Showing posts with label gamble. Show all posts
Showing posts with label gamble. Show all posts

Thursday

America, you’re stupid: Donald Trump’s political triumph makes it official — we’re a nation of idiots

Trump's rise proves we're full of loud, illiterate and credulous people — and he's a mirror of them




“I love the poorly educated.” — Donald Trump

Before any votes were cast, when Donald Trump was the theoretical front-runner, the optimists preached patience. Just wait, they said. This will blow over. He’s a clown, a huckster, a TV personality. There’s no way he can win. It’s just not possible.

Well, it’s not only possible – it’s likely.

Trump won again in Nevada on Tuesday night, by a massive margin, and he may well sweep the Super Tuesday states. If that happens, and it’s the most probable outcome at this point, the race is effectively over. Trump will have won the nomination of one our two major parties, and he’ll have done it with extraordinary ease.

I hate to have to say it, but the conclusion stares us in the face: We’re a stupid country, full of loud, illiterate and credulous people. Trump has marched straight to the nomination without offering anything like a platform or a plan. With a vocabulary of roughly a dozen words – wall, Mexicans, low-energy, loser, Muslims, stupid, China, negotiate, deals, America, great, again – he’s bamboozled millions of Americans. And it’s not just splenetic conservatives supporting Trump or your garden-variety bigots (although that’s the center of his coalition), it’s also independents, pro-choice Republicans, and a subset of Reagan Democrats.

This says something profoundly uncomfortable about our country and our process. A majority of Americans appear wholly uninterested in the actual business of government; they don’t understand it and don’t want to. They have vague feelings about undefined issues and they surrender their votes on emotional grounds to whoever approximates their rage. This has always been true to some extent, but Trump is a rubicon-crossing moment for the nation.

Trump’s wager was simple: Pretend to be stupid and angry because that’s what stupid and angry people like. He’s held up a mirror to the country, shown us how blind and apish we are. He knew how undiscerning the populace would be, how little they cared about details and facts. In Nevada, for instance, 70 percent of Trump voters said they preferred an “anti-establishment” candidate to one with any “experience in politics.” Essentially, that means they don’t care if he understands how government works or if he has the requisite skills to do the job. It’s a protest vote, born of rage, not deliberation.

In no other domain of life would this make any sense at all. If your attorney drops the ball, you don’t hire a plumber to replace him. And yet millions of Trumpites say they don’t care if Trump has ever worked at any level of government or if he knows anything about foreign policy or the law or the Constitution. It’s enough that he greets them at their level, panders to their lowest instincts.
He even brazenly condescends to his supporters, as the opening quote illustrates, and they fail to notice it. Trump, a billionaire trust fund baby who inherited $40 million from his father, has convinced hordes of working-class white people that he’s just like them, that he feels their pain and knows their struggle. He’s made marks of them all.

Sunday

Thomas Piketty: New thoughts on capital in the twenty-first century (Video/Transcript)


Source:TED
It's very nice to be here tonight.
 
 So I've been working on the history of income and wealth distribution for the past 15 years, and one of the interesting lessons coming from this historical evidence is indeed that, in the long run, there is a tendency for the rate of return of capital to exceed the economy's growth rate, and this tends to lead to high concentration of wealth. Not infinite concentration of wealth, but the higher the gap between r and g, the higher the level of inequality of wealth towards which society tends to converge.
 
 So this is a key force that I'm going to talk about today, but let me say right away that this is not the only important force in the dynamics of income and wealth distribution, and there are many other forces that play an important role in the long-run dynamics of income and wealth distribution. Also there is a lot of data that still needs to be collected. We know a little bit more today than we used to know, but we still know too little, and certainly there are many different processes — economic, social, political — that need to be studied more. And so I'm going to focus today on this simple force, but that doesn't mean that other important forces do not exist.
 
So most of the data I'm going to present comes from this database that's available online: the World Top Incomes Database. So this is the largest existing historical database on inequality, and this comes from the effort of over 30 scholars from several dozen countries. So let me show you a couple of facts coming from this database, and then we'll return to r bigger than g. So fact number one is that there has been a big reversal in the ordering of income inequality between the United States and Europe over the past century. So back in 1900, 1910, income inequality was actually much higher in Europe than in the United States, whereas today, it is a lot higher in the United States. So let me be very clear: The main explanation for this is not r bigger than g. It has more to do with changing supply and demand for skill, the race between education and technology, globalization, probably more unequal access to skills in the U.S., where you have very good, very top universities but where the bottom part of the educational system is not as good, so very unequal access to skills, and also an unprecedented rise of top managerial compensation of the United States, which is difficult to account for just on the basis of education. So there is more going on here, but I'm not going to talk too much about this today, because I want to focus on wealth inequality.
 
