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Monday, July 14, 2014
US Foreign Policy Overview ( July 14 , 2014 ) - Shambolic foreign policy isn't merely the Regional debacles of the Middle East / MENA , but also consider the damage to German relations as well as those with France by way of various foreign policy and US Intel misadventures ?
Zero Hedge ......
US Foreign Policy In Shambles: Global Crises Worst Since 1970 As Obama Golfs
If one were so inclined, one could imagine that the relentless barrage of domestic scandals plaguing Obama have been orchestrated with a simple reason: to divert attention from the worst US foreign policy in four decades. And sure enough, even a casual glimpse of all the raging international crises, in which the US is currently embroiled, is enough to make one wonder if the next global crisis will be fought not in the capital markets but in the actual battlefield. As the WSJ recounts, "a convergence of security crises is playing out around the globe, from the Palestinian territories and Iraq to Ukraine and the South China Sea, posing a serious challenge to President Barack Obama's foreign policy and reflecting a world in which U.S. global power seems increasingly tenuous. The breadth of global instability now unfolding hasn't been seen since the late 1970s, U.S. security strategists say, when the Soviet Union invaded Afghanistan, revolutionary Islamists took power in Iran, and Southeast Asia was reeling in the wake of the U.S. exit from Vietnam."
In the past month alone, the U.S. has faced twin civil wars in Iraq and Syria, renewed fighting between Israel and the Palestinians, an electoral crisis in Afghanistan and ethnic strife on the edge of Russia, in Ukraine.
Off center stage, but high on the minds of U.S. officials, are growing fears that negotiations with Iran over its nuclear program could collapse this month, and that China is intensifying its territorial claims in East Asia.
Sen. John McCain (R., Ariz.), in a CNN interview Sunday, said the world is "in greater turmoil than at any time in my lifetime." Many of the seeds of instability in the Middle East have taken root since the upheaval that followed the Sept. 11 terror attacks. At the same time, post-Cold War shifts are continuing as superpower influence has receded.
The developments have fueled debate over the Obama foreign-policy doctrine, which the president said in a May speech at West Point would rely on U.S. leadership, but not troop deployments.
Some more pointing out the obvious:
The president's critics in Washington, as well as some diplomats abroad, believe Mr. Obama's policies have fueled today's conflicts. They cite his decision to pull back from wars in Iraq and Afghanistan, his rejection of a more decisive U.S. and allied role in the Syrian civil war, and what they see as his reluctance to provide greater support to American allies in Asia and Europe as they face down the newly aggressive foreign polices of China, Iran and President Vladimir Putin's Russia.
"I think our country acting like such a paper tiger to the world on this and so many other fronts is doing incredible long-term damage to our nation," said Sen. Bob Corker (R., Tenn.) at a hearing last week on Ukraine. "And I do hope at some point the administration will actually follow through on the things that it continues to tout publicly."
The chaos has meant that the Obama administration finds itself in the middle of a second term reacting to rather than directing world events. Dangers for the president and for the U.S. are growing as militant groups gain greater control. The organization known as the Islamic State, which now holds parts of Iraq and Syria, poses a particular danger.
"If they are able to consolidate their gains in that area, I think it's just a matter of time before they start looking outward and start looking at the West and at the United States in particular," Attorney General Eric Holder said Sunday in an ABC News interview. "So this is something that we have to get on top of and get on top of now."
The biggest culprit for Obama's ruinous outside reign: completely confusion.
Many Middle East leaders also have said Mr. Obama has been too reluctant to use force, which has emboldened terrorist groups and rogue states. They cite the president's failure last year to follow through on a threat to strike Syrian President Bashar al-Assad's regime after it allegedly used chemical weapons on its political opponents.
Of course, with John Kerry in charge of policy, is anyone surprised? Still, he does report to Obama, and one would assume that despite the president "knowing nothing" about any of the domestic scandals he has faced in the past year, he can find the world on a map...
