The Sunni-Shia Divide

“The concentration of economic and foreign policy power on Mohammed bin Salman contains the latent danger that, in an attempt to establish himself in the royal succession while his father is still alive, he could overreach with expensive measures or reforms that would unsettle other members of the royal family and the population,"
-The Independent, BND


http://www.independent.co.uk/voices/comment/iraq-crisis-how-saudi-arabia-helped-isis-take-over-the-north-of-the-country-9602312.html

http://www.telegraph.co.uk/news/worldnews/middleeast/saudiarabia/11989196/Prince-Mohammed-bin-Salman-the-son-also-rises.html

http://www.independent.co.uk/news/world/middle-east/saudi-arabia-is-playing-an-increasingly-destabilising-role-in-the-middle-east-german-intelligence-a6760911.html

http://english.alarabiya.net/en/News/middle-east/2015/12/29/Top-ISIS-commanders-killed-in-Ramadi-who-were-they-.html

http://www.aljazeera.com/indepth/opinion/2016/01/iraq-recaptured-ramadi-matters-160103061219164.html

http://www.theguardian.com/world/2016/jan/03/how-isis-spread-its-deadly-ideology-a-timeline


http://www.nytimes.com/2016/01/04/world/middleeast/iran-saudi-arabia-execution-sheikh-nimr.html?&hp&action=click&pgtype=Homepage&clickSource=story-heading&module=first-column-region&region=top-news&WT.nav=top-news&_r=0

http://www.independent.co.uk/news/world/middle-east/how-saudi-arabias-own-media-reported-on-the-execution-of-47-people-a6794516.html

Maps
http://www.news.com.au/world/middle-east/ihs-maps-islamic-states-territorial-losses-over-2015/news-story/94a659d0b38a54857d8b11dc3922ac1e

https://www.washingtonpost.com/ihs jan/on-the-front-lines-of-the-war-against-the-islamic-state-a-tangled-web/2015/12/30/d944925a-9244-11e5-befa-99ceebcbb272_story.html

IRGC:
https://en.wikipedia.org/wiki/Mohammad_Ali_Jafari

GID:
https://en.wikipedia.org/wiki/Al_Mukhabarat_Al_A%27amah

If the ECB wants more power they must take it for themselves

The lender of last resort is a critical function of the US Federal Reserve. This mechanism is employed in times of crisis to stabilize economic conditions, provide capital to creditors (on debtors behalf), prevent bank runs and minimize adverse reactions by markets when it is needed most.  During the recent financial crisis, the Fed provided lender of last resort facilities to a myriad of institutions, banks, foreign governments, corporations, commercial paper markets and the like in effort to stabilize the liquidity crunch as the market raced to the bottom in the price of credit.

With open market operations and asset purchases (QE), the Fed essentially created its own jurisdiction in a way that is analogous to the Supreme Court's use of judicial review in Marbury v. Madison.  In the historic ruling, Chief Justice John Marshall granted the Supreme Court the power of judicial review.  Today, this power is assumed and taken for granted. However, it was the Marbury case that set the precedent of the Supreme Court's ability to review matters of Constitutional debate.  Without this ruling, the power and jurisdiction of the court is questionable at best.

The ECB has not had a Marbury v. Madison -- they do not have the ability to review budgetary measures by member nations.  The leadership of the ECB has not established sufficient credibility to serve the lender of last resort function in the market system. Mr. Draghi was able to implement Outright Monetary Transactions (QE), albeit 4 years late. He and ECB leadership must get creative (and timely) with policy tools to handle the recent Greek crisis.  If they are better off without Greece as a member, the leadership ought to set the stage and organize an orderly exit.  Additionally, measures to prevent the run on the Eurozone from extending to other members is vital for the currency survival.  Perhaps, it would be best to start with an accommodating monetary policy in times of crisis -- less you wish to experience self perpetuating crises.

The first rule is do no harm -- the Europeans take this a little too literally. Hence the four years it takes to implement a single policy.

If the ECB wants more power it may be best to just take it. Time is of the essence.

References:

The irony of Citizenfour

After recently watching the documentary by Ms. Poitras, I could not believe the complete ironic situation that Mr. Snowden has created for himself.  First, I thought the film was excellent and provided a unique perspective into the life and mind of one of the most wanted traitors on the planet. I began the film with the view that Mr. Snowden has created a meaningful debate in the US on the ever growing national security apparatus and the legality of information collected in secrecy by the NSA and CIA. However, the picture that was painted by the film, in my own narrow opinion, was that Mr. Snowden was a paranoid narcissistic freedom firefighter, who took extreme and illegal means to justify his view of the world that paid him a comfortable six figure living.  I had trouble separating what I saw as his own opinion of the world and how much he had created for himself in what could be viewed as a very large and arguably successful publicity stunt. 

