Security First

Warning: Profit-Making Colleges Are After You

Here we go again. Corporations are making money not by producing a product and marketing it, but by loading consumers with loans they cannot pay and then sticking the taxpayers with the bill. Only this time, it's not houses and mortgages but "higher" education and student loans.

Here's how it works. Fly-by-night "educational entrepreneurs" -- people who run profit-making colleges -- buy small liberal arts colleges that are on the verge of collapse because of financial difficulties. This provides the profit-makers with coveted regional accreditation, which is needed to allow their students to take out federal loans. The profit-driven colleges then set up boiler-room style "recruitment" offices to hunt and pressure people to enroll and take out loans, promising them bright futures and successful careers. Former recruitment officers have reported that they were under intense pressure to meet quotas and enroll students, regardless of their readiness for college-level education. Enrollment counselors were told, when on the phone with prospective applicants, to "create a sense of urgency" and "push their hot button," all tricks typically used to sell penny stocks. (All of this was vividly documented by PBS's Frontline in an episode entitled "College, Inc." You can watch it here.)

The education students receive at for-profit colleges bears little resemblance to the kind they would get at a true liberal arts college. Neither does it resemble the collegial image the for-profit colleges love to project. Professors at these schools often work on short contracts. There is no tenure. The executives make staggering salaries. Most students are taught online, often by poorly qualified professors who have very limited contact with the students. A 2007 New York Times article revealed that graduates of the University of Phoenix, the largest of the for-profit schools, had bitter complaints about "instructional shortcuts" and "unqualified professors." Students in an average course at the University of Phoenix spend about half as much time with professors as students in traditional universities do. Moreover, the university was fined for falling short of the minimum scheduled time required for receiving federal aid.

The schools' stripped-down curricula and poor instruction often make for nearly worthless degrees. When students graduate from these colleges, many cannot find jobs -- or at least not the kinds they were promised -- and eventually, many of them default on their loans. The federal government has estimated that for-profit university students, who make up just 10% of all American college students, account for about 44% of all student loan defaults. When the students default, you and I pick up the tab. But note: the money does not go to the students, but to the shareholders of the for-profit colleges.

The taxpayers are putting up the money and absorbing the losses, but the shareholders are making out like bandits. Bloomberg recently reported that in fiscal year 2009, the University of Phoenix reaped nearly $3.8 billion in revenue, and 86% of it came from the U.S. Department of Education.

In response to the growing problems, the U.S. Department of Education recently proposed new rules requiring for-profit universities to justify the federal support they receive by demonstrating that their graduates are actually finding jobs. But a swarm of industry lobbyists pressured the Department of Education, which just announced that it has delayed settling on a specific definition of the new rules, regulations which might turn out to have only limited influence over profit-making colleges.

The profiteers argue that they serve a large number of poor and minority students. These individuals could be served much better by transferring the funds the executives at "College, Inc." are dedicating in large part to their shareholders, to traditional four-year colleges and community colleges. Instead the administration cut the funds originally planned for community colleges from a proposed $12 billion over 10 years to $2 billion over four years. If these funds were to be restored to the proposed levels, these students could get not just an education, but a better one.

The NPT Test

Today the representatives of 188 nations (give or take a few) assembled in New York City to debate ways to revise the Nuclear Non-Proliferation Treaty. The issue could not be more important. As President Obama’s new Nuclear Posture Review declares, the greatest threats to global security are not the old Cold War adversaries but rogue states armed with nukes and terrorists with access to such bombs or the materials from which they can be made. Moreover, the NPT is severely challenged by Iran, which, the IAEA has repeatedly reported, is not living up to its obligations under the treaty. Other nations with nuclear ambitions are watching to see how the international community will react to Iran’s violations, as they figure out their own military futures.

If one examines previous meetings of the NPT signatories, one does not find them very reassuring, to put it mildly. During the last meeting of this group — which includes representatives of most nations of the world — those present debated the agenda for two weeks, and then went home.

This time the meeting is viewed with special interest because President Obama is seeking to garner support from many nations that in the past were very critical of the U.S. and other nations that already have nukes for not living up to their commitment under the NPT, namely to give up their nukes. President Obama thus declared that indeed zero nukes is the goal, and showed that he means business by working out a treaty with Russia that would scale back the number deployed on the top of launchers. He also obtained a measure of new support from a recent meeting of 47 nations in Washington, to better secure the remaining nukes and blend down the materials from which they can be made.

