The campaign for the 2016 Presidential nominations has shaken the political kaleidoscope, and the pieces are still moving. The populist surge of both Donald Trump and Bernie Sanders has torn the carefully crafted campaign strategies of other candidates into tatters. Populism is trumping realism. Political nostrums – like how Evangelical Christians or women will vote – are being challenged almost daily. The political establishment looks like the Wizard of Oz, with feeble powers inside giant machines.

There are, then, many losers in 2016. But perhaps the biggest loser of all is public policy. Policy used to matter quite a lot; the very term “policy platform” implied a solid structure, on which candidates would stand. Today, the strength of a candidate’s policy prescriptions and the strength of their political support seem unrelated. Or if there is a relationship, it is an inverse one. Trump provides the most vivid example of the sundering of policy from politics. But the policies of Sanders don’t come close to adding up either. Trump’s ideas are wacky – but Sanders’ are weak.

Trump’s proposals (when clear enough to be assessed) have been judged to be wholly impractical by every expert who is not certifiable. You cannot, in fact, force a sovereign nation to pay for a 2,000-mile, $20-billion wall you are building to keep their people out. You cannot enact a “total and complete shutdown of Muslims entering the U.S.” You cannot impose a 45 percent tariff on Chinese goods. You cannot cut taxes, ignore entitlements and wipe out the national debt. You cannot deport 11 million people. To be clear, I mean “cannot” here in the narrow, policy sense, rather than in legal or moral terms.

But cries of foul from the policy analysts have fallen on deaf ears. Each time Trump makes a ludicrous suggestion, these experts fill the airwaves with their reasoned arguments against it, Trump ignores them, and his poll ratings go up. Every time an establishment expert attacks one of his proposals, his anti-establishment credentials are burnished.

Meanwhile, the uber-wonk of the Republican field, Jeb Bush, became a piece of political marginalia. He produced some thoughtful and sensible policy ideas, on student financing, economic growth, health care, energy, school reform, and so on. Look where that got him.

Trump has grasped an important truth about politics in the digital age. Policy statements do not need to be serious proposals. They are merely ways to signal to the electorate what your instincts are, and what kinds of things you care about. It doesn’t matter if they don’t pass muster in the DC think-tank community. They are essentially a long list of the candidate’s likes and dislikes – politics in primary colors.

At his rallies, Trump announces his plan to build a wall on the southern border of the U.S., and asks: “And who’s gonna pay for it?” Then he holds out the mike to the crowd. They dutifully shout back: “Mexico!” It’s not true, and it can’t be true, but it doesn’t seem to matter. If Trump wins and appoints Ben Carson, the U.S. will have a Secretary for Education who has wondered aloud if Joseph built the pyramids.

Over on the Democrat side, Hillary Clinton, a wonk to match Bush, continues to fight a nervously close battle against a man who seems to design his policies on a blank sheet of paper, never allowing the facts on the ground to dilute the purity of his vision.

To be clear: I’m not saying that Sanders and Trump are equivalent. Trump plays on fear and loathing; Sanders indulges utopian idealism. But like Trump, the main purpose of Sanders’ policies is to signal a broad set of values, rather than chart a realistic way forward. Even the most progressive analysts of health care policy, like my Brookings colleague Henry Aaron, consider the Sanders plan for a single-payer health care system to be a pipe dream. As Aaron writes: “We know that single-payer mechanisms work in some countries. But those systems evolved over decades, based on gradual and incremental change from what existed before. That is the way that public policy is made in democracies.” Indeed. But not the way public policy is being made on the campaign trail.

Likewise, Sanders’ fiscal policies simply do not stack up, even if he can make the economy grow like it’s the ‘60s (the 1860s, that is). But don’t take my word for it: ask ultra-liberal economist Paul Krugman. Or indeed the four Democrat former chairs of the president’s Council of Economic Advisers who jointly wrote to warn of the fuzzy math at the heart of Sanders’ tax and spending plans. Sanders is playing fantasy fiscal policy.

But just as the unhinged ideas from Trump are doing nothing to dampen his fans, so the unrealistic ones from Sanders are not putting off his core supporters. And just as the scorn of the establishment helps Trump, so the attacks from experts on the mainstream left on Sanders’ ideas bolster his image as a revolutionary idealist, refusing to accept the status quo.

We should be honest: it is only in exceptional circumstances that policy is likely to be the central ingredient of politics. The personality, vision and message of the candidate, and the efficiency of a political operation, are typically more important. We should also be honest that the aspirational nature of campaign pledges very often puts them well beyond reasonable reach. Remember Hoover’s “chicken in every pot and a car in every garage?” Presidents can’t make that kind of change happen.

But even if policies declared on the campaign trail have often been a stretch, they have at least been a stretch in the right direction. Even if they were aspirational, they were not bonkers. The capacity to propose sensible policy has historically been a necessary test of political candidates, with scholars and serious journalists acting as examiners. Good policy may not often win you an election, but really bad policy could lose one. Now, in a fragmented media market, this basic test of policy seriousness may no longer disqualify a candidate.

Most successful Presidential candidates have, once in office, attempted to follow through on most (75% according to one study) of their campaign promises. Obama tried for 80%, according to Politifact. But many of those being made this year cannot be taken seriously, even perhaps by the candidates themselves. They are positioning devices, rather than proposals.

For a scholar working in a public policy think-tank, these are of course disheartening trends. What use is there for policy analysis when it seems as if politicians barely need policies at all? But there are deeper dangers here. If policy and politics separate entirely, the people who end up in office are likely to have little regard for policies, or even the skills required to make them. This will reduce the chances that policies will be implemented successfully, or that they will be effective, and therefore make them even less relevant to an electorate already concerned that our governance system is broken. Worse, the careless disregard for facts, laws, costs, and even basic math is corrosive to the democratic process. It is too much, perhaps, to expect politicians to seek to make voters better informed about the key issues. But I think it is reasonable to hope they will not misinform them.

I hope that I am wrong. I hope that policy will make a political comeback. But I’m not holding my breath.

Editor's note: This piece originally appeared in Bloomberg Government.

Despite widespread agreement that the federal budget is on an unsustainable path, there is also widespread disagreement about what should be done. The Hamilton Project asked leading experts from a variety of backgrounds—the policy world, academia, and the private sector, and from both sides of the political aisle—to develop and share their ideas for addressing the deficit. The proposals will be released at two events scheduled for February 22 and February 26. In a dialogue previewing those events, Hamilton Project Director Michael Greenstone and Policy Director Adam Looney discuss some of the key ideas offered by the experts.

Greenstone stresses that the goal of the papers is to move beyond the fights and disagreements between President Obama and Congress and to provide some of the poetry, or some of the details, on how government might run better. The papers will also be featured in a book, 15 Ways to Rethink the Federal Budget, and will take on a wide-ranging set of topics, including immigration, transportation, health care, defense spending, and tax expenditures.

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• Michael Greenstone and Adam Looney: These Authors Have Drafted Policies That Help the Budget and Provide Economic Benefits

Last night, retired lieutenant general Michael Flynn addressed the Republican convention as a headline speaker on the subject of national security. One of Donald Trump’s closest advisors—so much so that he was considered for vice president—Flynn repeated many of the themes found in his new book, The Field of Fight, How We Can Win the Global War Against Radical Islam and Its Allies, which he coauthored with Michael Ledeen. (The book is published by St. Martin’s, which also published mine.)

Written in Flynn’s voice, the book advances two related arguments: First, the U.S. government does not know enough about its enemies because it does not collect enough intelligence, and it refuses to take ideological motivations seriously. Second, our enemies are collaborating in an “international alliance of evil countries and movements that is working to destroy” the United States despite their ideological differences.

Readers will immediately notice a tension between the two ideas. “On the surface,” Flynn admits, “it seems incoherent.” He asks: 

“How can a Communist regime like North Korea embrace a radical Islamist regime like Iran? What about Russia’s Vladimir Putin? He is certainly no jihadi; indeed, Russia has a good deal to fear from radical Islamist groups.” 

Flynn spends much of the book resolving the contradiction and proving that America’s enemies—North Korea, China, Russia, Iran, Syria, Cuba, Bolivia, Venezuela, Nicaragua, al-Qaida, Hezbollah, and ISIS—are in fact working in concert.

No one who has read classified intelligence or studied international relations will balk at the idea that unlikely friendships are formed against a common enemy. As Flynn observes, the revolutionary Shiite government in Tehran cooperates with nationalist Russia and communist North Korea; it has also turned a blind eye (at the very least) to al-Qaida’s Sunni operatives in Iran and used them bargaining chips when negotiating with Osama bin Laden and the United States. 

Flynn argues that this is more than “an alliance of convenience.” Rather, the United States’ enemies share “a contempt for democracy and an agreement—by all the members of the enemy alliance—that dictatorship is a superior way to run a country, an empire, or a caliphate.” Their shared goals of maximizing dictatorship and minimizing U.S. interference override their substantial ideological differences. Consequently, the U.S. government must work to destroy the alliance by “removing the sickening chokehold of tyranny, dictatorships, and Radical Islamist regimes.” Its failure to do so over the past decades gravely imperils the United States, he contends.

The book thus offers two very different views of how to exercise American power abroad: spread democracies or stand with friendly strongmen...[P]erhaps it mirrors the confusion in the Republican establishment over the direction of conservative foreign policy.