 So let me just show you a very simple indicator about the income inequality part. So this is the share of total income going to the top 10 percent. So you can see that one century ago, it was between 45 and 50 percent in Europe and a little bit above 40 percent in the U.S., so there was more inequality in Europe. Then there was a sharp decline during the first half of the 20th century, and in the recent decade, you can see that the U.S. has become more unequal than Europe, and this is the first fact I just talked about. Now, the second fact is more about wealth inequality, and here the central fact is that wealth inequality is always a lot higher than income inequality, and also that wealth inequality, although it has also increased in recent decades, is still less extreme today than what it was a century ago, although the total quantity of wealth relative to income has now recovered from the very large shocks caused by World War I, the Great Depression, World War II.

So let me show you two graphs illustrating fact number two and fact number three. So first, if you look at the level of wealth inequality, this is the share of total wealth going to the top 10 percent of wealth holders, so you can see the same kind of reversal between the U.S. and Europe that we had before for income inequality. So wealth concentration was higher in Europe than in the U.S. a century ago, and now it is the opposite. But you can also show two things: First, the general level of wealth inequality is always higher than income inequality. So remember, for income inequality, the share going to the top 10 percent was between 30 and 50 percent of total income, whereas for wealth, the share is always between 60 and 90 percent. Okay, so that's fact number one, and that's very important for what follows. Wealth concentration is always a lot higher than income concentration.

  Fact number two is that the rise in wealth inequality in recent decades is still not enough to get us back to 1910. So the big difference today, wealth inequality is still very large, with 60, 70 percent of total wealth for the top 10, but the good news is that it's actually better than one century ago, where you had 90 percent in Europe going to the top 10. So today what you have is what I call the middle 40 percent, the people who are not in the top 10 and who are not in the bottom 50, and what you can view as the wealth middle class that owns 20 to 30 percent of total wealth, national wealth, whereas they used to be poor, a century ago, when there was basically no wealth middle class. So this is an important change, and it's interesting to see that wealth inequality has not fully recovered to pre-World War I levels, although the total quantity of wealth has recovered.

  Okay? So this is the total value of wealth relative to income, and you can see that in particular in Europe, we are almost back to the pre-World War I level. So there are really two different parts of the story here. One has to do with the total quantity of wealth that we accumulate, and there is nothing bad per se, of course, in accumulating a lot of wealth, and in particular if it is more diffuse and less concentrated. So what we really want to focus on is the long-run evolution of wealth inequality, and what's going to happen in the future. How can we account for the fact that until World War I, wealth inequality was so high and, if anything, was rising to even higher levels, and how can we think about the future?
   
future. Let me first say that probably the best model to explain why wealth is so much more concentrated than income is a dynamic, dynastic model where individuals have a long horizon and accumulate wealth for all sorts of reasons. If people were accumulating wealth only for life cycle reasons, you know, to be able to consume when they are old, then the level of wealth inequality should be more or less in line with the level of income inequality. But it will be very difficult to explain why you have so much more wealth inequality than income inequality with a pure life cycle model, so you need a story where people also care about wealth accumulation for other reasons. So typically, they want to transmit wealth to the next generation, to their children, or sometimes they want to accumulate wealth because of the prestige, the power that goes with wealth. So there must be other reasons for accumulating wealth than just life cycle to explain what we see in the data. Now, in a large class of dynamic models of wealth accumulation with such dynastic motive for accumulating wealth, you will have all sorts of random, multiplicative shocks. So for instance, some families have a very large number of children, so the wealth will be divided. Some families have fewer children. You also have shocks to rates of return. Some families make huge capital gains. Some made bad investments. So you will always have some mobility in the wealth process. Some people will move up, some people will move down. The important point is that, in any such model, for a given variance of such shocks, the equilibrium level of wealth inequality will be a steeply rising function of r minus g. And intuitively, the reason why the difference between the rate of return to wealth and the growth rate is important is that initial wealth inequalities will be amplified at a faster pace with a bigger r minus g. So take a simple example, with r equals five percent and g equals one percent, wealth holders only need to reinvest one fifth of their capital income to ensure that their wealth rises as fast as the size of the economy. So this makes it easier to build and perpetuate large fortunes because you can consume four fifths, assuming zero tax, and you can just reinvest one fifth. So of course some families will consume more than that, some will consume less, so there will be some mobility in the distribution, but on average, they only need to reinvest one fifth, so this allows high wealth inequalities to be sustained.
 
