Abu Dhabi's mercenaries need an incentive to stay

From the NYT on May 14th:

 ABU DHABI, United Arab Emirates — Late one night last November, a plane carrying dozens of Colombian men touched down in this glittering seaside capital. Whisked through customs by an Emirati intelligence officer, the group boarded an unmarked bus and drove roughly 20 miles to a windswept military complex in the desert sand.

The Colombians had entered the United Arab Emirates posing as construction workers. In fact, they were soldiers for a secret American-led mercenary army being built by Erik Prince, the billionaire founder of Blackwater Worldwide, with $529 million from the oil-soaked sheikdom.

Reflex Response is the new name given to the mercenaries formerly know as Blackwater, led by the aformentioned Erik Prince. R2, as the group is know in the Gulf, is in fact an Emirati company, with the government's stake at 51%. Prince has called this place his home for almost a year now, during which time he has been successfully convincing the Sheiks the benefits of a private foreign army (a la Gadafi).

Know for his groups' despicable practices, Prince has been distancing himself from his former company (currently re-branded as Xe). The former name was tainted by their operations in Iraq, where the group received several no-bid contracts amounting to 21 million USD. They have garnered harsh criticism for their behavior (to put it lightly) and have been investigated by several Governments, including the Iraqi government, for their abuses:

From the NYT again:

Contractors often shot with little discrimination — and few if any consequences — at unarmed Iraqi civilians, Iraqi security forces, American troops and even other contractors, stirring public outrage and undermining much of what the coalition forces were sent to accomplish. The mayhem cropped up around Iraq, notably in one episode reported in March 2005 in which a small battle erupted involving three separate security companies... 

...one of which was Blackwater. Most famously, the group opened fire on a crowd of people and killed at least 17 civilians including women and children, and wounded some 30 others in what came to be known as the Nisoor Square Massacre. In April of this year a US federal appeals court reopened the case against four Blackwater mercenaries.

Make no mistake. These are the worst people in the world. They go above and beyond the call of duty for a bloodthirsty gang of mercenaries. They bribe officials, smuggle arms, open fire upon civilians, and shoot at other private soldiers that are supposedly 'on their side'. There are endless stories about companies like Blackwater that mercilessly shoot down defenseless citizens.



Here in Abu Dhabi, the threat of citizens taking action against the government is slim to none. Unlike Bahrain, the people here are religiously homogenous. Unlike Egypt, no political opposition to the government exists. Unlike Libya, the people here are placated with houses, free school and health care, and all manner of interest free loans encouraging entrepreneurship and personal wealth creation. Basically, any and all reasons for uprising have either been dealt with or simply do not exist. As a friend recently put it, "If Emiratis were to protest... well, they'd probably send their Philipina maids in their place. It's too hot outside you know..." Three bloggers were arrested earlier this year for their harsh criticism of the regime, but I still can't imagine an organized demonstration of any kind. So what use is R2?

The main threat to the Sheiks, if any could be cited at all, may come from Iran. It's no secret that the strife in Bahrain this past spring was fomented by Iran. Here, however, there are very few Shia for Iran to eqip with rebellious ideology or weapons.

In any case, the government is easily courted by a security company from the US, a country with which the UAE has close ties. But it is not clear if the US State Department has had any involvement in the deal, or conversely, if Relex Response is in fact breaking US law by training foreign troops without first receiving their blessing. The UAE has had a strong history of pouring money on American military initiatives, and surely the offer of your own personal international guard makes too much sense to reject.

According to the NYT, R2 is spending $9 million per month on initiatives including training Emiratis, and paying south asian laborers to cook, clean and maintain their camp (as one does in this part of the world). Pennies for a Sheik. But operations have not been so smooth. Like any company that comes to the UAE, R2 has been plagued with what we call "runners". Handfuls of employees have been hired and either quit or were fired within months. They come, make a quick buck and realize this place is a desert. But with all the prostitutes in Dubai (rock up to the Fairmont any night of the week and you'll see what I mean) I'm sure R2 can persuade its mercenaries to stay.

They have no other reason.


