for everyone, according to our newly-released Center on Children and Families policy brief. The value of a college degree can vary dramatically, depending on factors such as field of study, type of college, graduation rate and future occupation. Here’s the second in a three-part blog post series, where we take a closer look at findings from the policy brief. (Read the first part here.)

For a young adult shopping for a college, the choices can be overwhelming. That shiny brochure can make College X look like a great place to spend four years. But what do you really get out of choosing one school over another? As it turns out, quite a bit. The return on investment (ROI) of a bachelor’s degree varies widely at different types of schools. For certain schools, according to the online salary information company PayScale, the ROI is actually negative.

But getting into college and choosing a school is only the beginning. College isn’t worth much unless you graduate. Part of what sets certain schools apart is how many of their incoming students actually come out with a degree.

Notice that there is a wide range of completion rates within each school selectivity category, particularly for the less selective colleges. Not every student can get into Harvard, where the likelihood of graduating is 97 percent, but students can choose to attend a school with a better track record within their ability level.

Authors

Isabel V. Sawhill
Stephanie Owen

Bending the Cost Curve in Health Care the Right Way—Through Better, More Person-Centered Care

Mark B. McClellan — Thu, 09 May 2013 13:54:00 -0400

The United States spends about 17 percent of GDP annually on health care, a figure that is projected to grow substantially in the years ahead, despite the recent slowdown in health care spending growth. Rising costs mean insurance coverage keeps getting more difficult to afford. Those rising costs, plus the aging demographics of the nation, account for most of the spending side of our nation’s long-term fiscal challenges at both the federal and state level. They mean higher expenditures on Medicare and Medicaid, and the tax subsidies for employer-provided coverage and the new subsidies for private insurance in the individual marketplaces. At the same time, biomedical innovation using genomics, systems biology, information technology, and innovative and convenient ways to deliver care holds the potential for much more effective, personalized care – if we can afford to develop and use it. That’s not the case so far: patients often do not get treatments we know to be effective, innovative treatments and ways of delivering care are hindered by payments that are tied more to the site of services and what we’ve paid for in the past than the value of these treatments for particular patients, and we often pay more for complications than for the coordination of care and person-focused support that could help health care providers and patients get much better results for the money they spend. Something has to change, not just to make sure that healthcare costs can be contained, but also to make sure that the quality of health care gets better by providing better support for what patients need.

Our new report, “Person-Centered Health Care Reform: A Framework for Improving Care and Slowing Health Care Cost Growth” is a system-wide framework to address our cost problems by improving care – by leveraging the large and growing opportunities for more person-focused care. We have developed a set of proposals for saving $1 trillion over 20 years and improving care at the same time. Written in collaboration with leading experts from across the academic and political spectrum, our report proposes a framework for how to improve health care financing and regulation so that we can achieve better, higher-value care for each person. The report describes a specific series of steps to improvement the way care is delivered in each part of our health care system, including Medicare and Medicaid, the employer and individual insurance markets, antitrust enforcement and other regulatory reforms. Focusing on person-level quality of care as the fundamental strategy for addressing health care cost growth is in some ways new, but it builds on promising ideas and trends throughout our health care system. It is an idea whose time as come, and which we should start to adopt as our long-term approach to addressing the health care quality and cost problems now.

This report is the third in our “Bending the Curve” series. While building on the past reports, it also differs from our previous work in some very important ways. First, we have broadened our group of authors. Still with us is the core group of experts who participated in previous reports – people like Joe Antos from AEI, Mike Chernew and David Cutler from Harvard, Mark Pauly from University of Pennsylvania, Dana Goldman from USC, Steve Shortell from UC Berkeley, and others who have a tremendous amount of health policy expertise and experience. We’ve also benefitted from some new expert perspectives, including Kate Baicker from Harvard. And along with that expertise, our group now includes some other experts with extensive policy and political experience – including NGA director Dan Crippen, former Senate Majority Leader Tom Daschle, former CEA chair and Columbia dean Glenn Hubbard, former Utah Governor and former HHS Secretary Mike Leavitt, former HHS Secretary and University of Miami President Donna Shalala, and former budget directors Peter Orszag and Alice Rivlin. Together, this unique group sparked a new and welcome level of discussion about reform. In particular, as Mike Leavitt put it, if Republicans and Democrats were at the point where they had to reach an agreement on reforming care and addressing the challenge of rising costs, what would they agree on – and how could we make sure it would work?

