Partisan gridlock and political extremism threaten to tear down the pillars of public policy and render the U.S. government utterly dysfunctional, argues Senior Fellow Thomas Mann, co-author with Norman Ornstein—resident scholar at the American Enterprise Institute—of It’s Even Worse Than It Looks (Basic Books, 2012). He argues that a flood of super-PAC money, negative ads and cowed mainstream news media are contributing to the problem.

Video

• Mann: Blame for Gridlock Is Squarely on Republican Party

The increasing diversification of news media—from online versions of major newspapers to political bloggers, to 24-hour cable news to social media—plus the profession’s changing economics have caused the balance of power between political reporters and presidential candidates to change. Stephen Hess, senior fellow emeritus, says our very good, well-trained reporters are “almost dangerous” to presidential candidates who are trying to stay on message. Thus, says Hess, the way the press covers campaigns has changed as well, and not for the better.

Video

• Stephen Hess: The Changing Balance of Power in Presidential Campaign Reporting

Following U.S. troop withdrawal in 2014, Afghanistan faces an uncertain future. Its fate could be compromised or even commanded by war lords, terrorists or corrupt government officials. Fellow Vanda Felbab-Brown spent time on the ground observing events and talking to a mix of Afghans from high ranking officials to village elders, to merchants to the person on the street. In this four-part video series based on her book, “Aspiration and Ambivalence: Strategies and Realities of Counterinsurgency and State-Building in Afghanistan,” Felbab-Brown offers analysis on an Afghanistan in flux.

Video

• Vanda Felbab-Brown: Counterinsurgency and State-Building in Afghanistan after 2014
• Vanda Felbab-Brown: The Afghan People Simply Want to Live and Thrive
• Vanda Felbab-Brown: Pakistan Plays a Significant Role in Afghanistan's Future
• Vanda Felbab-Brown: The Choices the U.S. Makes Will Largely Determine Afghanistan's Future

The terrible attack in Nice on July 14—Bastille Day—saddened us all. For a country that has done so much historically to promote democracy and human rights at home and abroad, France is paying a terrible and unfair price, even more than most countries. My colleagues Will McCants and Chris Meserole have carefully documented the toll that France, and certain other Francophone countries like Belgium, have suffered in recent years from global terrorism. It is heart wrenching.

From what we know so far, the attack was carried out by a deeply distraught, potentially deranged, and in any case extremely brutal local man from Nice of Tunisian descent and French nationality. Marital problems, the recent loss of his job, and a general sense of personal unhappiness seem to have contributed to the state of mind that led him to commit this heinous atrocity. Perhaps we will soon learn that ISIS, directly or indirectly, inspired the attack in one way or another as well. My colleague Dan Byman has already tapped into his deep expertise about terrorism to remind us that ISIS had in fact encouraged ramming attacks with vehicles before, even if the actual manifestation of such tactics in this case was mostly new. 

This attack will again raise the question: Why France? On this point, I do have a somewhat different take than some of my colleagues. The argument that France has partly brought these tragedies upon itself—perhaps because of its policies of secularism and in particular its limitations on when and where women can wear the veil in France—strikes me as unpersuasive. Its logical policy implications are also potentially disturbing, because if interpreted wrongly, it could lead to a debate on whether France should modify such policies so as to make itself less vulnerable to terrorism. That outcome, even if unintended, could dance very close to the line of encouraging appeasement of heinous acts of violence with policy changes that run counter to much of what French culture and society would otherwise favor. So I feel the need to push back.

Here are some of the arguments, as I see them, against blaming French culture or policy for this recent string of horrible attacks including the Charlie Hebdo massacre, the November 2015 mass shootings in Paris, and the Nice tragedy (as well as recent attacks in Belgium):

• Starting with the simplest point, we still do not know much about the perpetrator of the Nice killings. From what we do surmise so far, personal problems appear to be largely at the root of the violence—different from, but not entirely unlike, the case with the Orlando shooter, Omar Mateen.
• We need to be careful about drawing implications from a small number of major attacks. Since 2000, there have also been major attacks in the Western world by extremist jihadis or takfiris in New York, Washington, Spain, London, San Bernardino, Orlando, and Russia. None of these are Francophone. Even Belgium is itself a mixed country, linguistically and culturally.
• Partly for reasons of geography, as well as history, France does face a larger problem than some other European countries of individuals leaving its country to go to Syria or Iraq to fight for ISIS, and then returning. But it is hardly unique in the scale of this problem.
• Continental Europe has a specific additional problem that is not as widely shared in the United Kingdom or the United States: Its criminal networks largely overlap with its extremist and/or terrorist networks. This point may be irrelevant to the Nice attack, but more widely, extremists in France or Belgium can make use of illicit channels for moving people, money, and weapons that are less available to would-be jihadis in places like the U.K. (where the criminal networks have more of a Caribbean and sub-Saharan African character, meaning they overlap less with extremist networks).
• Of course, the greatest numbers of terrorist attacks by Muslim extremists occur in the broader Muslim world, with Muslims as the primary victims—from Iraq and Syria to Libya and Yemen and Somalia to South Asia. French domestic policies have no bearing on these, of course.

There is no doubt that good work by counterterrorism and intelligence forces is crucial to preventing future attacks. France has done well in this regard—though it surely can do better, and it is surely trying to get better. There is also no doubt that promoting social cohesion in a broad sense is a worthy goal. But I would hesitate, personally, to attribute any apparent trend line in major attacks in the West to a particular policy of a country like France—especially when the latter is in fact doing much to seek to build bridges, as a matter of national policy, with Muslims at home and abroad. 

There is much more to do in promoting social cohesion, to be sure, even here in America (though our own problems probably center more on race than on religion at the moment). But the Nice attacker almost assuredly didn’t attack because his estranged wife couldn’t wear a veil in the manner and/or places she wanted. At a moment like this in particular, I disagree with insinuations to the contrary.

Editors’ Note: The attack in Nice will inevitably, and appropriately, lead to more aggressive intelligence efforts against suspected ISIS networks and tighter security in general, writes Dan Byman. Unfortunately, they are also likely to bolster anti-Muslim voices in France and throughout Europe, and ISIS may in turn exploit Muslims’ resulting shame and anger. This post originally appeared on Slate.

At least 84 people are dead in Nice, France, after a truck deliberately plowed for over a mile through packed crowds celebrating Bastille Day; ISIS or one of its supporters is believed to be linked to the attack. As we reel in horror from yet another instance of terrorist carnage, news reports are trickling in, giving us a sense of the attack, its victims, and those behind the killings.