Now, you should not be surprised by the statement that r can be bigger than g forever, because, in fact, this is what happened during most of the history of mankind. And this was in a way very obvious to everybody for a simple reason, which is that growth was close to zero percent during most of the history of mankind. Growth was maybe 0.1, 0.2, 0.3 percent, but very slow growth of population and output per capita, whereas the rate of return on capital of course was not zero percent. It was, for land assets, which was the traditional form of assets in preindustrial societies, it was typically five percent. Any reader of Jane Austen would know that. If you want an annual income of 1,000 pounds, you should have a capital value of 20,000 pounds so that five percent of 20,000 is 1,000. And in a way, this was the very foundation of society, because r bigger than g was what allowed holders of wealth and assets to live off their capital income and to do something else in life than just to care about their own survival.
 
Now, one important conclusion of my historical research is that modern industrial growth did not change this basic fact as much as one might have expected. Of course, the growth rate following the Industrial Revolution rose, typically from zero to one to two percent, but at the same time, the rate of return to capital also rose so that the gap between the two did not really change. So during the 20th century, you had a very unique combination of events. First, a very low rate of return due to the 1914 and 1945 war shocks, destruction of wealth, inflation, bankruptcy during the Great Depression, and all of this reduced the private rate of return to wealth to unusually low levels between 1914 and 1945. And then, in the postwar period, you had unusually high growth rate, partly due to the reconstruction. You know, in Germany, in France, in Japan, you had five percent growth rate between 1950 and 1980 largely due to reconstruction, and also due to very large demographic growth, the Baby Boom Cohort effect. Now, apparently that's not going to last for very long, or at least the population growth is supposed to decline in the future, and the best projections we have is that the long-run growth is going to be closer to one to two percent rather than four to five percent. So if you look at this, these are the best estimates we have of world GDP growth and rate of return on capital, average rates of return on capital, so you can see that during most of the history of mankind, the growth rate was very small, much lower than the rate of return, and then during the 20th century, it is really the population growth, very high in the postwar period, and the reconstruction process that brought growth to a smaller gap with the rate of return. Here I use the United Nations population projections, so of course they are uncertain. It could be that we all start having a lot of children in the future, and the growth rates are going to be higher, but from now on, these are the best projections we have, and this will make global growth decline and the gap between the rate of return go up.
 
Now, the other unusual event during the 20th century was, as I said, destruction, taxation of capital, so this is the pre-tax rate of return. This is the after-tax rate of return, and after destruction, and this is what brought the average rate of return after tax, after destruction, below the growth rate during a long time period. But without the destruction, without the taxation, this would not have happened. So let me say that the balance between returns on capital and growth depends on many different factors that are very difficult to predict: technology and the development of capital-intensive techniques. So right now, the most capital-intensive sectors in the economy are the real estate sector, housing, the energy sector, but it could be in the future that we have a lot more robots in a number of sectors and that this would be a bigger share of the total capital stock that it is today. Well, we are very far from this, and from now, what's going on in the real estate sector, the energy sector, is much more important for the total capital stock and capital share.
 
The other important issue is that there are scale effects in portfolio management, together with financial complexity, financial deregulation, that make it easier to get higher rates of return for a large portfolio, and this seems to be particularly strong for billionaires, large capital endowments. Just to give you one example, this comes from the Forbes billionaire rankings over the 1987-2013 period, and you can see the very top wealth holders have been going up at six, seven percent per year in real terms above inflation, whereas average income in the world, average wealth in the world, have increased at only two percent per year. And you find the same for large university endowments — the bigger the initial endowments, the bigger the rate of return.
 
 Now, what could be done? The first thing is that I think we need more financial transparency. We know too little about global wealth dynamics, so we need international transmission of bank information. We need a global registry of financial assets, more coordination on wealth taxation, and even wealth tax with a small tax rate will be a way to produce information so that then we can adapt our policies to whatever we observe. And to some extent, the fight against tax havens and automatic transmission of information is pushing us in this direction. Now, there are other ways to redistribute wealth, which it can be tempting to use. Inflation: it's much easier to print money than to write a tax code, so that's very tempting, but sometimes you don't know what you do with the money. This is a problem. Expropriation is very tempting. Just when you feel some people get too wealthy, you just expropriate them. But this is not a very efficient way to organize a regulation of wealth dynamics. So war is an even less efficient way, so I tend to prefer progressive taxation, but of course, history — (Laughter) — history will invent its own best ways, and it will probably involve a combination of all of these.
 
 Thank you.
 
 (Applause)
 

  Bruno Giussani: Thomas Piketty. Thank you.