As we worked to answer these very practical questions, we were forced to consider the full range of key technical and political issues involved in health reform. We reviewed the kinds of reforms that we have considered before to improve quality and lower costs, along with new evidence on how those reforms and others being implemented now are working (with different degrees of success) in the public and private sectors. We combined that with consideration of how best to move forward in a way that avoids the need for disruptive short-term payment cuts, provides the policy certainty needed to accelerate the trends toward the availability of much better, more personalized care, and addresses serious short-term weaknesses in in Medicare, including unstable physician payments and a lack of support for beneficiaries to save money when they get better care These considerations led to a plan that involves implementing reforms that are not disruptive in the short term while supporting better quality and coordination of care, leading to a large impact over time on supporting improvements in care that can sustain slower cost growth in the years ahead. Our conclusion is that enacting these health care reforms will not be easy, but we agree that this is the best path forward.

We do need to act now. If enacted, our framework is able to avoid the more aggressive steps that will almost certainly be needed in the years ahead to achieve more urgent reductions in federal spending, like cuts in payment rates as in sequestration, or restrictions in coverage for vulnerable populations and in access to new types of innovative care. And even more importantly, it will speed up the innovations in health care and biomedical technology that lead to better results and lower costs for patients. The bottom line is that the best way to control health care costs is to have health care policies now that do as much as possible to support better care for each patient.

We have a window of opportunity right now for implementing thoughtful health care financing and regulatory reforms that improve care today and promote much better, person-centered health care for the future. This is the best way for the country to achieve its overall deficit reduction targets. We should act now before the window closes, and we are left only with policy options that shift costs, reduce quality, and most importantly, diminish the ability of patients and health care providers to achieve better care and better health.

Downloads

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Authors

Mark B. McClellan

Going to College? Think Hard About Your Major and Your Career After You Graduate

Isabel V. Sawhill and Stephanie Owen — Wed, 08 May 2013 10:00:00 -0400

Is a college degree worth it? Not for everyone, according to our newly-released Center on Children and Families policy brief. The value of a college degree can vary dramatically, depending on factors such as field of study, type of college, graduation rate and future occupation. Here’s the first in a three-part blog post series, where we take a closer look at findings from the policy brief.

For the past few decades, it has been widely argued that a college degree is a prerequisite to entering the middle class in the United States. We all know that, on average, college graduates earn significantly more money over their lifetimes than those with only a high school education. Brookings’ Hamilton project has estimated that the average bachelor’s degree holder makes $570,000 more over a lifetime than the average high school graduate. What gets much less attention is that the college premium varies widely by the choices students make.

For example, the value of a bachelor’s degree depends heavily on choice of major and later occupation. No surprise here: the highest paid major is engineering. If on the other hand you studied education (but didn’t go on to get a master’s degree), you can only expect to make half of what those engineering majors do. (Stagnant teacher compensation is a whole other topic that we won’t go into here.)

Not everyone ends up working in the field they studied in college, so it’s also useful to look at earnings by occupation. The highest-earning occupation category is architecture and engineering, with computers, math, and management in second place. The lowest-earning occupation for college graduates is service.

Of course, plenty of people choose to study art or become teachers because they derive intrinsic value from those fields that can’t be measured by a paycheck. Personal preferences and noneconomic benefits are important, too. Few among us would want to live in a world with all programmers and no artists, or all investment bankers and no philanthropists.

Authors

Isabel V. Sawhill
Stephanie Owen

Around the Halls: Israel's Airstrikes in Syria

Tue, 07 May 2013 11:22:00 -0400

Following news of Israel’s weekend airstrikes in Syria, Brookings experts examine the implications of Israel’s actions, analyze Syria and Hezbollah’s possible responses, and offer foreign policy recommendations for the United States. Daniel Byman, Michael Doran, Suzanne Maloney, Kenneth M. Pollack, Natan Sachs, Salman Shaikh, and Tamara Cofman Wittes weigh in on the latest developments.

