Occupation and resistance in Crete 1941-1945 – Georgios Papachristos

2-9-19

Dear Partners in thought,

Like the great Edward Luce, our top FT man in the US, you may be or had been holidaying in Crete (or in Greece) this summer and I thought I would tell about “Occupation and Resistance in Crete 1941-1945” by Georgios (George) Papachristos. George has been passionate about the history, tradition, culture, landscape and people of Crete given his family roots. George is an accomplished individual with three Masters degrees in history and political sciences, international relations and management (also the first Greek Sloan Fellow at the Stanford Graduate School of Business, home of the tech entrepreneurs) and he also holds a PhD in international political economy. As he is also a leading young Greek entrepreneur with a global remit, George is what we used to call in my days  a “Renaissance man”. 

George has researched in his book the events that took place as of when German paratroopers landed in 1941 (something the “red berets” keep studying) and the resistance movement and guerrilla warfare that ensued. His book is a must read, especially when vacationing in Crete but also for some of us who read about the exploits of the dashing Patrick (Paddy) Leigh-Fermor, his famous abduction of General Kreipe (indeed the military commander of Crete), and his later years in his “salon” in Southern Peloponnesian  Kardamyli. Some of you may have read the book that made Sir Anthony Beevor famous in 1991 when he published his account of Crete during WW2, which George obviously refers to. In this book we discover the various groups, sometimes not on good natural terms who all joined forces to ultimately participate in the defeat of the Nazi war machine. We discover that the Cretans share some clear features with other islanders like my Corsicans if only through the acute sense of honour or the liking for revenge that they call vendetta in Ajaccio. We go through all the major events that took place chronologically and involved sabotage and reprisals in many of the locations where we now enjoy a very relaxing time. First and foremost George’s book shows us a lesson in resilience against all odds and sheer brutality and the proof that good men and women can win in the end. Nearly all Cretans resisted, working relentlessly with Britain. This is a very enjoyable and educational book that I hope you will be reading in the shade in this cradle of civilisation.   

So you know, George is also someone I have known as a seed investor in a start-up, Toorbee, that his brother Nikos and him set up a short few years ago. Toorbee is focused on outbound Chinese tourism in Europe, wanting to become the leading B2B global distribution system in its segment, and while the core team is based in Athens, works in ten different European countries today. Talking about resilience, George used his limited seed capital to build a team of 16 people (including now three in Shanghai) while building a solid network of partners in China and Europe. He now has two venture capital investors and is ready to secure a leading position in his travel and fintech segment. http://www.toorbee.com  It is aways great to see and feel success particularly in our old Europe which has been the theatre of so much unsettling developments, starting with Brexit and the rise of populism (look at poor Matteo Salvini and how he is good at “governing”). I was in Athens this past week with George and Nikos thinking on how we could develop Toorbee further. I had this feeling that we were all the same, men of good will, thriving to achieve something together. I felt we were Europeans. I felt we could achieve little on our own while we could win together, making me think of Europe and this old EU dream that goes beyond the essential bloc it needs being and reflects who we are and that we should keep building…like the Cretans of the early forties, relentlessly and against all odds.            

Warmest regards,

Serge      

The Queen must and will save British democracy

29-9-19

Dear Partners in thought,

The decision by Boris Johnson to suspend Parliament for five weeks at this juncture is clearly expedient in terms of getting his No Deal Brexit or whatever deal through. It also shows that Brexiteers, especially of the hard kind, who supposedly love “the will of the people” are ready to silence their representatives in what is an extreme populist, if not autocratic, move. Whatever we may think of the strange workings of the House of Commons, this decision sets a precedent not seen in modern British history and shows, in spite of some newspapers not wanting to see a tyrant, a move that, if it perdured, would blemish British democracy and its executive branch forever. Boris Johnson took a big gamble quite apart of a no confidence vote he will likely face. He has likely ensured that the Queen will stop that dangerous process and save democracy, strengthening one more time British monarchy and the Windsor family which often rise to be the best at the worst times in British history. The alliance of Buckingham Palace and the Mother of Parliaments will prevail and be an example, for Britain and the Western world not to mention the world at large.  

Warmest regards,

Serge        

Reflections on the Brexit folly, its losers and winners

24-8-19

Dear Partners in thought,

The Brexit saga may end in a No Deal as foolishly desired by the current British PM whose only ambition was to be PM for a party that put its interests well ahead of that of its nation (like the other party’s leader to be fair). It is time to reflect upon how Britain arrived at this dire state of affairs and identify the losers and the winners of what history will doubtless see as folly. 

Referenda are usually meant to be lost even if few would have thought the Leave vote would have prevailed in June 2016. Leave prevailed as Remain was a bad name, the benefits of EU membership were poorly articulated and the “fear” factor and campaign over-played to the extent it did not register with many voters. Leave made promises in the truest populist sense that were easy solutions to complex issues combined with superior marketing skills and slogans à la NHS. Leave voters transcended party politics largely with left-wingers, many short on facts and at times education, in depressed British areas, aiming at the EU capitalist plot while others wanted to keep the job-stealing foreigners out of areas where there were no longer jobs. At the same time well-off, right winger, tories, often retired but very vocal decided it was time to get British sovereignty back (however notional it was) from those folks who could not run a pub in Bruxelles. To be sure most of them were all good people, but they wanted to exist, be heard and either stop that dreadful, inhuman globalisation process or go back to Victorian times they read about as children. 

