Why do between a fifth and a quarter of Americans think that Barack Obama is a Muslim? I was interviewed this morning by one new outlet on this topic. Perhaps 10% of the population listens to the talk-radio conspiracy theorists who actually believe that Obama is a covert Muslim, which of course is wrong; as I wrote elsewhere, he is not even a Muslim.

Nonetheless, the fact that Obama prominently and incessantly praises Islam while showing no interest in Christianity easily might lead the casual observer to believe that he is a Muslim. Unlike past presidents who professed Christianity, he does not attend church. Earlier this year NBC’s Matt Lauer asked Obama why he has not chosen a church to attend. Obama said that his presence might distract other parishioners–a compunction not shared by his predecessors. Instead, he makes do with a daily devotional email from a group of pastors. Christianity by Blackberry, one might call it. No wonder folks are confused.

I have nothing to say about the valedictory remarks of Christina Romer, the departing chair of President Obama’s Council of Economic Advisors:

She had no idea how bad the economic collapse would be. She still doesn’t understand exactly why it was so bad. The response to the collapse was inadequate. And she doesn’t have much of an idea about how to fix things.

What she did have was a binder full of scary descriptions and warnings, offered with a perma-smile and singsong delivery: “Terrible recession. . . . Incredibly searing. . . . Dramatically below trend. . . . Suffering terribly. . . . Risk of making high unemployment permanent. . . . Economic nightmare.”

Satire herself (as Trotsky wrote in another context somewhere in his History of the Russian Revolution) stands mute.

Between the Anglo-French declaration of war against Germany in September 1939 and the German invasion of France in May 1940, the world had eight months of “phony war” or Sitzkrieg (“sitting war”). Sitzkrieg continued on the Eastern front until June 1941, when Hitler at length invaded Russia. The question in 1940 was Germany’s aggressive intentions; the question today is Iran’s.

Now that the last American combat brigades have left Iraq, the conservative commentariat is unanimous in its self-congratulation for having fought the good fight in Iraq. John Podhoretz’ column today is entitled “Barack the Neocon,” and the editors of National Review boast that  ”we have transformed Iraq from a hostile, terrorist-supporting dictatorship destabilizing the region into a ramshackle democracy that is an ally in the war on terror.” They add: “Any strategy for containing Iran makes no sense unless a stable, U.S-allied Iraq is a bulwark against it.”

Sounds a bit like the Maginot Line. On the contrary: the reason that Iraq appears stable is that the Persians, who invented chess, well understand Aron Nimzovich’s maxim, “The threat is mighter than the execution.” Tehran has used its capacity to turn Iraq into a bloodbath as an instrument of blackmail against the United States: bomb our nuclear facilities, and we will turn Iraq into living hell.

It pains me to point this out, but left-wing commentators are stating the obvious truth that my conservative friends wish to suppress: it is up to Iran to determine how stable Iraq shall be. The odious Tony Karon, for example, wrote today on the Time website:

“[The] political power vacuum is being ably filled by Iran. Saddam’s Iraq was a brutal dictatorship that privileged Sunnis over Shi’ites and Arabs over Kurds, but it also functioned as a bulwark and battering ram against Iran on behalf of neighbors like Saudi Arabia, which funded Iraq’s war against the Islamic Republic. By inverting the domestic power equation — putting Shi’ites in charge, making the Kurds into kingmakers and marginalizing the Sunnis — the U.S. invasion also inverted the regional power equation. Iran, via its long-standing ties to the main Shi’ite parties, emerged as the dominant outside influence in Baghdad’s politics. U.S. officials routinely grumble about Iranian meddling in Iraqi politics, but there’s little they can do, because the vehicles for such meddling are, in fact, popularly elected Iraqi politicians. And Iran recognizes that if it can’t impose a friendly government next door, the next best thing might be a weak government unable to threaten it in the way that Saddam did.

As I wrote in the Tablet webzine last April:

Iran has gained political ascendancy in Iraq through intensive subversion efforts. According to senior military sources cited by Washington Post columnist David Ignatius on February 25, “The Iranians allegedly are pumping $9 million a month in covert aid to the Islamic Supreme Council of Iraq, a Shiite party that has the most seats in the Iraqi parliament, and $8 million a month to the militant Shiite movement headed by Moqtada al-Sadr.”