Some of Flynn’s evidence for the alliance diverts into the conspiratorial—I’ve seen nothing credible to back up his assertion that the Iranians were behind the 1979 takeover of the Grand Mosque in Mecca by Sunni apocalypticists. And there’s an important difference between the territorially-bounded ambitions of Iran, Russia, and North Korea, on the one hand, and ISIS’s desire to conquer the world on the other; the former makes alliances of convenience easier than the latter. Still, Flynn would basically be a neocon if he stuck with his core argument: tyrannies of all stripes are arrayed against the United States so the United States should destroy them.

But some tyrannies are less worthy of destruction than others. In fact, Flynn argues there’s a category of despot that should be excluded from his principle, the “friendly tyrants” like President Abdel-Fatah el-Sissi in Egypt and former president Zine Ben Ali in Tunisia. Saddam Hussein should not have been toppled, Flynn argues, and even Russia could become an “ideal partner for fighting Radical Islam” if only it would come to its senses about the threat of “Radical Islam.” Taken alone, these arguments would make Flynn realist, not a neocon. 

The book thus offers two very different views of how to exercise American power abroad: spread democracies or stand with friendly strongmen. Neither is a sure path to security. Spreading democracy through the wrong means can bring to power regimes that are even more hostile and authoritarian; standing with strongmen risks the same. Absent some principle higher than just democracy or security for their own sakes, the reader is unable to decide between Flynn’s contradictory perspectives and judge when their benefits are worth the risks. 

It’s strange to find a book about strategy so at odds with itself. Perhaps the dissonance is due to the co-authors’ divergent views (Ledeen is a neocon and Flynn is comfortable dining with Putin.) Or perhaps it mirrors the confusion in the Republican establishment over the direction of conservative foreign policy. Whatever the case, the muddled argument offered in The Field of Fight demonstrates how hard it is to overcome ideological differences to ally against a common foe, regardless of whether that alliance is one of convenience or conviction. 

Summary

At the Gleneagles Summit in 2005, leaders of the G8 group of nations committed to increase aid to poor nations by $50 billion per year. During the same year, in a meeting in Paris, donors promised to coordinate their interventions for more effective delivery. These commitments are now often referred to as the promise of donors to “scale up aid.” Increasing aid flows and improving coordination are indeed important goals and, in fact, goals that donors seem to have trouble meeting. The international donor community met this fall in Accra and will meet in Doha in November 2008 to review progress with this aspect of scaling up aid, and it is hoped that they will recommit to meet the ambitious targets set three years ago.

Scaling up aid is only one of the challenges that donors face. A more important challenge is to “scale up through aid,” meaning that aid flows should not merely support short-lived, one-time and partial development interventions—pilot projects, short-term technical assistance, programs that only address part of the problem, but leave major bottlenecks unaddressed—but should support projects, programs and policies that scale up successful interventions in a country, region or globally to reach the entire target population. Scaling up means that programs are long-term and sustained and that external support is aligned with country needs and deals comprehensively with the development challenges—often by working in partnership with other donors and pooling resources. This is the scaling up challenge that donors should address head-on, but so far have not.

This policy brief reports on the findings of an in-depth review of the literature and practice of scaling up development interventions and focuses on the role that aid donors can play in supporting scaling up for effective development. It stresses that successful scaling up with external assistance means that donor agencies need to: work with a vision and leadership; help create the political constituencies for large-scale implementation; create linkages among project, program and policy interventions; strengthen the institutional capacity of the implementing entities; provide for effective incentives and accountabilities of their own staff and management; work together with each other; monitor and evaluate the progress of programs with special attention to the scaling up dimension; and finally make sure they focus on effective preparation and flexible implementation of the scaling up process. While this is a long-term agenda, donors can take a few practical steps right away that will provide a basis for a more ambitious effort over time.

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Recent political movements within the United States have raised concerns about the health of American democracy. With hyper-partisanship dividing the country and Donald Trump—the most unlikely, unsuitable, and unpopular presidential nominee of a major party in American history—securing the Republican nomination, the question emerges of whether democracy in America has gone awry.  And if so, is it too much or too little democracy that’s to blame?

To help address those questions, in this paper, Thomas E. Mann summarizes and discusses the findings of Christopher Achen and Larry Bartels’ ambitious treatise on American democracy: “Democracy for Realists.” Achen and Bartels contend that the traditional conception of voters as rational, attentive decision-makers does not hold against empirical evidence. Instead, voters are best understood as members of partisan groups, which influence their perception of candidates, issues, and even simple facts. According to Achen and Bartels, perceived social identities drive voting decisions, rather than rationality.

Mann notes that most scholars would agree that voters do not follow the expectations of idealistic models, but draws attention to competing theories that are far less damning to voters’ rationality. In particular, the research of Paul Sniderman and Arthur Lupia suggests that voters are far more capable than Achen and Bartels would assert. In their view, voters have enough rationality and information to ensure a well-functioning democracy.

As Mann summarizes the arguments:  Achen and Bartels believe that citizens and elections are held to impossible, idealistic standards in the folk theory of democracy, which perpetuates myths and works against government responsiveness. Sniderman and Lupia, on the other hand, are offended by those who dismiss citizens as ignorant and incompetent; they seek to defend voters’ dignity and demonstrate the rationality and efficacy of their behavior in American democracy.

What does this scholarship tell us about the coming presidential election, and the future of American democracy?  Ultimately, Mann concludes that Achen and Bartel’s perspective is not anti-democratic, even if it is built on a belief that too much importance is placed on the often random and myopic outcomes of elections.  Instead, Mann believes that “Democracy for Realists” reveals the real democratic deficit facing America is one stemming not from too much democracy, but  from “asymmetry in political resources and representation of different segments of American society.” Truly understanding this problem and its root cause is a step toward strengthening American democracy. 

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Editor's Note: With the latest coup attempt in Turkey, Turkish democracy survived a major test, and the country turned from the edge of a precipice. writes Kemal Kirisci. But Turkey’s democracy has also taken a severe blow. This article was originally published in The National Interest.

The history of Turkish politics is littered with coups and coup attempts that have occurred in roughly ten-year intervals. It is almost a genetic defect.

• The nascent Turkish democracy experienced its first coup in 1960 when it was barely into its tenth year—led by a group of left-wing “young officers,” who had also forced the General Staff into its ranks. Administrative authority was returned to civilians in October 1961, after having cost the lives of the then-Prime Minister, Adnan Menderes, the Minister of Foreign Affairs, Fatin Rüştü Zorlu, and the Minister of Finance, Hasan Polatkan.
• The second military intervention took place in 1971 against the government of Süleyman Demirel—this time around, though, through a “coup by memorandum.” The military issued to the prime minister an ultimatum—to step aside and be replaced by a technocratic cabinet.
• Less than ten years later, in the midst of endemic violence between left- and right-wing radical groups, the military's top brass carried out another intervention. This was bloodier than the previous two interventions, costing hundreds of lives and leading to massive human-rights violations. After rubberstamping a suffocating constitution on the country, the military handed the government over to a semblance of a democratically-elected government in 1983.
• Surprisingly, Turkey broke this pattern of ten-yearly military interventions, and civilian authority continued until 1997, when there was what was termed a “post-modern coup.” The army rolled out a convoy of tanks into the streets of Ankara, and in a repeat of the coup of 1971, demanded the resignation of the coalition government led by Necmettin Erbakan.
• The next coup occurred a decade later (almost to the day) in April 2007, when the Chief of Staff staged an “e-coup” by posting a set of demands on its website. The coup was a reaction against a long list of democratic reforms that were introduced as a part of the leadership’s pro-EU agenda and were seen as a departure from the staunchly secularist, restrictive mode of governance. Bolstered by the public support for these reforms, however, the incumbent Justice and Development Party (AKP) led by Recep Tayyip Erdoğan, now the current president of Turkey, successfully withstood the “e-coup,” and for the first time, pushed the military back “into the barracks”.

The latest coup attempt—which took place on Friday, July 15—has widely been attributed to a large Gülenist faction within the military and the judiciary that circumvented the established chain of command and held the high command hostage. Gülenists are the followers of the Islamic scholar Fethullah Gülen, who leads a worldwide movement that claims to advocate a moderate form of Sunni Islam with an emphasis on tolerance and interfaith dialogue. Formerly allies with Erdoğan, the Gülenists were blamed for spearheading the corruption scandal in December 2013 that engulfed several government officials, ministers and people in Erdoğan’s intimate circle. Since then, Gülen and Erdoğan have been locked in a power struggle.

Back from the brink

Turkish democracy survived a major test, and Turkey turned from the edge of a precipice. The credit for the coup’s defeat goes to the Turkish people, who heeded Erdoğan’s call to resist this intervention “by any means possible and necessary" and filled the squares. TV reports were filled with eye-to-eye, tense, agitated confrontations between civilians and armed soldiers on the two bridges that connect the Asian and European sides of Istanbul. Public restraint and sobriety helped to prevent escalation of violence. There were nevertheless senseless causalities resulting from fire opened by the mutineers and especially attacks mounted on the parliament building as well as the Headquarters of the General Staff. It could have been a lot worse.

Erdoğan needs to rise above a majoritarian understanding of democracy and do justice to the aspirations of a public that heeded his call by pouring into the streets and squares to defeat the coup attempt.

