Monday, January 31, 2011

Professor Cornpone

Ethanol lobbyist Newt Gingrich and us—and the future of the GOP

The last time these columns were lambasted by a presidential candidate in Iowa, he was Democrat Richard Gephardt and the year was 1988. The Missouri populist won the state caucuses in part on the rallying cry that "we've got to stop listening to the editorial writers and the establishment," especially about ethanol and trade. Imagine our amusement to find Republican Newt Gingrich joining such company.

Associated Press

The former Speaker blew through Des Moines last Tuesday for the Renewable Fuels Association summit, and his keynote speech to the ethanol lobby was as pious a tribute to the fuel made from corn and tax dollars as we've ever heard. Mr. Gingrich explained that "the big-city attacks" on ethanol subsidies are really attempts to deny prosperity to rural America, adding that "Obviously big urban newspapers want to kill it because it's working, and you wonder, 'What are their values?'"

Mr. Gingrich traced the roots of these supposed antipathies to the 1880s, an observation that he repeatedly tendered "as an historian." The Ph.D. and star pupil of futurist Alvin Toffler then singled out the Journal's long-held anti-ethanol views as "just plain flat intellectually wrong."

Mr. Gingrich is right that ethanol poses an intellectual problem, but it has nothing to do with a culture war between Des Moines and New York City. The real fight is between the House Republicans now trying to rationalize the federal fisc and the kind of corporate welfare that President Obama advanced in his State of the Union. We'll dwell on this problem not merely because Mr. Gingrich the historian brought it up, but because it and he illustrate so many of the snares facing the modern GOP.


Mr. Gingrich was particularly troubled by our January 22 editorial about food inflation, "Amber Waves of Ethanol," saying that we "at least ought to use facts that are accurate." For the record, we cited figures from the Agriculture Department showing that four of every 10 rows of corn now go to ethanol, up from about one of 10 a decade ago.

A Gingrich spokesman said that what his boss meant to say is that this redistribution has a "negligible" effect on global food costs, especially compared to "higher fuel and energy prices and rampant speculation in the commodities markets."

Here's how he put in Des Moines, with that special Gingrich nuance: "The morning that I see the folks who are worried about 'food versus fuel' worry about the cost of diesel fuel, worry about the cost of commodities on the world market, worry about the inflation the Federal Reserve is building into our system, all of which is going to show up as higher prices, worry about the inefficiencies of big corporations that manufacture and process food products—the morning they do that, I'll take them seriously."

The morning Mr. Gingrich read the offending editorial, if he did, he must have overlooked the part about precisely those concerns. He must have also missed our editorial last month raising the possibility that easy money was contributing to another asset bubble in the Farm Belt, especially in land prices. For that matter, he must have missed the dozens of pieces we've run in recent years critiquing Fed monetary policy.

Of course, the ethanol boom isn't due to the misallocation of resources that always stalks inflation. It is the result of decades of deliberate industrial policy, as Mr. Gingrich well knows. In 1998, then Ways and Means Chairman Bill Archer tried to kill ethanol's subsidies for good, only to land in the wet cement that Speaker Gingrich had poured.

Yet today this now-mature industry enjoys far more than cash handouts, including tariffs on foreign competitors and a mandate to buy its product. Supporters are always inventing new reasons for these dispensations, like carbon benefits (nonexistent, according to the greens and most scientific evidence) and replacing foreign oil (imports are up). An historian of Mr. Gingrich's distinction surely knows all that.


Given that Mr. Gingrich aspires to be President, his ethanol lobbying raises larger questions about his convictions and judgment. The Georgian has been campaigning in the tea party age as a fierce critic of spending and government, but his record on that score is, well, mixed.

As Speaker in 1995, he thought he could govern from Congress, refused to bargain with President Clinton and after a veto was forced to retreat in a way that hurt Bob Dole and nearly cost the House majority. In 1997, he did manage a balanced-budget deal with Mr. Clinton, but the price included phony Medicare cuts on doctors and a new entitlement for children's health care.

Mr. Gingrich stepped down after the GOP lost House seats in 1998, but he re-emerged in 2003 to campaign for George W. Bush's Medicare prescription drug benefit. His personal contribution was to promote the bill's modest market fillips as epic virtues that lesser minds couldn't grasp. Instead, the bill damaged the GOP's fiscal credibility, while Democrats have since rolled back medical savings accounts and private insurance options for seniors.

Now Republicans have another chance to reform government, and a limited window of opportunity in which to do it. The temptation will be to allow their first principles to be as elastic as many voters suspect they are, especially as Mr. Obama appropriates the language of "investments" and "incentives" to transfer capital to politically favored companies. Many Republicans have their own industry favorites, and such parochial interests could undercut their opposition to Mr. Obama's wider agenda.

So along comes Mr. Gingrich to offer his support for Mr. Obama's brand of green-energy welfare, undermining House Republicans in the process. In his Iowa speak-power-to-truth lecture, he even suggested that the government should mandate that all new cars in the U.S. be flex-fuel vehicles—meaning those that can run on an ethanol-gas mix as high as 85%—as if King Corn were in any danger of being deposed.