Once the smoke clears and assuming Brexit is enacted, Britain, if it has not really felt much economic pain yet (as many Brexiters point out rightly even if recent signs are not good) will gradually feel the blow in terms of jobs shifted to mainland Europe (finance, services), a much lower level of foreign investment (quite a few foreign multinationals cancelled their investments like Toyota or BMW) and a British pound declining further, all of which will have dire consequences on the financial standing of the UK, not to mention the City of London, once a preeminent world financial centre and of course all households. As Bill Clinton’s chief campaign strategist’s James Carville  famously said once “It’s the economy, stupid”. Dreams of glory or revenge do not make up for a lower GDP and fewer jobs being created as Brexiters, once they have what they wanted, will soon realise, many of whom wondering what they did to themselves and their country. So Britain is a sure loser at all levels, not to mention that the young who did not vote much will bear the brunt of the decision of their elders who will gradually disappear in the sunset haven enjoyed a rather good life. However Europe is also the loser as it was stronger with Britain in a world of blocs. Europe’s preeminence as the leading trading bloc in the world will be seriously affected while Britain will have to deal with its largest trading partner and live with rules and regulations it will no longer participate in shaping. Brexit is a lose-lose game for both Britain and the European Union – and the Western world generally all the more as America is led by an erratic, ignorant and dangerous President. 

In fact the real winner of Brexit is Russia, which may have helped the Leave outcome and will surely benefit from it as the European bloc and the West are weakened. Macron’s decision to engage with Russia this past week to solve the Ukrainian situation is a preemptive move that says that Brexit will happen. The other winner of Brexit, albeit to a lesser and indirect degree, is China, which also has to deal with the trade war follies unleashed by President Trump who is now wondering whether America’s worst enemy is China or the Fed’s Chairman, just if we needed to assess his level of sanity. One thing is sure, to paraphrase Lenin, is that the Leave voters, regardless of whom they were and what they thought they thought in June 2016, were by and large “the useful idiots” of Vladimir Putin and to some extent, quite indirectly, China. 

Warmest regards,

Serge                 

The New Girl – Daniel Silva

24-8-19

Dear Partners in thought, 

You will remember that I wrote a Book Note last summer about the works of Daniel Silva, the great spy and thrill novelist whose main character is Gabriel Allon, now head of “The Office” (or Mossad for the outsiders). DS struck again precisely, as he does every year, on July 15 (one day I will ask him why that very date) with a new novel. After “The Other Woman” who was an old flame of disreputable MI6 Kim Philby, we now have “The New Girl” which makes for an interesting evolution in titles. As I promised I will not reveal too much so you fully enjoy the book – especially a spy novel from the new and more muscular John le Carré – and will simply set the stage for you.  

“The New Girl” is about MBS – sorry not Mohammed bin Salman – but Khalid bin Mohammed bin Abdulaziz Al Saud or KBM, who is the new early thirties ruler of the Kingdom of Saudi Arabia. He is a reformer, gives women the right to drive cars and attend sports events, jails his family members at the Riyadh Ritz Carlton before extracting from them USD 100bn and making them understand who rules and even gets implicated in killing Omar Nawwaf, a Saudi journalist, critical of the regime and of KBM (on this latter, tragic aspect DS has a pre-book note about the 54 journalists, including Jamal Khashoggi, killed in 2018). While his “Way Forward” had received much support in the West, Nawwaf’s killing, in which he seems to have been implicated even if he did not give direct orders, makes Western leaders and populations cringe. In spite of his drive for reform, KBM may after all be an old style autocrat who simply found a smart way to sell sell himself better in changing his country and its oil-dependant economy. This story set-up looks of course more than vaguely familiar. I was actually surprised that DS would stick to a storyline that was so close to reality, even using the well known acronym approach. However this is also why DS stands apart from the spy novelist crowd today as the line between fiction and reality is constantly and artfully blurred. 

“The New Girl” is a twelve year old who studies in a top international school in Geneva, who lives in a castle in nearby France, is surrounded by bodyguards and whom nobody knows who she really is. She is of course KBM’s only child. And she will be kidnapped by an unknown party whose only demand to KBM is that he abdicates if he wants to see his daughter alive. KBM surprisingly turns to his art adviser, Sarah Bancroft (ex-CIA, see my Book Note of last summer – DS’s novels always bring back the same characters) who is tasked (even though she had cut ties post Nawwaf’s horrific killing) to approach Gabriel Allon on behalf of KBM. The two men will meet in Riyhad, which for the head of The Office is a premiere and Allon will agree to help KBM recover his daughter. He does it not not out of love for the House of Saud but in the knowledge that KBM in spite of his serious shortcomings is a better and more stable player for the region than a more radical Whhahabi ruler, also as tensions with Iran are at an all time high with Yemen and other hot spots where the two countries fight against each other. The two men will go to Paris (DS has considerably warmed to the French in recent years – I recall an exchange some ten years ago when I wrote to him and Jamie, his wife, that he was taking too harsh an approach on France) to meet with the couter-intelligence folks at DGSI. They then go to London to meet with Graham Seymour still running MI6 who gives them some useful intelligence on some individuals who have been spotted in Geneva the day of the abduction. In a return match of sort, it is a disguised KBM’s turn to go to Israel by way of the embassy in London. Little by little they get closer to the group of abductors still not knowing who they are but ending up identifying a close relative, more radical, of KBM who is quickly and rashly despatched by the Saudi ruler with Allon being present. They get very close to freeing Reema, his daughter, and all congregate to an agreed rendez vous point. We are at half of the book. Things will evolve in a unexpected DS way which I will let you enjoy even if the ride will be very tough indeed. 