Clearly, Turkey’s democracy has taken a severe blow—cushioned only by the unequivocal stance of the opposition leaders and the media against the coup. Once again, the nation managed to break this pattern of ten-year coups. This offers the country a matchless opportunity for reconciliation. Granted, Erdoğan has had an exceptionally rough weekend and his frustration with those responsible for or implicated in the coup is understandable. He is correct in calling “for their punishment under the full force of the law of the land.” It will, however, now be critical that he ensure that the rule of law is upheld and rises to the challenge of winning the hearts and minds across a deeply polarized nation. He has the tools for it in his repertoire and had successfully wielded them in the past—especially between 2003 and 2011, when he served as prime minister. In hindsight, this period is often referred to as AKP’s “golden age,” when the economy boomed, democracy excelled, and Turkey was touted as a model for those Muslim-majority countries aspiring to transform themselves into liberal democracies.

As he steers the country from the brink of civil war, Erdoğan needs to rise above a majoritarian understanding of democracy and do justice to the aspirations of a public that heeded his call by pouring into the streets and squares to defeat the coup attempt. This is the least that the Turkish public deserves. This would also be a move in the right direction for Turkey’s neighborhood, which desperately needs a respite from the turmoil resulting from the war in Syria, the instability in Iraq, Russia’s territorial ambitions and now Brexit. This is the moment when a stable, democratic, transparent, accountable and prosperous Turkey needs to come to the fore on the world-stage. The United States needs it too. As much as the White House declared its faith in the strength of Turkey’s democracy and its support for the elected leadership, there is a clear chance for forging closer cooperation between the two countries. The first step in cooperation should be in bringing to justice the perpetrators of this coup, followed by measures to enhance Turkey’s capacity to address and manage the many challenges facing Turkey and its neighborhood.

As the G-20 Summit concluded in Brisbane, Australia on November 16th, it set a target to achieve an incremental jump in global GDP growth of 2 percent by 2018 and made commitments to creating a Global Infrastructure Investment Initiative (GIII) to address an estimated $5 trillion per year in infrastructure needs around the world. 

It is a valid policy idea to expose the gap between current and potential rates of economic growth to the public. That the Australians put the spotlight on this growth gap was the central achievement of their G-20 Summit in Brisbane. It is a contribution to the global effort to energize the global economy and generate both greater and smarter growth. The question is, will it work? 

The gap between potential and actual growth has more to do with the patterns and sources of growth than the rates of growth. It is certainly necessary to continue to use monetary and fiscal policy to stimulate aggregate, demand-driven growth, but it will not be not sufficient.  

The people-problem in global growth has to do with structural obstacles: market dynamics of globalization tend to increase income inequality; technologies can be labor displacing rather than labor absorbing; and the knowledge-economy requires technical skills that are more sophisticated than investment-driven industrialization.  

As a result, the focus is now on structural policies and reforms, an issue on which the OECD has been an international leader. OECD Secretary General Angel Gurria jointly released an OECD report with Australia Minister of Finance Joseph Hockey in February of this year. At the G-20 Summit in Brisbane, Gurria said that it was possible that the global growth effort by the G-20, which the OECD and IMF are monitoring, could “overshoot” the 2 percent target.  

Discussing structural reforms tends to “get in the weeds” quickly, since the details vary by each country’s circumstances—as made clear by Brisbane’s G-20 Action Plan. Going from the Brisbane G-20 Summit to regional, ministerial, and national agendas and actions becomes the next phase in this effort to boost global growth by shifting the patterns and sources of growth. 

A key component in closing the growth gap will be the aforementioned Global Infrastructure Investment Initiative. The GIII is the culmination of a long discussion involving the G-20, the World Bank, the regional development banks, the private sector and others on how to accelerate much-needed investment in infrastructure—globally, and on a scale that can make a difference, especially in an era of fiscal policy constraints.  

The relationship between private and public investment in global infrastructure and other global growth projects is tricky. Just because many governments face reduced flexibility with fiscal policy at the moment does not mean that the responsibility for infrastructure investment can or will or should be picked up by private investors, much less private financial institutions and markets. The public and private sector each have a vital role. One will not work without the other.

Yet rules and norms do have to be worked out to incentivize private investment in infrastructure. This work is well underway and embodied in the Brisbane GIII. Incremental investment in global infrastructure adds up over time, and prudent direction of financing toward the most impactful projects can be a big boost to global growth and directly have an impact on peoples' lives. This is the kind of people-oriented action G-20 leaders were looking for in Brisbane.

Setting incremental “reach goals” is not just a word game or publicity play. It has proven to be a means of mobilizing resources, policies and efforts by diverse actors to stimulate higher-order results than might otherwise have happened. Just engaging in projecting likely growth outcomes can set the bar too low. In fact, all global goal setting is meant to motivate and mobilize momentum for just such incremental efforts. 

Taken together, a combination of structural reforms, infrastructure investment and continued growth-oriented monetary and fiscal policies can make a real difference in boosting global growth. This combination makes the Brisbane target of an additional 2 percent of global GDP growth by 2018 a feasible, even if ambitious, goal.

Paid leave for parents is likely to be an important issue on the campaign trail this year. Hillary Clinton, positioning herself as the candidate on the side of families, argues for all parents to be paid for 12 weeks of family leave, at two-thirds of their salary up to a (so far unspecified) cap. Donald Trump has not so far ruled it out, simply saying: “We have to keep our country very competitive, so you have to be careful of it.”

Polls routinely show high levels of general support for paid leave across the political spectrum. But there are many nuances here, including how to fund the leave entitlement, how long the leave should be, and whether fathers and mothers ought to get the same treatment.

Some light can be thrown on these questions by an analysis of the American Family Survey conducted earlier this year by Deseret News and the Center for the Study of Elections and Democracy (disclosure: I am an adviser to the pollsters). 

Views differ over the optimum length of leave depending on whether it is for the mother or father, and whether it is paid or unpaid:

But even Republicans are quite supportive, backing almost four months of paid leave for mothers and three months for fathers. So on the face of it, Clinton’s plan should be a vote winner even among moderate Republicans.

There are important implications about gender roles here. Encouraging men to take paid leave is important not only for the quality of family life, but also for gender equality more generally. Attitudes towards the role of fathers are shifting, although the primacy of motherhood remains. Among every ideological group there was greater support for longer maternity than paternity leave. It is worth noting, however, that half the respondents supported equal leave for mothers and fathers; the variation is driven by those in the other half, who drew a distinction by gender.

It turns out that the order in which the question is asked also makes a difference. For half the respondents, the question about maternity leave came before the one on paternity leave. For the other half, the questions were asked in the opposite order. (Because of the design of the survey, respondents could not change their previous answer.) The ordering of the question had an influence on responses:

Among those who gave an answer on paternity leave first, the gap between the preferred length of leave for mothers and fathers was much less. This was especially true for unpaid leave.

When people think about paid parental leave, many may think automatically of a mother, just as they think of a man when asked to picture a “strong leader.” Asking about maternity leave first goes with the traditional cultural grain, and results in more support for mothers compared to fathers. Asking about paternity leave first interrupts the normal gender framing, and narrows the gap.

There has been a slow revolution in attitudes towards the respective roles of mothers and fathers, reflected in the strongly symmetrical attitudes towards maternity and paternity leave in this survey. But there is more work to do. Mothers and fathers both need help balancing paid work and family life. Let’s hope this can be at least one area of agreement between Clinton and Trump.

The headlines seem pretty good. Unemployment fell a tick to 7.3 percent. And jobs growth continued, with payrolls expanding by 169,000 in August, which is just shy of the 175,000 new jobs that analysts were expecting.

But beneath the headline: blech!

The most important news was the revisions to what we had previously thought was a healthy and perhaps self-sustaining recovery. Instead, jobs growth in July was revised from 162,000, to a weak 104,000, and June was also revised downward. Taken together, this month's revisions means we've created 74,000 fewer jobs than previously believed. And the previous jobs report subtracted another 26,000 jobs through revisions. Moreover, for reasons that remain a mystery, revisions have tended to be pro-cyclical, meaning that the healthy recovery we thought we were having might have been expected to yield further upward revisions. All this means that analysts are hastily revising their views.

The other bad news comes from the household survey, where employment fell 115,000, leading the employment-to-population ratio to decline by 0.1 percentage points. So the decline in the unemployment rate isn't due to folks getting jobs; instead, it's due to people dropping out of the labor force.

I have two simple metrics I use to measure the "underlying" pace of jobs growth. The first puts 80% weight on the (more accurate) payrolls survey, and 20% weight on the noisier household survey. That measure suggests employment grew by only 112,000 in August. The alternative is to focus on the 3-month average of payrolls growth, which suggests we're creating slightly around 148,000 jobs per month.

Bottom line: This report says that we're barely creating enough jobs to keep the unemployment rate falling from its current high levels. Policymakers have been looking for a signal that the recovery has become self-sustaining. This report doesn't provide it. And until we're confident that the recovery will keep rolling on, we should delay either any monetary tightening, further fiscal cuts, and definitely postpone the legislative shenanigans that Congress is threatening.

Event Information

John Quincy Adams famously said that America “goes not abroad in search of monsters to destroy.” A diplomat, secretary of state, as well as the sixth president, Adams is often described as a “realist,” and as the founder of American foreign policy realism. But did his own policy choices square with that doctrine of restraint? Recently, President Obama has described his own views in explicitly realist terms; Hillary Clinton is widely viewed as a more ardent believer in the active use of American power; and the Republican candidates seem more eager to build walls than to engage the outside world.