We’ll learn more in the days to come, but we already knew Europe—and France in particular—has a terrorism problem and that it may go from bad to worse in the near future. Ironically, one of the reasons for the increased attacks is the military successes the United States, France, and other countries and local fighters are scoring against ISIS’s core in Iraq and Syria and the setbacks suffered by ISIS’s key provinces such as that in Libya. ISIS, which had long trumpeted its success in establishing the now-shrinking caliphate, needs victories to compensate for these major losses. Earlier this month, CIA Director John Brennan warned, “As the pressure mounts on ISIL, we judge that it will intensify its global terror campaign to maintain its dominance of the global terrorism agenda.”

Running down people with a truck is a new form of violence for ISIS, though ISIS propaganda has called for supporters to kill by “ramming” people, al-Qaida’s Yemen branch recommended it in the past to “mow down the enemies of Allah,” and in 2008 a Palestinian used a bulldozer to kill three Israelis. But this is the fourth major terror attack in Europe in the past eight months: ISIS-directed terrorists killed 130 people in November in Paris; in March suicide bombers killed 32 people in Brussels, and just two weeks ago three men believed to be tied to ISIS killed more than 40 at the Istanbul airport.

The attacks will inevitably, and appropriately, lead to more aggressive intelligence efforts against suspected ISIS networks and tighter security in general. Unfortunately, they are also likely to bolster anti-Muslim voices in France and throughout Europe, fostering daily humiliations and furthering Muslim communities’ sense that they are suspect and under siege. ISIS will exploit the resulting shame and anger, increasing the risk of future attacks.

European nations face several types of terror threats from ISIS. The first is the unprecedented number of fighters—more than 5,000—that Europe has exported to Iraq and Syria to fight under the banners of ISIS and other jihadi groups. More than 900 of them (including 200 women) have come from France. More than 130 are dead, and almost 250 have returned; the rest are believed to still be in Iraq and Syria. The Paris attacks, which were coordinated and practiced, illustrate the danger such fighters can pose: Time in the battle zone allows them to gain fighting skills, become indoctrinated, and develop a network to exploit for future attacks. In addition, ISIS leaders can direct their operations to achieve maximal effect. As the so-called caliphate shrinks, more of these fighters may try to return. More than 1,000 other Frenchmen are believed to be radicalized but have not gone to Iraq and Syria, and this represents another overlapping danger. In the past many might have tried to go to Syria, but now, perhaps acting on directions from ISIS leaders with whom they are communicating or perhaps mixing with returned foreign fighters, these individuals might strike directly at France or other countries.

The last category are true “lone wolves”—those inspired by ISIS or other jihadi ideologies but with no direct operational connection to a group (the attacks in San Bernardino and Orlando appear to fall into this category). Two years ago ISIS propaganda emphasized coming to the “caliphate” to help it consolidate and expand. Earlier this year, however, its spokesman and external operations leader Muhammad al-Adnani declared, “The smallest action you do in the heart of their land is dearer to us than the largest action by us and more effective and more damaging to them.”

France, as we’ve seen, is particularly vulnerable. As my Brookings colleagues Will McCants and Chris Meserole have recently argued, French political culture is a counterterrorism problem. They found that “four of the five countries with the highest rates of radicalization in the world are Francophone, including the top two in Europe (France and Belgium).” Part of the problem are the large numbers of unemployed urban youth, a fertile field for radical recruiting. But part of it is also France’s aggressive secularization programs, which prohibit girls from wearing the veil in school and are considered by many Muslims to be a deliberate attack on their religion. Muslims’ trust in the government and security services is low. Add such a sense of humiliation to a surging far-right political movement that constantly blasts Muslim immigrants and citizens, and the conditions for radicalization are strong.

The United States is less vulnerable by comparison. Fewer than 300 Americans have gone to fight in Iraq and Syria. Part of this is because of an aggressive and effective law enforcement and intelligence effort to disrupt volunteers. But part of it is because the American Muslim community is far better integrated than its French counterpart and regularly cooperates with law enforcement. U.S. politics are becoming more poisonous toward Muslims, but—we can hope—that anti-Muslim sentiment in America may have peaked, and recent polls suggest positive attitudes toward Muslims are increasing.

Continued military and intelligence operations against the ISIS core by U.S.-led coalition forces and their local partners are necessary, but they will take time to bear fruit and in the end still don’t solve the terrorism problem. Stopping an attack like the one in Nice is exceptionally difficult. The attacker chose a “soft” (undefended) target and showed that one sick person can kill many with the right combination of determination and luck. Unfortunately, the most likely reaction after the Nice attack is also the worst one: more vitriol and hostility toward French and European Muslims, furthering a cycle that makes it harder for European security services to gain the cooperation of local communities and easier for ISIS to gain recruits and score victories.

France has been struck by an unprecedented three terror attacks in the last 18 months. In what’s called Operation Sentinelle, 13,000 French military personnel now patrol streets and protect key sites across the country, assisting police and other security agencies. “The fact that the armed forces are visible,” said French Defense Minister Jean-Yves Le Drian at a Brookings event on July 20, “help to reassure the French people that they are safe both at home and abroad.”

Do the challenges facing France today mean that it should reduce its engagement overseas, focusing instead on security at home? Le Drian doesn’t think so, and I agree. In a new book titled "Who is the Enemy?," he particularly emphasizes the multifaceted ISIS threat. As he said at Brookings: 

"Every war [has] two enemies…[Today’s] war [with ISIS] also sets in place two concepts of the “enemy” that are radically different: From a strategic point of view, we are dealing with a proto-state; at the heart of this entity, there is a terrorist army." 

It only further complicates matters, of course, that France faces ISIS threats on several fronts: in Syria and Iraq, on the one hand, and also on its own territory. This, Le Drian stressed, means “we must seek coherence in our military action.” It also helps explain why France remains one of the most active countries in the fight against the so-called Islamic State, as well as other extremist groups in the Middle East and in sub-Saharan Africa. In 2013 and 2014, France intervened in Mali in order to prevent jihadi groups from taking over the country. The French military also has a presence in Djibouti, Lebanon, Côte d’Ivoire, the Central African Republic, Gabon, Senegal, as well as in the Pacific (in French Polynesia and New Caledonia)—not to mention Syria, where France uses the Mediterranean Sea-based Charles de Gaulle aircraft carrier to strike ISIS targets. 

France is not a warmongering country—rather, it is responding to the fact that overseas threats come to it. Although it remains unclear to what extent the Nice attacker had connections with foreign terrorist networks, it has been established that the November 2015 Paris attacks were planned and orchestrated from Syria. This, among other considerations, has prompted France to engage further in Iraq and Syria. The rationale, as Minister Le Drian explained, is: 

“[T]rading our peace by reducing our military involvement doesn’t make sense. The more we let ISIS consolidate its presence on the Middle East, the more it will gather resources, attract fighters, and plan more attacks against us.” 

