Jay's Blogs

 Obama's Pending Foreign Policy Agenda

China: The recent tensions between the United States and China could possibly flare into a full-blown trade war in the coming months. As both countries have attempted to get back to pre-crisis levels of economic growth, it is only natural that their interests would collide at some point. A series of tit-for-tat acts of protectionism have now been exacerbated by the return of an argument dating back to the Bush years over the “correct” value of the renminbi, which keeps Chinese exports cheap and its economy moving ahead. The United States sees a glaring trade imbalance with the Chinese as the biggest roadblock standing in the way of more rapid economic growth, while Beijing views Obama’s new export initiative with caution.

U.S. midterm elections are quickly approaching in November, and China-bashing unites the American electorate like few other topics do. Bearing this in mind, the U.S. Treasury will issue a report on April 15 that may label China a currency manipulator, a decision heavily imbued with political overtones that could invite Congress to pass more penalties against China. There is a consensus within the American political establishment that China is, in fact, a currency manipulator; the question is whether Washington wants to consciously exacerbate tensions with Beijing by officially calling it out as such, and threatening it with the added tariffs that such a designation would ultimately entail. Whatever decision the U.S. government makes will have a direct bearing on the Strategic and Economic Dialogue that is scheduled to be held between the two nations in May, the tone of which will be set by the conclusion of the White House-backed Treasury report.

The country that had the most potential to draw the United States into yet another Middle East war during Obama’s first year in office is happy to watch from the sidelines as Israel struggles on the Iranian and Palestinian fronts vis-a-vis the United States. After all the talk of sanctions deadlines and hints of military action in the Persian Gulf, the United States has ramped down its efforts toward establishing crippling sanctions against Iran. The reason for this is not because the Iranians are believed to have stopped pursuing nuclear weapons (they have not), or that Israel all of the sudden finds itself resigned to the inevitability of an Iranian nuke (it is not), but rather that the United States feels neither of the two have the ability to directly launch effective attacks against one other. This situation will hold as long as Iran does not cross the ambiguous “line in the sand.” For the moment at least, the United States does not appear to be too concerned with Iran.

The Tuesday meeting scheduled to take place in Washington between Obama and Israeli Prime Minister Benjamin Netanyahu will occur when American-Israeli relations are at one of the lowest points they have been in years, perhaps decades. The timing of the announcement that Israel would continue apace with housing construction in East Jerusalem — delivered during U.S. Vice President Joe Biden’s trip to Israel two weeks ago — was interpreted by Washington as an intentional insult, designed to demonstrate that Israel would not budge when it comes to U.S. demands on the issue of Jerusalem. That is a political issue on which Netanyahu feels he cannot bend. However, the net effect of this could be diminishing support from Israel’s strongest ally, something far more damaging to Israeli national security than a long-standing domestic policy issue.

One country that has been delighted to read about the United States’ problems with China and Iran has been Russia. It has seized the opportunity to operate in its near abroad and continue upon its mission of resurging into the former Soviet periphery. Moscow most recently reasserted its influence over Ukraine with the election of pro-Kremlin Viktor Yanukovich as president, and the intimidating effects of its 2008 invasion of Georgia –- which was done without any retaliation by Washington -– continue to linger in the Caucasus. With Belarus, Azerbaijan and Kazakhstan being drawn back into the Russian sphere of influence, the Baltics could be next on the Kremlin’s target list.

So far, Obama has been too concentrated on health care and the brewing crisis in Iran –- not to mention a muddling economic recovery, troop increases in Afghanistan and trying to wind down the U.S. presence in Iraq — to focus his attention meaningfully on the Russian resurgence beyond token gestures. But the difference between Moscow tampering with its former possessions in the Ukraine and the Caucasus is one thing; venturing into countries that have since joined NATO and the European Union is another. Russia knows that U.S. commitments in the Middle East will not last much longer, and with the possibility of a more foreign policy-focused American president who can more actively resist Russian advances now on the table, Russia may see a need to speed up the course of events.

Possibly seeking to exploit the growing rift between the United States and Israel are the Palestinians, Iranians and Hezbollah. Sources have reported that elements from all three groups, as well as Gaza-based Islamist group Palestinian Islamic Jihad, are engaged in talks surrounding plans to launch a third Palestinian intifadah against Israel. This would be dependent upon a reconciliation between Hamas and Fatah, and the success of their discussions over how to prepare a militant response to Israel. Another intifadah, replete with mass uprisings in the West Bank, rockets fired from the Hamas-controlled Gaza Strip and the possibility of Hezbollah cooperation from Lebanon would certainly please Tehran. Not only would this force Israel into military involvement in its territories, it would also further strain relations with the United States, thus empowering Iran’s position in the Middle East.