For more, check out http://www.blackwaterwatch.com/

Bin Laden and Pakistani Aid

Osama Bin Laden has been killed. People are celebrating. I don't think we should be celebrating. Pakistan should certainly not be celebrating. As a Westerner in the UAE, I see moderate Arab Muslims shrugging their shoulders and those more conservative shaking their heads. No one is shouting. Pakistanis, notably those from Peshawar and the surrounding region,  give off no impression at all. But they in particular, should be worried. Take a look at this picture from the NYT:

If 96% went towards military, what does that leave little ol' development (plus overhead)? Not very bloody much. And now, with Osama dead, can we expect this stream to continue? Not bloody likely. Looking at it this way, it has been in Pakistan's best interest to keep Osama hidden and keep the taps flowing.

Traditionally, this is the time when the US disengages from a situation and leaves a mess for other organizations to fill in. The prize has been won. This reminds me of this video from a few years back in which Thomas Barnett makes a hawkish, yet perfectly acceptable presentation about how the US military needs to be comprehensively engaged in post war efforts to build peace and security.



Of course, Osama's death does not make this a post conflict zone, and in fact may do just the opposite.  Nonetheless, the strategic switch from offensive to developmental should be engaged.

I read a statistic from Paul Collier once (which I can't find now, of course) that said something like 40% of post conflict zones in the past 15 years that have attained some kind of peace have reverted back into hostile zones.

I brought up military spending at work today. People were surprised to hear that the US spends about as much as the entire rest of the world combined on their armed forces. A Syrian friend of mine replied lamenting about how rich his country would be if they weren't continuously funding the military. I told him of the untold billions Canadian PM Stephen Harper is going to spend on fighter jets. "For what?" he said.

The horror of the 2007/8 election violence in Kenya

The case against humanitarian aid

Although aid talk these days is centered on Japan, Ill let Tales from the Hood and La viaid loca lecture you about the issues surrounding those charity efforts. Basically, the short lesson is they don't need your old socks.

Instead, today I would like to convince you that humanitarian aid, as opposed to disaster relief (Japan) or development aid (Kenya), is bad.

Consider this: Humanitarian intervention lowers the cost of war.  Casualties of war require medical attention which requires money and resources. The Red Cross for example, brings in all kids of resources to help those in need.

"Free relief for all of my soldiers and wounded civilians? Sign me up!"

Humanitarian intervention lessens the burden of war on those who wage them; the wounded are cared for, the hungry are fed.

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Consider this: The media brings in all kinds of charity.

To quote La vidaid loca link from above, "Media attention on an emergency is a significant driver of the general public’s interest in giving to an emergency."

Media brings in money.

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Imagine for a minute that you are a rebel militant in some forgotten post-war country:

Together with your brothers, you wish to rise to power. You and your comrades will become rulers of the land so that you can live the life of a provider; a king. However, your resources are dwindling, and poverty is rampant. Some seasons are plentiful - when the rains come, and when resource deals are struck - but there is always the risk that activists will block trade deals, government forces will capture all the rents, and rains will fail. The risk you face is high no matter your action. The life you live is most likely short. Money is what you need. Money is power.

Which is the 'path of least resistance'? Choose one, or two that fit together:

a) Farm: Knuckle down, get a real job tilling the fields and pray that the rains are good.

b) Revolt: Go into battle with government forces on the little weaponry you have left from your last resources-for-arms deal and try to take control of the resource rich areas.

c) Look for a job: Go to the city to look for a job. Maybe you could become a taxi driver.

d) Get some education: Learn a new skill to apply to a productive endeavour in the near future.

e) Cut off a few limbs of starving children: Create a big humanitarian crisis so international aid resources come flowing into your country.

Escalate a humanitarian crisis -> media -> humanitarian aid -> free resources -> good chance to syphon off funds -> money AND  healthy soldiers -> more war -> natural resource capture -> money




Humanitarian aid has perverse incentives: it decreases the cost of war, and increases benefits to warlords for going to war.


We should not give humanitarian aid.
(...and we haven't even talked about colonialism yet)
Convinced?

What's up in Sudan:

Rather than bore you with lines of text explaining the vast and mostly terrible past and present states of Sudan, here is a great lil video:

Youtube(like) of the week - The History of the Carbomb

Former CIA agent Robert Baer  reveals how the century of the car turned into the century of the car bomb.

