The Month that can test Europe



Inside 17-days there will be three elections in March 2018. Elections in Italy, Netherlands and Russia are to dominate the news but more importantly it will add to the list of anxieties for Germany's Angela Merkel and France's Emanuel Macron. It will be a battle between the favored and the traditional, the dictator verses the battered and an election to cloud a referendum.


Italian voters will elect the 630-members of the Chamber of Deputies and the 315-elective members of the Senate of the Republic for the 18th legislature possibly the first stable government since 2016 and relieving the present caretaker government. Ironically the list of candidates consists of old faces and fewer new ones as the charismatic but unpopular former Prime Minister Matteo Renzi of the Democratic Party will take on the comeback Unto dal Signore Silvio Berlusconi of Forza Italia, the Napolitan Luigi Di Maio of Five Star Movement and the anti-mafia lawyer Pietro Grasso of Free and Equal party. The winner(s) will inherit the ardent task of battling the weakening of traditional parties and the rise of anti-establishment movements to combat the lagging Italian economy considered the fifth best in Europe and shrinking at 9% per fiscal year. The country has consumed massive debt at approximately $2.8 trillion, unemployment has been a constant problem since 2008-09 financial crisis and many economists have proposed deeper reforms as rescue of banks is a necessity as Italian banks hold more than $220 billion of bad loans affecting investment in local economies. Already forbidden by Brussels to bailout its own banks. Traditionally opposition and smaller parties have been against bailouts citing foreseeable corruption. If banks don’t receive help in this fiscal year of 2018, the problems may be no different from the nightmares of what Greece has endured and will bleed in to the doorsteps of the European Union. Even harder are the tackling of the migration crisis. Italy has had to absorb approximately 600,000-migrants over the last four years due to the Libyan civil war that is plaguing Italian society as friction has developed to publicized crime and murder resulting in the boosting of the fascist party after nearly a century.


There is no doubt that Vladimir Putin will win the 2018 Russia election but there are concerns of how much of a challenge opponents present that include: TV-personality Ksenia Sobchak of Civic Initiative Party, Former University lecturer Maxim Suraykin of the Communists of Russia, Afghan War Veteran Sergey Baburin of Russian-All Peoples Union, Free market economist Grigory Yavlinsky, the only non-Moscowite candidate and Businessman Boris Titov,  Entrepreneur Pavel Grudinin of the Communist Party and the Nationalist Vladimir Zhirinovsky of the Liberal Democratic Party of Russia but the best known opposition and possibly Putin’s main challenger Alexei Navalny was deemed ineligible by the Constitutional Court.

The real analysis of this election lies on how much the present regime fights to win this election no matter how bitter it can get and how much of a battle it will become. During the last few weeks significant language has been circulating in the media about the Kremlin reaching out to several unions, big businesses and local leaders to assist in the voter turnout. After ruling Russia for nearly two decades it appears Putin wants a swift but a clear victory, but it appears this might be difficult. Recent Russian polls conducted has found that provincial legislatures and public support for the Kremlin’s federal and foreign policies are the lowest since 2008. Fiscal problems consisting of sharp drop in oil prices, decline in Industrial output, Western sanctions placed Russia in a recession in 2014. The country has had to close over 280-failing banks close to 33% of the lending sector while the remainder house close to $150 billion of bad loans. All such bad news clouded in the foreign policy successes in Ukraine and Syria are barely keeping Russians at bay. Truthfully Russians desire Putin and his network’s traditional investment in the private and social services sector that provincial governments cannot provide from their own coffers. Putin’s network of energy companies like Gazprom, Rosneft, Lukoil, Surgutneftegas, Rushydro and Tatneft invested heavily in local development projects. In 2017 their investments rose 60% more than previous years. They have kept the local economies and single industry towns functioning. Keeping employment steady if not on the rise while making provincial government agencies obsolete.  There is no doubt that Putin’s state news media not only has had a monopoly on this but has worked to make Putin look favorable in Moscow and in the other Russian provinces. Yet the risks that has been developing for the Kremlin in the last decade may result in a dangerous monopoly by companies that it has given fruit in its own state apparatus. Just how far Putin’s network of companies will back him along with other partners he hopes bring in to the fold in this election remains to be seen.


Netherlands is composed of 388 municipalities, but this has been declining as in 1987 there were 774 municipalities. The sizes of the municipal council has depended on the number of inhabitants. The largest such size has been 200,000 inhabitants per municipality that are consisted of 45 members and the smallest being 9 with 3,000 residents. This will be a key factor to watch as recent trends such as migrants and shift to areas by the Dutch themselves due to employment by better economies in Europe will dictate the shape and even identity of these councils. The far larger concern is the Referendum on Surveillance law which will take place at the same time as the elections. Although this referendum had previously broad Dutch support there have been an outcry from European civil liberty groups that this three-year act consisting of military and civil intelligence agencies that will now have the opportunity to tap large quantities of internet data traffic without needing to give clear reasons and with limited oversight.