Yet there are currently dozens of flex-fuel models on the market, and auto makers already get a benefit if they sell them, via the prior fuel-economy mandates that did so much to devastate Detroit. The problem is consumers rarely want to pay more for flex-fuel cars when they get 25% to 30% fewer miles per gallon with E85, according to Energy Department data.


Some pandering is inevitable in presidential politics, but, befitting a college professor, Mr. Gingrich insists on portraying his low vote-buying as high "intellectual" policy. This doesn't bode well for his judgment as a president. Even Al Gore now admits that the only reason he supported ethanol in 2000 was to goose his presidential prospects, and the only difference now between Al and Newt is that Al admits he was wrong.

Syria Strongman: Time for 'Reform'

Syria Strongman: Time for 'Reform'

DAMASCUS—Syrian President Bashar al-Assad, who inherited a regime that has held power for four decades, said he will push for more political reforms in his country, in a sign of how Egypt's violent revolt is forcing leaders across the region to rethink their approaches.

Carole Al Farah for the Wall Street Journal

Syria's President Assad told The Wall Street Journal that Middle East revolts show a need for change in the region, but his nation is 'stable.'

In a rare interview, Mr. Assad told The Wall Street Journal that the protests in Egypt, Tunisia and Yemen are ushering in a "new era" in the Middle East, and that Arab rulers would need to do more to accommodate their people's rising political and economic aspirations.

"If you didn't see the need of reform before what happened in Egypt and Tunisia, it's too late to do any reform," Mr. Assad said in Damascus, as Egyptian protesters swarmed the streets of Cairo pressing for the resignation of longtime President Hosni Mubarak.

The Syrian strongman, who succeeded his father, has always kept a tight leash on his country and tolerated little protest. His regime has also maintained a close partnership with Iran and militant groups such as Hezbollah in Lebanon and Hamas in the Palestinian territories.

WSJ's John Bussey and Sudeep Reddy on the political and economic impact of the continued unrest in Egypt, and how it may bring on reforms in Syria. Also, Farnaz Fassihi from Beirut on how the Egyptian violence has inspired opposition forces in Iran.

While much of the region's unrest has hit countries that have developed alliances with Washington, his remarks indicate that the ripple effects of the Egyptian unrest will reach out to Middle Eastern leaders who are both friend and foe of the U.S.

Syria's response is particularly important because, while Mr. Assad's ties with the U.S. are strained, the Obama administration has been trying to pull his allegiances away from Tehran toward Washington.

But his remarks in the interview suggest that maybe harder in the wake of the Egyptian unrest. Mr. Assad said he will have more time to make changes than Mr. Mubarak did, because his anti-American positions and confrontation with Israel have left him in better shape with the grassroots in his nation.

"Syria is stable. Why?" Mr. Assad said. "Because you have to be very closely linked to the beliefs of the people. This is the core issue. When there is divergence…you will have this vacuum that creates disturbances."

Mr. Assad said he would push through political reforms this year aimed at initiating municipal elections, granting more power to nongovernmental organizations and establishing a new media law.

His government already made adjustments to ease the kind of economic pressures that have helped fuel unrest in Tunisia and Algeria: Damascus this month raised heating oil allowances for public workers—a step back from an earlier plan to withdraw subsidies that keep the cost of living down for Syrians but drain the national budget. Tunisia, Algeria and Jordan have also tried to assuage protesters by lowering food prices.

Mr. Assad's government, and that of his late father Hafez al-Assad, have been criticized as among the region's most repressive, detaining opponents without charges. This has stoked speculation in Western capitals over whether Syria could also face unrest. Syria's one-party political system and government-controlled media, meanwhile, are seen by many as more rigid than Egypt's or Tunisia's.

Mr. Assad acknowledged in the interview that the pace of political reform inside Syria hasn't progressed as quickly as he'd envisioned after taking power following his father's death in 1999.

Still, Mr. Assad indicated he is unlikely to embrace the sort of rapid and sweeping reforms being called for on the streets of Cairo and Tunis. He said his country needed time to build institutions and improve education before decisively opening Syria's political system. The rising demands for rapid political reforms could turn out to be counter-productive if Arab societies aren't ready for them, he said.

"Is it going to be a new era toward more chaos or more institutionalization? That is the question," Mr. Assad said. "The end is not clear yet."

Many diplomats and analysts believe Syria could serve as a barometer for the direction of the broader Middle East. Damascus's influence has grown in recent years as its alliance with Iran and the militant Islamist organizations Hamas and Hezbollah has opened the door to its renewed influence in Lebanon, the Palestinian territories and Iraq.

Still, Mr. Assad's rigid rule could leave him vulnerable to rising calls for democracy.

Damascus emerged this month largely victorious after a nearly eight-year struggle against the U.S. for influence inside Lebanon. The standoff was sparked by the 2005 murder of Lebanon's former Prime Minister Rafik Hariri, which some Western officials believed was ordered by Mr. Assad's government. Mr. Assad has repeatedly denied any involvement.

"What pleases me is that this transition between the two [Lebanese] governments happened smoothly, because we were worried," said Mr. Assad. "It was very easy to have a conflict of some kind that could evolve into a fully blown civil war."

This month, the U.S. returned an ambassador, Robert Ford, to Damascus for the first time since Mr. Hariri's murder.