On April 11, the Brookings Project on International Order and Strategy (IOS) hosted a discussion between Brookings Senior Fellow Robert Kagan and James Traub, columnist and contributor at foreignpolicy.com, lecturer of foreign policy at New York University, and now the author of the new book, “John Quincy Adams: Militant Spirit” (Basic Books, 2016). Kagan and Traub debated whether Adams was a foreign policy realist and whether his approach to foreign policy can still inform the policy choices facing the United States today. Brookings Fellow Thomas Wright, director of IOS, moderated the discussion.

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• Was John Quincy Adams a realist? A debate

Transcript

• Transcript (.pdf)

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• 20160411_john_quincy_adams_transcript

For years, corporate campuses like Silicon Valley were known for innovation. Located in suburban corridors that were only accessible by car, these places put little emphasis on creating communities where people work, live and go out.

But now, as the economy emerges from the recession, a shift is occurring where innovation is taking place. Districts of innovation can be found in urban centres as disparate as Montreal, Seoul, Singapore, Medellin, Barcelona, and London. They are popping up in the downtowns and midtowns of cities like Atlanta, Cambridge, Philadelphia, and St. Louis.

These are places where advanced research universities, medical complexes, and clusters of tech and creative firms are attracting businesses and residents.

Other innovation districts can be found in Boston, Brooklyn, San Francisco, and Seattle, where older industrial areas are being re-imagined and remade, leveraging their enviable location near waterfronts and city centres and along transit lines. Innovative companies and talented workers are flocking to these areas in abundance.

Even traditional science parks like Research Triangle Park in Raleigh-Durham are scrambling to urbanise to keep pace with their workers' preference for walkable communities and their companies' desire to be near other firms.

In these districts, leading anchor institutions and start-ups are clustering and connecting with one another. They are coming together with spin-off companies, incubators, and accelerators in the relentless pursuit of new discoveries for the market.

These areas are small and accessible, growing talent, fostering open collaboration, and offering housing and office space as well as modern urban amenities. They are both competitive places and "cool" spaces.

The growth of innovation districts is being driven by private and civic actors like universities, philanthropies, business associations and business improvement districts. Yet local governments play an important role in accelerating the growth of districts and maximising their potential . Three roles stand out:

1) Mayors are leading efforts to designate districts

Barcelona's former mayor Joan Clos set his eyes on transforming his city into a "city of knowledge". Through extensive, focused public planning and investment, Clos designed an innovation district from the debris of a 494-acre industrial area, which was scarred and separated from the rest of the city by railroad tracks. His vision included burying these tracks, increasing access via a new public tram, designing walkable streets, and creating new public spaces and housing.

Today, the area is a 21st-century urban community with 4,500 firms, thousands of new housing units, and clusters of universities, technology centres, and incubators.

Across the Atlantic in Boston, former mayor Tom Menino declared the South Boston waterfront an innovation district in 2010. Menino persuaded innovators like MassChallenge to move to the district and exacted important concessions from developers (including land for innovation-oriented retail, shared labs and other spaces, and micro-housing) to help realise the district's vision.

2) Changing land-use laws to build spaces with a mix of facilities

Barcelona and Research Triangle Park, for example, developed bold master plans encouraging the "mixing" of large and small firms, research facilities, housing, restaurants, and retail and outlining where to create open spaces for networking. Cambridge, Massachusetts, by contrast, has allowed incremental moves from rigid, antiquated rules to encourage similar outcomes in Kendall Square .

3) Supporting scarce public resources with large private and civic investments

In New York , former mayor Michael Bloomberg deployed $100m in municipal capital to prepare the infrastructure necessary to lure Cornell and Technion universities to Roosevelt Island. In other cities, including St Louis and Seattle, local resources are financing infrastructure improvements to buttress and accelerate private growth.

Given that many innovation districts are adjacent to low-income neighbourhoods, cities like Philadelphia are considering smart use of school investments to prepare disadvantaged youth for good jobs in the Stem (science, technology, engineering, and math) economy.

As this decade unfolds, we should expect more cities to use their powers in the service of this new model of innovative, inclusive, and resilient growth.

This opinion originally appeared in The Guardian

November's U.S. Bureau of Labor Statistics (BLS) employment report showed continued improvement in the job market, with employers adding 211,000 workers to their payrolls and hourly pay edging up compared with its level a year ago. The pace of job growth was similar to that over the past year and somewhat slower than the pace in 2014. For the 69^th consecutive month, private-sector payrolls increased. Since the economic recovery began in the third quarter of 2009, all the nation’s employment gains have occurred as a result of expansion in private-sector payrolls. Government employment has shrunk by more than half a million workers, or about 2.5 percent. In the past twelve months, however, public payrolls edged up by 93,000.

The good news on employment gains in November was sweetened by revised estimates of job gains in the previous two months. Revisions added 8,000 to estimated job growth in September and 27,000 to job gains in October. The BLS now estimates that payrolls increased 298,000 in October, a big rebound compared with the more modest gains in August and September, when payrolls grew an average of about 150,000 a month.

Average hourly pay in November was 2.3 percent higher than its level 12 months earlier. This is a slightly faster rate of improvement compared with the gains we saw between 2010 and 2014. A tighter job market may mean that employers are now facing modestly higher pressure to boost employee compensation. The exceptionally low level of consumer price inflation means that the slow rate of nominal wage growth translates into a healthy rate of real wage improvement. The latest BLS numbers show that real weekly and hourly earnings in October were 2.4 percent above their levels one year earlier. Not only have employers added more than 2.6 million workers to their payrolls over the past year, the purchasing power of workers' earnings have been boosted by the slightly faster pace of wage gain and falling prices for oil and other commodities.

The BLS household survey also shows robust job gains last month. Employment rose 244,000 in November, following a jump of 320,000 in October. More than 270,000 adults entered the labor force in November, so the number of unemployed increased slightly, leaving the unemployment rate unchanged at 5.0 percent. In view of the low level of the jobless rate, the median duration of unemployment spells remains surprisingly long, 10.8 weeks. Between 1967 and the onset of the Great Recession, the median duration of unemployment was 10.8 weeks or higher in just seven months. Since the middle of the Great Recession, the median duration of unemployment has been 10.8 weeks or longer for 82 consecutive months. The reason, of course, is that many of the unemployed have been looking for work for a long time. More than one-quarter of the unemployed—slightly more than two million job seekers—have been jobless for at least 6 months.  That number has been dropping for more than five years, but remains high relative to our experience before the Great Recession.

If there is bad news in the latest employment report, it's the sluggish response of labor force participation to a brighter job picture. The participation rate of Americans 16 and older edged up 0.1 point in November but still remains 3.5 percentage points below its level before the Great Recession. About half the decline can be explained by an aging adult population, but a sizeable part of the decline remains unexplained. The participation rate of men and women between 25 and 54 years old is now 80.8 percent, exactly the same level it was a year ago but 2.2 points lower than it was before the Great Recession. Despite the fact that real wages are higher and job finding is now easier than was the case earlier in the recovery, the prime-age labor force participation rate remains stuck well below its level before the recession. How strong must the recovery be before prime-age adults are induced to come back into the work force? Even though the recovery is now 6 and a half years old, we still do not know.

For more than a decade, the economy’s rate of productivity growth has been dismal, which is bad news for workers since their incomes rise slowly or not at all when this is the case. Economists have struggled to understand why American productivity has been so weak. After all, with all the information technology innovations that make our lives easier like iPhones, Google, and Uber, why hasn’t our country been able to work more productively, giving us either more leisure time, or allowed us to get more done at work and paid more in return?

One answer often given is that the government statisticians must be measuring something wrong – notably, the benefits of Google and all the free stuff we can now access on our phones, tablets and computers. Perhaps government statisticians just couldn’t figure out how to include those new services in a meaningful way into the data?

A new research paper by Fed economists throws cold water on that idea. They think that free stuff like Facebook should not be counted in GDP, or in measures of productivity, because consumers do not pay for these services directly; the costs of providing them are paid for by advertisers. The authors point out that free services paid for by advertising are not new; for example, when television broadcasting was introduced it was provided free to households and much of it still is.

The Fed economists argue that free services like Google are a form of “consumer surplus,” defined as the value consumers place on the things they buy that is over and above the price they have paid. Consumer surplus has never been included in past measures of GDP or productivity, they point out. Economist Robert Gordon, who commented on the Fed paper at the conference where it was presented, argued that even if consumer surplus were to be counted, most of the free stuff such as search engines, e-commerce, airport check-in kiosks and the like was already available by 2004, and hence would not explain the productivity growth slowdown that occurred around that time.

The Fed economists also point out that the slowdown in productivity growth is a very big deal. If the rate of growth achieved from 1995 to 2004 had continued for another decade, GDP would have been $3 trillion higher, the authors calculate. And the United States is not alone in facing weak productivity; it is a problem for all developed economies. It is hard to believe that such a large problem faced by so many countries could be explained by errors in the way GDP and productivity are measured.

Even though I agree with the Fed authors that the growth slowdown is real, there are potentially serious measurement problems for the economy that predate the 2004 slowdown.