Team player

French policy isn’t just about ensuring its own security—rather, its many contributions are integrated within global efforts, including U.S.-led ones. As Le Drian said at Brookings: “I am convinced that the French-American relationship is stronger and better than ever.” France is a prominent participant of the 66-member international coalition against ISIS, and in that capacity participated in the first joint meeting of that group’s foreign and defense ministers in Washington this month. 

France remains a key member of the joint military operation Inherent Resolve in Iraq and Syria, which has damaged or destroyed over 26,0000 ISIS-related targets since August 2014. The Charles de Gaulle carrier—with 26 aircrafts on board—has been an essential part of that coalition mission. Following specific instructions from U.S. Defense Secretary Ash Carter and his counterpart in Paris, Minister Le Drian, French and U.S. intelligence agencies cooperate closely in intelligence-sharing. And just last week, President François Hollande announced that France will soon be supplying artillery to Iraq to support its fight against ISIS. Beyond the Iraq-Syria theater, France is cooperating with the United States and other partners in Libya, another country that is both a victim and source of extremist threats. 

The French Defense Ministry’s efforts to double-down on protecting French citizens within France, therefore, has not reduced its overseas role. Particularly now that the United Kingdom will leave the European Union, France’s military role has never been so important. France—along with Germany, which recently suggested it would raise its defense spending significantly—should continue to play a leading role as one the top defense actors in the West. 

Although advancements in medical science have greatly improved overall life expectancy and the ability for many to survive a cancer diagnosis, a recent study predicts that cancer care alone will cost the American health system $157 billion by 2020. It is well known that a major driver of these surmounting costs is the rising cost of chemotherapy and other treatments, in addition to the variation in how these treatments are used across the health care system.  However, there are several ways that providers, payers, and patients can work together to establish a more medically and financially effective cancer care model that also reduce costs and inefficiencies in the system.

Figure 1: Estimates of the national expenditures for cancer care in 2010 and estimated increase in cost in 2020

Source: Journal of the National Cancer Institute

Develop “Clinical Pathways” to Reduce Inappropriate Use
For many cancers, there are multiple drugs that can be equally effective in treating a patient’s condition, but the price of these treatments can differ in cost by tens of thousands of dollars. Currently, oncologists are responsible for purchasing their own chemotherapy drugs, processing and maintaining them in a specialized pharmacy-like set up, and then administering them to their patients. Insurers then reimburse the oncologists for the cost of the drugs plus a margin to defray the price of maintenance and administration. Since oncologists receive a share of their income from the margins on the drugs they prescribe, insurers assert that there is an incentive to prescribe the pricier drugs, even when lower cost options of equal effectiveness exist.

One mechanism for ensuring that the most evidence-based treatment is used in the care of cancer patients is to use a set of “clinical pathways.” These pathways are based on clinical guidelines available to the public, but tailored for a particular set of patients or a type of oncology practice. Many professional societies have contributed to these guidelines and are working on developing more advanced tools to manage a patient’s care. The American Society of Clinical Oncology (ASCO) is developing a system to rate drugs for advanced cancer based on a combination of benefit, side effects and price.

Several health plans and providers are already showing results. A Pennsylvania-based collaboration with the University of Pittsburgh Medical Center and commercial payers achieved savings of more than $1 million in only six months by controlling and reducing the use of Avastin through clinical pathways. A Washington-based health plan also achieved $1 million in cost savings through a partnership with 22 medical oncologists.[i] Most recently, one of the nation’s largest health plans announced a new clinical pathways program that provides oncologists with $350 per patient per month (PMPM) for adhering to specific chemotherapy regimens. The program will be rolled out in July across six states with potential for expansion after its first year.

Develop Appropriate Value-Based Incentives that Improve Care and Reduce Costs
It will also be essential to develop alternative payment models that move away from a volume-based fee-for-service model that only pay oncology practices for traditional face-to-face office visits and parenteral medications. Instead, payers should support the transition to value-based models that reward non-traditional care, such as telephone and e-mail clinician support, patient education, and counseling services with a social worker.

ASCO also released a comprehensive payment reform proposal to transition to an episode-based payment system. The proposal outlines five types of flexible, bundled payments built around (1) taking on new patients; (2) providing treatment during a given month; (3) actively monitoring patients when they are not being actively treated; (4) the progression or recurrence of a patient’s disease that requires significant treatment regimen changes; and (5) a patient’s participation in a clinical trial. Additional recommendations include adding penalties or bonuses of up to 10 percent based on the quality of care provided, and complementing other payment reforms such as primary care medical homes and accountable care organizations (ACOs). A number of potential methods of reforming the oncology payment system have been explored elsewhere, including implementation of the Community Oncology Alliance (COA) Oncology Medical Home.

Replicate value-based models across the private and public sectors. Even with momentum from private insurers, comprehensive change must involve the public sector. When Medicare, the largest health insurer in the country, changes policies, many commercial insurance companies follow suit. Cancer care would be an ideal arena to launch a program like Medicare’s Comprehensive Primary Care Initiative, a multi-payer public sector-private sector collaboration to strengthen primary care.

In many ways, insurers’ decisions to take direct action to minimize variations in care and excessive costs sets the stage for what is to come next in health care reform. Not only does this represent a step toward broad payment reform in oncology, but marks a trend toward exploring new methods of payment in other specialties, and to align those efforts with primary care payment reforms.

To learn more about the Engelberg Center's efforts to reform payment in the field of oncology, join us on July 9th from 10:30 AM to 12:30 PM EST for MEDTalk: Reinventing Patient-Centered Cancer Care.

Editor’s note: This post is adapted from a forthcoming full-length case study; the second in a series from the Engelberg Center’s Merkin Initiative on Physician Payment Reform and Clinical Leadership designed to support clinician leadership of health care delivery, payment, and financing reform. The case study will be presented during the Merkin Initiative’s “MEDTalk” event on July 9 from 10:30 AM to 12:30 PM EDT, featuring live story-telling and knowledge-sharing from patients, providers, and policymakers.

Oncology practices and hospitals across the nation struggle with providing sustainable, comprehensive, and coordinated cancer care. Clinical leaders with strategies and models to improve the quality and value of health care often don’t know how to navigate the landscape of payment and delivery reform options to sustain their innovations.

We use a case study approach to investigate and tell the story of the New Mexico Cancer Center (NMCC), an independent cancer center that is experimenting with innovative ways to improve patient-centered oncology care. We identify challenges for creating sustainable and supportive payments models, and we share the broader strategic and policy lessons for adopting alternative payment models.