Warmest regards,

Serge                            

Joe is the man with the right message and mission – for America and our world

23-8-19

Dear Partners in thought,

The news of Joe Biden’s demise after the first Democratic primary debate and his “time being up” (in his own words) were very premature – as I told you then.  I still think that Joe, barring a round of mega-gaffes, will get the nomination and polls seem to go this way.  It is a simple Cartesian thing regardless of the reasons for the media to make the process more exciting. Radicals simply can’t make it based on the fact that moderates are the clear majority of Democratic primary voters. Sanders and Warren both at 15-16% are well behind Joe at 30% and can certainly count on vocal activists but that wing is less 15-20% of the Dems on a good day…And Harris as she spoke more and was propelled in the limelight strangely went back where she was at about 5% showing that she needs to wait her time. I hope she gets warmer to Joe for the ticket I think they should build based on the perfect mix they represent at all levels. As for Mayor Pete, the other rising star we got to know more, he will be the man for 2024 or 2028. Lastly I think Joe’s new ad move to say that the Dem focus should squarely be “to beat Trump” and “restore our values” – forget about those radical programs – is very smart and what I would have advised him to go for. Joe should also state early on to artfully deflect the age factor that he will fulfil his core mission for one term only, hence the critical running mate selection. Politics is not rocket science and it is high time for America and the world to have a safe pair of hands with restored values we have always shared to shine on that “city on the hill”.  

Warmest regards,

Serge

Talking to my daughter: A brief history of capitalism – Yanis Varoufakis

15-8-19

Dear Partners in thought,

Before I start on this new Book Note, I wanted to let you know that my Book Notes may be shorter in the future, not because I suddenly became lazy but as I found out that you did not have all the time in the world to spend on my musings and I also did not want to tell you too much – which I admittedly did – in discussing those books so you would want to read them. I already feel a wave of warm support and appreciation reaching me in Prague from so many parts of the world… 

I wanted to tell you today about a book that is aimed at explaining the economy to the young (and in his mind, of course, not so young), written by Yanis Varoufakis (I feel eyes rolling), the  colourful (not to say firebrand) former economics minister in the early Tsipras government in Greece when the country was making the headlines as to whether it would repay its public international debt and would not eventually leave the EU. While things are much calmer in the cradle of Western civilisation with Tsipras now seen as a reformer and even defender of the EU (see the FT Special in May 2019), this feeling being strengthened by a former McKinseyite as new PM, YV having left the government some time ago, has been much on the circuit for speeches and conferences while sharing his experience in print. While many see him as an opportunist who may sail closely if unwittingly to the bad populist winds, there is no denying his brio, intellect and attractive persona. He also knows how to sell his message and himself, marketing the V brand very well as he goes on the speaking yours or even talk about Greece on various TV channels. Amusingly his book was shown to me by a very serious private equity veteran who seemed to like YV’s mix of iconoclastic flavour and Bernie Sanders approach, showing that a differentiated style matters as much as the rest for getting one’s messages across.     

His book is short and simple but very smart and entertaining. It is indeed a conversation (or a one sided, multiple address via letters) with Xenia, his daughter where he tries to explain to her the major tenets of economics in ways that would “resonate” with her. YV first wrote it in Greek with the English translation coming up later. His daughter, representing the young target audience (and let’s be clear all of us) lives in Australia so he could have gone “English” as he started the first time around, also as he masters the language like few of us foreigners can. Admirably he wrote it in eight days on the island of Aegina between meals and a bit of sailing – what is it not to like? Especially in these summery times…Clearly it is a funny and radical way to explain the economy to one’s daughter (the word “capitalism” in the sub-heading makes you wonder about another bearded thinker who would probably agree with YV today but also missed the point in his days about where the revolution would start). However taken as a piece of clever entertainment, it is really a good read while it makes you think about a few facts we always have taken for granted.    

YV addresses the main issue of “Why so much inequality?” that seems to have bothered him for ages. We learn why Europeans and their geography and agricultural surpluses (cultivating land being the key genesis fact for later success) conquered the rest of the world that was often more rich and full of “plentiful” cultures that did not need to bother about conquests or defending themselves. On the way, we learn the origin of writing (I say “we” though I should say “am” as many of you doubtless know already the need to check those amounts of grain in the Mesopotamian granaries). We learn why the British conquered Australian aborigines and not the other way around, which if an odd example to discuss inequality, is nonetheless a great dinner table topic. His main message is that Europeans did not prevail as they were smarter but as they had been given less natural assets and had to work harder that in turn started a cycle that led to the cycle of conquests that we know. Bureaucracy, armies and clergies, all established for the preservation of a certain order of things were by-products of agricultural surpluses that created Western kingdoms and nations. We then go on to understanding better the difference between goods and commodities and why debt and profits are the key elements that makes our world go around. The nemesis banking sector and its bankers are of course well covered while “haunted machines” are addressed in what is becoming a rising robotisation trend. He discusses economic instability as a chronic risk and why our economic system benefits some while impoverishing others, be they individuals or nations. All in all, these chapters or indeed letters to his daughter, cover the key pieces of the economic puzzle and address what are for YV the major issues linked to inequality in today’s world and why market-driven policies are not solving the more pressing issues facing our world. His main objective is to ensure that Xenia (and us) think about those points, be equipped better about what he sees as the failures and obfuscations of the current system and thrive for a more democratic alternative and outcome in the way the economy and indeed capitalism work.    