Thomas, I want to ask you two or three questions, because it's impressive how you're in command of your data, of course, but basically what you suggest is growing wealth concentration is kind of a natural tendency of capitalism, and if we leave it to its own devices, it may threaten the system itself, so you're suggesting that we need to act to implement policies that redistribute wealth, including the ones we just saw: progressive taxation, etc. In the current political context, how realistic are those? How likely do you think that it is that they will be implemented?
 
Thomas Piketty: Well, you know, I think if you look back through time, the history of income, wealth and taxation is full of surprise. So I am not terribly impressed by those who know in advance what will or will not happen. I think one century ago, many people would have said that progressive income taxation would never happen and then it happened. And even five years ago, many people would have said that bank secrecy will be with us forever in Switzerland, that Switzerland was too powerful for the rest of the world, and then suddenly it took a few U.S. sanctions against Swiss banks for a big change to happen, and now we are moving toward more financial transparency. So I think it's not that difficult to better coordinate politically. We are going to have a treaty with half of the world GDP around the table with the U.S. and the European Union, so if half of the world GDP is not enough to make progress on financial transparency and minimal tax for multinational corporate profits, what does it take? So I think these are not technical difficulties. I think we can make progress if we have a more pragmatic approach to these questions and we have the proper sanctions on those who benefit from financial opacity.
 
 BG: One of the arguments against your point of view is that economic inequality is not only a feature of capitalism but is actually one of its engines. So we take measures to lower inequality, and at the same time we lower growth, potentially. What do you answer to that?
 
TP: Yeah, I think inequality is not a problem per se. I think inequality up to a point can actually be useful for innovation and growth. The problem is, it's a question of degree. When inequality gets too extreme, then it becomes useless for growth and it can even become bad because it tends to lead to high perpetuation of inequality over time and low mobility. And for instance, the kind of wealth concentrations that we had in the 19th century and pretty much until World War I in every European country was, I think, not useful for growth. This was destroyed by a combination of tragic events and policy changes, and this did not prevent growth from happening. And also, extreme inequality can be bad for our democratic institutions if it creates very unequal access to political voice, and the influence of private money in U.S. politics, I think, is a matter of concern right now. So we don't want to return to that kind of extreme, pre-World War I inequality. Having a decent share of the national wealth for the middle class is not bad for growth. It is actually useful both for equity and efficiency reasons.
 
 BG: I said at the beginning that your book has been criticized. Some of your data has been criticized. Some of your choice of data sets has been criticized. You have been accused of cherry-picking data to make your case. What do you answer to that?
 
 TP: Well, I answer that I am very happy that this book is stimulating debate. This is part of what it is intended for. Look, the reason why I put all the data online with all of the detailed computation is so that we can have an open and transparent debate about this. So I have responded point by point to every concern. Let me say that if I was to rewrite the book today, I would actually conclude that the rise in wealth inequality, particularly in the United States, has been actually higher than what I report in my book. There is a recent study by Saez and Zucman showing, with new data which I didn't have at the time of the book, that wealth concentration in the U.S. has risen even more than what I report. And there will be other data in the future. Some of it will go in different directions. Look, we put online almost every week new, updated series on the World Top Income Database and we will keep doing so in the future, in particular in emerging countries, and I welcome all of those who want to contribute to this data collection process. In fact, I certainly agree that there is not enough transparency about wealth dynamics, and a good way to have better data would be to have a wealth tax with a small tax rate to begin with so that we can all agree about this important evolution and adapt our policies to whatever we observe. So taxation is a source of knowledge, and that's what we need the most right now.
 
BG: Thomas Piketty, merci beaucoup.
 
 Thank you. TP: Thank you. (Applause)

"Irresponsible & Reckless": Environmentalists Decry Obama’s Approval for Shell Drilling in Arctic (Video/Transcript)


Source:Democracy Now

The Obama administration has tentatively approved Shell’s plans to begin oil extraction off the Alaskan coast this summer. Federal scientists estimate the Arctic region contains up to 15 billion barrels of oil, and Shell has long fought to drill in the icy waters of the Chukchi Sea. Environmentalists warn Arctic drilling will pose a risk to local wildlife and exacerbate climate change. They fear that a drilling accident in the icy Arctic Ocean waters could prove far more devastating than the deadly 2010 Gulf of Mexico spill since any rescue operations could be delayed for months by harsh weather conditions. We speak to Subhankar Banerjee. He is a renowned photographer, writer and activist who has spent the past 15 years working for the conservation of the Arctic and raising awareness about indigenous human rights and climate change. He is editor of the anthology, "Arctic Voices: Resistance at the Tipping Point."

Transcript

This is a rush transcript. Copy may not be in its final form.