With Brexit on schedule a firm Italy will be looked to lifting its weight to influence the health of other European economies as French President Emmanuel Macron’s envisages a deeper European integration, but the far more worrisome factors are how the result of these elections will affect Europe’s relations with Russia that may represent a sharp break with the status quo. If Berlusconi or his allies win and with a close friendship of Russian President Vladimir Putin which will place Italy to play a reduced role in the North Atlantic Treaty Organization (NATO). With the victory of Putin, Russia’s economic problems will enhance resulting in further corruption. If in the Netherlands a Referendum on Surveillance Law passes and other European nations debate to adopt it, Europe again will be entrenched in two camps; one for civil liberties and the other a police state. All of which can well work to Russia’s wishes and the frustration to the United States.

Turkey's Coup of July 2016

The roots of the July Coup may have its beginnings in 2002 when the Turkish military had strong reservations about Erdogan's appointment of General Hilmi Ozkok as Chief of General Staff of the Turkish Army. This was the beginning of a process to put Erdogan loyalists in key Command structure positions so that a repeat of the 1997 coup did not ever happen again. During Turkey's bid to enter EU this was a common excuse that both Germany and France repeatedly used that Turkey did not have enough Institutions outside the Army to have the necessary checks and balances to keep its Democratic and more importantly its Secular forces intact. They were partially right then. Today its a different story. Turkey has a vibrant Middle class society, its State Institutions though take a Muslim identity does have secular policies ranging from education, business and their treatment of gender in key metropolitan areas. Nevertheless the Turkish Army amongst its Junior Cadre for the last 14 years have protested within their own Commands about their distaste of their President's policies both domestically and overseas. Within the younger officers there have been frustration building up about how their commands have had to be merged with other commands who have taken a favorable line with the President's policies on day to day operations and how batting with Kurdish factions on three fronts (i.e Eastern Turkey, Iraq and Syria) is proving to be a Cancer. In the last 14 years, the Army has gone from a secular institution to a institution where secular factions are fighting Erdogan's Islamic factions for control.  In many respects it seems that the coup was a battle within the Army and a plea to the Turkish public to choose the secular faction. The odd reality is neither the secular nor the religious factions have any support within their own apparatus nor in the electorate. The Turkish electorate just wants Democracy at whatever value they can get. Independently they favor President Erdogan but they like the process their electorate system has matured to and most importantly they don't see the Army anymore has a the vanguard of secular Turkey.

The Afghan Massacre Attack

The blast shook Kabul’s streets as the incident appeared to be near a central part of the city with offices of European Union, a shopping market area and a hospital. The bomb exploded in the crowded street at 12:15pm Kabul time on Saturday January 27 by the attacker who passed through a very tight security checkpoint disguised as a driver in a hospital van.

 This is the third largest attack in Afghanistan of killing 103 people, wounding 235 in Kabul inside eight months. Last October, 176 people died in one week alone with Afghan security forces facing massive losses and casualties battling the Taliban. In May 2017, another 150 people were killed in Kabul. Cited by the Afghanistan government, as the true perpetrators were the Pakistan-backed Haqqani group, although no evidence has become known. It is also worth stating unlike before the Taliban have now claimed responsibility for this massacre.

 Are the Taliban really succeeding?

Most military analysts will concede that the Taliban at present is a much more rejuvenated, technology-savvy, military and politically armed group than the one that dispersed in the US invasion of Afghanistan in 2001. However, that is not to say that they do not have problems within their own camp.

With the assassination of their leader Mullah Dadullah's in 2007, a new breed of leaders, kingmakers and fighters have joined the ranks. For Taliban, this has meant that they have become more of an umbrella group that consists of a coalition of fighter groups. To their detriment, the Taliban realize that many of their own fighters do not necessarily share the objectives of the central leadership of Hibatullah Akhundzada. For the Taliban, they can neither marginalize the extremist jihadist fighters nor bring more moderates into their fold. The far bigger worry that is shared by the older Taliban leaders is that splinter groups are now developing rapidly. These groups of fighters are often younger, faster, present in social media, more efficient in the art of bombing, technology and explosive warfare, more extremist in their ideology, have a way to access regional players, warlords, smugglers, criminal networks and Intelligence agencies. What they do lack is a clear strategic policy that aligns with the Taliban. A key example of this was the defection of the one-time governor of Nimruz Province, Mullah Muhammad Rasul, along with his fighters broke away from the Taliban to form his own High Council of Afghanistan Islamic Emirate group in 2015. Along with his group, Rasul continues to amass considerable fortune controlling cross-border drug smuggling through Nimruz province. This drives the fear of the new reality that unlike the past, the new generation of individuals and their networks have alliances that are always shifting, sometimes even against the Taliban’s own objectives as access to money, firearms and the ability to plan attacks are much more feasible now than they were before. This has been possible mainly because since 2011 a large contingent of US Army forces have left Afghanistan. The small contingent of American forces that are supporting the Afghan Army have very little knowledge of comprehending the torrential landscape or the networks of rural villages which for many of these new generation of fighters have an advanced knowledge.