 I would probably not want YV to run my national economy while I would be happy to go on holiday with him – as he is very entertaining and has a knack for explaining economics in a fun manner even if his overall focus is of course highly radical. Conversely I would not like to go on holiday with many people I would trust blindly for running my national economy but whom by definition would be boring to spend time with. He is definitely more radical than progressive economists who nonetheless are playing the “game”, like Nobel laureates Joseph Stiglitz or Paul Krugman, but probably more fun to read in this very “Talking to my Daughter” instance. This is why I recommend that you read YV’s book (maybe for some if not many not to say all as a great piece of fiction) while enjoying some relaxing time somewhere not too hot…(now if you wanted to have a slightly more classical though also entertaining way to think about economics, I also recommend you to take Paul Krugman’s Master Class on the subject http://www.masterclass.com . So you know, I myself took wonderful Aaron Sorkin’s on screenwriting and the art of the dialogue. A gift of one of my daughters “talking to me” to tie this back to YV). 

Warmest regards,

Serge                

On the endemic demise of Western political parties and the innovative rise of new solutions

13-8-9

Dear Partners in thought,

A very good man who used to be the mayor of a great, historically fateful American city recently told me that the Republican Party under Trump was dead while the Democratic Party was dead too but did not know it yet, prompting me to reflect on the fate of our great Western political parties in a few historically key Western nations. 

I actually think that the main “political parties”, as we have known them for decades in the West are dead or dying. Look at France with the Socialists (social democrats really) and center right parties (whatever the latter’s changing names) which commanded about 75-80% of the votes, broadly speaking for 50 years, garnered an aggregate “15%” at the European parliamentary elections of late May. Look at the UK and how “abysmal” both main parties have been since the June 2016 referendum in terms of both leaderships (not to mention putting parties before nation) and of course their electoral results…Germany is on its way too with the CDU at 25% in late May…I think one might be also tempted to think that Putin and his “liberalism is obsolete” is right (I don’t believe that though he has a point) when you see that the extremes rise, also in the voting booth (though not as much as could have been feared in May), as easy solutions to complex issues are appealing to many for a variety of reasons and fashions, when rational arguments are not wanted, especially if emanating from the “elite” as populism is inherently unsatisfied and corrosive of politics. 

For my part I think it is a time where those main parties go through a “re-foundation” process to re-define their identities and value add. I think the GOP and Dems will go through such process (by gradually rejecting “Trumpisation” and economic radicalism, away from mirror vote-grabbing extremism respectively) all the more when Trump is gone (I think he does not have the numbers even if the Dems can be self-hurting) as he has been a major disruption factor for both. As for France, I think Macron is a good leader dealing with an ever riotous and challenging Gallic nation but his 2017 victory killed the main parties while his own is not yet one (re-foundation of both centre-left and centre-right will be hard as Macron is occupying both spaces on different issues, having succeeded in creating a broad “centre” where Giscard failed as he was too early 45 years ago). As for the UK, both main parties seem doomed, Brexit (and poor Cameron) being the “emotionally-charged” reason and the Boris Johnson train down the road to no-deal oblivion and overall decline that all can see as a bad unfolding and unavoidable script…If only they were letting the people speak, to settle once and for all the matter and however imperfect this way forward, three years later and based on more facts, and not those two non-representative parties…I wonder what historians will say 50 years from now.  

However and in the meantime we should not despair. The dire current Western political landscape has already triggered innovative initiatives led by concerned individuals focused on tackling societal challenges “together” and not along toxic partisan lines. One such initiative, Engage Britain, is being led by well-known financier, Guy Hands, founder and chairman of Terra Firma, the British private equity group. Engage Britain aims at putting pepole, with all their differences, knowledge and experience, at the heart of tackling the most difficult and divisive challenges facing Britain – which are of course easy for all to see particularly from afar. Guy’s bet is that his fellow citizens are capable of working together, through established and pioneering solution-focused principles and methods, to help solving challenges, that parties have not been able to such as the funding of healthcare, opportunities for families living in poverty, protecting the environment or addressing decently and rationally divisive issues such as immigration. Engage Britain’s end game is ambitiously to “act as catalyst of wider civic society to build a better place for all to live”. I recommend that you go to http://www.engagebritain.org to get a good overview of such new initiative that is emblematic of things to come and will likely have a strong, positive impact on society and further marginalise political parties in the West. There is light at the of the tunnel and we should still believe in the future.            

Warmest regards,

Serge 

The Shadow War – Jim Sciutto

7-8-19

Dear Partners in thought,

I would like to talk to you about “The Shadow War” from Jim Sciutto, the CNN anchor and Chief National Security Correspondent some of you may know. JS goes “inside Russia’s and China’s secret operations to defeat America ” as the sub-heading says somewhat strikingly, though in essence his book deals with the new range of aggression short of actual war which today are the most modern aspect of warfare essentially carried out by two powers which either would wish to come back to the pack of leading nations (Russia) or would wish to assert itself as the new world leader, displacing America from its century-old historical role (China).             