Mr. Assad said that while he sought closer ties to Washington, he didn't see this coming at the expense of his alliance with Iran. The Syrian leader said that he shares the U.S. goals to target Al Qaeda and other extremist groups, but that Tehran remains a crucial ally to Syria.

"Nobody can overlook Iran, whether you like it or not," Mr. Assad said.

On the Mideast peace process, Mr. Assad stressed that Damascus remained open to a dialogue with Israel to reclaim the Golan Heights region that the Jewish state occupied in 1967. But he said he didn't think Israeli Prime Minister Benjamin Netanyahu would engage in the same way as his predecessor, Ehud Olmert. Mr. Assad insisted he and Mr. Olmert were close to forging a peace deal in 2008.

"No, [the peace process] is not dead, because you do not have any other option," Mr. Assad said. "If you talk about a 'dead' peace process, this means everybody should prepare for the next war."

The Syrian leader acknowledged his government is likely to continue to be at odds with the U.S. on key strategic issues.

Successive U.S. administrations have charged Damascus with smuggling increasingly sophisticated weapons systems to Hezbollah, including long-range missiles that could reach most of Israel. The U.S. has subsequently put in place economic sanctions against Syria.

Mr. Assad denied charges that his government directly arms Hezbollah.

He also indicated that his government was unlikely to give the United Nations' nuclear watchdog, the International Atomic Energy Agency, wide access to investigate claims that Syria had covertly been developing nuclear technology.

"It will definitely be misused," said Mr. Assad, who denies Syria has been seeking atomic weapons.

Facebook, Twitter, and the Arab Revolutions

Facebook, Twitter, and the Arab Revolutions

by Gary North

The dictator of Tunisia was overthrown in less than one month after being in power for 23 years. There is no question about how opponents of his regime were able to topple it. Two words describe it: Facebook, Twitter. These two social networking sites enabled protesters to take to the streets, organize the opposition, recruit new protesters, and overcome the police force and the military.

There is no question that if the government had chosen to use machine guns to cut down the protesters, it probably would have succeeded in suppressing the revolt. If it had combined machine guns with switching off the Internet, it would have been able to cut the protest down, both literally and digitally. But to do that, the regime would have had to act extremely fast, and it would have risked coming under international condemnation. It would also have created a permanent opposition, ready to revolt again.

The opposition forces are now connected, yet not organized. This has never happened before in recorded history. The masses can communicate with like-minded people for the price of a computer and an Internet connection.

In the good old days of the Soviet Union in the 1960s, the leaders would have applied that degree of force without a moment's hesitation. But this is not the era of the Soviet Union. We are living in a digital age, and almost nothing can be concealed from the public for very long. If a tyrant is weak, this will become common knowledge. There are few Goliaths and a lot of Davids online.

It is the power of the communications networks, when coupled with a willingness on the part of protesters to gather in the streets, that spells a period of crisis for every autocratic regime on earth. The autocrats have seen in January 2011 that it is difficult to put a lid on any unorganized protests. The organizing did not come from some little group that can be infiltrated or arrested. This was as close to a spontaneous protest as anything we have seen in modern times.

The ability of the social networks to organize a protest almost overnight, because people of similar beliefs and commitments are in close communication with others, has completely changed the nature of political resistance and revolution. This system of revolution toppled a middle eastern dictatorship in less than a month. It threatens to topple two more before the end of February: Yemen and Egypt. We have entered into a new period political resistance.


From an economic standpoint, this is easy to explain. When the cost of political mobilization falls, more is demanded. When people can mobilize thousands of protesters without any centrally directed agency and without any organization that can be infiltrated and subverted, they are in a position to impose enormous political damage on any existing regime, as long as the regime really is corrupt, tyrannical, and hated. When a dictator can control the society for 23 years, and get 89% of the vote when he runs for office, you can be confident that he is hated. It is corrupt. Nothing survives that long in a democratic society with 89% support.

The revolt that is taking place in Egypt is a direct result of the success of the revolt in Tunisia. The social networking organizations are again at the center of the revolt. There is a similar revolt going on in Yemen. Across the Arab world, it is becoming obvious that protesters have a tool available that will enable them to cause enormous discomfort for the tyrannical regimes of the region.

Regimes have established systems of control, including thought control, based on the price of communications in the era of print media. They can control paper, ink, and distribution. They cannot control telecommunications through the Internet without shutting down the Internet entirely. This is what Egypt did on Friday, January 28.

Because Egypt had fewer than a dozen major Internet service providers, the government was able to shut down the Internet at one time. The government also shut down landline telephone communications in some regions of the country. This was not simply an attack on the Internet. The government had to shut down other forms of telecommunications.

The difficulty that the government faces is obvious: it cannot continue to keep the Internet and landline telephone service from the general public. The modern economy is becoming increasingly dependent upon the Internet. It has already become highly dependent upon the telephone system. It is not possible for any government to intervene into the delivery of telecommunications services without creating enormous problems for the economy. Any government that attempts to do so on a long-term basis is going to find its tax revenues falling, more people becoming alienated from the government's policies, and more opportunities for troublemakers to increase the amount of trouble. At some point, the government will have to reestablish Internet services and landline telephone service. At that point, it will probably face an even more alienated population than when the protests began.