How is one to assess the achievements of the NPT conference? I predict that much attention will be focused on the posturing of various nations (Iran is a member), criticisms of the members of the nuclear club (who still have enough nukes to kill most everyone three times over) and the nations that did not join the NPT (Pakistan, India, and Israel). Possibly some progress will be made in passing a resolution that urges the member nations to endorse the so-called “Additional Protocol,” which widens the scope of IAEA inspections. However, the true test of the 2010 NPT conference lies elsewhere.

The NPT has one major, debilitating flaw. It has a loophole so large that aircraft carriers can sail through it unnoticed. The NPT allows a nation to build nuclear reactors using highly enriched uranium, which is weapons-grade material, as well as to build the facilities needed to enrich additional uranium to this level — as long as the nation claims that these materials are to be used for peaceful purposes. The nation is then entitled to send a notice that it is quitting the treaty and three months later do so, taking with it all these facilities, and legally begin making bombs. A nation hence need not cheat, hide its bomb making from inspectors, or face criticism and possible UN sanctions. All it takes is basically a postcard.

Thus when one evaluates whether the NPT review conference is truly succeeding, or mainly dealing with atmospherics and debating points and possibly some secondary issue, ask whether this loophole is closed. My expectation? Do not hold your breath, lest you turn very blue.

Washington Unlocked--For the Rich

The cliché that Washington is deadlocked and dysfunctional is only partially true. Congress and Obama get done those things favored by lobbies with deep pockets that have their hooks into both the GOP and a fair number of Democrats. Thus, despite all the hullabaloo about deficits, the government is about to provide $8.33 billion in loan guarantees to the nuclear industry, which adds to government liabilities, and hence increases the deficit.

Congress -- which so far has done extremely little to provide for new financial regulation -- has found the time to dilute accounting rules that govern the banks, "improving" their balance sheets, which sows the seeds for the next financial crisis -- or the next round of the current one. And Congress seems ready to move to allow offshore oil drilling after Obama's signal to this effect during his State of the Union.

This political set up also predicts where the new commission on deficit reduction is headed: major cuts in the outlays and benefits for the masses, and few tax increases for the rich. You heard it here first.

Liberals like to dream about a pendulum, in which the United States swings from conservative eras to liberals ones and back. Arthur Schlesinger Jr. was the main scholar who helped formulate this vision. Actually the United States since the 1970s is going through shorter and shorter -- and weaker! -- liberal intervals, and longer and stronger conservative periods. The liberals can complain all they want, but until they get together and form a united front, a shared agenda, and a social movement to back it up, they should be ready for another bout of market forces intervening in the government -- while complaining about government interference in the market.

Canary in the Coal Mine: Student Loans

The Democrats are caught between the need to set up structures that will prevent future meltdowns and the pressures they face from well-heeled Wall Street-based interest groups. They are under cross-pressure to act in the public interest and to survive in the political system: those who displease groups with deep pockets face tough re-election campaigns, as their opponents will get the large amounts of funds needed these days to run for office.  Hence, despite all the talk about new regulations, surprisingly little is happening.

Student loans serve as a sort of a canary in the dark recesses of Washington politics. If the Democrats cannot stand up to private sectors here, they are extremely unlikely to persevere elsewhere. The issue is very simple. If the Democrats cannot show the public that the existing arrangement constitutes an out-and-out raid of the public treasury by a few investment houses and banks -- and that anybody who opposes reform should be booed out of office -- do not expect them to be able to do so on the much more complicated issues of credit swap controls and regulations of derivatives.

Since 1965, the federal government has provided funds to private lenders through the federal Family Education Loan Program.   The government gives loan money to private lenders and guarantees 97% of the loans, ensuring that the private lenders loan virtually without risk. Last year, these private lenders made $56 billion in loans to students.  They pocketed huge profits without providing any service.

On February 26, President Obama proposed that instead of going through private lenders to borrow money, students should borrow money directly from the U.S. Department of Education, eliminating the role of the private lenders. By early July, the chairman of the House Education Committee had endorsed President Obama's plan, which, projects the Congressional Budget Office, would save up to $87 billion in the next ten years.  On September 17, the House of Representatives voted 253 to 171 to put this plan into effect.  It is eight months later but the Senate has not acted, while all the time it has been shedding tears about the mushrooming deficits.