Mr. Snowden raises vital positions regarding information and how it is collected and used in a legal framework, for which we have little precedent. Although, I get the feeling that in his work for the government, he failed to recognize that private corporations are operating in a very similar way that is also intrusive and may be in violation of our constitutional rights. The fact that the government collects vast arrays of information should not be headline news. If the bureaucratic establishment has the capability, certainly Google, Facebook, Apple, Microsoft, Verizon, AT&T, JPMorgan, Bank of America and others have the  capacity to do the same level of reconnaissance. Perhaps in the future, the government's intrusion into personal lives is dwarfed by the combined ability of every single cellphone application to access your location, contacts and anything and everything that the user has "granted" permission for self enabled spying. Moreover, the incentives for corporations to use this data and license the information to third parties for profit is well beyond the legal arrangement that the NSA or CIA must utilize in the name of national security interests.

 The massive amounts of information collected is effectively a public good and should be governed ethically across institutions.

The institutionalization of information theory is an incremental and balanced process that has few legal precedents. My opinion is that current judges do not have the technical skills to perform their own regression analysis to use the data to make an informed decision that governs the legal rights of end users of information- black hats do not request permission from a judge. The filmmakers did an excellent job at outlining the arguments and mixing policy with sophisticated data encryption technologies. It should not be lost on Hollywood or Mr. Snowden, that in the name of his overarching political views, Mr. Snowden has become a de facto citizen (prisoner) of Mr. Putin's republic. Mr. Snowden, for his many contributions and crimes, will ultimately mourn his beliefs in the name of freedom in exchange for his life. 

Theoretical insurgency

The attacks carried out by extremists in Paris are an example of an insurgency of ideology. The interpretation of literature is used as a cover for violence. Urbanization and integration of immigrant communities can become a mitigating factor. The role of education and economic development cannot be understated.

 Kilcullen described the coming age of the urban guerilla as dense villages along coasts giving way to evolving forms of violence. In Mogadishu he described platoons of urban militia that move succinctly according to the environment which they operate. They accomplished this efficiently driving mounted trucks that move in columns without the modern technology deployed by militaries.

Although Paris is by no means Mogadishu, Mumbai or Jamaican slums, there exists a sizable migrant and ethnic population that lives along the train tracks riding east into the city from De Gaulle airport. This is the lowest point on the socioeconomic ladder- is not the place where tourists flock, and I am not sure what they need to survive, but the conditions are atrocious rivaling the worst ghettos I have scene in the US. I would be interested in the demographics of this population.


The Parisean version of the urban guerilla is partially similar to the Boston Marathon bombers, with strong ties to an insurgency, extreme nature and ability to operate in an urban environment. The Boston crew also received outside support in terms of operations and planning from an insurgent outpost in Russia. It is unclear from media reports regarding the extent which ISIS or Yemen may have provided operational support, while the philosophical sphere of influence is obvious. The use of philosophical beliefs to draw members to radical forms of religion represents a fundamental construct of the theoretical insurgency.

The use of proxy wars is an example of how concentrated interests are more inclined to mobilize logistical support. This is evident in Libya and Syria as failed nation-states wage conflict with rebels supported by outside groups like ISIS and AQAP. The conflict enables the insurgency to establish legitimacy as a political form of structure and provide territory for operations.

  The need to assimilate migrant communities socially, culturally and economically has never been more evident, in the wake of Charlie Hebdo. Urban economics can provide a basis for the literature in terms of integrating communities of mixed income.

George Friedman refers to integration in a recent Stratfor posting from Geopolitical Weekly. Is it possible to have social integration without economic integration (entry to the middle class)?  Friedman states that the killings have nothing to do with poverty.  On the surface, this is true. Although, how do you promote multiculturalism with segregated housing structures based on nationality and religious affiliation? If you do not integrate economically, it might be impossible to integrate socially based on the cost of housing, which is particularly high in London and Paris.  The more unequal society becomes in terms of income distribution will increase the divide of social segregation in terms of housing.

 Urban economics literature discussed about benefits of social capital -- the less interaction one has outside their community can make it difficult to break the cycle of poverty.  This goes for the low end - reaching up the ladder as well as the high end - reading down the ladder.  My hypothesis is that if the immigrant communities are better integrated into broader society (economically and socially), they may be exposed to more opportunities and cultures outside of radical religious beliefs.  You obviously cannot force people to live in diverse communities, but a starting point would be better outreach and perhaps educational integration. Brown v. Board of Education was hugely controversial, but it was instrumental in the political integration of minority communities.

One of the books we read for Oxford was about immigration in Great Britain and the EU.  My assumption is that France is similar to Britain in this respect.  The EU is supposed to increase migration and population movement by bringing down barriers to free movement of labor (trade).  Many of the right wing (tea party like) groups in Europe have benefited from the backlash against movement of labor. The drawback from is similar to what is seen in the US - competition from an influx of low skilled workers suppresses wage growth. The economy as a whole benefits from the housing, consumption, and population growth that immigration brings.