In some cases, U.S. allies are complicating matters. European countries have balked at imposing tough new sanctions on Russia, according to U.S. officials. And divisions between South Korea and Japan have undermined U.S. efforts to present a united front against China.
Some foreign diplomats believe the Middle East is weathering a historic intra-Islamic feud between its Sunni and Shiite sects that no outside power could significantly affect and that is undermining the very structure of the region's nation states.
There is a growing skepticism in Asia about whether the U.S. would abide by its commitment to defend Japan, Taiwan and other Asian countries if their territorial disputes with China escalate into conflict, according to Asian diplomats. Messrs. Obama and Kerry have worked to assure Japan and South Korea that Washington remains wholly committed to its defense treaties. But even some security analysts who are close to the White House say the Obama administration's perceived hesitancy in responding to international threats is unnerving U.S. allies in the region.
"Our allies are looking for a quarterback to call some plays here, and our body language sometimes doesn't show that we're doing that," said Brian Katulis of the left-leaning Center for American Progress. "Obama's always been a look-before-you-leap guy. And I think that leads to some of the confusion here at home, but also abroad."
Although to be honest, not all is a disaster: Obama has shown that when it comes to spying on his closest European ally, he is indeed second to none. The only problem is that said information would have been better used outside the public domain.
So what does Obama do to mitigate the disastrous image he portrays to global leaders everywhere?
US secret services have recruited more than a dozen officials in various German government ministries to work as spies, with some of them working for the CIA for many years, a German tabloid reported on Sunday.
Following previous espionage scandals in Germany, with several suspected US agents exposed in July, a report of more spies infiltrating German ministries was published by Bild am Sonntag, Germany's largest-selling national Sunday paper.
The alleged spies work within the country's defense, development, economic, and interior ministries, reported the paper, referring to unnamed sources in the US intelligence community.
Due to the current diplomacy tensions between Washington and Berlin, caused by espionage concerns, the spies are reportedly not meeting with their US handlers at the moment, according to Bild.
Several inquiries into the activities of American embassies in Prague and Warsaw have been initiated, as US intelligence agencies are reportedly considering basing their recruitment activities there.
German Chancellor Angela Merkel (Reuters/Thomas Peter)
German Chancellor Angela Merkel admitted it would be difficult to convince the US to change the way it carries out its intelligence missions.
"I believe it won’t be an easy task to persuade the US authorities to drastically alter the nature of their intelligence services' activities," she told ZDF channel during a pre-recorded interview, which will be aired on Sunday night.
Merkel also said the two countries have "different views" on the work of intelligence agencies. "We want this partnership, but...you do not spy on each other," she said.
The German chancellor's interview proved previous reports – of alleged instructions to German security authorities to keep cooperation with US services to a minimum – to be wrong.
"Germany benefits from the cooperation, regarding fight against terrorism and other things," she said.
Despite the espionage tensions, US Secretary of State John Kerry called the two countries "great friends" on Sunday.
U.S. Secretary of State John Kerry (L) and German Foreign Minister Frank-Walter Steinmeier shake hands as they conclude remarks to the media, after talks between the foreign ministers of the six powers negotiating with Tehran on its nuclear program, in Vienna July 13, 2014. (Reuters/Jim Bourg)
Standing alongside German Foreign Minister Frank-Walter Steinmeier in Vienna, where the officials had nuclear talks with Iran, Kerry did not address the spy scandal directly, but commented that the two nations "will continue to work together.”
"We have enormous political cooperation and we are great friends," Kerry said on the sidelines.
Earlier, the US admitted that it had been monitoring Merkel’s phone for several years. Following the scandal, US President Barack Obama promised no more eavesdropping on Merkel’s telephone conversations. However, Washington refused to provide guarantees that it would not spy on other German officials.
This week, German authorities carried out a raid on the residence of a Defense Ministry official over suspicions of him passing secrets to the US. The raid happened just one week after the arrest of a German officer who worked as a double agent within the state security apparatus.