“The Shadow War” deals with hybrid warfare which encapsulates forms of attacking an adversary while remaining just below the threshold of conventional war also referred to as the “gray zone” by military experts, using a range of hard- and soft-power tactics from cyberattacks on critical infrastructure, to deploying threats to space assets, to information (of disinformation) operations designed to spark domestic divisions, often in the context of democratic elections, to territorial acquisitions just short of a formal invasion. JS started to focus on those forms of soft-warfare when dealing with the poisoning of former FSB and Russian dissident Litvinenko in London in 2006 when working for ABC News, feeling that it marked a new era of aggressive risk-taking by a resurgent Russia that initiated a new form of war, which was continued even more strikingly with the Skrypal poisoning “raid” in Salisbury in 2018, both being officially denied by Russia. 

To JS, Russia and China, two different powers, use hybrid warfare which was new to the unprepared US and Western allies until the late 2000s as they sought another path to “victory”, realising they would be unlikely to win a shooting war to advance their strategic goals. The two “adversaries” also showed other countries the way, such as Iran and North Korea “starting down the same road”. Russia which admittedly was the most aggressive in all its shadow war ways, clearly stated in February 2013 (one year before Crimea and eastern Ukraine) in what became the Gerasimov doctrine (after the name of the chief of staff of the Russian Federation military) that “wars are no longer declared, and having begun, proceed according to an unfamiliar template” involving both military and non-military methods. To Gerasimov, “the role of non-military means of achieving political and strategic goals has exceeded the power…of weapons in their effectiveness.” Like Russia with the annexation of Crimea, China was able to secure sovereign territory in disputed South China Sea areas, without firing a shot and incurring reprisals – even if both nations according to JS, based on U.S. officials’ accounts, including China, are also willing to rely upon traditional spying in the U.S. and the West and kill adversaries, like dissidents or opponents “at the drop of a hat”. In one of the most friendly version of hybrid warfare, both countries have been proficient at conducting efficient news operations via RT (formerly Russia Today, which was perhaps too obvious a name) or the newly rebranded-state run China Global Television Network that use Western reporters and anchors, following a very CNN style of delivery.                  

In Opening Salvo, JS takes us to Estonia and the first major cyber attack against a sovereign country, this time by Russia even if the culprit always remained unofficial and no claim was never made. Following the decision to move a Soviet war memorial in April 2007, protests erupted in the street combined with waves of cyberattacks ultimately paralysing all of Estonia as the government decided to take the country off the international web. Estonia had become the first victim of a state-sponsored cyber-attach on another nation in the form of a coordinated, focused and global “distributed denial of service” or DDoS attack. This attack was also an attack on NATO and the EU given Estonia’s membership of both, with Estonians fearing that was the prelude to a full-scale invasion. Estonia compared “2007”, which went on for weeks, to 9-11 given the asymmetric means employed though came short of requesting NATO assistance under Article 5 of the Treaty while pointing the finger at Russia which was easily identified as behind the attack. “2007” promoted Estonia to rethink its cyber vulnerabilities to the point that it is one of the most cyber attack-ready countries today, making Russian attacks unsuccessful even if the offense always has an edge over the defence in cyber warfare. Estonia suffered little from the 2017 “WannaCry” (attributed to North Korea) and the global attack on infrastructure in 2018 (attributed to Russia), mainly as Estonia developed a top level of cyber “hygiene” at the level of each of its citizens that is the first step to counter cyber attacks. Estonia also established data embassies, like in Luxembourg and other undisclosed places, where giant digital copies of data and communication related to government, voters or health and financial records were safely stored. JS saw two key lessons in that opening salvo: 1. A relatively blunt and low cost cyber weapon, like a DDoS, can paralyse an entire nation. 2. Russia demonstrated as of 2007 it was willing to launch cyber weapons against Western nations on a scale and degree not done before. JS felt that the U.S. and the West have largely missed the lessons of “2007” and thus what was to come (with hindsight) in the ensuing  decade, still thinking that Russia wanted what the West wanted, that is a mostly friendly relationship governed by a Western international rules-based order. 

In Stealing Secrets, JS takes us into ways by which China stole secrets to advance and support its economic growth. JS focuses on Stephen Su or Su Bin who while being involved in business activities in the US as a manufacturer of aircraft cable harness, had developed a ring of spying and stealing intellectual property from defence contractors, notably Boeing. Interestingly these spying activities which were encouraged if not led by Beijing, were also entrepreneurial with rings of thieves stealing secrets to then sell them to China. The U.S. Office of Intellectual Property estimates that up to USD 600 bn is lost up by the U.S. mainly to China. JS sees two lessons: 1. China, which wants to surpass economically the U.S.,  has been aggressively stealing government and private sector secrets and intellectual property for years in what it sees a fair game and not a crime, making it the most expensive theft in modern history. 2. The U.S. never managed to change Chinese behaviour in spite of repeated efforts and warnings by all administrations to stop its theft drive. Personal presidential warnings, indictments of members of the Chinese military or trade tariffs never stopped China’s drive while the West kept assuming that China wanted what the West wanted and that participating in international treaties and associations like the WTO would make China more Western, not unlike the approach to Russia.  