how net neutrality mirrors the financial crisis

One assumption regarding net neutrality is that access providers will inevitably limit the service they provide based upon their rational best interest - the almighty dollar. This is best scene in the negtotiations over fees Netflix paid to Comcast over bandwidth usage. Once access providers see their income streams dry up, corporate interests lobby for high barriers to entry to stifle competition, ensuring their position in the market. This is exactly what has happened as consumers, tired of high costs and lackluster service, have done in attempt to get content at a better price.  Companies such as Netflix and Hulu benefit when cables subscriptions are terminated.  The institutionalization of access providers to control content from media platforms in the market allows them to monopolize supply as well as pricing (technically an oligopoly). The ability of Comcast and Verizon to control bandwidth as revenue streams search for better investments is directly analogous to the movement of capital at the peak of the financial crisis.  Investors could no longer rely on income from MBS as the first wave of option ARMs reset- the real price for real estate collapsed when demand was exhausted.  This is exactly what happened to cable television subscriptions.  The movement of capital, seeking the best return on investment, substituted internet service for cable and cash for mortgage backed securities. The fundamental survival technique is evolve or die- become acquired or parish, consolidate and reform to provide better service at a lower cost- as the new wave of youtubesphere takes over.  But, if you run a 200 billion dollar corporation, it's much simpler to lobby that infratructure and bandwidth are finite, rather than innovate. The slow collapse of traditional interests gravitates to the institutionalization of market power and ultimately results in higher prices for consumers. Let's hope that the innovators can continue to provide the best choice for consumers.

does more political power lie in beijing or hong kong?

The attainment of political capital in the south is viewed as existential threat to the monopolies held by the communist party in local market economies.  The geographic location and purchasing power or civilians plays a central role in level of resistance, as does the draconian actions sought to control public opinion.  The stronger the threat, the more intense pressure is exerted by the political establishment in order to control the response, media and opinions held by civilians.  This is manifested through the communist party's control of candidates in local elections. The approval or disapproval of the democratic process is far from out of the ordinary in traditional Chinese elections. The ability of leadership to control online content is a primary concern, according to western media reports.  The post reported that there was widespread belief that western governments and their allies are responsible for much of the protest in Ukraine.  Unfortunately, the pattern has been established throughout the Arab world that the tighter control of internet users is prone to strengthen the dissent in the long run- given the speed of information movement is exponentially faster than the ability of governments to control the message.  The institutionalization of control is prominent and even expected throughout Chinese society. One perspective views the Chinese opinion as Hong Kong students as the ones who violated Beijing's agreement with the UK in 1997.  That is, historical precedents for elections already exist as a widely agreed upon process, e.g.the electoral college without the democracy part.  This assumption is based on historical connotations of political power. It should be noted that the US can often appear as opposed to democracy in many parts of the world, particularly in the middle east.  This is based on the fact that the US oftentimes refuses to support legitimate elections when they are won by a party that is classified as a terrorist organization.  The US is only now beginning to recognize the strategic importance of organizations such as Hezbollah, given their political clout, provisions of government services as well as influence in Beirut and Damascus.   The ability of protests in Hong Kong has to spread to the mainland is an ominous storm that Bejing has seen and weathered in the past.  One cannot underestimate Beijing' s ability to control the message. However, it would be naive to think that opinions can be dictated by backroom dealers in the 21st century.  The era has yet to be defined, but leadership will be served best by the public perception and evenly distributed wealth- it is the return on political capitalism in advanced market systems that that can define a changing of the guard. The world is witnessing the aftermath of the Arab Spring.  The Hong Kong or Shanghai version has higher potential output due to the size of the economy. Well managed urbanization and continued reform of the hoku system is one place for emphasis. Another is giving civilians more choices in the products they buy and leadership that are supposed to represent their interests.

Does Scotland deserve its own independent country?

That question will be answered by the Scottish people in a very short period of time(hopefully by 10:30 pm ET on 9-18-2014). However, in light of the ability of IS to control its own territory inside Iraq and Syria, I'd say the Scottish should easily qualify.  Each situation is a prime example of socioeconomic development in the 21st century.  he separation of market economies from nation-states will innately increase over time.

Throughout history, it has been the role of nation-state actors to: (1) control territory; (2) develop market systems; (3) fund government services; and (4) provide public goods  The Industrial Revolution in the UK (r.i.p.?) was the first modern market system, beginning in the 1800s. Before the IR, it was the British control of vast ocean supply routes, development of the US colonies and superior naval force that provided the economic engine of a robust export economy.

The role of the British Navy and western style economic development-- complete with deep and liquid financial markets-- has contributed to the prosperity in Western Civilization for hundreds of years.  Militias, such as IS, are able to control territory that is not supported by liquid socioeconomic market systems, in the absence of government services and public goods.  The demand for political establishment to develop court systems and military capabilities is  obvious --- the demand from the cities is a natural part of socioeconomic system, whereas IS profits from the demand and provides services that are in some twisted shape, a form of rent seeking.

Well, why does this happen? The success of organizations such as IS is rooted in theory of small and large concentrated interests. Small groups are more efficient, less bureaucratic, nimble entities that owe their survival to adaptation to the environment.  Essentially, it is a lot easier to go to dinner and pay a bill with 5 people than it is to split it with 15 people. This enables IS to seek rents, develop military capabilities and control territory, albeit on quite a large scale.  Their ideology appeals to a certain aspect of society that reads the works of Sayid Qtub, the Egyptian poet that provides the theoretical basis for modern extremism.