The governments of the world are caught between the proverbial rock and a hard place. If they allow the Internet to stay up, and if the social networking systems continue to recruit people to go into the streets, a corrupt government will face a rapidly escalating crisis. Its legitimacy is being called into question, and the only way to restore order under these conditions is to begin to shoot people. Tear gas is no longer working.

Here is a video of the riots in Cairo. The government had an armored vehicle rolling through the streets, and it was firing canisters of tear gas. People were not only paying no attention, they were kicking the canisters across the street into areas in which there were no protesters.

I have been subjected to a very mild administration of tear gas, when I was a high school student, and a local police chief was showing a few of us what it was like. He had an aerosol container of it, and he held his finger on the button for only a few seconds. We were perhaps 10 feet away, and it was unpleasant. I cannot imagine anybody staying in the streets when the police are firing canisters. But that is what I saw in the video.

Governments have become fearful of bringing out the machine guns, for fear of international condemnation. Dozens of people will be videotaping the event and will immediately upload the videos to a satellite, which will spread around the world in a matter of seconds. The low cost of telecommunications is making it possible for protesters to expose the policies of their governments so that all the world can see.

Universally, governments do not want exposure of what they are doing. They want to control the flow of information, and they want to be able to spin it rapidly. They can do neither when the Internet is operating, because the images are out there so rapidly, and picked up by the news media so rapidly. The governments cannot spin away the visual information. They are caught in the situation attributed to Groucho Marx, when he declared to someone who had interrupted his meeting with an attractive young woman: "What are you going to believe? Me or your own eyes?"

The fact that this is taking place in the Arab countries indicates that the whole region is vulnerable to more revolutionary resistance. The telecommunications network is well developed in all of these nations, and the people who use them are educated. They have enough money to plug into the Internet. A lot of them are college graduates. Worse, they are unemployed college grads. They understand the media, and they are in social network arrangements, connection by connection, with thousands of similarly unemployed, equally educated people. Unemployed intellectuals who are young have always been a threat to established tyrants. These are the people who have relatively little to lose, and they think they have great deal to gain, by taking to the streets. When they are not shut down fast, they are emboldened. They assume that nothing can stop them, because tear gas and rubber bullets are not so great a threat.

When people around the world can see street protesters, this encourages thousands of other protesters, who had attempted to sit the fence, to get off the fence and go into the streets. There is safety in numbers. When they can see on television or on the web that there are thousands of people in the streets protesting, they assume that they will gain a degree of invisibility and anonymity if they join the protests. So, they leave the safety of their homes and join the protest movement. Because of social networking, this can take place so rapidly that government officials are unable to respond fast enough to put a stop to it before it is obvious that there are thousands of people in the streets.

The social networks can become a liability if the revolt fails to dislodge the existing regime. The government can use the Internet to track down those people who were activists in the early stage of the revolt. There is no way to hide your communications retroactively on Twitter and Facebook. The government is going to find out who sent out messages, and it will be able to trace the spread of these messages by means of the very technology that enabled the original protesters to recruit thousands of volunteers. But how many can the police arrest? There were too many protesters to put all of them in jail.

The people the government will have to investigate are highly educated, and have enough money to own a computer and be plugged into the Internet. These are exactly the kinds of people the government does not want to alienate. These people have connections, they have money, and they have time on their hands.

When you are talking about thousands of protesters going into the streets, you are talking about a protest without any organization. You cannot stop the organization when you cannot control a handful of the organization's leaders. The social network system enables rapid response protesting without any clear-cut chain of command. There really is no chain of command. That is the whole point of social networking. It is horizontal; it is not vertical. To stop something from spreading, the government has got to shut the entire system down.


This is changing the nature of social protest. This has finally produced a situation in which the old rhetoric of the revolutionaries is true: the revolution is a spontaneous work of the People. There is no clandestine group of conspirators who are organizing a conspiracy in such a way that it looks like a spontaneous insurrection. Governments can deal with that kind of revolutionary organization by infiltrating the organizations at the very top. They have done this for centuries. But when revolt really is the result of the spread of rhetorically effective communications in a decentralized system of telecommunications, the government cannot cut this off in advance. It cannot arrest the organizers in the days before the great plan was about to be executed. There is no great plan, and the government has no time to react.

By speeding up the mobilization process, and by flattening it out, the protesters have been able to topple one regime and threaten two more in a matter of a month. They were able to challenge the existing political structure of approval for autocrats who have held power for decades. The ruler in Yemen has been in power for 32 years. The ruler of Egypt has been in office for almost 30 years. Yet the social networks have brought these two regimes to the edge of disintegration in a matter of days. How can governments mobilize resources to head this off at the pass, when there is no pass?

We are therefore seeing a shift in the balance of power away from centralized government, which has control over most of the print media in the country, to broad masses of people with money and computers – people who are in no way dependent upon paper, ink, and paste to put up posters. The government can react rapidly to the older media, but it cannot react as rapidly as the social networks call out the anti-government troops. The government had the edge in speed back in the days of printed manifestos and posters. That world is gone.