 What is the Afghanistan government's response?

 Kabul, home to President Ashraf Ghani’s government used to be one of the safest cities in Afghanistan but now it is becoming increasingly dangerous. Additionally, the new presence of Islamic State or ISIS as they are known in Afghanistan has also added fears. The emerging fears of Afghans does not look to have alarmed the central government. Though the government has condemned such attacks and blame Pakistan, they are also dangerously embroiled in corruption of their own. In October of 2017 President Ashraf Ghani told CNN that being President of Afghanistan “is the worst job on earth”. The frustrations of this former World Bank Anthropologist lies in his own battle in finding credible Ministers, domestic and international partners to bring added vibrancy to a battered Afghan economy. President Ashraf Ghani is well versed in the art of nation building. In 2006, he built the Institute of State Effectiveness. He is all too aware that with his own government are rampant corruption. Perhaps even more so in rural development, which was central in developing nearly 35,000 of the roughly 40,000 villages across the country at the very basic level providing 70% of Afghans with vital infrastructure, such as midwife clinics, schools, waterworks, bridges, roads, women’s training centers, and solar power projects. A program such as this would have provided jobs, local infrastructure and a process to develop other domestic programs to combat poverty, alienation and going back to the days of taking up arms. The sad reality is that it wasn’t the Taliban or its competing terrorist groups that halted such an initiative, rather the political class themselves who wanted greater share in the profits of this program. In real terms, the Afghan central government is too weak to take on the ardent tasks and initiatives they themselves set forth let alone taking on a re-energized Taliban.   

 What can be done?

 The Military aid from foreign donors, which in 2009 included $4 billion from the United States was 16 times Afghanistan's domestic military expenditures but with such high figures have not produced an effective fighting force in the Afghan National Army who continue to face heavy losses against the Taliban or against its competing groups. Similarly, the NDS (National Directorate of Security) the key Afghan Intelligence agency have begun a process to warming up to Pakistan even more than previously but this has not paid dividends as some of the deadliest of attacks are continuing from 2017 onwards.  

The terrorism problem will continue but a political settlement specific to Taliban’s demands and its affiliates has to be reached soon before an unconceivably all-out war breaks out. At present, that is less likely. The air support provided by the United States military for now has kept a minimalist bulwark against greater advances for the Taliban, but that is only specific to Kabul. The Taliban has large outside territories under their control. Corruption has crippled the Afghan government to be effective. A weak Afghan army maybe battle-hardened but that has not resulted in any win in their own offensives.  Meanwhile, Afghanistan’s ethnic groups are all victims to how all this will playout. It is difficult to understand what lies ahead in Afghanistan. What will happen when and if more United States military forces were to leave? Will Iran and Pakistan divide the spoils or will the Taliban and its affiliates become even more brutal to consolidate their grasp on Afghanistan. The answer may be more difficult to swallow than the pain many Afghan’s endured from losing their loved ones in this tragic massacre of an attack.



In 1981 US Attorney-General; Benjamin Civiletti interpreted the 1884 Anti-deficiency Act stating that in the event of a funding gap, government agencies should suspend operations until Congress appropriated money. The question then beckons why other Countries do not have Government shutdowns.

In a parliamentary system that is almost impossible, as government without money cannot supply the honey to function. Theoretically, many countries do not even need a working government. Both Netherlands and Belgium operated without a government between 200-500 days respectively however during this time both nations operated with business as usual. So why is it so important for the effects of a US Government shutdown to be taken so seriously?

Unlike 2013 shutdown where the issues where much more linear in government funding, in 2018, the situation is a combination of polarized and politicized issues.  