Health care is the most important example. It amounts to around 19% of GDP and in the official accounts there has been no productivity growth at all in this sector over many, many years. In part that may reflect inefficiencies in health care delivery, but no one can doubt that the quality of care has increased. New diagnostic and scanning technologies, new surgical procedures, and new drugs have transformed how patients are treated and yet none of these advances has been counted in measured productivity data. The pace of medical progress probably was just as fast in the past as it is now, so this measurement problem does not explain the slowdown. Nevertheless, trying to obtain better measures of health care productivity is an urgent task. The fault is not with the government’s statisticians, who do a tremendous job with very limited resources. The fault lies with those in Congress who undervalue good economic statistics.

Gordon, in his influential new book The Rise and Fall of American Growth, argues that the American engine of innovation has largely run its course. The big and important innovations are behind us and future productivity growth will be slow. My own view is that the digital revolution has not nearly reached an end, and advances in materials science and biotechnology promise important innovations to come. Productivity growth seems to go in waves and is impossible to forecast, so it is hard to say for sure if Gordon is wrong, but I think he is.

Fortune reported in June 2015 that 70% of its top 500 CEOs listed rapid technological change as their biggest challenge. I am confident that companies will figure out the technology challenge, and productivity growth will get back on track, hopefully sooner rather than later.

Editor’s note: This piece originally appeared in Fortune.

In his presidential campaign in 1928, Herbert Hoover promised to help impoverished farmers by increasing tariffs on agricultural products; after the election, he also asked Congress to reduce tariffs on industrial goods. In April 1929, well before Black Thursday, U.S. Representative Reed Smoot, a Republican from Utah, introduced a bill that passed the House in May. The bill increased agricultural and industrial tariffs at levels that had not been seen for a century. This was a relatively benign beginning of what would become one of the most tragic policy measures of the 1930s. Within a few months of the bill being passed in the Senate as the Smoot-Hawley Tariff Act, other countries in response raised their own trade barriers, which started a vicious circle of contracting world trade flows and economic activity, and rising unemployment from 1930 to 1933.

There are three main lessons from the policies mentioned above: 

1. “Beggar-my-neighbor” policies are bad.
2. Bad policies can have tragic consequences.
3. Beware of benign measures that can ignite uncontrollable chain reactions.

Indeed, these lessons have been in every policymakers’ mind since the Lehmann Brothers failure. In fact, the creation of the G-20 was a spectacular effort by the major economies of the world to cooperatively answer the challenges raised by the most severe financial crisis since the 1930s. The G-20 coordinated the management of strong macroeconomic policies, including huge deficits and easy monetary policies. These were bold decisions but not radical, and those who condemned government intervention have been rebutted by the urgency of these measures. And it is now widely acknowledged that these unconventional measures successfully avoided the transformation of the Great Recession into another Great Depression.

In the U.S., the recovery is at best shaky, unemployment is artificially reduced by the growing number of discouraged workers who have stopped looking for work, and the median income is dramatically lagging.

Today, there are reasons of hope that have been eloquently described by Roger Altman [1]: it can be argued that in the U.S., and to a lesser degree in Europe, the crisis has inspired significant reforms that have pushed the economy closer to a sound and sustainable growth trajectory. However others rightfull so object that enormous challenges are still facing the populations and their respective governments. The price paid for curing the damages of the global financial crisis is extremely high everywhere. In the U.S., the recovery is at best shaky, unemployment is artificially reduced by the growing number of discouraged workers who have stopped looking for work, and the median income is dramatically lagging. In Europe, austerity is the name of the game in every country except Germany and despair is growing among the populace. Japan has been stuck for two decades in deflation. Many citizens around the world feel that the efforts have gone too far, yet the benefits and retribution have benefitted too few. Electoral frustrations are on the rise as demonstrated in Italy where Mario Monti’s wise policies have been followed by the success of the Five Stars Movement of Beppe Grillo. Italy turning ungovernable is a bad sign for democracies. Could we see a comeback of desperate national policy experiments like the ones that democracies were progressively pushed to adopt after facing insurmountable difficulties in the early 1930s?

Now, a really radical policy experiment is already taking shape in Japan with the introduction of what has been named “Abenomics” after the name of the newly-elected prime minister, Shinzo Abe. It has taken only one election and one nomination at the head of the Bank of Japan to really revolutionize monetary policy. This revolution can be qualified in two ways, one benign, one threatening.

There is first reason to rejoice. After two decades of failed policies, it’s finally good to see bold politicians ready to do whatever it takes to extract Japan from its deflationary trap. Should Mr. Abe succeed, he would unclench the domestic brakes to economic growth, which deflation has so lengthily opposed: declining prices in effect are discouraging consumption (goods will be better and cheaper tomorrow, why spend now?) and investment (facing massive excess capacity of production and weak final demand, why invest now?). The new mission of the governor of the Bank of Japan is to raise inflationary expectations to 2 percent, which would make Japan converge with the world average inflationary trend and monetary policy. Demand would restart and Japan would contribute to an improved global economic outlook. This is the view that the IMF chief recently endorsed. As expected, Mr. Kuroda last week unveiled a much more aggressive package of quantitative easing than what we have previously witnessed, with a view to double the monetary base. Japan’s central bank will buy more long-term government bonds, pushing private investors to invest more in risky assets. Since the election, the Nikkei has risen 34 percent. Different polls and surveys suggest that the public is positively reacting to Mr. Abe’s promises.

Is success already underway? That would be good news for Japan and for the world. But it is clearly too soon to celebrate because this virtuous circle can simply fail to happen. No central bank until now has ever tried to raise inflationary expectations and no one knows if this can turn to be a practical and manageable reality. Inflationary expectations could also easily turn out of control. Before exercising traction on the economy, they could impose higher interest rates that would have devastating consequences for the Japanese Treasury in the management of a huge public debt (more than twice the size of the GDP). But there is something worse than the risk of Abenomics having poor or adverse domestic consequences.

The other side of Abenomics is currency management, a much less propitious theme for a government to communicate in the weeks leading up to the IMF Spring Meetings in Washington. This aspect of the policy is not only bold, it’s actually radical. As a candidate, Mr. Abe made extremely clear that he was willing to help the manufacturing sector by depreciating the yen and that monetary policy would be designed with this goal in mind. Remember that Japan, despite all its woes, remains a formidable exporter with an external surplus close to ¥650 billion in February (approximately $6.5 billion). As my fellow economists at Brookings have recently shown [2], the Japanese bilateral surplus with the U.S., which is $23 billion according to reported trade statistics, would dramatically increase by 60 percent and reach $36 billion if measured in added-value terms. Mr. Abe’s message was well received by investors who quickly after the election started to short the yen. As a result, the yen has slumped 21.5 percent in the past five months— the worst (or the best?) performance among the currencies of the developed economies. Following last week’s announcement that the Bank of Japan was really acting to debase monetary policy, the yen weakened beyond 99 yen per dollar and dropped against 15 major currencies.

A weakening yen also poses challenges for China, complicating the China’s strategy to reach its 8 percent target growth for this year; it could also trigger huge capital flows into China destabilizing the delicate control of financial stability

This is where Mr. Abe and Mr. Smoot cross ways: both are local politicians inspired by the difficulties facing their countries; both are willing to use every available policy tool to soften these difficulties; neither is willing to shock the global economy, which has never been the case when arguing in favor of protectionism or competitive devaluations. But these measures are nonetheless radical because they have the potential to ignite uncontrollable chain reactions. South Korea for one already declared itself very concerned by this aggressive policy, which is totally understandable. For instance, when Toyota and Sony take some advantage of Abe’s policy, the ones that would likely be first to suffer are Hyundai and Samsung. South Korea has vital interests at stake and, over In the last five months, it has been struggling with a pernicious appreciation of its currency. A weakening yen also poses challenges for China, complicating the China’s strategy to reach its 8 percent target growth for this year; it could also trigger huge capital flows into China destabilizing the delicate control of financial stability; SAFE, the financial institution that manages China’s huge official reserves, last week published its yearly report for 2012. Commenting on the global environment, the report emphasized that “a yen’s depreciation can’t solve Japan’s structural problem, … [but] could turn out of control and trigger a suspicion about its sustainability,… and finally have dangerous spill-over-effects”[3]. Chinese officials at the Boao Forum also expressed similar concerns.

We still don’t know the end. Hope is that we could see the positive interpretation of a bold Japanese policy experiment contributing to a better functioning world economy. Experience should nonetheless make us cautious. What the movement by the Bank of Japan does is to increase an already huge excess liquidity, inundating global markets. In addition, the Japanese government has added a dangerous touch of currency manipulation. Both aspects should be alerts for the IMF rather than too quickly fuel the artificial satisfaction of promises regarding higher inflationary expectations and increased domestic demand. In the end, competitive devaluations always prove inefficient and dangerous because they inevitably provoke reactions and retaliations. “Currency wars” have made headlines from time to time in the recent years but these were skirmishes. This time it could be for real, and this should be a major concern for the United States. It is a great thing that Japan recently expressed interest in joining the Trans-Pacific Partnership, but these are words with long delayed potential results. A more constructive and immediate task is to continue the cooperative global approach of exchange rate policies and to strongly discourage any temptation of national radical policy experiments. This should be a central issue next week during the IMF Spring Meetings in Washington.