So, as we watch the digits undermine the foundations of Middle Eastern autocracies, we get a picture of what is likely to come in the next generation. Every government in the world is now threatened by the visual power of street demonstrators. The protests will be posted on YouTube within minutes.

None of this existed six years ago. Governments have used money, recruiting techniques, propaganda techniques, and all the rest of it for the last hundred years in terms of a particular technology. That technology is the printing press. Martin Luther created a social and religious revolution in northern Europe by means of pamphlets, broadsides, and posters with cartoons almost 500 years ago. For almost five centuries, the technology of communication did not change radically. And then, without warning, the rise of the Internet began to shift the balance of power in the direction of citizens. With the advent of the social networks, there has been a quantum leap in the ability of protesters to register their protests publicly, with no comparable increase in response time by the authorities. Telecommunications are instantaneous, and they are delivered at no marginal cost to the participants. When the price of protesting falls, more of it will be demanded. This is what is taking place today.

The only defense against this is extreme poverty. We are not seeing anything like this in Zimbabwe. Hardly anybody has a computer in Zimbabwe. Only the very rich have access to the Internet. But as soon as price competition drives down the cost of getting connected, a government faces the kind of events that have taken place over the last three weeks. When there is widespread ownership of computers and widespread participation on the Internet, the social-networking capabilities of the Internet become a major threat to the government.


What is at stake is government legitimacy. When it becomes obvious to a growing minority of intellectuals that the government is corrupt, it is only a matter of time before these people begin to spread the word: the government is illegitimate. The only way that a government can keep control is to elicit voluntary compliance with its laws, rules, and official pronouncements. This can cease to work very fast.

A corrupt government is perceived as legitimate only because it is so expensive to get the word out to large numbers of people, especially people with educations and money, that the government is both corrupt and vulnerable. So, the only way for a despot to survive the kinds of things that have taken place in the North African autocracies is to extend political power, educational opportunity, and employment opportunities to the broad majority of the population. Western capitalist governments have been able to do this over the past century, but the autocracies have not been able to. They are the ones that are most at risk by the spread of the Internet and social networking. In other words, the best way to avoid revolution today is to have already created a system of political power in which large numbers of people believe that they have a stake in the system and a voice in the system.

The Arab world has never done this. The leaders seemingly are incapable of doing this. They will have to rethink the entire political order in order to avoid a series of protests comparable to what is taking place over the last month. They are going to have to reform their systems of government, or else those systems will be reformed for them. Yet an autocracy that grants greater democratic participation risks the very revolutionary violence that these three governments have experienced in January. The government never reforms fast enough and on a wide enough basis to satisfy those people in society who have called for government reform. Once it is clear that the government is capitulating to the demands of reformers, the more radical reformers are encouraged to believe that the system is toppling, and therefore they renew their efforts to topple the system. This has been going on since at least the time of the French Revolution. It will escalate.

Governments understand this process of escalating resistance in the face of limited domestic reforms. This is why they resist granting any kind of significant rights to large numbers of people. They see this as lighting a fuse that is going to lead to an explosion.

There is no way that any society can grow economically without adopting the Internet. This is the wave of the future, and educated people understand this. Arab governments want to participate in economic growth that is spreading across the Third World as a result of telecommunications. They are going to have to allow their citizens to buy computers and sign up for the Internet.

As the price of doing this gets less expensive, more and more people are going to take advantage of the opportunity. This brings money, entertainment, and many of the blessings of life that millions of people across the face of the earth have wanted to experience over the past 50 years or 100 years, and were unable to do so. So, we see the rapid escalation of the spread of this new technology. It brings benefits to large numbers of people, especially educated people. Yet, as we have seen, the spread of this technology leads to resistance against policies of these autocratic and formerly poverty-stricken nations. The richer these nations get, the more dangerous the intellectuals are.

I see no way out for the world's autocrats. One by one, these men are going to be challenged by large numbers of people who now have the means of extending the resistance. The means of economic growth now constitute a threat to the survival of every autocratic regime. Only if the autocrats become media-savvy demagogues can they hope to mobilize the people who now have access to computers and the Internet. They are going to have to appeal directly to those people if they want to avoid some sort of domestic political conflagration. Yet they have no skills in mobilizing these people, because it was not necessary in the past. Governments could buy off intellectuals, and they could also control the spread of ideas, because they had control over radio, television, and printing presses. They are losing control in all three areas. They are on the defensive in the social media.

So, the techniques of political control that have been developed over the last 200 years are being superseded rapidly by new technologies that are so inexpensive that there is no way governments can keep them from spreading. North Korea can keep them from spreading, of course, but North Korea is one of the most poverty-stricken nations in the world. Any nation that pulls the plug on the Internet and landline telephones is in effect putting a sign that says, "Welcome to the next North Korea." No government leader wants to do this.


From the point of traditional conservatism along the lines outlined over two centuries ago by Edmund Burke, and also from the point of view of traditional libertarianism as it was outlined by Leonard Read, Ludwig von Mises, and Murray Rothbard, the development of the social networks is consistent with theory, and beneficial to the extension of liberty. The decentralized worldview of Burke, the decentralized worldview of Hayek and Mises, and the anti-government worldview of Rothbard all come together with social networking, YouTube, and e-mail.