Not even we anticipated this particular "unintended consequence" as a result of the US multi-billion dollar fine on BNP (which France took very much to heart). Moments ago, in a lengthy interview given to French magazine Investir, none other than the governor of the French National Bank Christian Noyer and member of the ECB's governing board, said this stunner at the very end, via Bloomberg:
NOYER: BNP CASE WILL ENCOURAGE ‘DIVERSIFICATION’ FROM DOLLAR
To complete the French triple whammy offensive against the US Dollar this weekend (first, French central banker Noyer suggesting de-dollarisation; second, French oil major Total's CEO "seeing no reason for the Petrodollar"), French finance minister Michel Sapin says "now is the right time to bolster the use of the euro" adding, more ominously for the dollar, "we sell ourselves aircraft in dollars. Is that really necessary? I don’t think so." Careful to avoid upsetting his 'allies' across the pond, Sapin followed up with the slam-dunk diplomacy, "This is not a fight against dollar imperialism," except, of course - that's exactly what it is... just as it was over 40 years ago when the French challenged Nixon.
NOYER: BNP CASE WILL ENCOURAGE ‘DIVERSIFICATION’ FROM DOLLAR
Here is the full google translated segment:
Q. Doesn't the role of the dollar as an international currency create systemic risk?
Noyer: Beyond [the BNP] case, increased legal risks from the application of U.S. rules to all dollar transactions around the world will encourage a diversification from the dollar. BNP Paribas was the occasion for many observers to remember that there has been a number of sanctions and that there would certainly be others in the future. A movement to diversify the currencies used in international trade is inevitable. Trade between Europe and China does not need to use the dollar and may be read and fully paid in euros or renminbi. Walking towards a multipolar world is the natural monetary policy, since there are several major economic and monetary powerful ensembles. China has decided to develop the renminbi as a settlement currency. The Bank of France was behind the popular ECB-PBOC swap and we have just concluded a memorandum on the creation of a system of offshore renminbi clearing in Paris. We have very strong cooperation with the PBOC in this field. But these changes take time. We must not forget that it took decades after the United States became the world's largest economy for the dollar to replace the British pound as the first international currency. But the phenomenon of U.S. rules expanding to all USD-denominated transactions around the world can have an accelerating effect.
In other words, the head of the French central bank, and ECB member, Christian Noyer, just issued a direct threat to the world's reserve currency (for now), the US Dollar.
Total’s de Margerie Sees No Need for Dollars in Oil Purchases
Oil major Total's chief executive Christophe de Margerie was responding to questions about calls by French policymakers to find ways at EU level to bolster the use of the euro in international business following a record U.S. fine for BNP.
"There is no reason to pay for oil in dollars," he said.He said the fact that oil prices are quoted in dollars per barrel did not mean that payments actually had to be made in that currency.
So even a major beneficiary of the status quo appears to see the end in sight for the Petrodollar.
And now The Triple Whammy
*FRANCE SAYS INCREASING EURO USE IS ISSUE OF 'GLOBAL BALANCE'
*SAPIN SAYS EURO AREA NEEDS TO LEAD DISCUSSION ON DOLLAR USE
French Finance Minister Michel Sapin says that now is the right time to bolster the use of the euro in transactions outside the U.S. Sapin speaks in an interview with Bloomberg News in Aix-en-Provence, France.
“We sell ourselves aircraft in dollars. Is that really necessary? I don’t think so,” Sapin says, adding "I think a rebalancing is possible and necessary, not just regarding the euro but also for the big currencies of the emerging countries, which account for more and more of global trade."
“We can avoid the exchange rate risk, and that’s always useful. We can diminish financing costs in pricing more in other currencies,” Sapin says.
“This is not a fight against dollar imperialism,” Sapin says.
“It’s up to Europe, to the euro zone in particular, to lead this argument,” Sapin says.
As The FT reports, Mr Sapin said he would raise the need for a weightier alternative to the dollar with fellow eurozone finance ministers when they meet in Brussels on Monday, although he declined to go into detail about what practical steps might emerge.