NERMEEN SHAIKH: The Obama administration has tentatively approved Shell’s plans to begin oil extraction off the Alaskan coast this summer. Federal scientists estimate the Arctic region contains up to 15 billion barrels of oil, and Shell has long fought to drill in the icy waters of the Chukchi Sea.

AMY GOODMAN: Environmentalists warn Arctic drilling will pose a risk to local wildlife and exacerbate climate change. They fear a drilling accident in the icy Arctic Ocean waters could prove far more devastating than the deadly 2010 Gulf of Mexico spill, since any rescue operations could be delayed for months by harsh weather conditions. Speaking to KTUU, Lois Epstein of The Wilderness Society denounced the government’s decision to greenlight oil exploration.
LOIS EPSTEIN: Their record from 2012 drilling in the Arctic Ocean was a disaster, by anyone’s measure. One of their of drill rigs grounded near Kodiak. There were fires. There were criminal penalties for air pollution violations.
AMY GOODMAN: For more, we go to Washington, D.C.—Washington state, where we’re joined by Subhankar Banerjee. He’s a renowned photographer, writer and activist who’s spent the past 15 years working for the conservation of the Arctic and raising awareness about indigenous human rights and climate change, editor of the anthology, Arctic Voices: Resistance at the Tipping Point. His recent piece for TomDispatch is called "To Drill or Not to Drill, That is the Question." In 2012, he won a Cultural Freedom Award from the Lannan Foundation.

Subhankar Banerjee, welcome back to Democracy Now! Can you talk about the Obama administration decision and what this means for the Arctic?

SUBHANKAR BANERJEE: The decision is both irresponsible and reckless. But let me clarify something at the beginning. What the administration has approved now is the exploration plans for Shell to drill this summer, starting from July to October. But this is not the—this is the most significant permit that Shell needs, but not all of the permits. So Shell still needs more permits from, like, NOAA, Fish and Wildlife Service and other federal agencies. So that’s why the activists are working very hard to make sure that some are—some of these permits are not granted, because it’s a reckless decision, as you mentioned, for multiple reasons, the primary ones being a spill in the Arctic Ocean would be far more devastating than what happened in the Gulf of Mexico. And the administration has finally acknowledged, after losing in two federal courts—one in 2010 and one in 2014—that there is a 75 percent chance of one or more major spills if exploration leads to production. So a spill is inevitable.

And if a spill does happen, as you mentioned, that, let’s say, a spill happens late in the season, like in October, then that oil will have to be left in place for like nine months, because the sea ice gets covered, covers the Arctic Sea, until the ice melts the following year, when effective cleanup can begin. But even if the spill happens in the summertime, it is a real problem, because the Arctic Sea always has constant dangers of large ice flows—and Shell already encountered that in their 2012 drilling season—as well as deep fog that severely restricts visibility, and the storms have become more violent and more intense. You combine that with the fact that there is absolutely no deep water port in U.S. Arctic—the nearest Coast Guard station is a thousand miles away—and there is no infrastructure in place. Like in your previous segment, you were talking about infrastructure. There is absolutely no infrastructure in place to respond to a large spill. So that’s the spill site.

The second site that we need to understand, that Arctic is what is called the integrator of world’s climate systems, both atmospheric and oceanic. Just to give you a couple of examples, what happens in the Arctic affects not just the Arctic, but the whole planet. The severe—recent years, severe winter weather in the Northeast of U.S. as well as the severe ongoing drought in California both have now been linked by recent scientific studies to slowing down of the Arctic jet stream, because the Arctic is warming at a much faster rate than the lower latitudes. And the second one is the Gulf Stream, where you have the warm water from the Gulf of Mexico and the southern latitudes go up to the Arctic, goes down into the deep ocean, gets cold and comes back. It’s called the Gulf Stream, that maintains, again, our oceanic and atmospheric process. That, too, is slowing down. And its impacts are not yet very well understood, but one thing is that it will further contribute to the increase of the sea level. So what happens in the Arctic affects us all, but also to the indigenous people up there. And you mentioned the ecology of the region. If the American public knew what is in those Arctic seas of America—Beaufort and the Chukchi—they will not allow drilling there, because it is truly a national and an international ecological treasure.


NERMEEN SHAIKH: Well, according to this ad by Shell, the oil company has developed unprecedented Arctic oil spill response contingency plans.
SHELL AD: Shell’s Alaska exploration program is defined by its remoteness, and Shell has gone to great lengths to make sure a worst-case scenario, such as an oil spill, never takes place. But in the unlikely event that one did, Shell’s on-site oil spill response assets would be deployed and recovering oil within one hour. The recovery effort would be aided by nearshore response equipment and onshore oil spill response equipment. This kind of 24/7 response capability is unprecedented.
NERMEEN SHAIKH: Subhankar, could you comment on what the Shell ad says and also tell us a little about Shell’s record in the Arctic region?