Digital technology, because it is price competitive, penetrates the broad masses of individuals in the West. It is price competitive, and therefore is inherently decentralized. Everyone can have his own printing press in the new system. The ability of governments to control the spread of ideas is not keeping pace with the ability of the Internet to enable people to communicate ideas. The competitive system is asymmetric. This time, it is not asymmetric in favor of the government; it is asymmetric in favor of the citizens. They hold the hammer.

Yes, it is true that governments can temporarily take away the hammer. They can shut down the Internet. Anyway, small governments in the Middle East can do this. It is highly unlikely that the government could in the United States. The tendency of the system of telecommunications is to decentralize. The government that would dare to stop the spread of telecommunications is asking to lose the next election.

The Mideast Burns

The Mideast Burns

by Eric Margolis

When I wrote my latest book on the way America dominates the Mideast, I chose the title, American Raj, because this modern US imperium so closely resembled the famed Indian Raj – way the British Empire ruled India.

As I predicted in this book, and in a column last April, Egypt was headed for a major explosion. America’s Mideast Raj is now on fire. Whether it survives or not remains to be seen.

One cannot escape a sense that we may be looking at a Mideast version of the 1989 uprisings across Eastern Europe that brought down its Communist regimes and then the Soviet Union. Americans should be uneasy seeing crowds of Egyptians pleading for freedom and justice watched over by US-supplied tanks.

There are indeed certainly strong similarities between the old Soviet East Bloc and the spreading intifada across the police states of America’s Mideast Raj. Corrupt, repressive governments; rapacious oligarchies; high youth unemployment and economic stagnation; widespread feelings of fear, frustration, hopelessness and fury.

But there is also a big difference. The principled Soviet leader, Mikhail Gorbachev, and the Communist rulers of Eastern Europe, refused to turn their army’s guns against the rebelling people.

In Tunisia, where the current Arab uprising began, the army has so far stayed admirably neutral.

But in other Arab states now seething with rebellion – Egypt, Algeria, Yemen, Morocco, Libya, Jordan – there may be no such reservations. Their ruthless security forces and military could quickly crush the uprisings unless the soldiers refuse to shoot down their own people – as happened in Moscow in 1991.

As of this writing, Egypt’s 450,000-man US-equipped and financed armed forces are poised for action against that nation’s popular uprising, but its generals are undecided whether to shoot down their own people and earn universal hatred, overthrow President Mubarak’s regime, or openly seize power. Mubarak’s newly named vice president, Gen. Suleiman, controls the hated and feared secret police, or mukhabarat, but is unloved by the army.

Somewhere in the ranks of Egypt’s armed forces must be a group of officers like Col. Gamal Abdel Nasser and his Young Officers who seized power in 1952 to end foreign control of Egypt. Nasser, adored by most Egyptians was the first authentic native-born leader in 2,000 years. Look for a resurgence of Nasserism.

Washington is watching this growing intifada in its Mideast Raj with alarm and confusion. Ignore the Obama administration’s hypocritical platitudes urging "democracy." All of the authoritarian Arab rulers now under siege by their people have been armed, financed and supported for decades by the US. The US has given Egypt $2 billion annually, $1.4 billion of which goes to the military. Almost all the tanks and armored vehicles deployed in Cairo’s streets came from the US.

Washington has previously lauded Mubarak for "moderation" and "stability." These are code words for faithfully following US policies and crushing all opposition. Moderate opposition groups across the Mideast have been jailed and tortured, leaving only outlawed underground movements. The same thing happened in Iran.

Egypt’s armed forces were configured to keep Mubarak’s military regime in power, not to defend the nation’s borders. The US keeps Egypt’s armed forces short on munitions and spare parts so it cannot fight a war against Israel for more than a few days.

The brutal, sadistic secret police and other security forces of Morocco, Algeria, Egypt, Jordan and Yemen were all trained and equipped by the US or France. The CIA taught them "interrogation techniques," just as it did to the Shah of Iran’s secret police, Savak. We have reaped the whirlwind in bitter US-Iranian relations.

Secretary of State Hillary Clinton urges "restraint" on both sides. One supposes she means those being beaten by clubs, raped, or tortured by electric drills must show proper restraint. Washington simply does not understand that this kind of hypocrisy turns even more people in the Muslim world against the United States.

Egypt, as this column has long said, has long been a ticking bomb. Half of 85 million Egyptians subsist below the UN’s $2 daily poverty level. A third of all the Arab World’s people are Egyptian. A well-connected oligarchy grows rich while the rest of the country struggles for basic food.

In fact, the US Congress still supplies Egypt with large amounts of wheat and other foodstuffs. Israel thus holds a whip hand over Egypt by being able to get its supporters in Congress to shut off food aid to Egypt, an act that would provoke massive food riots as occurred in the 1970’s. Small wonder Husni Mubarak is Israel’s closet ally in the Arab world.

Mubarak has ruled Egypt with an iron fist since the assassination of another US-installed leader, Anwar Sadat, in 1981. All violent and peaceful opposition to Mubarak’s regime has been crushed. But now Mubarak’s time is running out. Nobel-Prize Laureate Mohammed al-Baradei has agreed to lead a resistance coalition that includes the Muslim Brotherhood, the best-organized movement in Egypt.