As I said, if this bill cannot fly through a Democrat-controlled Congress, do not be surprised if little else opposed by large and well-endowed private interests will see the light of day.  Even if the bill passes, it will be so diluted and further watered down after it is enacted that it will end up basically as a reform in name only. Watch the canary and see whether the toxic clouds are lifting or closing in.

Love the bomb?

Some years back I wrote an essay for Time magazine. When I met with the editor, he told me that wanted “a forehead slapping piece.” When I meekly replied that I did not know what this meant, he explained that he wanted the “reader to exclaim ‘Wow, why did I not think about that?!’” The editor was much less keen to find out  whether the idea could be well supported. All this came to mind when I read an article in a recent issue of Newsweek by a journalist, one Jonathan Tepperman. Time magazine would have loved his essay.

Mr. Tepperman announced that we are all dead wrong: “Nuclear weapons may not, in fact, make the world more dangerous.” Wait, wait, Mr. Tepperman is just warming up. “The bomb may actually make us safer,” he claims. Mr. Tepperman finds that more nuclear-armed states are not dangerous and, in effect, are “agents of peace.”

The Newsweek journalist modestly refers to this revelation as “the truth” and claims that his conclusion is based on a “growing and compelling body of research.” Given that I have been trying to keep up with the field ever since I wrote two books about nukes in the mid-sixties, he surely got my attention.

Soon, it became clear that there is no research—let alone compelling research—to support this forehead-slapping claim, only Mr. Tepperman’s simplistic conclusions. Exhibit number one: He finds we need not fear nukes because they have not been used since 1945. But in 1945, they were used to wipe out two cities, and those who now seek to get their hands on them are much more fanatical and impulsive than the superpowers that monopolized them in the past. 

Moreover, while the US and Russia neutralized each other’s nukes— because of the threat of retaliation—terrorists have no such concerns. They are willing to commit suicide to carry out their mission and, hence, hardly fear retaliation. Furthermore, they would be delighted if the nation whose city they destroyed went and took out, say, Tehran. As they see it, such an attack would serve to mobilize the Muslim world for the ultimate jihad.

The point I just made concerns the future, which I grant is unpredictable (but about which we would rather be safe than sorry). However, Mr. Tepperman fully reveals the depths of his “research” when he writes, “There’s never been a nuclear, or even a nonnuclear, war between two states that posses them.” I guess he has never heard about India and Pakistan.

I stopped reading after Mr. Tepperman—ignoring the terrorists— declared that we are safe because heads of states are rational actors. Anybody who calls Hitler rational and who thinks it is was rational for the Japanese Emperor and his generals to believe that they could knock out the United States simply does not understand what rational means.

Three cheers for Israel?!

The media is full of stories critical of the way Israel deals with the Palestinians.
There is indeed a lot to criticize, which, by the way, Israelis often do. However, when Israel does something right — and in a big way — that too should be noted. After all, one cannot expect a nation that is boxed around the ears every time it strays, but not rewarded when it gets it right, to mend its ways.

Here what happened which got next to no coverage, except — thanks — in the Washington Post.

The Dead Sea is dying.  Since 1960, its water level has decreased by 75 feet and its surface area by a third.  But this problem is not restricted to one body of water: throughout the Middle East, water is running out.  Israel and Jordan have moved jointly to address this problem.

Israel and Jordan have developed a plan to connect and redistribute water sources throughout their countries to shore up the water supply.  One project under this plan would provide Amman with water by connecting it to the Dissi Reservoir, an underground water source in the south of Jordan, and would desalinate it by connecting it to Israeli desalination plants that are being built on the Mediterranean.  Another plant would send 500 billion gallons of water from the Red Sea to the Dead Sea through pipelines and tunnels over a path of 110 miles.  Some of this water would be used to replenish the Dead Sea, while the rest would be desalinated for use by both countries.

The desalinated water from the Dissi Reservoir and Dead Sea would be shared amongst Jordan, Israel and the Palestinian Authority. The replenished Dead Sea would sustain a tourist attraction and provide economic benefits for both Jordanian and Israeli companies who sell its chemicals.