SUBHANKAR BANERJEE: What you just mentioned, Nermeen, is nothing new. It is sugarcoating on an old rhetoric that Shell has been peddling for the last few years. In 2010, Shell spent millions of dollars on an ad campaign called "Let’s Go" to pressure the Obama administration to grant them the various permits, and then towards the—and also another ad called "We have the technology—Let’s go." So Shell has been saying this for the last at least five years now. Nothing has changed. All of the things I just mentioned previously has not changed. The government acknowledges it, that there would be a major spill. And if it does a spill happen, this whole idea of "We have the technology" is nothing but a PR campaign with no truth behind it, as industry and government would acknowledge, that if a spill does happen in the icy waters, the cleanup would be very ineffective compared to the Gulf of Mexico.

And then I forgot the second part of the question—oh, Shell’s record in the Arctic. So Shell went up there with, again, a conditional permit from the Obama administration in 2012, conditional because they were not allowed to drill all the way to the oil-bearing zone, only a top hole drilling to prepare for the following season. And what ended up happening? The very first day they started drilling, they encountered an ice flow the size of Manhattan, 30 miles by 10 miles long, and had to immediately halt operation and disconnect from the sea floor anchor. When they were coming—while they were going up to the Arctic, their drill ship, Noble Discoverer, almost ran aground off of the Dutch Harbor in Southwest Alaska. And then, while coming back, the Noble Discoverer caught fire, and the engine suffered damage, while the other drill ship, Kulluk, was grounded in the Gulf of Alaska, near Sitkalidak Island. And the reason they were bringing the Kulluk back was—actually, to the Seattle waters, Puget Sound water—is because Shell tried to avoid Alaska taxes. So it all goes back to the fact that right now the price of oil is low. And it is truly incredibly irresponsible, when price is—price of oil is low, and the technologies don’t exist, the infrastructure don’t exist, to send Shell up there, because Shell will try to cut costs, as they did in 2012. And the company and its subcontractor, Noble Drilling, was fined a total of $12 million, Noble Drilling, and $2 million to Shell, for violating numerous environment laws, including the Clean Air Act, as well as the Clean Water Act.

Thursday

Airstrike Uncertainties: Obama's Dangerously Vague New War

By Markus Feldenkirchen, Christoph Reuter and Holger Stark
Source: Der Spiegel
Obama has spent much of his term withdrawing the US from quagmires abroad. But now, in the battle against Islamic State extremists, he has a war of his own. His plan of attack, though, is filled with uncertainties and America's ultimate goal remains unclear.

The City of Rabbits. That is the bucolic alias once attached to the Syrian town of Marea. But it is no longer in use. Now, one of the most important frontlines in the war in northern Syria runs through the town. Some 5,000 rebels have established themselves in the potato fields surrounding Marea in an effort to stop Islamic State jihadists from continuing their advance on Aleppo. 

Thus far, they have been successful -- thanks largely to assistance from the US. In Marea, an American-supported rebel command center coordinates the rebels' defense. The entire front is divided into sectors, which are each under the control of a single group. They have names like "Defenders of the Faith," "Islamic Front" and "Nureddin Senki Brigade" and are fairly obscure. Even so, they now have satellite images, ammunition for Kalashnikovs and larger caliber weapons, night-vision devices and provisions. A few anti-tank rockets also arrived a few months ago. 

All of the materiel was provided to the fighters by the US. The CIA has established a military operations center in the Turkish border town of Reyhanli which it uses to support Syrian rebels. Those given a green rating by the CIA receive both arms and a salary. Those coded yellow receive help but no weapons. Those marked red receive nothing. Nine groups with a total of around 10,000 fighters are now said to be operating north of Aleppo to stop the march of the Islamic State.

Witnesses who have visited the operations center and who work with the US. have described a curious alliance -- the cast of characters ranges from bearded Islamists to defected army officers. The fighters aren't radical. They aren't exactly secular either. Above all, they aren't corrupt; they are disciplined and capable.

Waiting for Air Strikes
 
"We are holding our lines, but we aren't going to attack," says one of the Syrian rebel commanders who just came to Turkey for two days. The fighters have plenty of arms and ammunition, he said, but also have a fear of the Islamic State and its extreme brutality. "To advance against the Islamic State, we need heavy weaponry, artillery and rocket launchers." He says that the Americans need to provide Syrian fighters with the kind of weapons that the Islamic State has been able to plunder from the Iraqi army. "We are now waiting for US airstrikes," the commander says. "Nothing will happen before that."