The Clinical Scenario: Living With Cancer

Vicky Bolton, a 58-year-old full-time medical legal coordinator from Albuquerque, has stage 4 adenocarcinoma lung cancer. She started chemotherapy in 2003 and has consistently received treatments over the last 11 years. Vicky is one of 13 million Americans currently living with cancer, with more than 1.6 million new diagnoses added each year.

Although Vicky’s condition is currently stable, she is at high risk for venous thrombosis (blood clots), life-threatening infections, and other complications, which put her at high risk for repeated hospitalizations. In the past six months, she has taken advantage of “after hours” care on three occasions as an outpatient at NMCC. Fortunately, each of her providers and services — oncology, radiation therapy, labs, x-rays, and internal medicine — are centralized in a single location at NMCC, reducing the need for emergency room (ER) visits or hospitalizations for these episodes.

The Challenge: Controlling Spending While Improving Patient-Centered Care

Cancer is the second leading cause of death in the U.S. Forty-one percent of Americans will be diagnosed with cancer during their lives. Cancer care is also expensive, accounting for $125 billion of total health care spending annually. In 2011, Medicare alone spent nearly $35 billion in fee-for-service (FFS) payments for cancer care, representing 9 percent of all Medicare FFS payments.

The high costs of cancer care are driven by issues that plague the entire health system: uncoordinated care delivery, duplication of services, fragmentation, and volume-based payments. A common impact of these drivers in oncology is the use of the ER to relieve symptoms associated with adverse effects of chemotherapy or other treatments that can also result in hospitalization.

For example, research shows that the most common reasons for cancer patient ER admissions are pain, respiratory distress, nausea, and vomiting. More than half of the ER visits occurred on weekends or in the evening, and over 60 percent resulted in hospital admission. This suggests that if a patient’s symptoms could be managed at home or in the community, costly hospital admissions could be avoided. ER visits, where patients are exposed to germs and infections as they wait — often hours — to be admitted, can have catastrophic outcomes for patients that are actively in treatment since they have weakened immune systems and are more prone to infections.

In addition to the inherent issues with fee-for-service (FFS) payments — with payments incentivizing volume of procedures rather than the value of care delivered — the current payment system further exacerbates problems: If a practice provides higher-value care to patients at a lower cost to the overall system (that is, they perform fewer services and have lower revenue), the financial winner is the payer who reimburses fewer services, not the practice (which merely has less revenue). This combination of the misaligned incentives of FFS and the lack of financial benefit for improving care while reducing costs means that many practices simply cannot afford to make the transformations needed without other funding mechanisms.

The Real World: How Has An Independent Cancer Center Responded To These Challenges?

NMCC delivers care to roughly 2,700 patients and provides care to one in three New Mexicans with cancer. The changes that the center has made have focused on reducing the impact of fragmentation of care on their patients (Table 1).

A key innovation was enhancing comprehensive after-hours and weekend care on site and creating a telephone and urgent care triage program to avoid expensive emergency room and inpatient care, which NMCC termed the COME HOME model.

As part of its redesign process in 2012, NMCC – along with six community oncology practices — secured a $20 million Center for Medicare and Medicaid Innovation (CMMI) Health Care Innovation Award (HCIA), for a three-year period. The award has an explicit aim of reducing ER visits by 50 percent and hospitalizations by 20 percent to justify the program costs.

Table 1: Care Redesign Elements Undertaken by NMCC

The Key Levers: How Can COME HOME Be Sustained?

On the heels of the Affordable Care Act (ACA) and numerous quality and payment focused initiatives in the private sector, health care organizations need to enhance the competitiveness and efficiency of their systems in the marketplace.

Alternative payment models (APMs) such as Accountable Care Organizations (ACOs), bundled payments, and patient-centered oncology medical homes (PCOMH) are just a few of the initiatives supported by public and private payers to align care redesign and payment reform and encourage continuous improvement. (Clinical pathways, a strategy recently embraced by WellPoint, offer PCOMH-like incentives to encourage adherence to practice guidelines, a strategy primarily geared to encourage higher-value chemotherapy practice.)

Broader or larger case-based payments may also provide stronger incentives to limit costs, to help assure that promising delivery reforms actually lead to cost reduction, but this exposes oncologists to greater levels of financial risk, as shown in Table 2. Consequently, implementing payment reforms that are viewed as feasible and desirable by both providers and payers is difficult.

Table 2: Comparison of Alternative Payment Models for Oncology

The Path Ahead: How Can These Models Assist NMCC?

NMCC currently receives approximately $70,000 per month from the CMMI grant and has not yet identified a clear strategy to sustain the delivery reforms in the COME HOME care model past the end of the grant (July 2015). As for payment reform options, NMCC has been unable to contract as part of a comprehensive ACO due to local health care market conditions.

Clinical pathways are geared primarily to guidelines and chemotherapy adherence, and are not designed to provide funding for after-hours care or triage programs that are intended to achieve offsetting savings through avoiding costly complications. Possible remaining options include:

• PCOMH: Using the data it gathers, NMCC intends to quantify the additional costs the COME HOME model requires, and the savings that it achieves. Based on that estimate, NMCC could suggest a per-member per-month (PMPM) payment from a private insurer to cover the costs of providing higher quality care. To encourage participation, NMCC could also enter into a risk-sharing agreement, in which overall costs of inpatient care and ER visits would be compared against a target. The PMPM payment could be at-risk if the targets are not achieved after a certain period of time.

• Bundled Payments: NMCC could potentially use the medical home approach with risk sharing (described above) as a first, interim step toward a bundled payment system, NMCC’s long-term preferred model. Computing actuarially sound expected costs for the bundled payments would require merging claims data with clinical data (for example, ICD-9 codes fail to distinguish between subtypes of breast cancer that have radically different treatments). A bundled payment pilot might be performed for high volume cancers, such as breast and lung.

Lessons Learned

The experience of innovative pioneers like NMCC can shed some light on potential barriers to conceptualizing and implementing sustainable clinical redesign. The lessons learned have been sorted into three main categories: relationships with payers and networks, payment model selection, and data collection and quality improvement considerations.

Relationships with payers and networks. Though counterintuitive, merely demonstrating significant value from care design, perhaps from lower utilization of inpatient and emergency department utilization, does not automatically create a financial pathway for sustainable delivery reform. To do so, innovative providers should consider involving lead payer partners early on to help identify end-points of interest to payers and potential payment strategies that may emerge later.

Providing support for health care delivery reforms requires new activities by payers towards aligning their payments with value, rather than volume and intensity of services. However, fragmented health care markets face the challenge of the “free rider” problem: payers may be unwilling to shoulder delivery transformation costs that may benefit other payers’ clients while they wait for CMS or others to make the financial investment, pay for the program evaluation, and enact policy change). Other challenges include payer inertia and long lag times between care redesign and subsequent data demonstrating results.