Petraeus’s opinions about the Middle East carry less weight than those of his boss, Joint Chiefs Chairman Mike Mullen, who has been warning against an Israeli strike against Iran’s nuclear capability for the past year. In a March 16, 2009, interview with Charlie Rose, Mullen said: “What I worry about in terms of an attack on Iran is, in addition to the immediate effect, the effect of the attack, it’s the unintended consequences. It’s the further destabilization in the region. It’s how they would respond. We have lots of Americans who live in that region who are under the threat envelope right now [because of the] capability that Iran has across the Gulf. So, I worry about their responses and I worry about it escalating in ways that we couldn’t predict.”

A rough translation of Mullen’s remarks into civilian political language is that the quixotic notion of building democracy in the Middle East led the United States into an Iranian trap.

The neoconservatives never appear to have noticed that the Iranian leadership was just as keen on building democracy in Iraq as they were. When the American occupation forces held the constitutional referendum in late 2005 that is the putative foundation of Iraqi democracy, Iran’s Supreme Leader Ali Khamenei hailed it as “a great and blessed job” in an October 21, 2005, sermon. “The next important step in Iraq after the referendum is the general elections on which the occupiers are planning right now,” he said. Khamenei called for a truce in the sectarian war between Shi’ites and Sunnis, intoning, “These elements [extremists] are neither Sunni nor Shi’ite but are the enemies of both and Islam.”

Iran retained the capacity to inflict high levels of casualties on the United States throughout the Iraqi democratization campaign but chose not to use it. Instead, it withdrew some of its most exposed and volatile assets, including Muqtada al-Sadr, to Iran. The Iranians counted on the fact that the Americans would soon be gone—and that their proximity, staying power, and affinity with Iraq’s Shi’ite majority would allow the Islamic Republic to emerge as the dominant player in the country.

It is utter and complete folly to attempt to stabilize the plaster and drywall around Iran. To prevent Iran from acquiring nuclear weapons, the West will have to suffer the consequences that Iran has been preparing for the better part of the decade that Washington wasted in its Mesopotamian distraction. These include civil war in Iraq, interdiction of Persian Gulf shipping through surface-to-sea missiles, rocket attacks on Israel from Lebanon and Gaza, as well as terror attacks all over the world. Lancing the boil now will be painful and messy.

The grand vulnerability of the West is fear of chaos. The grand advantage of Iran and Islamic radicals generally is their willingness to place the burden of uncertainty upon the enemy by threatening chaos.

If Iran acquires nuclear weapons, it will be free to subvert its neighbors and perpetrate acts of terrorism under a nuclear umbrella, and the world will change drastically for the worse. To prevent this from happening the West must attack Iran’s capacity to make nuclear weapons, and do it soon. Just how much time we have before Iran makes a deliverable bomb, I do not know and cannot find out. Operational estimates of this sort are dicey at best; if some intelligence agency has a definitive estimate, no-one will tell me. My view on timing is: Why take chances? Get it over with now.

That probably means a prolonged civil war in Iraq between the Shi’ite forces funded and trained by Iran and the 100,000-strong Sunni Awakening funded and trained by General Petraeus during the so-called surge. It may mean a replay of the Iran-Iraq war of the 1980s, but as a civil war in Iraq, spilling over into several other venues, notably Pakistan. It may involve casualties an order of magnitude larger than the million dead in the Iran-Iraq conflict.

And that is the best-case scenario. The worst-case scenario is a nuclearized Middle East and an inevitable nuclear exchange among several players, with casualties two orders of magnitude larger than the Iran-Iraq war–a hundred million dead or more. It is questionable whether the State of Israel could survive such a conflict. When all was lost, Hitler and Goebbels hoped to burn on the funeral pyre of civilization and take everything down with them. Tehran may do the same.

We are going to have something very much like the Thirty Years War in the Middle East. We cannot avoid it; we should consider how to win it. The winner of the last Thirty Years War was Cardinal Richelieu, and I highly recommend close study of his methods.