In Little Green Men, JS refers to the invasion of Crimea without firing a shot and the arming and supporting, very directly, via “little green men” the insurgents in Eastern Ukraine in the so-called Republic of the Donbass. JS sees two lessons: 1. Russia had the intent and the ability to redraw the borders of Europe by force (going further than invading Georgia in the Caucasus in 2008) and it could do so on NATO’s doorstep on the border of four EU and NATO members states. 2. The West missed or ignored warnings to exert military influence over Ukraine by Putin and other senior Russian officials in the years and months before and kept thinking that Russia could behave in Western manners as the tanks kept rolling westwards and Malaysian MH17 was shot down by a Russian-made missile in April 2015.         

In Unsinkable Aircraft Carriers, JS refers to the gravity-defying artificial islands built and then quasi-weaponised by China to cement ownership claims of part of the South China Sea which was contested by half a dozen nations. JS feels that China’s means of claiming sovereignty, which is a major land grab also backed by force though without firing a shot, challenges the rules-based international order set up and led by the U.S. since 1945. This land grab was also  a way to challenge America’s role as the leading military power and arbiter in the region. This development set a bad example for things to potentially come in relation to the Senkaku islands claimed by Japan and the Scarborough Shoal claimed by the Philippines, knowing that the U.S. is bound by treaty to assist military both nations in the event of an aggression by a third party, which everybody knows can only be China. Today China’s man-made islands in the South China Sea are “facts on the sea” and here to stay, a fact admitted by the most hawkish American foreign policy-makers.  

In War in Space, JS deals with the other, expanding field of battle which is space where many of the world challenges are being settled in this 50th anniversary of the Apollo 11 mission. Both Russia, since Sputnik, and China are major space actors while India is starting to join the club. China ad Russia can paralyse the U.S. and western powers from space, disabling militaries, bringing civilian populations to standstill by shutting down infrastructure commanded from satellites while rendering the public and private sector in-operational. America which took a superior advantage in space technology became vulnerable to attack as both China and Russia took advance of this advance and reliability. In recent years Russia and China have translated their well-honed cyber-offensive tactics capabilities into the space arena with the U.S. only reacting now this new development. Counter measures have been developed by the public and private sectors by spreading GPS and critical communications among more satellites to reduce the damage linked to the loss of one or a few of them. The question facing the U.S. today is whether to focus on deterrence or joins a new arms race.           

In Hacking an Election, JS obviously takes us to the U.S. 2016 presidential elections and makes us wonder what the impact of the hacks really was knowing Trump’s wafer thin 22,000 vote lead in key states that delivered him all their delegates and thus the presidency all the while lacking three million votes nationally (this putting aside the viability of the American electoral college process that is a sacrosanct, non-debatable issue even for the Democrats in the U.S.). It is not unlikely that Russian meddling, with or without the help of the Trump campaign that remains a debatable issue, had an impact on the election outcome – this being reinforced with the equivocal response to the matter from the Trump Administration and their Republican backers which not only showed a fractured American response to a critical issue but also potentially emboldened Russia to keep at this new tactics. The Russian meddling into the run-up of the 2018 mid-term elections showed that sheer U.S. sanctions did not deter Russia even if President Trump recently allowed the Pentagon and Cyber Command to use offensive cyber operations to respond to foreign cyberattacks. It is not clear for U.S. cyber experts that America today has achieved enough offensive and defensive capabilities at a time when Russia would have been joined by China, Iran and North Korea in attempts or experimentations undermining the confidence of the American public in the the electoral process. The U.S. is not alone dealing with election meddling as the 2017 French presidential elections showed when Emmanuel Macron’s campaign was attacked by Russian trolls, this being reinforced by Russian support of the extreme right parties across the EU leading to the uncovering of dubious funding of leaders or parties such as in the cases of scandals involving Austria’s FPO or Italy’s Northern League.          

In Submarine Warfare, JS deals with the last soft-war issue which is the control of the oceans which is is often done down from “below” and subjects submariners to very dangerous challenges below the usual public radar or in this case, surface. Both Russia and China have meaningfully upgraded their submarine capabilities and increased their incursions into U.S. and Western territorial waters, at times close to the shore. The Pacific and Atlantic oceans, together with the Mediterranean not to mention Artic and Antarctic seas are the theatre of a new “Great Game” between the three powers with the U.S. playing defence and catching up fast to maintaining its earlier, disappearing advantage.     

Finally JS gives us his views on how America (and one would think the West, though Europe is not mentioned) could win the “shadow war”: 

1. Know the Enemy (understand who they are and how they operate “now”) – He could have said “thy” but we will forgive JS.

2. Set Red Lines (so the adversary knows it is crossing them at a real cost, meaning enforcement)

3. Raise the Costs (do not make it easy to wage soft-power aggression)

4. Bolster Defence (what was good in the past is no longer doing the job, this repeatedly) by i) protecting the home front, ii) easing rather than inflaming internal divisions and iii) enhancing resilience. 

5.Develop an offensive capability (si vis pacem para bellum or for themillennials: “if you want peace, prepare for war”, an admittedly old adage from the Roman times I like to use) through i) the development of information ops similar to what Russia and China perform, ii) be ready to undertake attacks on critical infrastructure and iii) be ready to organise deployments as “hard deterrence” which I would call “reality checks” (e.g. by making it clear to China that the U.S. Navy would have the necessary experience and means to destroy the man-made islands in the South China Sea or deploying U.S. Marines in the Baltics to calm down Moscow and make them “think twice” about the costs of their “soft” strategies) or iv) start deploying weapons in space so not only Russia and China weaponise and gradually control it.  