Critics of the plan argue that these new connections will upset the region’s ecosystem and recommend that their possible effects be studied, which could take several years.  But Jordan and Israel maintain that the plan be implemented immediately to prevent water shortages, as some cities in Jordan have already begun rationing their water supply.

Three cheers for all concerned.

Make Health, Not War

Afghanistan needs more sociologists, not more troops. Sociologists would point out that Americans tend to see this country as one nation, with a central government and national security forces. But it actually is a collection of tribes—(including Tajik, Uzbek and Hazara). The first loyalty of most members of these tribes is to their own kind, not to the national government. Most Afghans correctly perceive the national government as corrupt to the core, in cahoots with drug lords, promoted by foreign powers, and the beneficiary of fraudulent elections.

We have been trying for eight years to straighten out this government, to no avail. We should now work with the local tribes and their natural leaders, rather than seek to impose a false national order on them.We should let the people of Afghanistan duke it out with the Taliban, to determine how much of a sharia regime they are willing to tolerate. However, we should not allow our young people to be killed for rights most Afghans do not want. Surely, they show no sign that they are willing to die for them.

We should make it clear that if the Afghans ever again allow their turf to be used as a base for terrorists, we shall bomb the daylights out of them. However, we need not be in Afghanistan to do this. Finally, we should not lump the Taliban—keen to run their own country— in with Al Qaeda, which seeks to harm us. True, these two are now allies, but this is the case at least in part because we treat them as if they were of one kind.

President Obama conducted a strategic review of Afghanistan. It concluded that we should seek “to disrupt, dismantle, and defeat Al Qaida in Pakistan and Afghanistan and to prevent their return to either country in the future.” This is a precise and narrow goal that can be achieved, as long as we understand that we cannot get there by nation building—a task which is simply beyond our reach. Let the Afghan people form the local governments they favor, and let these form inter-regional alliances, and let us leave them be. Most of the Afghans will be happy in return to let us be.

A someone who was around during the Vietnam War, I predict that whatever number of troops President Obama will now agree to add to the war in Afghanistan, the generals will come back and ask for more. If those are not sent, critics will attribute to this “failure”—the reason Afghanistan will not be stabilized. Best to get off this bloody escalator now.

Sacrificing for spin?

I yield to no one in my delight that President Obama is bringing a whole new attitude to international relations, and I salute his consistent efforts to restore the good name of the United States across the world. The new goodwill was supposed to make it easier for the US and other nations to work together. What is happening instead, at least in dealing with Russia, is that the Obama administration is making major concessions—in order to make it seem that the new spin is working.

The Russians are very excited about the Bush-designed plan to position a missile defense system in the Czech Republic and Poland. The Obama administration is moving toward an agreement to place the missile defense some other place, one the Russians approve of, and to make it into a joint defense project. Thus, the US satisfies in full a major Russian demand—getting what in exchange? A temporary pause to Russia cussing us out? 

The Russians are very keen to reduce the number of strategic nuclear arms they keep deployed because their economy is in shambles, their military is very poorly equipped and they have a very hard time to find the funds needed to keep it going. The United States agreed to a reduction, in exchange for what?

At the same time the Russians have not granted the US what it most needs from them: Using their leverage with Iran to convince it to stop its program that will lead it in short order to command nuclear weapons. This is despite the fact that objective observers agree that an Iran as a nuclear power, and the resulting arms race in the Middle East, poses at least as much threat to Russia as it does to the US and its allies, the Saudis and the Israelis.

You may ask, how can anyone dare to call the main part of the Obama-Medvedev agreement “spin,” when it entails cutting nuclear arms? However, the agreement—yet to be worked out—is anticipated to call for reducing the number warheads from the existing treaty’s range of 1700 - 2200 by 2012, to a range of 1500 - 1675 by 2019…and reference is merely to deployed warheads. Those offloaded may be kept in storage, from which they can be readily redeployed. If this is not spin, what is?

I am not saying that the US should bully Russia or demand unilateral concessions or stop striking the new, more congenial, tone. However, one very good way to achieve a new tone for both sides is for them to truly help each other rather than one making major concessions and the other—taking them to the bank.