Large ACOs and other integrated payer-provider plans, including those large enough to form Medicare Advantage plans, are moving forward on negotiating payment and delivery reforms. This may be more difficult for innovative, smaller practices, even if they can provide higher-value clinical services. In turn, this may have anti-competitive consequences, such as discouraging delivery innovation that leads to “demand destruction” of high-cost hospital-based services. Private and public payers should be particularly interested in developing models that enable smaller, specialized providers like oncology practices to undertake key delivery reforms.

Sustainable Payment Model Selection. While substantial attention has been paid to primary care focused APMs, specialty-focused APMs are needed for practices like NMCC. Their development should be a high priority for public and private payers. Clinical transformation grants, such as those offered by CMMI, should include clear pathways for transitioning to APMs if initial cost savings targets or projections are met. Otherwise, delivery system innovations are at high risk of failure despite evidence of improved value.

Data Collection and Quality Improvement Considerations. Timely sharing of actionable information from claims and other administrative data remains a major challenge, with complex and varied procedures for obtaining claims from payers; smaller practices are particularly challenged in interpreting the claims data. Some states, such as Maryland, Massachusetts, Vermont, and Colorado (among others) are proceeding with creating all-payer claims databases. (Maryland, for example, offers almost instantaneous provider feedback from claims through their CRISP database.)

Others, such as Minnesota, are using “distributed” approaches in which multiple payers and systems produce measures in consistent ways. As NMCC’s early efforts illustrate, practices can produce more clinically sophisticated performance measures. Strategies to achieve consistent methods for sharing key data on cost and quality need to be expanded to encourage quality improvement and payment reform.

Event Information

Many clinicians have terrific ideas for improving the quality and cost of health care, but often don’t know how to navigate the often baffling landscape of payment and delivery reform options. To address this need in clear, practical terms, we are pleased to announce the second MEDTalk event in the “Merkin Series on Innovations in Care Delivery.” The series is designed to support clinicians and policymakers who’ve always wondered how delivery reform occurs, but didn’t know where to begin. 

Our second case focused on the work of leaders from the New Mexico Cancer Center (NMCC), and their efforts to "Reinvent Patient-Centered Cancer Care." The event featured several brief “TED-style” talks that considered the challenges of delivering oncology care, while enhancing patient experience, improving coordination of care, and reducing costs. The agenda included firsthand experiences from patients, payers, policymakers, and NMCC's clinical leadership who explores sustainable improvement strategies, and the financial mechanisms available to encourage innovations in oncology.

Video

• A Day in the Life: The Patient Experience
• The Future of Oncology: Drugs, Genetic Testing and Personalized Medicine
• The Challenge of Delivering Cancer Care in a Triple Aim World
• What We're Learning from New Oncology Payment Models
• Supporting Care While Reducing Costs: What is Possible?
• The New Mexico Experience: Aligning Clinical Redesign and Payment Reform
• Sustaining Improvements in Patient-Centered Care
• Lessons Learned and the Path Forward
• MEDTalk: Reinventing Patient-Centered Cancer Care

Event Materials

• Oncology Case Study August 2014 FINAL WEB

Event Information

Over the past few years, more than 600 Accountable Care Organizations (ACOs) have formed across the country, charged with the dual goals of improving health while also reducing health care costs. Increasingly, evidence on how public and private ACOs are progressing toward these goals is beginning to emerge. Based on these results, major regulatory changes are anticipated in the months ahead that will impact accountable care programs in Medicare, as well as future uptake within the private sector.

On October 20, the Engelberg Center for Health Care Reform hosted a half day forum to assess the latest evidence on accountable care, discuss strategies to overcome unique ACO challenges, and provide an overview of accountable care reforms. Sean Cavanaugh of the Centers for Medicare and Medicaid Services (CMS) provided keynote remarks on the latest Medicare ACO results and potential changes to the Medicare Shared Savings Program (MSSP). Panel sessions featured leading experts in ACO research, implementation and health care policy.

 Join the conversation on Twitter using #ACOFuture or follow @BrookingsMed

Video

• The Medicare Shared Savings Program (MSSP): Looking Ahead
• Big Issues for ACOs Going Forward
• ACO Policy Issues and Solutions on the Horizon

Audio

• The State of Accountable Care: Evidence to Date and Next Steps

Transcript

• Uncorrected Transcript (.pdf)

Event Materials

• ACO Public Event full deck FINAL
• 102014_Accountable Care_Transcript

Editor’s Note: The National Perspectives on Global Leadership (NPGL) project reports on public perceptions of national leaders’ performance at important international events. This fifth installation of the NPGL Soundings provides insight on the issues facing leaders at the Seoul G-20 Summit and the coverage they received in their respective national media. Read the other commentary »

The week before the Seoul G-20 Summit was one in which the main newspapers read in Washington (The New York Times, The Washington Post and Financial Times) all focused their primary attention on the “currency war,” global imbalances, the debate on quantitative easing (QE 2), the struggle over whether there would be numerate current account targets or only words, and the US-China relationship. As early as Wednesday, November 10, The Washington Post front-page headline read: “Fed move at home trails U.S. to Seoul; Backlash from Europe; Obstacles emerge for key goals at G-20 economic summit.” By Thursday, November 11, things had gotten worse. “Deep fractures hit hopes of breakthrough; governments are unlikely to agree on a strategy to tackle economic imbalances” read the Financial Times headline on Alan Beattie’s article from Seoul. Friday, November 12, The New York Times front-page headline declared: “Obama’s Economic View is Rejected on World Stage; China, Britain and Germany Challenge U.S.; Trade Talks with Seoul Fail, Too.” By Saturday, the Financial Times concluded in its lead editorial: “G-20 show how not to run the world.”

From these reports, headlines and editorials it is clear that conflicts over policy once again dwarfed the progress on other issues and the geopolitical jockeying over the currency and imbalances issues took centre stage, weakening G-20 summits rather than strengthening them. Obama was painted as losing ground, supposedly reflecting lessening U.S. influence and failing to deliver concrete results. China, Germany and Brazil were seen to beat back the U.S. initiative to quantify targets on external imbalances. Given the effort that Korean leaders had put into achieving positive results and “consolidating” G-20 summits, it was, from this optical vantage point, disappointing, to say the least.

How was the Rebalancing Issue Dealt With?

At lower levels of visibility and intensity, however, things looked a bit different and more positive. Howard Schneider and Scott Wilson in Saturday’s edition of The Washington Post (November 13) gave a more balanced view of the outcomes. Their headline read: “G-20 nations agree to agree; Pledge to heed common rules; but economic standards have yet to be set.” They discerned progress toward new terrain that went beyond the agreement among G-20 finance ministers in October at Gyeongju, which other writers missed.