Natan Sachs
Fellow, Foreign Policy Program, Saban Center for Middle East Policy

The Israeli airstrikes in Syria over the past few days were an instance of a standing Israeli policy: preventing, by all means necessary, the transfer of “game changing” weapons to either Asad’s ally, Hezbollah, or—of increasing Israeli concern—to extremist groups among the Syrian opposition. Such weapons include not only chemical weapons from Syria’s large stockpile but also advanced conventional weapons such as Russian anti-aircraft missiles or the Iranian Fateh 110 surface to surface missiles Israel reportedly targeted this weekend (missiles with significantly larger payload, better accuracy and longer range than most existing Hezbollah weaponry, such that Israelis cities would be under considerably more threat from Hezbollah than in the past).

The Israelis are betting that their actions do not backfire, either by provoking a larger conflict with Hezbollah or the Asad regime or by influencing the Syrian civil war in unpredictable ways (see this piece Dan and I wrote in Foreign Policy). Israel, in its view, has no horse in the race in Syria. It has no love for the Asad regime but is deeply wary of the potential for chaos or for an extremist takeover of parts of Syria. The Israeli stance has been, therefore, to take action on tangible, operational intelligence as it emerges but to refrain from involvement in the civil war itself; to protect its vital interests while remaining largely outside the fray.

But acting on the tactical and operational level without influencing the situation at large can be a difficult balancing act. Israel would provide the perfect foil for the Syrian regime or for Hezbollah, both of whom are mired in a bloody civil war where they on the wrong side, in popular Arab eyes. A diversionary conflict with Israel would offer them an out from the ire of the Arab publics, as the renewed anti-Israeli rhetoric of the Syrian regime in the past few days has demonstrated. Indeed, Israel was on alert in its north, deploying Iron Dome batteries, temporarily closing off the northern civilian airspace and ramping down a planned military exercise, for fear of stoking the flames. But Israel remains relatively confident that the situation will remain under control—Israeli Prime Minister Binyamin Netanyahu departed the country for a state visit to China—with both the Asad regime and Hezbollah wary of opening a front with the vastly more powerful Israel, and especially its airpower, while they struggle to hold their positions on the ground in Syria.

Kenneth Pollack
Senior Fellow, Foreign Policy Program, Saban Center for Middle East Policy

First, I'd like to just note that three Israeli strikes with non-stealthy aircraft cast some doubt on the Administration's alarmism about Syria's vaunted air defenses. Indeed, I wonder if that isn't also in the back of Bibi's head—demonstrating just how poor Syrian air defenses actually are.

Second, I would like to resurrect some of my comments from my blog post from last week: namely that whether the regime retaliates against Israel will be driven by its assessment of the fight with the opposition. As long as the regime feels it has a prospect of beating the rebels, it won't retaliate for fear of an escalatory spiral with Israel. They are very wary of taking on the IDF while they are fighting for their lives against the Sunnis--as long as they think they can win that fight. However, once they become concerned that they cannot win that fight, then the regime's incentive structure flips and it becomes more likely that they will retaliate against Israel, since the possibility of transforming the contest into an Arab-Israeli war outweighs whatever damage the Israelis could do once they conclude that they are doomed anyway. Right now, I do not believe the regime has reached that level of desperation, so I doubt they retaliate.

Salman Shaikh
Director, Brookings Doha Center, Fellow, Foreign Policy Program, Saban Center for Middle East Policy

First, Israel seems intent on defending its "red lines" and has already acted to stop the transfer of advanced weapons to Hezbollah; responded directly to fire from Syrian army units in the Golan Heights; and sounded the alarm on the use of chemical weapons.