Zero is too much

Unfortunately, the Obama Administration has adopted, hook, line and sinkers—the vision of a world free of nukes. It is a vision that has been promoted previously by four very senior statesmen, all of whom made their names during the Cold War. George P. Shultz, William J. Perry, Henry A. Kissinger and Sam Nunn. They have popularized the idea that the best way to protect the world from nuclear weapons is for the United States and Russia to lead—by first reducing their nuclear stockpiles, and eventually moving to zero. This move in turn is expected to inspire other nations to reduce their stockpiles or give up on their ambitions to acquire nuclear arms—and to pressure those so inclined, to desist.
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One Obama official suggested that by going for zero we will occupy the moral high ground, take away “one of Iran’s talking points” and “stop the Indians from whining.” (Indians are among those who have frequently complained that they are asked to join the NPT and live with its restrictions while the US and Russia, France and Britain are not living up to their treaty obligations to eliminate their nuclear stockpiles.) 

If one refuses to shut down one’s critical mind, one soon notes that this approach is based on shiploads of wishful thinking and may well distract attention from urgent priorities. The precept that because the United States and Russia talk up a world without nukes (a world which is indeed very far over the horizon, given the grave dangers for a nation that disarms if the other successfully hides a few nuclear bombs) this will inspire other nations to give up their bombs or nuclear ambitions, has no legs. This is even more true for the notion that if the United States and Russia reduce their stockpiles to 1,500 warheads (below the current ceiling of 2,200)—or some other such number— this too would somehow inspire other nations to pack in their nuclear ambitions.

Above all, one must fear that pursuing such pie in the sky schemes will distract attention from the most serious threat to our security, that of our allies, and to world peace, which is very widely agreed to be that terrorists will get their hands on a ready-made nuclear weapon. (Making new ones is much more of a challenge), The most likely place for terrorists to steal, bribe their way to, or otherwise commandeer nuclear weapons is Pakistan. 

No one serious thinks that if the United States and Russia live up to their commitments under the NPT, this will lead Pakistan to give up its bombs, given that the main reason Pakistan has them is that they serve as a deterrent against the much larger Indian conventional forces, which Pakistan cannot match. Hence, even if not only the United States and Russia but also India gave up their nuclear bombs (an extremely unlikely event), Pakistan is most unlikely to follow. The same holds for Israel’s stockpile and Iran’s plans to build bombs. These and other such nations have strong reasons of their own to hold such arms.. These reasons will not be modified by whatever the United States and Russia do or do not do regarding their own stockpiles. New evidence in support of this point: the morning President Obama announced his plans to move to zero, hoping to inspire others to relent, North Korea tested a long-range missile which could carry a nuclear warhead.  A few days later, Iran announced that it is making good progress in its nuclear development efforts. Other nations barely yawned.

Moreover, in dealing with Russia, the greatest priority for the United States is to encourage Russia to further improve its controls over the fissile material from which nukes can be made and over the thousands of tactical nuclear arms it possesses. Reducing the Cold War instruments, the long-range missiles and strategic nuclear weapons—on which Henry A. Kissinger and his colleagues focus—are much less of an issue. They are already relatively well-controlled and, moreover, are not well-suited for terrorists equipped with speed boats, shipping containers, and trunks. It follows that dismantling these Cold War arms is much less urgent. Similarly, the United States is keen to gain Russia’s cooperation in stopping Iran’s nuclear militarization. Neither mission is affected by the number of nukes the two powers hold.

The fate of the curbs on the spread of nuclear arms in the near future is going to be decided in Iran. If it is allowed to gain a bomb, there will be no stopping Saudi Arabia and other Arab nations from going down the same road, and Japan and South Korea are likely soon to follow, to countervail North Korea. Nuclear terrorists are looking for bombs in Pakistan (and for fissile materials and small bombs in Russia). These burning matters are enough to occupy a president who has shown that he can work on half a dozen issues at the same time. Zero can wait.

Pakistan, outside the box

Social scientists have long used systems theory to point out links that are sometimes overlooked. Such a link now leads to the suggestion that to deal with the crisis in Pakistan and the mounting difficulties in Afghanistan, one should go to, of all places, India. The main reason the Pakistani army is reluctant to take on the Taliban, who threaten to overrun the country, is that the army considers India its enemy.