On the eve of the 13th anniversary of the Sept. 11, 2001 terror attacks, US President Barack Obama announced that such airstrikes were on the way, in a speech that was designed to demonstrate America's power and determination. Standing in the White House, the president informed his fellow Americans of a war against the Islamic State that could take years to achieve its goals. The appearance marked a complete reversal for Obama. He is now no longer the president who only brings wars to an end; he has now become a war president himself. As Obama announced the operation's aim, he sounded eerily reminiscent of George W. Bush, his predecessor: "We will degrade, and ultimately destroy, ISIL," Obama said, using one of the many acronyms used to refer to the Islamic State.

For Obama, there is something almost tragic about this moment. A rapid withdrawal from Iraq was once one of his central campaign promises, and now he is in danger of leaving his successor a country deeply mired in an intransigent conflict not unlike the ones he inherited from Bush.

Unclear Goals
 
That speech marked the moment Obama gave up on his "lead from behind" doctrine, which imagined a superpower pulling the strings backstage rather leading the charge. The about-face became necessary in part because of the West's earlier hesitation to get involved in the Syrian civil war, a delay which allowed the jihadists to gain strength.

The risks associated with the new operation, which Obama has sought to sell as an anti-terrorism campaign, are immense. And important questions remain unanswered. What, for example, does Obama seek to achieve? Is the US only interested in the destruction of the terror group to prevent it from being able to carry out possible terror strikes in the US? Or is Washington also tempted by regime change in Syria?

The bombs, after all, won't be targeting the cause of the Islamic State's rise -- Syrian dictator Bashar al-Assad is leading a destructive war in his effort to cling to power. Attacking the Islamic State helps Assad, but it also, more than anything, helps rebel groups in Syria.

"Nobody knows what our strategy really looks like in Syria," says former CIA analyst Kenneth Pollack of the Brookings Institution. "The strategy in Iraq is clearly a military one, with the Iraqi army as a partner. In Syria, it sounds like a counterterrorism mission like those in Yemen and Somalia." In those places, though, drone attacks have done little to weaken Islamist groups. On the contrary. And experts agree that airstrikes are not enough to destroy a well-organized pseudo-army like the one belonging to the Islamic State.

The Assad Question
 
It also remains unclear how the US intends to fly bombing raids in Syria without cooperating with Assad's regime. In Iraq, the government explicitly requested American assistance, but Obama has ruled out working together with the Syrian government. Assad maintains effective anti-aircraft systems, though Pollack believes that Assad would not fire at US fighters and drones. "The last thing that Assad wants is an additional fight with the US," he says. But it isn't a certainty.
Russia has been vociferous in its criticism of Obama's plans, with the Foreign Ministry in Moscow saying in a statement that airstrikes would be "an act of aggression" and that such a step, "in absence of a UN Security Council decision, would be ... a gross violation of international law" and would further increase tensions.

Should it come under attack, the US may then feel forced to destroy Syrian airports, fighter jets and anti-aircraft batteries, which would end Syrian control of airspace over large areas now under rebel control. Assad's Syria would shrink to a small strip from Damascus to the coast.

It is more likely that the Assad regime will silently tolerate US airstrikes. Indeed, Western diplomats and intelligence personnel in southern Turkey say that the US has been secretly negotiating with Damascus in recent weeks in the hopes of getting the green light for air raids.

Damascus is eager to win the US as an ally. Syrian Foreign Minister Walid al-Muallem has said that any airstrikes must be carefully coordinated -- though there are large differences between Washington and Damascus's notions of who exactly the enemy is.

Rebels Caught in the Middle
 
When Islamic State fighters began shelling rebel-controlled Marea from three sides in August, the Syrian air force flew several air raids. But their bombs didn't hit the Islamic State. They instead struck exactly the rebels that are receiving support from the US.

Yassir al-Haji, head of the political opposition in Marea, says two girls died in the town late last week, one after being struck by an Islamic State tank shell and the other as a result of a regime airstrike. "Both sides are shooting at us. Assad's air force is flying sorties against us every day. At the same time, more than 1,000 Islamic State fighters are just five kilometers away -- and are not being bombed," Haji says.

The Islamic State was long a useful enemy for the regime in Damascus, with the jihadist group's brutality making Assad look like the lesser of two evils. Indeed, the Syrian air force refrained from attacking Islamist State positions at all until mid-June. In return, the Islamists focused their fight on other opposition groups -- and financed themselves through oil deals with Damascus. Both Assad and the Islamic State were apparently trying to use each other.

Rise of the Islamic State
 
But suddenly, the Islamic State became much more powerful than expected. The CIA recently estimated that the group may have as many as 30,000 fighters. Since the jihadists began attacking regime positions in the east, the Syrian air force has been attacking them there. But only there.