With regard to the transfer of weapons to Hezbollah, it has shown that it is willing to change the 'rules of engagement' with the Assad regime and hit these weapons inside Syria. In doing so, it is seeking to establish a new level of deterrence with respect to such activities. Certainly, the latest strikes against weapons depots and reportedly the headquarters of the 104th Brigade of the Republican Guard as well as the 4th Division commanded by Bashar's brother, Maher Assad are punitive and painful. The psychological effects that such strikes could have on the senior officer core, particularly the Alawite officers, who form the backbone of the army and its security forces will be worth watching. In a short period of time, the certainty of the previous 40 years of "cold peace" has been replaced by the realisation that Israel will strike again and harder if Asad continues to supply Hezbollah.

The likely response from the Assad regime, as has already been the case since the strikes over the weekend, is to exploit the propaganda value of Israel's "aggression" and attempt to link it with efforts to aid the opposition's rebel forces. The Free Syrian Army has condemned the "Israeli aggression" but denied any connection to it. The Syrian National Coalition has responded by engaging in “verbal acrobatics” by condemning the attacks but also blaming Assad for weakening the country.

What will matter is the effect that this will have on the large number of people, particularly in the cities, who have not openly sided with either the regime or the opposition. If the situation escalates, the regime could gain ground by hammering the message that Israel has sided with rebels and extremists and that only the regime can protect the unity of Syria in this difficult period.

Key states in the Arab world, at least rhetorically, seem to be following suit. In addition to the predictable condemnations from the Syrian regime's supporters in Lebanon and Iraq, statements from President Morsi of Egypt and the Saudi government have condemned Israel's "violation of international law" and pointed to its dangerous consequences for the region. Meanwhile, the Arab League Secretary-General called it "a blatant aggression and a serious violation of an Arab country's sovereignty." He has also called for the UN to take action (never mind the League's silence over the recent massacres in Baniyas and the alleged use of chemical weapons).

Whether these statements reflect the views of Arab publics is debatable. For now at least, the focus will likely remain on the Assad regime's brutal use of force against its own people. The majority of Arabs, particularly Sunni Arabs are angry with Assad and resentful of the support that Hezbollah and the Iranians have provided to him. However, the suspicions that many in the region have towards Israel's actions will likely grow if the attacks continue and if these are perceived as only furthering Israel's interests.

Daniel Byman
Senior Fellow, Foreign Policy Program, Director of Research, Saban Center for Middle East Policy

For U.S. policy, my concern is that several important U.S. allies—Saudi Arabia, Turkey, Qatar, Jordan, and now Israel— are involved in significant ways. And other neighbors, notably Lebanon and Iraq, are suffering increasing instability from the Syrian conflict. Meanwhile, the instability from Syria is steadily spreading beyond its borders. Even beyond the human cost, the United States has long had its own interests, including counterterrorism, in playing a more decisive role. Now the problem is metastasizing, and U.S. allies might work at cross purposes, and their actions may end up harming each other in the end.

Michael Doran
Roger Hertog Senior Fellow, Foreign Policy Program, Saban Center for Middle East Policy

I agree wholeheartedly with Dan. The issue for me is the abdication of American leadership. I cannot remember another time when the United States was so noticeably absent from a major issue— the major issue— in Middle Eastern international politics. It's important to make a distinction between leadership and direct intervention. Often when people call for a more robust American policy, they are shut down with a pointed question: "What do you want, another Iraq war?" But there is much that the United States could do, short of military intervention, to coordinate the activities of its allies. Leadership requires, before anything else, a clear vision of the future— a picture of an end state that is both desirable and achievable. The United States has no vision whatsoever of the outcome that it would like to see in Syria. It does not even have a clear definition of its major interests in the conflict. The only interest that the Obama administration has clearly articulated is its desire to remain aloof.