War, Rent Seekers, Dutch Diseases, Elite Capture, and One Trillion More Problems in Afghanistan

The NYT today reported that one (1) trillion (a thousand billion) USD worth of mineral deposits have been found across Afghanistan. For a country with a GDP of 21 billion (neighbours Iran make 778 billion, Pakistan 421, Uzbekistan 72), this could be a real boon.

We could go off and discuss how GDP isn't a good measure because of differences in populations,  inequality, the black market, non-market transactions, the non-monetary economy, environmental considerations and externalities, but that is for another time. For now, we can tell there is a trillion dollars sitting underneath one of the most war-torn nations on the planet! What could possibly go wrong?

For decades natural wealth has been discovered in dozens of developing countries, but rarely has it translated into anything beneficial for the average citizen. Why? What becomes of all that wealth?

The most obvious outcome in this case will be an intensified struggle for ownership/control of the land. For details on this I would advise reading someone familiar with the conflict (you know who you are). I will gloss over the civil conflict side for now and simply predict more terrorism and more war. Instead of dwelling on the war as we probably should, let us suppose ISAF is able to gain and keep control over large areas of land to allow for the extraction of these minerals (Ok, a huge leap, I know), what else will go wrong?

The Afghanistan government will likely hand over the rights to mining companies in the US or China for a little cash in the back pocket. Whose back pocket would benefit is not exactly clear. Elites will have to battle for it. In any case, one group - be it the central government or otherwise - will sell off the stuff quickly to seek a little rent. Whats wrong with that?

Finding a great source of wealth outside the (marginally) taxable labour of citizens of their nation and rife with corruption already, the Afghanistan government will allow elite capture of the mineral wealth and ignore their obligations to infrastructure, institutions (ie. health and education) and people. Well, I suppose they won't be worse off than they were before, right?

The natural course of action for a government that has found a revenue stream is to develop that stream. Investment will pour into resource extraction at the expense of other public investments. Any large endeavours into any other economic activity will be sidelined and currently active sectors will eventually crumble. This is a concept known as the Dutch Disease.

If the investment into extractive industries is wildly successful, at best a dubious proposition given the security situation, then Afghanistan has the potential to export a massive amount of minerals. If they export enough to influence the world price then their terms of trade could fall and they could experience immiserizing growth. Given the elite capture of revenue, the rent seeking and the disease from the dutch, a fall in the terms of trade could outweigh the gains from growth.

 All of these perils of extractive industries (and I haven't even mentioned environmental degradation) are general and applicable to any economy. Afghanistan is a special and complicated case where America (and others) are at war with the Taliban. For Afghans only one thing is certain, bringing that money to the surface will only cause more trouble.

A Nice, Healthy Taliban

I received a good question from Lady N today. Here is the news story that contains that very question:

"The International Committee of the Red Cross (ICRC) raised eyebrows on Tuesday when it announced it was giving first aid training and medical kits directly to the Taliban insurgency. The move is part of a wider Red Cross effort to save lives in Afghanistan. The agency is teaching local doctors and Afghan security forces how to deal with weapon-related wounds. But in April it also provided basic first aid training and emergency medical kits to "over 70 members of the armed opposition," the ICRC said."  - Richard Foot, Canwest News Service 

 Should the Red Crescent Teach the Taliban First Aid?  ( <- go ahead read more)

I say everyone should have access to the information/health care that
helps to save lives. However, if we (the royal we) have a limited
amount of resources we should spend those resources where
they do the greatest good. This is clearly ambiguous, but it is also
easy to see that saving the lives of people who wouldn't think twice
about killing other people is not very efficient (and therefore not
the greatest).  Although the efficiency argument is cold, I think it
fits this context of the moral dilemma quite nicely.

If we had unlimited health resources, or even a glut of localized and
immovable resources in taliban areas, I would argue that helping them
out is a good idea. A child in this part of the world who loses a
family member mostly or partly because health care is withheld is more
likely to grow to resent foreign organizations of any sort. (I think
this stands whether or not people are aware of intentional
restriction.) Anything perceived by locals as a positive influence
from foreign organizations is a good thing.

What do you think?