The Islamic State is like a parasite and has taken advantage of the weaknesses displayed by its hosts, Syria and Iraq. The terror group is not only made up of fanatics, but also of strategists who prefer eye-catching brutalities to staging provocative attacks in the West. Indeed, this dearth of large-scale attacks abroad led many experts to believe until recently that the Islamic State didn't play in the terrorist big leagues. In January, even Barack Obama compared the group to a high-school's second-tier ("JV") basketball team. What they all missed was that the Islamic State had turned al-Qaeda's concept on its head: Instead of starting off with global terror, the Islamic State was first focusing on conquering territory from which to operate.

In early August, though, Islamic State leaders made a crucial mistake that set off a chain reaction: They attacked the Yazidi and Christian communities in northern Iraq. The fate of the minority groups was greeted with international outrage, and led the US to bomb Islamic State positions in Iraq -- a development the jihadists had seemingly not expected.

The terrorists then beheaded two American journalists in an effort to intimidate the United States. This, too, was not a clever move: Since mid-June, popular US approval for military operations against IS has skyrocketed, with almost three quarters of Americans now in favor. Suddenly, the Islamic State is confronted with a significant opponent.

The Islamic State is made vulnerable by the fact that it behaves like an army instead of a terror organization; captured Humvees, artillery pieces and tanks are clearly identifiable military targets. Many of them have been destroyed by the over 150 sorties thus far flown in Iraq by the US. The Islamic State is much more difficult to fight in urban areas and no cities controlled by the group have been retaken yet.

'Enemies of America'
 
It is still difficult to predict the effect the American air attacks will have in Syria. Much will depend on who exactly they will be targeting. If Washington adheres to its terror list, it will also have to attack the al-Nusra Front, whose leader once pledged his loyalty to al-Qaida. Nusra's fighters are almost all Syrians -- and most are embittered enemies of the Islamic State. "An attack on Nusra would be the biggest favor that Washington could do to the Islamic State," warns one of the most knowledgeable experts on the Syrian opposition. "It would turn many Sunnis into enemies of America."

More than anything, though, the US need local support, given that Obama is reluctant to send ground troops. But the Syrian opposition has been worn down by fighting a two-front war against Assad and the Islamic State and is disillusioned about the West due to its apathy. Thousands of rebels have died while others have fled from the country with their families. The Free Syrian Army has fallen apart, old brigades have been dissolved and new ones have been founded under different names. The rich Syrian exiles that have long financed the opposition are cash-strapped after years of war, leading many fighters to cross over to Nusra or the Islamic State.

If Obama wants to convince the Syrians that he is serious, he will also have to present a political strategy. This would mean abandoning the course it has followed thus far -- that of trying to force both sides to come to a negotiated solution. The secret negotiations in Switzerland earlier this year did succeed in bringing them closer together, but the talks fell apart over one crucial point: Assad's hold on power. A best-case scenario would see Washington's new strategy result in a decisive breakthrough.

'Explicit Pro-American'
 
But the operation's success will be especially dependent on the "Coalition of the Willing" that Obama is now currently assembling. France's President Francois Hollande declared himself ready this past Friday to attack targets in Iraq from the air. British Prime Minister David Cameron has not fundamentally ruled out military participation in Syria. Only the German government doesn't want to get directly involved in the fight against the Islamic State. "But the last thing that the US wants is a new crusade of the West in the Middle East," says Brookings expert Kenneth Pollack. "The coalition against the Islamic State needs to be regionally anchored."

It is precisely this alliance that Washington has formed in the past weeks -- an alliance that, until recently, nobody would have thought possible: between the Kurds, Saudi Arabia, the Gulf States, Egypt, Jordan, Lebanon and Iraq. They are to block the Islamic State's flow of money, allow the use of military bases, control borders and provide humanitarian assistance. Even Iran supports the offensive against the Islamic State -- even though it is simultaneously helping Assad. The Saudis, meanwhile, want to topple Assad and destroy the Islamic State -- but doesn't want to support their Shiite archenemies in Iraq. And crucially Turkey, the country through which most Jihadists make their way to Syria and Iraq, is not on-board.

It will soon become clear the degree to which the world is prepared to follow the US. The war in the Middle East will be a central topic at the UN General Assembly in September. Obama will give another keynote address and lead the meeting of the Security Council. Should he receive Security Council backing, it would mark a significant foreign policy success.

His strategy could also help Democrats in seven weeks, when Congressional elections are held. Even Newt Gingrich, a Republican detractor of the president's, was impressed last week. "This speech," he said, "is the most explicit pro-American speech he ever made."