“By agreeing to set economic standards, the G-20 leaders moved into uncharted waters,” they wrote. “The deal rests on the premise that countries will take steps, possibly against their own short-term interests, if their economic policies are at odds with the wider well-being of the world economy. And leaders are committing to take such steps even before there’s an agreement on what criteria would be used to evaluate their policies.”

They continued: “In most general of terms, the statement adopted by the G-20 countries says that if the eventual guidelines identify a problem, this would ‘warrant an assessment of their nature and the root causes’ and should push countries to ‘preventive and corrective actions.’”

The Schneider-Wilson rendering went beyond the words of the communiqué to an understanding of what was going on in official channels over time to push this agenda forward in real policy, rather than declarative terms. As the Saturday, November 13, Financial Times’ editorial put it, “below the headline issues, however, the G-20 grouping is not completely impotent,” listing a number of other issues on which progress was made including International Monetary Fund (IMF) reform which the Financial Times thought might actually feed back into a stronger capacity to deal with “managing the global macroeconomy.”

The Role of President Barack Obama

Without doubt, the easy, simple, big-picture message coming out of Seoul was that Obama and the United States took a drubbing. And this did not help the G-20 either. The seeming inability of the U.S. to lead the other G-20 leaders toward an agreement in Seoul on global imbalances, the criticism of U.S. monetary easing and then, on top of it all, the inability to consummate a US-Korea trade deal, made it seem as if Obama went down swinging.

But again, below the surface of the simple, one got a different picture. Obama himself did not seem shaken or isolated at the Seoul summit by the swirl of forces around him. At his press conference, he spoke clearly and convincingly of the complexity of the task of policy coordination and the time it would take to work out the policies and the politics of adjustment.

“Naturally there’s an instinct to focus on the disagreements, otherwise these summits might not be very exciting,” he said. “In each of these successive summits we’ve made real progress,” he concluded. Tom Gjeltin, from NPR news, on the Gwen Ifyl Weekly News Roundup commented Saturday evening that the G-20 summits are different and that there is a “new pattern of leadership” emerging that is not quite there yet. Obama seems more aware of that and the time it takes for new leadership and new patterns of mutual adjustment to emerge. He may have taken a short-run hit, but he seems to have the vision it takes to connect this moment to the long-run trajectory.

Reflections on the Role of South Korea

From a U.S. vantage point, Seoul was one more stop in Asia as the president moved from India to Indonesia to Korea to Japan. It stood out, perhaps, in higher profile more as the locus of the most downbeat moments in the Asia tour, because of the combination of the apparent lack of decisive progress at the G-20 along with the needless circumstance of two presidents failing to find a path forward on something they both wanted.

From a Korean vantage point, the summit itself was an event of immense importance for Korea’s emergence on the world stage as an industrial democracy that had engineered a massive social and economic transformation in the last 50 years, culminating in being the first non-G8 country to chair the G-20 summit. No one can fault Korea’s efforts to reach significant results. However, the fact is that the Seoul Summit’s achievements, which even in the rebalancing arena were more significant than they appeared to most (see Schneider and Wilson), but included substantial progress on financial regulatory reform, international institutional reform (specifically on the IMF), on development and on global financial safety nets, were seen to be less than hoped for. This was not the legacy the Koreans were looking for, unfortunately.

Conflicts among the major players on what came to be seen as the major issue all but wiped out the serious workmanlike progress in policy channels. The leaders level interactions at G-20 summits has yet to catch up to the highly significant degree of systemic institutionalization of the policy process of the G-20 among ministers of finance, presidents of central banks, G-20 deputies and Sherpas, where the policy work really goes on. On its watch, Korea moved the agenda in the policy track forward in a myriad of significant ways. It will be left to the French and French President Nicolas Sarkozy to see if they can bring the leaders into the positive-sum game arrangements that are going on in the policy channels and raise the game level of leaders to that of G-20 senior officials.

Event Information

While the future impact of rising powers such as Brazil, Russia, India and China is uncertain and the shifting political landscape in the Arab world is still playing out, the influence of these emerging nations is a central fact of geopolitics.

Already the global financial crisis, the Copenhagen climate negotiations, and the debate over Iran sanctions have illustrated the potential, the pitfalls, and above all the centrality of the relationship between American power and the influence of these rising actors and developing democracies.

In a new paper, Senior Fellow Bruce Jones, director of the Managing Global Order Project at Brookings, argues the greatest risk lies not in a single peer competitor but in the erosion of cooperation on issues vital to U.S. interests and a stable world order. U.S. power is indispensible for that purpose but not sufficient. No longer the CEO of Free World Inc., the United States is now the largest minority shareholder in Global Order LLC.

On March 15, the Brookings Institution and Foreign Policy magazine hosted the launch of Bruce Jones’s paper "Largest Minority Shareholder in Global Order LLC: The Changing Balance of Influence and U.S. Strategy." Panelists explored the prospects for cooperation on global finance and transnational threats; the need for new investments in global economic and energy diplomacy; and the case for new crisis management tools to help de-escalate inevitable tensions with emerging powers.

Susan Glasser, editor in chief of Foreign Policy, moderated the discussion. After the presentations, panelists took audience questions.

Video

• Relative Shift in U.S. Balance of Power
• Shifting Coalitions of Consensus
• Paradox of Power for U.S.
• U.S. Needs To Get Serious about Development and Energy

Audio

• Shifting Balance of Power: Has the U.S. Become the Largest Minority Shareholder in the Global Order?

Transcript

• Uncorrected Transcript (.pdf)

Event Materials

• 20110315_global_order

Event Information

2015 is a crucial year for the international community. For the first time, all nations will converge upon a new set of Sustainable Development Goals applicable to advanced countries, emerging market economies, and developing countries, with the experience of implementing the Millennium Development Goals to build upon. Implementation is the critical component.

The Brookings Global Economy and Development program hosted a day-long private conference at the Brookings Institution in Washington, DC on Monday, March 30 to focus on “Governance innovations for implementing the post-2015 Sustainable Development Agenda.”

Hosted in collaboration with the Ministry of Foreign Affairs of Finland, this high-level conference drew on experiences from the North-South Helsinki Process on Globalization and Development carried out over the past 15 years. The Helsinki Process presaged many of the prerequisites for achieving accelerated progress by linking goal-setting to goal-implementation and by utilizing multistakeholder processes to mobilize society and financing for social and environmental goals to complement sound economic and financial policies. 

Download the conference agenda »
Download the related report »
Download the list of registrants »
Download the conference statement »

Brookings President Strobe Talbott shakes hands with Finland’s Minister of Foreign Affairs Erkki Tuomioja after welcoming participants to the conference.

Former President of Finland Tarja Halonen shares insights in the conference’s opening panel.