6. Warn of the consequences: Communicate clearly about the consequences of action, however soft-power they may be – and take advantage of the adversary’s inherent weaknesses like Russia’s vast attack surface and uncontrollably huge borders that it could never defend properly. Explaining the costs of Shadow War in no unclear terms. 

7. New treaties for Cyber and Space: Russia and China can fight a conflict in both cyber and space, all the more as there are no rules in the absence of any treaties in two key new conflict theatres. 

8. Maintain and Strengthen Alliances: America cannot win alone if only as it cannot act everywhere at the same time so it needs to strengthen and not weaken its key alliances both in Europe and in Asia (precisely unlike what the Trump administration in a MAGA drive has done).  

9. Leadership: All plans and their execution are only as good as the leadership at the top. Leadership is also about explaining consistently to its own people what is going on and why, not undercutting the assessment of its intelligence agencies and other departments – as in the case with Russia and the Trump Administration. It also goes with knowing “what liberal democracy is all about” (and rising above daily politics) as Desperate Measures would wholeheartedly agree with. 

One could wonder if Russia and China are different adversaries for the U.S. and the West. Isn’t there a difference between the poisoning of dissidents, soft invasions of countries, cyber disruption and disinformation in relation to elections as performed by Russia from the stealing of corporate and government secrets as performed by China (perhaps not including the unsinkable islands in the South China seas). One form, the Russian one, is more war-like in its means and objectives while the other, the Chinese one, is “usually and generally” more commercially-focused in nature with the main goal of growing its GDP, which is not to say it should be allowed but is less in the realm of strategic military-like warfare, however soft-power like. In some ways, the commercially-focused Chinese theft drive is perhaps more manageable through improving the cyber defences of targets than the Russian forms of aggressions that are wide-ranging but can also take more the form of quasi- (if not actual) military strikes albeit in official peace time. We also need China more than we may need Russia, the latter which we just want to contain and keep peaceful in its new form to take the old George Kennan adage, while we wish to build a new world and trade with an integrated China, always thriving, even if perhaps naively, to make us closer (them to us) and dealing as peacefully as possible with downturn situations like Hong-Kong today.   

“The Shadow War” is very enjoyable for all and educational for some  as it covers a recent period of history since the mid-2000s where America has gradually lost of its sole world leadership, perhaps as it got lost in reshaping the Middle East, triggering other geopolitical crises, but also as both Russia and China reasserted themselves either as they were growing economically and naturally wanted to assert themselves (China) or as they wanted to restore the dignity they felt they had lost during the 1990s transition (when we were perhaps not sensitive enough) while wanting to be back at the leaders’ table (through military might as its economy is too thin) and strengthening power at home (Russia). The only drawback of the book, however would be JS’s quasi-newsroom delivery style which is more akin to that of the excellent anchor he undoubtedly is that to the writer he had to be for “The Shadow War”. However for sure a great summer read to embark upon and a useful, clarified “architecture” of all the geopolitical soft-power events involving the three powers and their “allies” we have lived through since the mid-2000s.    

Warmest regards,

Serge       

Where we are on the Democratic primary side, away from “the sound and the fury”…

6-8-19

Dear Partners in thought,

I thought I would give you my take on where the Dems are primary process-wise now that the first and second debates (sadly very much akin to TV reality and Twitter with only a few seconds to express views on key matters) have happened and where we are now. The second rounds of debate last week did not change the dynamics of the Dem race which were set in the first rounds in late June. Joe Biden was under attack from all in his group, given his clear lead today, this in spite of a temporary slump following his rather unimpressive fighting spirit in late June while a passion-driven Elizabeth Warren kept appearing as the better one in her own group. Based on this, I would actually like to focus a bit more on the first rounds that really set the stage in late June for where we are and may continue to be.    

Now we can guess (partly thanks to Donald Trump Jr who is definitely his father’s son) that Kamala Harris probably unleashed her attack in the first debate (second group) with the dual goal of reducing Joe’s “establishment” lead and interestingly beefing up her African-American credentials, hence these odd “busing”and “little girl” references, so she could deal with the fact that she has more of a Jamaican and Indian background as it came up a few days later (at least she was not asked to go back where she came from by Dad). Personally I think that kind of well-rehearsed “stitch up” and especially these race tactics, however crucial the subject matter in American “history”, are a disservice (to her for sure and) to American politics (probably also strengthening Trump and why he is where he is in the first place) even if she rose in the Dems primary polls (though did not overtake the three leaders who are still Joe, Bernie and Elizabeth). As an aside, 53% of African-Americans were backing Joe after last week’s debates, far ahead from any candidate and due to the clear Obama legacy and the often forgotten fact that most African-Americans are of the moderate Democratic persuasion, as Bernie can remember.   

Joe certainly appeared a bit out of touch and for some “showing his age” (we are bound to hear more about this and his health in the coming months) in that first debate as shown with his poor response to Kamala’s fierce attack (defending de facto states rights, which was daft) but this changed nothing substantially.  He still leads confortably and can keep building a commanding position in the first primaries – as nearly 50% of Dems primary voters are “moderates” and only 16% are “radicals”, which makes the leftward drive of some usually mild candidates strange (unless he keeps up on the gaffe trail and quotes such as “My time is up” by way of conveniently deflecting attacks). There is no doubt that this radicalisation of the Dems exemplified by Bernie (true to himself for sure) and Warren, compounded by the vocal statements of the four congresswomen Trump called the Squad (with AOC as the main voice) helps Trump and he knows it, making them front and center while pleasing his core base. It is no wonder why wise House Speaker Nancy Pelosi worries about this non-representative left wing drive and dangerous calls for an impeachment, whatever its good grounds, that has no chance of happening and would comfort Trump’s base. Would AOC and her three friends actually against all odds be the best Trump supporters?  