Japan-Style Stagnation? You Should Be So Lucky

August 29th, 2010

By David Goldman

Last week some old comrades-in-arms from the financial industry turned up in New York from their present haunts in Europe and Asia; at the end of the week we all found ourselves on the deck of a beach house in the Hamptons, watching a nearly-full moon and a luminescent Venus migrate together slowly from left to right across the Atlantic. The question we discussed was not whether America would suffer a “Japan-style stagnation,” but whether America would be lucky enough to sustain a Japanese style stagnation.

We’ve been taking about the comparison to Japan for quite some time. During Japan’s “lost decade” of the 1990s, everyone was working, everyone kept their homes, everyone maintained their lifestyle (minus some shopping trips to Paris), and life carried on more or less the same. America enters the second decade of the millennium with un- and underemployment around 20%.

Japan went through its great retirement wave in the 1990s, just as America must during the 2010s. But the Japanese for years had saved massively, and exported massively in order to do so. If a country’s population ages rapidly, the soon-to-retire cohort will shift from consumption into savings. Japan had insufficient young people to absorb the investment requirements of the 40- and 50-year-olds, and therefore had to invest overseas. Japan’s industrial genius made it the world’s premier exporter, and Japan was able to save successfully to fund the retirement wave–even though consumption remained weak and real estate prices fell and the stock market fell to a third of late 1980s peak.

How are Americans going to save? They can’t buy home mortgages; they could buy US Treasuries at 2.5% for a 10-year maturity; they can buy the junk bonds now flooding the market; or they can leave their money in cash at a fraction of a percent. As aging American shift from consumption to saving, they must do so by reducing domestic purchases. The Japanese could save by exporting and remain close to full employment. American’s savings requirement cannot be met in the same way, because Americans have forgotten how to export. There aren’t enough soybeans and corn to make much of a difference; with a few exceptions, America has lost its edge in capital goods as well as consumer goods, excepting commercial aircraft and a few other pockets of strength.

As Reuven Brenner and I wrote in First Things in December 2009

Today, America is coming out of a decade without savings and years of borrowing from the world instead of lending to it. Rather than exporting and saving, America is vacuuming capital out of the rest of the world and going further into debt. Once we exclude the option of admitting a few million skilled, entrepreneurial young immigrants—as Israel did from Russia two decades ago—the present crisis can be solved only by opening the world to American exports and restructuring the American economy to create the necessary export capacity.

We proposed a number of measures to accomplish this, none of which has much chance of adoption. That leaves Americans fighting for a dwindling supply of available savings instruments (in effect, old people fighting for the few young people available to support them).

And that drives down the level of returns across the board. Pension funds will have umpty-zillion-dollar deficits once they recalculate their liabilities at a 3% rate of return rather than the fictional 8.5% return assumed by most of the defined-benefit plans during the 2000s. The equity risk premium will remain depressed for a generation. The banks can’t make money after the short-lived boom in distressed assets because demand for yield has flattened the curve to the point that their old trades are less economical. Hedge funds can’t make money because they are behind the banks in the queue for assets.

Perhaps the only thing that would get the US pumping again would be an infusion of 10 or 20 million Chinese or Indians with doctorates in quantitative subjects. The Chinese and Indians, though, do not need to come to America, as they did only a dozen years ago, and if they do, they do not need to stay here. And with the economy and markets in the miserable condition they appear, why should they? There are more opportunities to build wealth in Shanghai and Mumbai than in America.

We opened yet another bottle of Pinot Noir and congratulated ourselves for having been clever enough to be born in time to catch the last wave of wealth accumulation. And we laughed at the miseries of the liberal establishment. Federal Reserve Chairman Ben Bernanke seems authentically perplexed; he followed the instructions to the letter, mixing the eye of newt with the tongue of bat, and adding $2 trillion in securities to the witches’ brew–but nothing seems to have happened. He sits up night in his tower studying ancient manuscripts: was it a she-goat or a he-goat that he is supposed to sacrifice on a moonless night?

