Airbus's good year and two links

One European company seems to be surviving the global economic downturn just fine. EADS, the pan-European aerospace conglomerate best known as the parent company of Airbus, has recovered from a dismal 2007 to record a $2 billion profit in 2008. 

Travis Sharp's new piece for FP, might offer a hint for why things are looking up for EADS. While the world's economy contracts, countries everywhere are investing in expensive military systems like those built by EADS:

Despite its overwhelming dominance in overall spending, the United States did not have the fastest growing defense budget in the world between 2005 and 2007, the most recent period for which an accurate assessment is possible. That distinction belongs to Kazakhstan, which saw its defense budget increase by 84 percent. Other countries with booming budgets during this period included Angola (80 percent), Ukraine (57 percent), Jordan (57 percent), and Slovakia (55 percent). The United States, China, and Russia had more modest growth rates of 17 percent, 27 percent, and 33 percent, respectively.

But EADS's good times may not last forever, particularly if U.S. Democrats enact "Buy American" policies to limit the amount of equipment the U.S. military buys from overseas. The main flashpoint for this debate is an Air Force refueling tanker contract that Airbus and U.S. rival Boeing have been fighting over for years with Congress acting as an increasingly incompetent referee. Former Undersecretary of Defense Jacques Gansler believes military protectionism is bad for dense and ultimately bad for the economy:

The Defense Department is not a social welfare organization, and its sole responsibility is to supply U.S. war fighters with the best equipment at the best price. Luckily, though, these two goals aren't mutually exclusive: Military globalization is in fact a blessing for Americans.

The United States is still the world's largest military customer, and it's in the interest of international weapons manufacturers to do business where the buyers are. In the past decade, a number of major international firms have set up shop in the United States. In fact, the Northrop deal would have created tens of thousands of U.S. jobs.

 JOEL SAGET/AFP/Getty Images


A democracy downgrade?

Is Barack Obama downgrading the importance of promoting democracy in the Middle East? A group of activists and scholars led by my former boss, Egyptian dissident Saad Eddin Ibrahim, sure seems to think so. Or at least, they're going to hold the U.S. president's feet to the fire. This just in:

Washington, DC - March 6, 2009 - More than 80 scholars and experts-including Egyptian democracy activist Saad Eddin Ibrahim and former deputy prime minister of Malaysia Anwar Ibrahim -are urging President Obama to adopt a consistent and credible policy that supports democracy in the Arab and Muslim world. The group will formally issue an open letter to the president at a news conference Tuesday, March 10, at 2:30 p.m. at the National Press Club in Washington.

"For decades, the United States and Europe have been coddling and supporting dictators in the Arab world, and this has been disastrous for the region and for U.S.-Islamic relations," said Radwan Masmoudi, president of the Center for the Study of Islam and Democracy and a co-convener of the letter.  The letter states that for decades the United States has "supported repressive regimes that routinely violate human rights, and that torture and imprison those who dare criticize them."

The signatories call on the administration to make supporting democracy and its proponents in the Middle East a top foreign policy priority, even in countries that are U.S. allies such as Egypt, Jordan, and Saudi Arabia. The authors call on the United States to "use its considerable economic and diplomatic leverage to put pressure on its allies in the region when they fail to meet basic standards of human rights."

"Because of its association with the Bush administration, there is a temptation to move away from any discussion of democracy promotion in the Middle East.  That would be a mistake," said Shadi Hamid, director of research at the Project on Middle East Democracy and a letter co-convener. The letter lauds the President's initial efforts to reach out to the Arab and Muslim world, but cautions that the U.S. must demonstrate its commitment to democratic reform through actual policy changes.

The letter demonstrates strong support across the ideological spectrum for a renewed commitment to supporting democratic reform in the region, and for supporting the political inclusion of moderate Islamist groups. Among the more than 80 signatories are: Francis Fukuyama of Johns Hopkins University; Morton Halperin, former director of policy planning at the State Department; Jennifer Windsor, executive director of Freedom House; Peter Beinart, contributing editor at The New Republic; Georgetown Professor John L. Esposito, and democracy expert Larry Diamond of Stanford University; author and blogger Matt Yglesias, and Robert Kagan of the Carnegie Endowment for International Peace.

Several of the co-signers will be available during the news conference to answer questions from the media about the policy recommendations included in the open letter, including Saad Eddin Ibrahim, Radwan Masmoudi, Jennifer Windsor, Larry Diamond, Geneive Abdo, and others.

The truth is that, for all its rhetoric, the Bush administration did a terrible job promoting democracy in the region. The policy failures are largely self-evident, but the basic problem is an unwillingness to accept that it's not possible right now to have governments in the Middle East that are all of the following:

  • democratically elected
  • supportive of U.S. policies in the region
  • friendly or at least not hostile to Israel
  • economically liberal

One can, for instance, have governments that are friendly to Israel, but they will be toppled. One can have democratically elected governments, but they will be anti-American and anti-Israel. But you can't have your cake and eat it too.

So far, the vast weight of evidence suggests that the United States, when faced with an implicit choice, will always choose to support regimes that are largely cooperative with U.S. security interests in the region. Perhaps the Obama administration is simply acknowledging this reality.