[1] Roger C. Altman: “The Fall and Rise of the West”, Foreign Affairs, January-February 2013

[2] Kemal Dervis, Joshua Meltzer and Karim Foda: “Value-Added Trade and its Implications for International Trade Policy”, Brookings Opinion, April 2, 2013

[3] http://www.safe.gov.cn/resources/image/076044004f1fb34a9da59ff675a23beb/1365377817854.pdf?MOD=AJPERES&name=2012年中国国际收支报告.pdf

Last night, retired lieutenant general Michael Flynn addressed the Republican convention as a headline speaker on the subject of national security. One of Donald Trump’s closest advisors—so much so that he was considered for vice president—Flynn repeated many of the themes found in his new book, The Field of Fight, How We Can Win the Global War Against Radical Islam and Its Allies, which he coauthored with Michael Ledeen. (The book is published by St. Martin’s, which also published mine.)

Written in Flynn’s voice, the book advances two related arguments: First, the U.S. government does not know enough about its enemies because it does not collect enough intelligence, and it refuses to take ideological motivations seriously. Second, our enemies are collaborating in an “international alliance of evil countries and movements that is working to destroy” the United States despite their ideological differences.

Readers will immediately notice a tension between the two ideas. “On the surface,” Flynn admits, “it seems incoherent.” He asks: 

“How can a Communist regime like North Korea embrace a radical Islamist regime like Iran? What about Russia’s Vladimir Putin? He is certainly no jihadi; indeed, Russia has a good deal to fear from radical Islamist groups.” 

Flynn spends much of the book resolving the contradiction and proving that America’s enemies—North Korea, China, Russia, Iran, Syria, Cuba, Bolivia, Venezuela, Nicaragua, al-Qaida, Hezbollah, and ISIS—are in fact working in concert.

No one who has read classified intelligence or studied international relations will balk at the idea that unlikely friendships are formed against a common enemy. As Flynn observes, the revolutionary Shiite government in Tehran cooperates with nationalist Russia and communist North Korea; it has also turned a blind eye (at the very least) to al-Qaida’s Sunni operatives in Iran and used them bargaining chips when negotiating with Osama bin Laden and the United States. 

Flynn argues that this is more than “an alliance of convenience.” Rather, the United States’ enemies share “a contempt for democracy and an agreement—by all the members of the enemy alliance—that dictatorship is a superior way to run a country, an empire, or a caliphate.” Their shared goals of maximizing dictatorship and minimizing U.S. interference override their substantial ideological differences. Consequently, the U.S. government must work to destroy the alliance by “removing the sickening chokehold of tyranny, dictatorships, and Radical Islamist regimes.” Its failure to do so over the past decades gravely imperils the United States, he contends.

The book thus offers two very different views of how to exercise American power abroad: spread democracies or stand with friendly strongmen...[P]erhaps it mirrors the confusion in the Republican establishment over the direction of conservative foreign policy.

Some of Flynn’s evidence for the alliance diverts into the conspiratorial—I’ve seen nothing credible to back up his assertion that the Iranians were behind the 1979 takeover of the Grand Mosque in Mecca by Sunni apocalypticists. And there’s an important difference between the territorially-bounded ambitions of Iran, Russia, and North Korea, on the one hand, and ISIS’s desire to conquer the world on the other; the former makes alliances of convenience easier than the latter. Still, Flynn would basically be a neocon if he stuck with his core argument: tyrannies of all stripes are arrayed against the United States so the United States should destroy them.

But some tyrannies are less worthy of destruction than others. In fact, Flynn argues there’s a category of despot that should be excluded from his principle, the “friendly tyrants” like President Abdel-Fatah el-Sissi in Egypt and former president Zine Ben Ali in Tunisia. Saddam Hussein should not have been toppled, Flynn argues, and even Russia could become an “ideal partner for fighting Radical Islam” if only it would come to its senses about the threat of “Radical Islam.” Taken alone, these arguments would make Flynn realist, not a neocon. 

The book thus offers two very different views of how to exercise American power abroad: spread democracies or stand with friendly strongmen. Neither is a sure path to security. Spreading democracy through the wrong means can bring to power regimes that are even more hostile and authoritarian; standing with strongmen risks the same. Absent some principle higher than just democracy or security for their own sakes, the reader is unable to decide between Flynn’s contradictory perspectives and judge when their benefits are worth the risks. 

It’s strange to find a book about strategy so at odds with itself. Perhaps the dissonance is due to the co-authors’ divergent views (Ledeen is a neocon and Flynn is comfortable dining with Putin.) Or perhaps it mirrors the confusion in the Republican establishment over the direction of conservative foreign policy. Whatever the case, the muddled argument offered in The Field of Fight demonstrates how hard it is to overcome ideological differences to ally against a common foe, regardless of whether that alliance is one of convenience or conviction. 

Editor’s Note: The following piece is a chapter from the 2012 edition of Eurasian Development Bank’s Eurasian Integration Yearbook.

INTRODUCTION

For centuries Central Asia was in the backwater of global political and economic attention, tales of “Great Games” and “Silk Roads” notwithstanding. However, interest in Central Asia from outside the region has been on the rise in recent years: Central Asia’s energy resources are of great importance to its neighbours in Europe and Asia. In addition, China wants a peaceful backyard, while Russia considers Central Asia part of its historical economic and regional interests and draws heavily on Central Asia migrants. Turkey is attracted by the common Turkic heritage of the region. Iran shares language and cultural ties with the Tajik people. The Central Asia’s Islamic tradition connects it with the Middle East and other Islamic countries. And now NATO countries rely on Central Asia for transit of their nonlethal military supplies in their engagement in Afghanistan.

There is wide agreement that economic prosperity and political stability in Central Asia is critical not only for the 60-plus million inhabitants of the region, but also for Central Asia’s neighbours, since Central Asia serves as a strategically important land bridge between Europe and Asia. Since the five Central Asian countries are landlocked small economies, a critical prerequisite for long-term economic growth and political stability is successful economic integration underpinned by effective regional cooperation.

This paper therefore addresses the central question of what are the prospects for regional economic integration and regional cooperation in Central Asia. It starts by briefly reviewing the role of Central Asia in the context of the overall process of Eurasian continental economic integration. It then considers what are the benefits and obstacles of regional integration and cooperation in Central Asia against the backdrop of lessons of international experience with regional integration and cooperation, and looks at four of the most important recent regional cooperation initiatives. In closing, the paper provides an answer to the question whether regional integration and cooperation in Central Asia are for real or only a mirage.

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Editor's Note: Johannes Linn discusses the potential of multilateral development banks in the latest G-20 Research Group briefing book on the St. Petersburg G-20 Summit. Read the full collection here.

The origins of the multilateral development banks (MDBs) lie with the creation of the World Bank at Bretton Woods in 1944. Its initial purpose, as the International Bank for Reconstruction and Development, was the reconstruction of wartorn countries after the Second World War. 

As Europe and Japan recovered in the 1950s, the World Bank turned to providing financial assistance to the developing world. Then came the foundation of the InterAmerican Development Bank (IADB) in 1959, of the African Development Bank (AfDB) in 1964 and of the Asian Development Bank (ADB) in 1966, each to assist the development of countries in their respective regions. The European Bank for Reconstruction and Development (EBRD) was set up in 1991, following the collapse of the Soviet Union, to assist with the transition of countries in the former Soviet sphere. 

The MDBs are thus rooted in two key aspects of the geopolitical reality of the postwar 20th century: the Cold War between capitalist ‘West’ and communist ‘East’, and the division of the world into the industrial ‘North’ and the developing ‘South’. The former aspect was mirrored in the MDBs for many years by the absence of countries from the Eastern Bloc. This was only remedied after the fall of the Bamboo and Iron curtains. The latter aspect remains deeply embedded even today in the mandate, financing pattern and governance structures of the MDBs. 

Changing global financial architecture 

From the 1950s to the 1990s, the international financial architecture consisted of only three pillars: the International Monetary Fund (IMF) and the MDBs represented the multilateral official pillar; the aid agencies of the industrial countries represented bilateral official pillar; and the commercial banks and investors from industrial countries made up the private pillar. 

Today, the picture is dramatically different. Private commercial flows vastly exceed official flows, except during global financial crises. New channels of development assistance have multiplied, as foundations and religious and non-governmental organisations rival the official assistance flows in size. 

The multilateral assistance architecture, previously dominated by the MDBs, is now a maze of multilateral development agencies, with a slew of sub-regional development banks, some exceeding the traditional MDBs in size. For example, the European Investment Bank lends more than the World Bank, and the Caja Andina de Fomento (CAF, the Latin American Development Bank) more than the IADB. There are also a number of large ‘vertical funds’ for specific purposes, such as the International Fund for Agricultural Development and the Global Fund to Fight AIDS, Tuberculosis and Malaria. There are  specialized trust funds, attached to MDBs, but often with their own governance structures.

End of the North-South divide 

Finally, the traditional North-South divide is breaking down, as emerging markets have started to close the development gap, as global poverty has dropped and as many developing countries have large domestic capacities. This means that the new power houses in the South need little financial and technical assistance and are now providing official financial and technical support to their less fortunate neighbors. China’s assistance to Africa outstrips that of the World Bank.