And we felt some sympathy for the Tea Party types who want to march on Frankenstein’s castle and burn it down. If they ever have the misfortune to get into power, they will discover how much of the problem stems from the sloth, complacency, ignorance and incompetence of ordinary Americans. We’ve had the financial ride of our lives during the past fifteen years courtesy of the rest of the world, and now it’s over. We have to learn how to export again–and that is not going to be easy.

Although it lingered another sixty years, the Sack of Rome by Alaric the Visigoth in 410 marked the downfall of the empire. Gustav Niebuhr, writing in the Washington Post, finds hope in the fact that the Christian religion survived the destruction of its first state sponsor. That, says Niebuhr, shows why Americans should allow the Ground Zero Islamic Center to proceed:

The empire, since the conversion of Emperor Constantine nearly a century earlier, had gradually been bringing its official might to bear in support of Christianity, the very faith its rulers once persecuted. The old, pagan religions suffered greatly. And then, in 410, that remarkable Roman state suffered a mortal wound. At the time, Christians expressed enormous fear for the future.

But their faith would not only survive, but also grow, vastly (well before subsequent European states emerged again to support it).

Is there evidence here for the benefit of keeping religion separate from government power–for the good of both–so that neither meddles in the other’s affairs, such that no religionist tells a political leader what to say, and no political leader tells religionists where they might and might not build their houses of worship? One might so argue.

Bringing up the Sack of Rome in the context of the attack on the World Trade Center is not a reassuring argument. After all, that is what barbarians do when they sack imperial capitals: they destroy important symbols of power. Alaric’s men did not rape and murder and random, but desecrated public buildings and imperial mausoleums in particular.

A more interesting question is: why did a small number of barbarian invaders bring down the densely-populated Roman Empire? As Brian Ward-Perkins reports in his superb book on the Fall of Rome, “A large Germanic group probably numbered a few tens of thousands, while regions like Italy and Roman Africa had populations of several millions,” supporting a standing army of 600,000 during the 4th century.

But Rome was a slave empire. A contemporary source reported that when Alaric besieged the city,  ”Almost all the slaves who were in Rome, poured out of the city to join the barbarians.”

Ward-Perkins adds, “Even as early as 376-8 discontents and fortune-seekers were swelling Gothic ranks soon after they had crossed into the empire – the historian Ammianus Marcellinus tells us that their numbers were increased significantly, not only by fleeing Gothic slaves, but also by miners escaping the harsh conditions of the state’s gold mines and by people oppressed by the burden of imperial taxation.”

Rome, in short, was a state very similar to what Hitler would have built had he conquered Europe: incorporate some nations into the empire (e.g., Northern Europeans), enslave others, and exterminate yet others. The Gothic invasion by itself would not have brought Rome down without the slave revolt that it helped to trigger.

I am very glad that Christianity survived the Fall of Rome. But the lesson to be drawn from the 1600th anniversary of the Sack of 410 C.E. is that predatory empires premised on conquest will get what they deserve. And that thought makes me consider the proposed monument to Muslim triumphalism in a different light.

DNA samples from several dozen relatives of Adolf Hitler indicate that the monster of the 20th century very likely had some Jewish ancestry, reports the Jerusalem Post.  The newspaper explains, “His father, Alois, was thought by some to have been the illegitimate offspring of a maid called Maria Schickelgruber and a 19-year-old Jewish man with the family name of Frankenberger.”

In a May 2009 essay entitled “Demographics and Depression,” I warned First Things readers that the great economic headwind of our time was demographic:

Our children are our wealth. Too few of them are seated around America’s common table, and it is their absence that makes us poor. Not only the absolute count of children, to be sure, but also the shrinking proportion of children raised with the moral material advantages of two-parent families diminishes our prospects. The capital markets have reduced the value of homeowners’ equity by $8 trillion and of stocks by $7 trillion. Households with a provider aged 45 to 54 have lost half their net worth between 2004 and 2009, according to Dean Baker of the Center for Economic and Policy Research. There are ways to ameliorate the financial crisis, but none of them will replace the lives that should have been part of America and now are missed….