Over 75 conference participants from governments, multilateral institutions, civil society, the private sector, and think tanks participated in a number of roundtable discussions throughout the day.

President Halonen and Minister Tuomioja share lessons from the Helsinki process as conference participants consider paths forward for implementing the post-2015 Sustainable Development Goals.

Event Materials

• 330 PostReportFinal
• Conference Agenda_FINAL
• March 30 List of Registrants
• Conference Statement Brookings Post2015 Implementation

Editor's note: This blog piece is based on findings from the new book Governance in an Age of Abundance: Experiences from the Extractive Industries in Latin America and the Caribbean, which will be launched at a Brookings public event later today. A Spanish version of this post is available on the Inter-American Development Bank's website. 

The myth of Sisyphus represents in Greek mythology a metaphor for pointless and interminable efforts. Sisyphus was condemned by Zeus to push a huge boulder up a steep hill. Every time he was close to reaching the top, the boulder was made to roll back down the hill and to the starting point, so that Sisyphus had to start all over again, in perpetuity.    

This metaphor may sound familiar to countries rich in natural resources. In many of these countries, citizens have hoped for generations that the revenue derived from extractive industries (oil, gas and mining) would translate into concrete benefits. Instead, rents from extractive industries have frequently been misused, either through wasteful state spending or public and private corruption. In many countries, heavy dependence on revenues from extractive industries has produced economic and political distortions. Also, revenues are all too often centralized at the national level, leaving local communities to wonder about the benefits of hosting extractive industries.

Overcoming the ‘Resource Curse’

The good news is that there are countries that have found a way to overcome the so-called "resource curse." In Norway, for example, the revenue deriving from the extractive industries supports a majority of government investment in education and health, as well as the pension system. While many resource-rich states can make the same claim, what makes Norway unusual is that it has been able to do so while minimizing corruption, mitigating economic distortions and ensuring efficiency in government spending at the same time.  

How did Norway do it? A look at the Natural Resources Governance Index (NRGI), developed by the Natural Resource Governance Institute, provides a possible explanation: by strengthening governance in the extractive sector. This implies establishing a robust legal and regulatory framework, agile mechanisms to promote transparency and disseminate information, effective safeguards and rigorous controls, and an overall institutional environment that is business-friendly and conducive to greater accountability in the public sector. And this is not a phenomenon unique to Norway, but it is replicated in other countries with large extractive sectors, such as Australia, Botswana and Canada.

Extractive Industries in Latin America and the Caribbean

Latin American and the Caribbean are at a crucial juncture in their effort to strengthen governance in the management of natural resources. On the one hand the above-mentioned NRGI, which measures the quality of extractives governance in 58 resource-rich countries, shows that among the eleven world leaders in quality of extractives governance, more than half are countries from the region (Brazil, Mexico, Chile, Colombia, Trinidad and Tobago and Peru). This is especially good news if one considers that Latin America and the Caribbean is the main source of metals at a global level, and that it holds the second largest oil reserves in the world. Latin America and the Caribbean are also remarkable because many countries have managed to develop large extractive sectors while at the same time avoiding the secessionist conflicts over extractives that plague resource-rich countries in other regions of the world.

On the other hand, Latin America still has to resolve some important issues. Overall, the region still falls short on rule of law and corruption measures in comparison to OECD (Organisation for Economic Co-operation and Development) countries. Social conflicts related to the exploitation of natural resources remain a sensitive issue in the region, especially when extractive industries operate in territories where indigenous communities have a significant interest and presence. Citizen demands regarding the control and mitigation of environmental impacts by governments and corporations are increasing, especially in terms of land use and conservation of water resources and forests. And many Latin Americans are increasingly demanding good governance and transparency in state spending.

Transparency is Key to Improving Governance

The recent IDB book Governance in an Age of Abundance: Experiences from the Extractive Industries in Latin America and the Caribbean (IDB, 2014), edited by Juan Cruz Vieyra and Malaika Masson, analyzes these challenges, particularly in light of recent initiatives to strengthen transparency in the governance of natural resources in the region.

The book focuses on two main themes. The first is on how best to improve governance in the extractives sector, especially in a way that promotes inclusive growth and takes into account the concerns of citizens. The key to this is governance mechanisms that include checks and balances to ensure that the needs of local communities are taken into account. The second theme of the book is a focus on evaluating concrete governance proposals, which include improved legislation, licensing arrangements, contracting procedures, and fiscal regimes. Underlying these two themes is a strong argument in favor of strengthened government capacity to produce, use, and disseminate accurate and timely information about the extractive sector.

The book identifies transparency as a key tool to improve the quality of governance in the extractive sector. This is not an easy task, because effective governance of this sector requires states to manage across a complex set of policy domains. Transparency is part of the solution to this problem by making data available to a wider set of stakeholders. This allows for improved coordination inside of government and helps civil society and the private sector to make informed contributions to public policy and hold governments accountable. For example, Colombia, through its Maparegalías initiative, is putting all the information about how money from extractive industry royalties are being spent, community by community, with everything placed online on an interactive map for easy access. But to make the most out of transparency, states need to address shortfalls in human capacity to use newly available data effectively in the public sector. This is particularly true at the sub-national level in many Latin American and Caribbean countries. Ultimately, as transparency improves and governments use data to operate more effectively and efficiently, citizen trust and confidence in the ability of the public sector to manage the wealth produced by extractive industries will improve. 

The findings of the book point towards two key challenges for governments related to designing and implementing transparency initiatives:

1. Governments need to make data more easily available and more accessible to stakeholders. This includes addressing the quality and timeliness of information. It also means improving the ease of use of data, both in terms of the formatting of data and navigability of the platforms that present it.
2. Governments need to be creative about soliciting feedback from stakeholders in the extractive sector. It is not enough to merely present data to the public. Governments should actively seek out input from citizens. This will ultimately mean investing in public and private capacity to analyze available data so that stakeholders can make informed contributions to governance.

These recommendations present the best way for governments in Latin America and the Caribbean to emerge from the paradoxical Sisyphean trap that resource abundance has all too often posed.

The authors are grateful to Pablo Bachelet, Juan Cruz Vieyra, Francesco De Simone and Martin Walter for their comments. 

Event Information

During the past decade, an abundance of wealth in minerals and hydrocarbons in Latin America and the Caribbean has translated into substantial revenues and macroeconomic growth. However, operations in the extractive sector have also led to significant challenges, such as corruption, negative social outcomes and environmental impacts.