The Brotherhood is not an Iranian-style extreme Islamic movement, contrary to alarms being spread by neocons and the often poorly-informed US media.

In fact, the Muslim Brotherhood has long eschewed politics to concentrate on social, religious and educational issues. If anything, it has been ultra-conservative, even stodgy and timid. But it also represents the Washington’s best potential ally if Egypt’s military regime falls. We should not be misled by self-serving warnings about Islamic bogeymen.

So far, none of the intifadas across the Arab world have produced effective leadership. But this could soon change. The most important North African Islamic movement leader and theorist, Rashid Gannouchi, just returned from exile to Tunisia, where the intifada began.

Further inflaming Arab opinion, the bombshell "Palestinian Papers" leaked to al-Jazeera has exposed Mahmoud Abbas’ Palestinian Authority as an eager collaborator with Israel and its West Bank occupation. The endless Israeli-Palestinian "peace talks" are shown to be a fraud. Israel’s Mossad and its Palestinian Quislings have worked closely to destroy the militant but democratically elected Hamas government in Gaza.

We also learn from these papers that in 2008, US State Secretary Condoleezza Rice actually proposed shipping millions of Palestinian refugees to Latin America. This after Israel, financed by the US, imported one million Russian settlers, many of them not even Jewish. One is reminded of British proposals in the 1930’s to move Germany’s endangered Jews to Kenya.

The Mideast uprisings are poorly understood by most North Americans. The US media frame news of the regional intifada in terms of the faux war on terror, and a false choice between dictatorial "stability" and Islamic political extremism. Much of what’s happening is seen through Israel’s eyes, and is distorted. Burning Cairo should show how misguided we have been in our understanding of the Arab world.

Platitudes aside, there is little concern in the US about bringing real democracy and modern society in the Arab world. Washington still wants obedience, not pluralism, in its Mideast Raj, and primacy for Israel in the Levant. As with the British Empire, democracy at home is fine – but it’s not right for the nations of the Arab world.

Asia Today: Egypt Turmoil Hits Asian Markets

AM Report: Opposition Gains Strength in Cairo

News Hub: Middle East Unrest Unnerves Markets

News Hub: Egypt Unrest Inspires Iranian Opposition

Opposition Ramps Up Pressure on Mubarak

Opposition Ramps Up Pressure on Mubarak

[1egypt0131] Felipe Trueba/European Pressphoto Agency

Egyptian soldiers and civilians in Tahir Square, central Cairo, Monday.

CAIRO—A coalition of opposition groups called for a million people to take to Cairo's streets Tuesday to ratchet up pressure on President Hosni Mubarak to leave.

American and other world leaders were intensifying calls for an orderly transition to a democratic system as demonstrations against Mr. Mubarak's administration continued into a seventh day.

WSJ's John Bussey and Sudeep Reddy on the political and economic impact of the continued unrest in Egypt, and how it may bring on reforms in Syria. Also, Farnaz Fassihi from Beirut on how the Egyptian violence has inspired opposition forces in Iran.

After another day of protests, President Mubarak struggles to cling to power while Mohamed ElBaradei steps in to lead the opposition. The Wall Street Journal's Margaret Coker reports from Cairo.

U.S. Issues Call for "Real Democracy" in Egypt


After days of treading a fine line, the U.S. has repeated its insistence for Egypt's leaders to install a democratic system of government. WSJ's Julian Barnes says it's another step by the administration to distance itself from the Mubarak regime.

The pressure came as state television announced that Mr. Mubarak has sworn in a new cabinet, replacing one dissolved as a concession to the unprecedented antigovernment protests.

In the most significant change, the interior minister—who heads internal security forces—was replaced. A retired police general, Mahmoud Wagdi, was named to replace Habib el-Adly, who is widely despised by protesters for brutality shown by security forces.

Mr. Mubarak has retained his long-serving defense minister, Field Marshal Hussein Tantawi, and his foreign minister Ahmed Aboul Gheit.

The coalition of opposition groups, dominated by youth movements but including the outlawed Muslim Brotherhood, said it wants the march from Cairo's central Tahrir Square to force Mr. Mubarak to step down by Friday.

Spokesmen for several of the groups said their representatives were meeting Monday afternoon to develop a unified strategy for ousting the long-serving Egyptian leader. The committee will also discuss whether Nobel peace laureate Mohamed ElBaradei will be named as a spokesman for the protesters, they said.

The army had an increased presence in Tahrir Square Monday, and the curfew has been tightened. Heavy traffic jams developed downtown as the army closed major routes, apparently in a new effort to control the crowds.

Protesters began streaming into Tahrir Square in large numbers as a military helicopter circled over the square, swooping low over the crowd gathered there.

Earlier, Egypt's opposition groups lined up behind the moderate Mr. ElBaradei, a prodemocracy advocate and former head of the United Nations' nuclear watchdog, as their best chance to oust Mr. Mubarak.

Photos: Monday Protests

Khaled Desouki/Agence France-Presse/Getty Images

A succession of rallies and demonstrations, in Egypt, Jordan, Yemen and Algeria have been inspired directly by the popular outpouring of anger that toppled Tunisian President Zine al-Abidine Ben Ali. See how these uprising progressed.