Interestingly Trump is polling behind most lead Dems (an average of 10 points behind Joe). I think Bernie is not doing too well this year in a more crowded and less clear contest, also in the absence of a super-establishment “put-off” candidate (for some). A passionate Warren did well in the first debate and kept doing well in the second one but mainly as she was the only heavyweight in her group – and has now risen above Bernie in some polls. Strangely Castro who did well in the first debate and is very engaging did not gain much poll-wise (apart from more money) while Beto did not confirm the hopes of many Texas followers and should work on his super Italian hand-gesticulating style that does not help him…Talented and unpronounceable Pete Buttigieg, the South Bend, Indiana mayor – ex-McKinsey and Afghan veteran – is doing extremely well on the fundraising trail (also targeting rich donors unlike Warren and Sanders) but one may also think that his “upfront diversity” is the driver behind it while he is still relatively low in the polls, also lacking a minority appeal notably after a fatal, criticised shooting by the police in his town in June. The other candidates (it’s hard to keep track of how many are still running now though we can now exclude Congressman Salwell and include hedge fund billionaire Tom Steyer!) are there “for the future” or hoping for a VP slot if they shone well enough…However what are NYC Mayor Bill de Blasio, this interesting female writer and a few others, however skilled in their own ways, really doing there? It is likely that half of the candidates will have disappeared by year-end.  

As you know, I actually saw Kamala as Joe’s best running mate (note that Joe might still do too, forgiving and tactical as I am sure he is) like I said a couple of months ago given the perfect geography/age/gender/race balance with a relatively compatible overall moderate outlook that her prosecutorial profile helps with, whatever radical economic initiatives (like with student loans now, to outflank Bernie) she may talk about (also a good complementarity with Joe). Given his age, I also see Joe for one term eventually or, better, clearly stated at the ticket start with his main mission of “getting things back to normal”. 

Even though the road is indeed very long and short of unexpected events arising, I stick to Joe winning the nomination and Joe-Kamala for the ticket in spite of the early debate attacks from the Californian which actually propelled her in the top group and raised her combative and complementary features which the experienced and calm man from Delaware should have noticed. Interestingly I saw that the FT’s Ed Luce mentioned a first all-women Warren-Harris ticket. I had not thought about that ground-breaking combative one.  

Warmest regards,

Serge

What we have learned from El Paso and Dayton

5-8-19

Dear Partners in thought,

As I come back from blog break, it would be hard not to write about the massive El Paso and Dayton tragedies we all know. 

What have we learned from these 249th and 250th “mass shootings” this year alone? Nothing new. Mass shootings be they in schools, shopping malls or restaurant districts in “America the beautiful”, the leading country in the world, are probably the number one horrifying fact of American life today. It looks like the severity of those two tragedies may have caused some serious thinking and re-thinking even if the NRA is likely getting into gear, counting on its paid politicians and lobbyists to propel the usual message that guns are what have made America and will keep it safe against all enemies. 

When looking at the reactions to El Paso and Dayton, especially from the NRA supporters and the so-called defenders of their interpretation of the Second Amendment, it is useful to understand the following two points:

1. President Trump has encouraged hatred through his language and style which led mentally-ill individuals who felt they were following a virtuous path for America (at least in the case of El Paso) to go and shoot innocent people. When Trump first reacted to El Paso, he condemned the event due to its “cowardice” as if the shooter should have simply not killed people in the back. This is beyond words and shows who Trump is and what damage he has done to America (and the world on other matters). That he dares linking congressional legislation on gun control to immigration is beyond belief in what America always stood for. 

2. Some likeable Republican pundits like Rick Santorum, a former U.S. Senator from Pennsylvania and Republican presidential candidate now acting as moderate conservative counterpunch on CNN, reacted to potential (read likely) gun legislation in two ways: 1. Depriving good citizens of the possibility to stop bad events like in El Paso and Dayton as they would have no access to guns would be bad. 2. Making guns hard to obtain will not stop really bad people from getting them if they want. Rick Santorum is right. However police forces as in many countries in the world have the mission to enforce the law and protect citizens (in Dayton they stopped and killed the shooter in one minute of his rampage which, if already dreadful, could have been much worse while in El Paso the shooter was apprehended in a few short minutes even if the dead and wounded count was horrifying). Moreover gun legislation would be targeted at assault weapons and special multi-round magazines like the two shooters used, not simple handguns so American culture would be preserved. Lastly Santorum is right in that “bad people” committing bank robberies or gangs fighting gangs will always have access to bad guns like everywhere else but 21 year old “nutcases” influenced by the official DC discourse and social media won’t and schools and shopping malls will be safer for this. 

Gun control is not out of reach. If anything El Paso and Dayton due to their dual timing and horror may this time lead to real change that even the NRA, Trump and his friends will not be able to stop as it would be too costly politically. With this on the road a much harsher management of hate speech on social media will need to be put in place as guns are only one of the tools to control even at the cost of free speech. There is “no ifs or buts” today to borrow from a recent PM in Britain.

Warmest regards,

Serge