The main source of tension between the two countries is the question of who will control Kashmir. At first, any suggestion of solving this tricky problem in order to get the Pakistani army to refocus would seem truly far-fetched, if not visionary to the nth degree – like asking someone to improve the climate by first stopping earthquakes. Dealing with the internal tensions in Pakistan is difficult enough; add to the mix a conflict that has been simmering for decades and seems to resist any solution, and your way seems completely blocked.

The good news is that secret negotiations between India and Pakistan about Kashmir have been taking place. Those now need to be restarted, supported, and accelerated. In the process should we also dump the obsolete notion that India should be made to “balance” China, and we may then be on our way to a more stable region in this much contested part of Asia. Both steps require some elaboration.

India and Pakistan have fought three wars and come close to blows on several other occasions, mainly over Kashmir. The Pakistani and Indian armies’ training, formations, and alignments are focused on deterring each other, and are largely concentrated on their mutual border. The terrorists who recently attacked Mumbai, and before that the Indian Parliament and markets in New Delhi, see themselves as Kashmiri freedom fighters. It is hard to imagine major repositioning of the troops involved and changes in the strategic planning of both countries until the Kashmir issue is resolved.

A large variety of suggestions have been made about the way to determine the future of Kashmir. Some favor that the people of the area be allowed to vote on which nation they wish to join, as was prescribed by the UN Security Council after the partition of India; others favor dividing the area between the two nations; still others favor turning it into an area which enjoys a large measure of independence. The secret negotiations that took place between India and Pakistan during Pervez Musharraf’s tenure as president appear to have focused on the idea of ‘making borders irrelevant,’ that is, granting Kashmir a great deal of autonomy to avoid either country having to lose face by giving up their claims to control. Since General Musharraf stepped down these negotiations seem to have stopped. The Obama Administration would do well to apply here the same system-wide approach it is revealing in the Middle East: follow the links. In this case, encourage, cajole, and help Pakistan and India to move toward settling the Kashmir issue. Eliminating this source of terrorism and war, and the reason both nations are keen to maintain nuclear arms, is of course worthy in its own right.  It will also pay off handsomely in getting the Pakistani army to focus on the Taliban, including both those who threaten the government at home and those who cross the border from Pakistan to Afghanistan.

Obama seems not to shy away from complexities. In this case, dealing with India must take into account two more related matters. One involves a Bush Administration-backed deal with India which allows US companies to sell it nuclear fuel and other nuclear technologies to be used only in India’s civilian reactors. However, the net effect it that this deal allows India to shift from civilian to military use the limited uranium it has from other sources. (Bush assumed that it is acceptable for ‘good’ governments—like that of India and Brazil—to develop their nuclear industries, while only those of ‘bad’ governments, such as Iran and North Korea, need to be reined in.) However, as we now fear in Pakistan, government can change overnight, and above all, if the norm against proliferation is to have a chance to take hold, the fewer nations that go down this road, the greater the chances of enforcing a non-nuke global regime. This means is that even if the US can’t get India and Pakistan to give up their nukes, at this stage at least, it is ill-advised to help them increase their armed nuclear program. Hence the Obama Administration should renegotiate the agreement to provide nuclear fuel and technologies to India, and both India and Pakistan should be encouraged to scale back on the nukes and join the NPT, as their conflicts are resolved.

All this assumes that one drops the obsolete notion that nations can be used to balance each other and that a militarily powerful India somehow will serve to countervail a rising China. China is focused on its economic development, and its military has a very long way to go before it will pose a threat to the United States, even if there was reason to believe that it would seek such a confrontation. And if China has such intentions, whether India has a few extra nukes or not would hardly matter, given the size of the American arsenal. In short, to the extent that the US has any influence on India, it can be used to scale back its nuclear program without any discernable loss to American strategic interest.

I will be the first to grant that this kind of social science thinking leads one to try to tackle some very tough and persistent international problems as a way to treat some very acute local problems inside Pakistan and in Afghanistan. In that sense, it is truly far-fetched.  However, these pestering international conflicts call for resolution anyhow, and if they can at least be curbed, such progress would help on the local fronts.  Dealing with the Taliban may entail going to Kashmir, New Delhi, and Islamabad, and forgetting for now about China.