On November 4, the Latin America Initiative and Energy Security Initiative at Brookings, with the Inter-American Development Bank (IDB), hosted a discussion on governance and institutional capacity in the extractive sector in Latin America and the Caribbean, drawing on findings from the publication Transparent Governance in an Age of Abundance: Experiences from the Extractive Industries in Latin America and the Caribbean, published by the IDB. Edited by Malaika Masson and Juan Cruz Vieyra, the book presents transparency as a central element to bolster governance quality and state legitimacy in the context of an increasingly demanding citizenry.

 Join the conversation on Twitter using #LatAmResources

Audio

• Transparent Governance in Latin America’s Extractive Industries

How to react to presidential candidates who are running, in part or wholly, on their experience in private business?

It’s impossible for anyone to come into the White House with all the skills required to be a good president. We can know that key traits include intelligence, both cognitive and emotional; self-confidence; and decisiveness. Also needed are the ability to communicate; to listen and learn; to delegate; to recognize problems–and a sense of humor and humility.

Candidates’ stands on the issues are critical in primaries and in the general election, but I suspect that the views of many independent voters–whose ranks are growing–may not be as intensely held as those of partisan voters.

Given Americans’ widespread frustration with traditional politicians, it is understandable why a few candidates with at least some business experience have entered the fray. Having run a business exposes one to how government affects the private sector, which is the engine of economic growth and drives improvements in living standards.

But running a private-sector business is very different from heading a federal government that employs millions, and that takes in and spends trillions, while also dealing with a wide range of domestic and foreign policy issues, many of which demand immediate attention. These things require dexterity–and the combined challenges are ones that no business ever comes close to dealing with. (Probably the closest experience to the presidency is running a large state. But even then, no governor has had to confront the range of foreign policy challenges facing the president.)

A critical difference between running a business and government is that CEOs can usually make sure that their orders are carried out; and if they’re not, those who didn’t do their jobs can be fired. Imagine a president tried working with Congress that way. “My way or the highway” won’t cut it.

One might think that military leaders would face the same problem, but successful generals, especially in recent times, have had to develop and hone political skills as well as knowing how to fight. Gen. Dwight Eisenhower is now regarded as a good president not only because of his military experience but because he also was a politician-administrator while commanding allied forces during World War II. George Washington had both a military and business background, but he was a politician too–and the government he oversaw wasn’t much larger than his (substantial) private business.

Some 2016 voters will cast ballots based on particular issues. But for others, particularly those who believe this country is on the wrong track, a candidate running on his or her business background in an effort to stand out from the pack is not likely to have the qualifications most important to being a successful president.

Capitalism has provided unprecedented wealth and prosperity around the world, but a growing community is raising concerns about whether the promise of the capitalist system to achieve a more shared and durable prosperity can be achieved without systemic changes in the way for-profit corporations are governed and managed. The change in public opinion has become evident among workers, consumers, and investors, as well as through new policies enacted by elected officials of both parties: more than ever before, the public supports businesses that demonstrate positive social change and sustainable development. These new attitudes have begun to take root in corporations themselves, with a growing community of investors, business leaders, and entrepreneurs expressing a fiduciary duty to create value not only for shareholders but for society. However, businesses and investors seeking to harness these opportunities face significant institutional and normative barriers to achieving their goals.

In a new paper, the co-founders of non-profit B Lab, Andrew Kassoy, Bart Houlahan, and Jay Coen Gilbert, write about this overarching culture shift, the importance of and impediments to effective impact governance and impact management to make this shift meaningful and lasting, and how a rapidly growing community of responsible businesses has overcome these barriers, is maximizing its social impact, and is creating pathways for others to follow. The impact and growth of the B Corp movement will be maximized not only through increased adoption by business leaders, but also through the unique roles played by research institutions, the media, policy-makers, investors, and the general public. With enough support, this movement may soon transform shareholder capitalism into stakeholder capitalism, in which businesses can more easily live up to their potential to create a more shared and durable prosperity for all. 

This paper is published as part of the Center for Effective Public Management’s Initiative on 21st Century Capitalism. It is one of more than a dozen papers written by academics and practitioners about the changing role of the corporation and the importance of improving corporate governance. The authors of this paper are the co-founders of B Lab, a nonprofit organization that oversees the certification of B Corporations, and a major subject of this paper. The perspectives put forth in this paper are solely those of the authors, based on their professional expertise in this area.

Downloads

• Download the paper

In 2013, China surpassed the European Union to become the Middle East and North Africa (MENA) region’s largest trading partner, and Chinese oil imports from the region rival those of the United States. Do China’s growing interests in the Middle East imply a greater commitment to the region’s security? How can China and regional governments reinforce these ties through greater diplomatic engagement?

In a new Policy Briefing, Chaoling Feng addresses the key choices facing Chinese and Middle East policymakers. She finds that China’s continued reliance on a framework of “non-intervention” is being challenged by the region’s divisive conflicts. Indeed, China’s economic interests face mounting risks when even maintaining “neutrality” can be perceived as taking a side. Furthermore, China’s case-by-case, bilateral engagement with MENA countries has hindered efforts to develop a broader diplomatic approach to the region.

Read "Embracing Interdependence: The Dynamics of China and the Middle East"

Feng argues that China and particularly the GCC states must work to further institutionalize their growing economic interdependence. China, drawing on its experiences in Africa and Latin America, should take a more holistic approach to engagement with the MENA region, while enhancing Chinese institutions for energy trading. GCC countries, for their part, should aim to facilitate bilateral investments in energy production and support China’s plans for Central and West Asian infrastructure development projects.

Downloads

• English PDF
• Arabic PDF

Over the past year, much attention has been given to the growing production of shale oil and the challenge that these unconventional sources of energy pose to traditional producers in the Gulf. As the world’s leading exporter of liquefied natural gas (LNG), Qatar faces related concerns – mounting competition from new LNG exporters and more competitive pricing in key Asian gas markets. How will this global gas boom unfold? How can Doha develop a robust response to growing volatility in gas pricing and demand?

In a new Brookings Doha Center Analysis Paper, Naser al-Tamimi examines Qatar’s position on the global gas stage and assesses the prospects of new competitors. He argues that new LNG production and exports – from Australia, the United States, and other countries – present a challenge to Qatar’s dominant status in global gas markets, particularly in the Asia-Pacific region. At the same time, diversification and slowing growth in this region’s major economies, such as China, South Korea, and Japan, may reduce LNG demand across the board.

Read "Navigating uncertainty: Qatar’s response to the global gas boom"

Ultimately, Tamimi argues that Qatar’s pricing mechanisms and export revenues will come under significant pressure as a result of these developments, posing a potential challenge to Qatari finances. He contends that an effective response from Qatari officials must emphasize greater exports to the Middle East/North Africa region, greater contract flexibility to attract new buyers, and cooperation with other GCC members to improve Gulf bargaining power in key regional markets.

Downloads

• English PDF
• Arabic PDF