On Sunday, the nation's military closed ranks with the government leadership but allowed protests to continue raging in the streets.

The moves continued to sharpen the country's clash over whether Mr. Mubarak would resign. Events here present difficult choices for the U.S., which has been attempting to push for both the stability that the military offers and the sweeping political changes demanded by the opposition. There was no indication that the two sides would meet or hold discussions.

State television showed footage of Mr. Mubarak with his newly appointed vice president, former intelligence chief Omar Suleiman, meeting Egypt's top army commanders Sunday. The images appeared to be a bid to show that control of the armed forces was still in the hands of Mr. Mubarak and his regime.

Fragmented opposition groups, including the powerful Muslim Brotherhood, put aside sometimes strident differences to unify behind Mr. ElBaradei, who often tangled with U.S. officials when he led the U.N. agency inspecting Iran's nuclear program. His entry in Egyptian politics is more recent. He came to Cairo last week only after the protest movement had gathered steam on its own.

Egypt's opposition groups have had a checkered past, with ideological divides and personal animosities sapping them against the might of the Mubarak regime. For now, their solidarity appears to be holding. Mr. ElBaradei's endorsement by the Muslim Brotherhood, Egypt's largest and best-organized opposition force, amounted to a historic display of unity between the country's secular and Islamist opposition forces.

The umbrella organization that organized the protests formed a steering committee on Sunday under Mr. ElBaradei to pressure the regime for more political concessions, according to senior Brotherhood leaders.

Mr. ElBaradei said in televised remarks that he looked forward to working with the military to help establish order and forge Egypt's new political future. In an interview with the British Broadcasting Corporation, he said: "The first step is [Mubarak] has to go…The second step is we have to have a government of national salvation in coordination with the army. The third step is the army has that horrible task of ensuring security." He warned the U.S. that its failure to disavow the current government was causing it to "lose credibility by the day."

Regional Upheaval

Public acknowledgment of the crucial role the military would play in any transition appeared to be an attempt by Mr. ElBaradei to win over a key pillar of the regime. Since a military-led coup seized power in 1952, the military has wielded considerable power, but in recent decades has kept a relatively low political profile.

The military on Sunday dramatically increased its control over security and political affairs. The army assumed control of the Ministry of the Interior, which oversees the country's internal security forces, loathed by many Egyptians for their brutality. Top army officials, including the defense minister, made appearances around the capital Sunday, meeting with troops and shaking hands with people gathered for demonstrations.

Despite the public displays of power, major question marks surrounded the Mubarak regime. It was unclear how unified the top leadership was; how deeply divisions ran within the military hierarchy; and the extent of cooperation between the military and the police force.

Mr. ElBaradei made his first appearance in the city's central Tahrir Square on Sunday evening, where tens of thousands of protesters massed. The Interior Ministry's headquarters just a few blocks away was the site a day earlier of violent clashes between protesters and what appeared to be the last vestiges of internal security forces left on the country's streets. The military appeared to come to the protesters' aid, sending four armored personnel carriers to face down police.

While U.S. officials cautiously distanced themselves from Mr. Mubarak and U.S. Secretary of State Hillary Clinton called for transition to a "real democracy," the Egyptian military still came in for praise. "They are acting professionally," said Capt. John Kirby, a spokesman for Adm. Michael Mullen, chairman of the Joint Chiefs of Staff. "They are supporting the institutions of government and that is the proper role of the military."

The military has enjoyed broad respect among Egyptians, and appears to have gone to great lengths to avoid antagonizing citizens since deploying in the streets. But it showed no clear signs of reaching out to the opposition leadership. Military factories control significant chunks of the nation's economy, giving its leaders a vested interest in controlling the pace and extent of any political reforms.

Egypt's armed forces are the 12th largest in the world, according to the International Institute for Security Studies, and receive $1.3 billion in annual U.S. aid. One dramatic display of military might Sunday afternoon came when two F-16 jets flew over the Nile and the center of the capital.

Still, signs of disorder—including widespread outbreaks of looting and reports of mass prison breaks from at least five different detention facilities since Friday—threaten to erode the military's standing if it doesn't impose order. The army has yet to take firm control of the streets in the absence of the police, leaving many Egyptians worried and wondering why.

In an interview with WSJ's John Bussey, former Ambassador to Egypt Edward Walker discusses the demonstrations in Egypt and what new form of leadership could emerge from the protest movement.

Security issues led the U.S. State department to organize emergency charters to help U.S. citizens who want to evacuate, beginning Monday. Sketchy reports have said more than 100 people have been killed during protests since Friday.

Throughout the capital, looting was a growing problem. As night fell Sunday, Cairo residents, armed with steel pipes and two-by-fours, organized neighborhood watch groups to fend off roving bands.

Many opposition leaders and analysts accused the military of allowing the chaos as part of a larger strategy to discredit popular protests.

Others believe that the military is incapable of restoring order or unwilling to jeopardize its popular standing by taking on the potentially unpopular role of a police force. State television announced that regular police forces would return to the streets Monday, but wouldn't deploy in the city's central Tahrir Square, apparently to avoid friction with protesters.

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