In the industrial world, there are more than 400 million people in their peak savings years, 40 to 64 years of age, and the number is growing. There are fewer than 350 million young earners in the 19-to-40-year bracket, and their number is shrinking. If savers in Japan can’t find enough young people to lend to, they will lend to the young people of other countries. Japan’s median age will rise above 60 by mid-century, and Europe’s will rise to the mid-50s.

America is slightly better off. Countries with aging and shrinking populations must export and invest the proceeds. Japan’s households have hoarded $14 trillion in savings, which they will spend on geriatric care provided by Indonesian and Filipino nurses, as the country’s population falls to just 90 million in 2050 from 127 million today.

The graying of the industrial world creates an inexhaustible supply of savings and demand for assets in which to invest them–which is to say, for young people able to borrow and pay loans with interest. The tragedy is that most of the world’s young people live in countries without capital markets, enforcement of property rights, or reliable governments. Japanese investors will not buy mortgages from Africa or Latin America, or even China. A rich Chinese won’t lend money to a poor Chinese unless, of course, the poor Chinese first moves to the United States.

That the aging world population needs to save for retirement, and an imbalance of savings with respect to investment opportunities reduces returns in capital markets, finally has dawned on the commentariat. Goldman Sachs just issued a report on demographics and the stock market, noting, “The rise in ‘prime age’ savers globally may also have played an important role in the story of the ‘savings glut’, putting downward pressure on global  real interest rates. Here too, the demographic underpinnings of that story could intensify in the next 10-15 years.” There have been similar articles in the financial press and the client notes of Wall Street economists.

If you subscribed to First Things, you knew about this a year and a half ago.

Where is Mel Brooks when we need him? The creator of “Spaceballs” is the right person to deal with this item from the Jewish webzine The Tablet:

This month, 12 students were initiated into a class of women studying to become kohanot, or Hebrew priestesses, at a retreat center in rural Connecticut. The ordination process they’ll go through—loosely modeled on the threefold anointing of priests described inLeviticus and invoking the Shekhinah—came to Holly Shere, a folklorist, in a “dream vision” that she shared with Rabbi Jill Hammer, her co-director at Kohenet, the Hebrew Priestess Institute, which was founded in 2006.

Kohenet is part of a growing, grassroots Jewish movement to reclaim the divine feminine—female aspects of God represented in Jewish texts—and reintroduce earth-based traditions to Jewish spiritual seekers.

Hell hath no fury like a Druish Princess.

Daniel Luban argued last week in the Tablet webzine that the old anti-Semitism has transmogrified into Islamophobia:

…many of the tropes of classic anti-Semitism have been revived and given new force on the American right. Once again jingoistic politicians and commentators posit a religious conspiracy breeding within Western society, pledging allegiance to an alien power, conspiring with allies at the highest levels of government to overturn the existing order. Because the propagators of these conspiracy theories are not anti-Semitic but militantly pro-Israel, and because their targets are not Jews but Muslims, the ADL and other Jewish groups have had little to say about them. But since the election of President Barack Obama, this Islamophobic discourse has rapidly intensified.

The trouble with this analysis is that the group of Americans who have the least favorable opinion of Islam–evangelical Christians–also have the most favorable opinion of Jews. By a margin of 57-24, evangelicals have an unfavorable opinion of Muslims. I reviewed these results in a recent Asia Times Online “Spengler” column.

Enlightened opinion, to be sure, no longer peddles racist slurs against the Jews, just blood libels against the State of Israel. The constituencies most hostile to the State of Israel also are the most Islamophilic. Liberal Democrats have a favorable opinion of Islam by a 66-17 margin, for example, and mainline Protestants (whose organizations seem to think that divestment from Israel is the most important thing to do between now and the Apocalypse) have a favorable opinion by a margin of 51 to 30.

Curious, these liberals. The allegedly misogynistic and homophobic evangelicals don’t like the most misogynistic and homophobic societies on earth, while the feminist-and LGT-supporting liberals like them. Maybe the kingdom’s coming, or the Year of Jubilo.

It seems misguided, though, to sound the alarm about anti-Semitic impulses lurking behind Islamophobia when the most pro-Israel segment of the American population is the least friendly to Islam.