The future for MDBs 

In this changed environment is there a future for MDBs? Three options might be considered: 

1. Do away with the MDBs as a relic of the past. Some more radical market ideologues might argue that, if there ever was a justification for the MDBs, that time is now well past. In 2000, a US congressional commission recommended the less radical solution of shifting the World Bank’s loan business to the regional MDBs. Even if shutting down MDBs were the right option, it is highly unlikely to happen. No multilateral financial institution created after the Second World War has ever been closed. Indeed, recently the Nordic Development Fund was to be shut down, but its owners reversed their decision and it will carry on, albeit with a focus on climate change. 

2. Carry on with business as usual. Currently, MDBs are on a track that, if continued, would mean a weakened mandate, loss of clients, hollowed-out financial strength and diluted technical capacity. Given their tight focus on the fight against poverty, the MDBs will work themselves out of a job as global poverty, according to traditional metrics, is on a dramatic downward trend. 

Many middle-income country borrowers are drifting away from the MDBs, since they find other sources of finance and technical advice more attractive. These include the sub-regional development banks, which are more nimble in disbursing their loans and whose governance is not dominated by the industrial countries. These countries, now facing major long-term budget constraints, will be unable to continue supporting the growth of the MDBs’ capital base. But they are also unwilling to let the emerging market economies provide relatively more funding and acquire a greater voice in these institutions.

Finally, while the MDBs retain professional staff that represents a valuable global asset, their technical strength relative to other sources of advice – and by some measures, even their absolute strength – has been waning. 

If left unattended, this would mean that MDBs 10 years from now, while still limping along, are likely to have lost their ability to provide effective financial and technical services on a scale and with a quality that matter globally or regionally. 

3. Give the MDBs a new mandate, new governance and new financing. If one starts from the proposition that a globalised 21st-century world needs capable global institutions that can provide long-term finance to meet critical physical and social infrastructure needs regionally and globally, and that can serve as critical knowledge hubs in an increasingly interconnected world, then it would be folly to let the currently still considerable institutional and financial strengths of the MDBs wither away.

• The mandate of the MDBs should be adapted to move beyond preoccupation with poverty eradication to focus explicitly on global and regional public goods as a way to help sustain global economic growth and human welfare. Moreover, the MDBs should be able to provide assistance to all their members, not only developing country members. 

• The governance of the MDBs should be changed to give the South a voice commensurate with the greater global role it now plays in economic and political terms. MDB leaders should be selected on merit without consideration of nationality. 

• The financing structure should be matched to give more space to capital contributions from the South and to significantly expand the MDBs’ capital resources in the face of the current severe capital constraints.

In addition, MDB management should be guided by banks’ membership to streamline their operational practices in line with those widely used by sub-regional development banks, and they should be supported in preserving and, where possible, strengthening their professional capacity so that they can serve as international knowledge hubs. 

A new MDB agenda for the G20 

The G20 has taken on a vast development agenda. This is fine, but it risks getting bogged down in the minutiae of development policy design and implementation that go far beyond what global leaders can and should deal with. What is missing is a serious preoccupation of the G20 with that issue on which it is uniquely well equipped to lead: reform of the global financial institutional architecture. 

What better place than to start with than the MDBs? The G20 should review the trends, strengths and weaknesses of MDBs in recent decades and endeavour to create new mandates, governance and financing structures that make them serve as effective pillars of the global institutional system in the 21st century. If done correctly, this would also mean no more need for new institutions, such as the BRICS development bank currently being created by Brazil, Russia, India, China and South Africa. It would be far better to fix the existing institutions than to create new ones that mostly add to the already overwhelming fragmentation of the global institutional system.

I this week had the pleasure of doing a podcast debate with my Brookings colleague Jonathan Rauch on the question of whether we need stronger machines and weaker transparency in American government, or the opposite. Guess which side I took! This has been a long-running water cooler and cafeteria discussion between Jon and myself since I arrived at Brookings almost a year ago. While we find some areas of agreement in the podcast (more than you might think),I remain unconvinced by the so-called “political realist” school that Jonathan is a leader of. As I have previously written and blogged (here, here and here), I think the realists are fantasists, disconnected from the actual reality of politics, including its risks. We need more transparency, not less to deal with, for example, things like corruption risk, particularly in the post-Citizens United era. Indeed, that decision itself embraces the value of a vigorous transparency regime when other safeguards are relaxed. My belief is that Washington works both more efficiently and more ethically under the scrutinizing gaze of the American media, ngo's and public. As former White House ethics czar, I often facilitated administration openness efforts, including as a means of accountability, for example helping put the White House visitor logs online.

Jon and my lively debate covers not only issues of transparency itself but also applies them to other current topics—the Affordable Care Act, Trade Promotion Authority, and much more. The debate was silently moderated by our colleague Ben Wittes as part of his “Chess Clock Debates” series. With only ten minutes on the chess clock each to make our points, it was a concise discussion that hit the fundamentals briskly. Thanks to Ben for inviting us and giving us a public forum to discuss this critical policy issue.

Hypocrisy is not scarce in the world of politics. But the current House and Senate budget resolutions set new lows. Each proposes to cut about $5 trillion from government spending over the next decade in pursuit of a balanced budget. Whatever one may think of putting the goal of reducing spending when the ratio of the debt-to-GDP is projected to be stable above investing in the nation’s future, you would think that deficit-reduction hawks wouldn’t cut spending that has been proven to lower the deficit.

Yes, there are expenditures that actually lower the deficit, typically by many dollars for each dollar spent. In this category are outlays on ‘program integrity’ to find and punish fraud, tax evasion, and plain old bureaucratic mistakes. You might suppose that those outlays would be spared. Guess again. Consider the following:

Medicare. Roughly 10% of Medicare’s $600 billion budget goes for what officials delicately call ‘improper payments, according to the 2014 financial report of the Department of Health and Human Services. Some are improper merely because providers ‘up-code’ legitimate services to boost their incomes. Some payments go for services that serve no valid purpose. And some go for phantom services that were never provided. Whatever the cause, approximately $60 billion of improper payments is not ‘chump change.’

Medicare tries to root out these improper payments, but it lacks sufficient staff to do the job. What it does spend on ‘program integrity’ yields an estimated $14.40? for each dollar spent, about $10 billion a year in total. That number counts only directly measurable savings, such as recoveries and claim denials. A full reckoning of savings would add in the hard-to-measure ‘policeman on the beat’ effect that discourages violations by would-be cheats.

Fat targets remain. A recent report from the Institute of Medicine presented findings that veritably scream ‘fraud.’ Per person spending on durable medical equipment and home health care is ten times higher in Miami-Dade County, Florida than the national average. Such equipment and home health accounts for nearly three-quarters of the geographical variation in per person Medicare spending. Yet, only 4% of current recoveries of improper payments come from audits of these two items and little from the highest spending locations.

Why doesn’t Medicare spend more and go after the remaining overpayments, you may wonder? The simple answer is that Congress gives Medicare too little money for administration. Direct overhead expenses of Medicare amount to only about 1.5% of program outlays—6% if one includes the internal administrative costs of private health plans that serve Medicare enrollees. Medicare doesn’t need to spend as much on administration as the average of 19% spent by private insurers, because for example, Medicare need not pay dividends to private shareholders or advertise.

But spending more on Medicare administration would both pay for itself—$2 for each added dollar spent, according to the conservative estimate in the President’s most recent budget—and improve the quality of care. With more staff, Medicare could stop more improper payments and reduce the use of approved therapies in unapproved ways that do no good and may cause harm.

Taxes. Compare two numbers: $540 billion and $468 billion. The first number is the amount of taxes owed but not paid. The second number is the projected federal budget deficit for 2015, according to the Congressional Budget Office.

Collecting all taxes legally owed but not paid is an impossibility. It just isn’t worth going after every violation. But current enforcement falls far short of practical limits. Expenditures on enforcement directly yields $4 to $6 for each dollar spent on enforcement. Indirect savings are many times larger—the cop-on-the-beat effect again. So, in an era of ostentatious concern about budget deficits, you would expect fiscal fretting in Congress to lead to increased efforts to collect what the law says people owe in taxes.

Wrong again. Between 2010 and 2014, the IRS budget was cut in real terms by 20%. At the same time, the agency had to shoulder new tasks under health reform, as well as process an avalanche of applications for tax exemptions unleashed by the 2010 Supreme Court decision in the Citizens United case. With less money to spend and more to do, enforcement staff dropped by 15% and inflation adjusted collections dropped 13%.

One should acknowledge that enforcement will not do away with most avoidance and evasion. Needlessly complex tax laws are the root cause of most tax underpayment. Tax reform would do even more than improved administration to increase the ratio of taxes paid to taxes due. But until that glorious day when Congress finds the wit and will to make the tax system simpler and fairer, it would behoove a nation trying to make ends meet to spend $2 billion to $3 billion more each year to directly collect $10 billion to 15 billion a year more of legally owed taxes and, almost certainly, raise far more than that by frightening borderline scoff-laws.

Disability Insurance. Thirteen million people with disabling conditions who are judged incapable of engaging in substantial gainful activity received $161 billion in disability insurance in 2013. If the disabling conditions improve enough so that beneficiaries can return to work, benefits are supposed to be stopped. Such improvement is rare. But when administrators believe that there is some chance, the law requires them to check. They may ask beneficiaries to fill out a questionnaire or, in some cases, undergo a new medical exam at government expense. Each dollar spent in these ways generated an estimated $16 in savings in 2013.