Tamara Wittes
Director, Saban Center for Middle East Policy, Senior Fellow, Foreign Policy Program

Syrian activists on the ground and in exile are at least ambivalent about the Israeli strikes, and some are downright celebratory. But the Egyptian government and the Arab League were quick to issue statements denouncing Israeli interference. Given the involvement of Arab League members and the League itself in Syria’s internal crisis, the latter condemnation in particular was thick with irony. But just as the speedy criticisms from Cairo reflect the ongoing nationalist sensitivity there, the controversy in the rest of the Arab world over how to respond to the Israeli strikes likewise underscores the ways in which the Arab Awakening— and the Syrian conflict most pointedly— has upended once-comfortable principles regarding sovereignty, Arab nationalism, and non-intervention in internal affairs.

Suzanne Maloney
Senior Fellow, Foreign Policy Program, Saban Center for Middle East Policy

The Israeli air strikes have been interpreted by many as a message to Tehran, hardly surprising given Iran’s central role in providing materiel support to Bashar Al Asad and its reliance on Damascus as both a bulwark against regional isolation and a conduit to its proxies in the Levant. What is interesting is Tehran’s response – not simply the predictable fulminations from senior officials and clerics, but the stepped-up pace of Iran’s diplomatic outreach on Syria. Foreign Minister Ali Akbar Salehi arrived in Amman today for talks, just in time to announce a visit to Tehran next week by Qatari Prime Minister Hamad bin Jassim bin Jaber Al Thani.

This is the latest indication of Iran’s underlying objective with respect to the conflict in Syria – ensuring that the Islamic Republic retains influence in Damascus irrespective of the outcome of the civil war. This imperative has shaped a hedging strategy from the outset of the unrest: Iran hopes to preserve at least a vestige of its ally Bashar, but has also sought a seat at the table in shaping post-Asad Syria in any formal regional dialogue. Tehran’s hedging here goes beyond protecting its equities and bolstering regime security; there is a genuine national interest in precluding the expansion of Sunni extremism, which Iran has rightly viewed as a threat since the emergence of the Taliban more than two decades ago.

The concept of Iranian engagement on Syria is anathema to Washington, for good reason. And yet it should not be reflexively blocked by an Obama Administration that is under fire for its absurd public dithering on Syria. Iranian diplomatic engagement on Syria will not preclude troublemaking by Tehran; however, excluding Iran from the contentious regional politics surrounding the conflict is a recipe for inflaming the situation even further. Any long-term stable outcome in Syria will require neutralizing Iran’s incentives for sabotage as well as stemming the sectarian violence brewing amidst the conflict.

Authors

Publication: The New York Times

Singapore's Health Care Lessons for the U.S.

William Haseltine — Mon, 06 May 2013 12:39:00 -0400

Most people will agree that the U.S. health care system needs systematic restructuring. Americans pay more for their health care then residents of other high income countries but get worse health outcomes. The Affordable Care Act of 2010 addresses some but not all of the most pressing problems. I believe we can reduce health care expenses, saving trillions of dollars a year, by making our health care system more efficient, following the lessons from the best other countries have to offer. Singapore offers an excellent starting point.

In my new book, Affordable Excellence; The Singapore Health Care Story: How to Create and Manage Sustainable Health Care Systems (Brookings, 2013), I examine how Singapore has succeeded in establishing a health system that ranks among the best and most efficient in the world. Globally, Singapore ranks sixth in health care outcomes, yet spends proportionally less on health care than any other high-income country, spending less than one-fourth the cost of health care in the United States and about half that of Western European countries.

In the United States, public and private health care costs account for almost 18% of GDP, more than four times that of Singapore. Yet we rank at the very bottom of all advanced economy nations in terms of measures of health and below many less advantaged countries as well. The rapidly growing numbers of elderly patients who place the heaviest demand on health services burden our system even further. The present course is clearly unsustainable. The Affordable Care Act, if successful, will alter this trajectory only slightly, reducing projected health care costs from $4.8 trillion to $4.4 trillion in the year 2030.

The primary lesson from my study of the Singapore health care system is that the key to controlling costs lies in aligning individual and collective incentives. Individuals must understand that health services costs money and that they should pay those costs they can afford themselves. Government can create a framework of rules to align hospital and doctor incentives that encourage them to provide the best service at the best price. But the framework must also assure that people have the ability to pay and then provide a safety net if they cannot. Finally, the health care system should be monitored to make sure it is transparent and honest. Some of the key lessons from Singapore that I discuss in my book include: transparency in pricing; increased competition; a shift to home- and community-based care; investing in wellness; opt-out catastrophic health insurance; salaried doctors; higher co-pays; and a tiered system.

The lessons from Singapore’s health care system will be of interest to those currently planning the future of health care in emerging economies, as well as those engaged in the urgent debates on health care in the wealthier countries—with their serious long-term challenges in health care financing. Policymakers, legislators, and public health officials responsible for health care systems planning, finance and operations, as well as those working on health care issues in universities and think tanks, should understand how the Singapore system works to achieve affordable excellence.

Affordable Excellence provides proof of principle that it is possible to deliver excellent health to a diverse population at a cost that is sustainable for individuals and nations. I don't expect any country to adopt all of the Singapore system but rather adapt some key features to their own unique circumstances.

Authors

William Haseltine

World Economic Forum on Africa: Delivering Africa’s Promise

Mwangi S. Kimenyi — Mon, 06 May 2013 12:19:00 -0400

The World Economic Forum (WEF) on Africa was established in Davos, Switzerland in 1990. Since then, the Forum has brought together thousands of world leaders, government officials, business executives and policy experts to discuss the various opportunities and challenges that Africa faces in pursuit of improving the continent’s economy and quality of life of her inhabitants. Broadly, the WEF on Africa has provided a platform for high-level debates and an exchange of ideas on economic and political issues affecting the continent. The primary objective of the WEF is to improve the state of the world by engaging political, business and policy leaders in shaping regional and industry agenda. Annual forums have dealt with different themes that reflect the realities of the day consistent to the objective of the WEF. Naturally, with the major changes that have taken place in Africa’s political and economic landscape over the past 23 years, the themes of the annual forums have also varied significantly.

This year, the WEF on Africa will be held on May 8-10 in Cape Town, South Africa. The theme of the Forum is “Delivering Africa’s Promise.” This theme is informed by the good economic performance that African countries have recorded over the past decade but with the realization that the benefits of growth have not reached many of the people and that there are many forces that could reverse the growth trends in the future. Although the recent growth has resulted in a large and growing middle class, the benefits of growth have not been shared by the majority of the population. Growth has occurred amidst increasing inequality and joblessness, especially among youth. In essence, the good economic growth has not really made a difference to the livelihoods of millions of Africans. Furthermore, although it is expected that Africa will continue to record decent rates of growth over the near future, there are many potential risks to sustained growth, such as the volatile global situation, the limited diversification of the continent’s productive structures and associated dependence on commodities, the many barriers to competitive economies—such as the large infrastructure deficit—and leadership and skills shortfalls.

The Cape Town forum will focus on issues that are key to unlocking Africa’s potential and sustaining high rates of economic growth that are also inclusive. These include strategies to accelerate investments in infrastructure and agriculture, building resilience, strengthening partnerships for growth through investments, enhancing technological innovation, managing natural wealth, nurturing leadership, and creating strategies to enhance jobs and skills, among many other pertinent topics. Special sessions by leaders and development experts including the Cape Verde President Emeritus Pedro Pires, Governor of the Central Bank of Nigeria Sanusi Lamido Sanus, Founder and Group Chief Executive of the Abraaj Group Arif Naqvi, Professor Calestous Juma and Mo Ibrahim promise a rich offering of perspectives and insights on delivering Africa’s promise to her citizens.

I will be participating at the Forum and I am privileged to be the Rapporteur of one of the key plenary sessions, “Mapping the African Growth Landscape,” scheduled for May 9. This session will feature African cabinet ministers, business leaders and international policy experts. After the session, I will record a video that will be posted as part of the WEF’s Insight Reporting.

In addition to the public events, I am looking forward to participating in a session on the role of African think tanks in policymaking. This important session will seek to expound on how African think tanks can better support policymaking in finding solutions to the challenges that the continent faces.

Follow me on Twitter @mwangikimenyi as I provide insights from Cape Town.

Authors

Mwangi S. Kimenyi