Still, the Social Security Administration is so understaffed that SSA has a backlog of 1.3 million disability reviews. Current estimates indicate that spending a little over $1 billion a year more on such reviews over the next decade would save $43 billion. Rather than giving Social Security the staff and spending authority to work down this backlog and realize those savings, Congress has been cutting the agency’s administrative budget and sequestration threatens further cuts.

Claiming that better administration will balance the budget would be wrong. But it would help. And it would stop some people from shirking their legal responsibilities and lighten the burdens of those who shoulder theirs. The failure of Congress to provide enough staff to run programs costing hundreds of billions of dollars a year as efficiently and honestly as possible is about as good a definition of criminal negligence as one can find.

Social Security faces a financial shortfall. If Congress does nothing about it, current projections indicate that benefits will be cut automatically by 21 percent in 2034. Congress could close the gap by raising revenues, lowering benefits, or doing some of both. If benefits seem generous, Congress is likely to lean toward benefit cuts more than revenue increases. If they seem stingy, then the reverse.

Given the split between the two parties on whether to cut benefits or to raise them, evidence on the adequacy of benefits is central to this key policy debate. Those perceptions will help determine whether Social Security continues to provide basic retirement income for workers with comparatively low earnings histories and a foundation of retirement income for most others or it will become just a minimal safety-net backstop against extreme destitution?

Down-in-the-weeds disagreements among analysts often seem too arcane for anyone other than specialists. But sometimes they are too important to ignore. A current debate about the adequacy of Social Security benefits is an example.

The not-so-simple question is this: are Social Security benefits ‘generous’ or ‘stingy’? To answer this question, people long looked to the Office of the Social Security Actuary. For many years that office published estimates of something called the ‘replacement rate’—that is, how high are benefits paid to retirees and the disabled relative what they earned during their working years. A 2014 retiree with median earnings had average lifetime earnings of about $46,000. That worker qualified for a benefit at age 66 of about $19,000, a replacement rate of about 41%. Replacement rates vary with earnings. Dollar benefits rise with earnings, but they rise less than proportionately. As a result, replacement rates of low earners are higher than replacement rates of high earners.

As you might suppose, there are many ways in which to compute such ‘replacement rates. Because of analytical disputes on which method is best, the Social Security trustees in 2014 decided to stop including replacement rate estimates in their annual reports.

In December 2015, the Congressional Budget Office (CBO) offered what it considered a better measure of the generosity of Social Security. It estimated that replacement rates for middle income recipients were about 60%–dramatically higher than the 41% that the Social Security Trustees had estimated.

The gap between the estimates of CBO and those of Social Security is even larger than it seems. To see why, one needs to recognize that to sustain living standards retirees on average need only about 75% to 80% as much income as they did when working. Retirees need less income because they are spared some work-related expenses, such as transportation to and from work. Those are only average of course; some need more, some less.

If one believed the SSA actuaries, Social Security provides median earners barely more than half of what they need to be as well off as they were when working. Benefit cuts from that modest level would threaten the well-being for the majority of retirees who are entirely or mostly dependent on Social Security benefits—and especially for those with large medical expenses uncovered by Medicare.

On the other hand, if one accepted CBO’s estimates, Social Security provids more than three-quarters of the retirement income target. Against that baseline, benefit cuts would still sting, but they would pose less of a threat, and not much of a threat at all for most retirees who have some income from private pensions or personal savings.

When the CBO estimates came out, conservative commentators welcomed the findings and cited CBO’s well-established and well-earned reputation for objectivity. They correctly noted that many retirees have additional income from private pensions, 401ks, or other personal savings, and asserted that there was no general retirement income shortage. By inference, cutting benefits a bit to help close the long-term funding gap would be no big deal. Social Security advocates were put on the defensive, hard-pressed to challenge the estimates of the widely-respected Congressional Budget Office.

But earlier this year, CBO acknowledged that it had made mistakes in its Decameter estimates and revised them. The new CBO estimate put the replacement rate for middle-level earners at around 42%, almost the same as the estimate of the Social Security actuaries, not the much higher level that had sent ripples through the policy community. One conservative analyst, Andrew Biggs, who had trumpeted the initial CBO finding in The Wall Street Journal, promptly and honorably retracted his article.

Two aspects of this green-eyeshade kerfuffle stand out. The first is that policy debates often depend on obscure technical analyses that are, in turn, remarkably sensitive to ‘black-box’ methods to which few or no outsiders have ready access. The second is that CBO burnished its reputation for honesty by owning up to its own mistakes — in this case, a whopping overestimate of a key number. Such candor is all too rare; it merits notice and praise.

But there is a broader lesson as well. Technical issues of comparable complexity surround numerous current political disputes. Is Bernie Sanders’ single-payer plan affordable? Will Marco Rubio’s tax plan cause deficits to balloon? To vote rationally, people must struggle to see through the rhetorical chaff that surrounds candidates’ favorite claims. There is, alas, no substitute for paying close attention to the data, even if they are ‘down in the weeds.’

Editor's note: This piece originally appeared in Fortune.

The global consumer products company Unilever Plc announced on Monday a $35 million investment in Cuba’s Special Development Zone at Mariel. Late last year, Brascuba, a joint venture with a Brazilian firm, Souza Cruz, owned by the mega-conglomerate British American Tobacco (BAT), confirmed it would built a $120 million facility in the same location.

So far, these are the two biggest investments in the much-trumpeted Cuban effort to attract foreign investment, outside of traditional tourism. Yet, neither investment is really new. Unilever had been operating in Cuba since the mid-1990s, only to exit a few years ago in a contract dispute with the Cuban authorities. Brascuba will be moving its operations from an existing factory to the ZED Mariel site.

What is new is the willingness of Cuban authorities to accede to the corporate requirements of foreign investors. Finally, the Cubans appear to grasp that Cuba is a price-taker, and that it must fit into the global strategies of their international business partners. Certainly, Cuban negotiators can strike smart deals, but they cannot dictate the over-arching rules of the game.

Cuba still has a long way to go before it reaches the officially proclaimed goal of $2.5 billion in foreign investment inflows per year. Total approvals last year for ZED Mariel reached only some $200 million, and this year are officially projected to reach about $400 million. For many potential investors, the business climate remains too uncertain, and the project approval process too opaque and cumbersome. But the Brascuba and Unilever projects are definitely movements in the right direction.

But Unilever feared that granting its Cuban partner 51% would yield too much management control and could jeopardize brand quality. Unilever also balked at exporting products made in Cuba, where product costs were as much as one-third higher than in bigger Unilever plants in other Latin American countries.

The 2012 collapse of the Unilever contract renewal negotiations adversely affected investor perceptions of the business climate. If the Cuban government could not sustain a good working relationship with Unilever—a highly regarded, marquée multinational corporation with a global footprint—what international investor (at least one operating in the domestic consumer goods markets) could be confident of its ability to sustain a profitable long-term operation in Cuba?

In the design of the new joint venture, Cuba has allowed Unilever a majority 60% stake. Furthermore, in the old joint venture, Unilever executives complained that low salaries, as set by the government, contributed to low labor productivity. In ZED Mariel, worker salaries will be significantly higher: firms like Unilever will continue to pay the same wages to the government employment entity, but the entity’s tax will be significantly smaller, leaving a higher take-home pay for the workers. Hiring and firing will remain the domain of the official entity, however, not the joint venture.

Unilever is also looking forward to currency unification, widely anticipated for 2016. Previously, Unilever had enjoyed comfortable market shares in the hard-currency Cuban convertible currency (CUC) market, but had been largely excluded from the national currency markets, which state-owned firms had reserved for themselves. With currency unification, Unilever will be able to compete head-to-head with state-owned enterprises in a single national market.

Similarly, Brascuba will benefit from the new wage regime at Mariel and, as a consumer products firm, from currency unification. At its old location, Brascuba considered motivating and retaining talent to be among the firm’s key challenges; the higher wages in ZED Mariel will help to attract and retain high-quality labor.

Brascuba believes this is a good time for expansion. Better-paid workers at Mariel will be well motivated, and the expansion of the private sector is putting more money into consumer pockets. The joint venture will close its old facility in downtown Havana, in favor of the new facility at Mariel, sharply expanding production for both the domestic and international markets (primarily, Brazil).

A further incentive for investment today is the prospect of the lifting of U.S. economic sanctions, even if the precise timing is impossible to predict. Brascuba estimated that U.S. economic sanctions have raised its costs of doing business by some 20%. Inputs such as cigarette filters, manufacturing equipment and spare parts, and infrastructure such as information technology, must be sourced from more distant and often less cost-efficient sources.

Another sign of enhanced Cuban flexibility: neither investment is in a high technology sector, the loudly touted goal of ZED Mariel. A manufacturer of personal hygiene and home care product lines, Unilever will churn out toothpaste and soap, among other items. Brascuba will produce cigarettes. Cuban authorities now seem to accept that basic consumer products remain the bread-and-butter of any modern economy. An added benefit: international visitors will find a more ready supply of shampoo!

The Unilever and Brascuba renewals suggest a new realism in the Cuban camp. At ZED Mariel, Cuba is allowing their foreign partners to exert management control, to hire a higher-paid, better motivated workforce, and it is anticipated, to compete in a single currency market. And thanks to the forward-looking diplomacy of Raúl Castro and Barack Obama, international investors are also looking forward to the eventual lifting of U.S. economic sanctions.

This piece was originally published in Cuba Standard.