The Deferred Action for Childhood Arrivals (DACA) nicknamed “Dreamers” was an American immigration policy that allowed a group of individuals entering the US when they were minors, and had either entered or remained in the country illegally, to receive a renewable two-year period of deferred action from deportation and to be eligible for work.  This program came under immense scrutiny when in September 2017 the new Trump Administrations wanted to end it. US Congress however wanted to extend the time to March 2018. For both the Democrats and Republicans in the House of Representatives this is an issue where some districts have or are consisting of such constituents, which is why many Congressional Representatives wanted a fix to the issue. No state has this as a cornerstone of an issue like the Republican state of Arizona. Many commentators have joked that the Mexican border has developed north in to the state as Arizona houses the largest number of Dreamers. This staunchly Republican state and the narrative circulating around it over immigration has cornered many Republicans within Trump’s own party. Under recommendation from Republican Majority leader Mitch McConnell, President Trump did strike an agreement with Democratic leaders Nancy Pelosi and Charles Schumer that for additional security at the border, the priority of Dream Act maybe sidelined for now. That was not until Immigration hardliners within the President’s staff caused a policy shift; adding further demands for the DACA deal consisting of funding for the Mexico wall and more additions to the legal immigration system. A furious Nancy Pelosi and Charles Schumer responded by making this issue as part of their stand in 2018.

The Children's Health Insurance Program (CHIP) in order to lure Democrats to vote for a stopgap-spending bill without an immigration deal the Republicans attached a six-year CHIP reauthorization while dropping an earlier proposal to pay for the extension with Medicare cuts. The Democrats furiously opposed, furthermore, later it was noted that a long-term extension would be less costly than first believed as new enrollers as if families would be eligible for government subsidies under the Affordable Care Act. Democrats were unconvinced thereby CHIP became an issue of explosive political and verbal exchanges blaming one another for choosing between health care for children and Dreamers.

In December 2017, after the Trump Tax Overhaul passed the Senate with 51 YES to 49 NO votes, Republican lawmakers wanted a Short-term Spending Resolution (SSR) funding until January 19, 2018. Democrats, fed up with not just the present SSR but two previous SSRs was strategically able to galvanize the Republican defense hawks in the House and Senate over the lack of a full-year spending that cripples the Pentagon. The SSR at the basic level worries the Pentagon of each bullet-by-bullet utilization as they seek further funding in their operations and equipment. To mitigate such an issue a small group of House-Republicans unsuccessfully added a full-year spending bill but the Republican Leadership did not approve of it. As a result four Republican Senators refused to vote for SSR continuing resolution undermining any effort to assist the Pentagon or have a united front against the Democrats.  


The President in-tweet, Donald Trump has displayed a very unstable negotiating style that has plagued both Republicans and Democrats to find an amicable deal. To add more misery to his conduct his inappropriate and vulgar references to African nations as “shithole countries” and rejecting a bi-partisan DACA proposal caused further havoc within his own party. When the President was much needed by his Republican strategists, he was absent or silent in his tweets. The relationship of the President to his own Congress has become so toxic that at the behest of the Republican Senate leadership; Republicans have begged with utter frustration what would the President like as an agreement only to find that the Commander-in-tweet is “not sure”. Senate Republican, Mitch McConnell mentioned “As soon as we figure out what he is for, then I would be convinced that we were not just spinning our wheels.”


At the very basic level, it is lost time for federal workers and lost pay for government contractors. Based on the shutdown of 2013, each working day of shutdown costs approximately $125 million to the US government. The far larger issue is the SSR and the repeat and expiration of it. Beth Ann Bovino, chief economist at S&P Global, says this will go down as a "blip" for the US economy. Goldman Sachs estimates that each week of a shutdown could lead to roughly 0.2% reduction in quarterly GDP growth. The Stock market so far has not been affected. However, there are signs that Investors might be hesitant as the ramifications and analysis of the shutdown becomes more apparent. So is there anything to worry about? Oh my god yes!

Unlike previous shutdowns where partisan and policy conflicts were under control, this time one-party controls both the White House and Congress and this has become the litany of migraines for market analysts and economists. The key issue that would keep these folks up at night is the budget and the SSR.


New Security Concerns at the Syrian-Turkey Border

Since the beginning of the Syrian civil war Turkey's status of its southern borders have gone from humanitarian help to what is now heavily militarized. This approximate 500 mile border with a wall to prevent illegal smuggling that will be completed in Spring of 2018; for the last six years has seen the chaos, volatility, violence and victims resulting from Assad's Syrian-civil war. What began as a set of crossing points of shelter and refuge to now a ticking point of fate for Ankara; pressed to decide if it sees removal of Assad a greater priority than the Kurdish YPG- the leading component of Syrian Democratic Forces (SDF) that has evolved out of the support of its own ally the United States.

Eastern Quagmire

The Kurdish relationship has been a challenging one. While Ankara assisted Iraqi Kurdistan in building their infrastructure and trade in post Saddam era it had to contend with conflicts in its own southeastern Anatolia provinces of Kurdish separatism versus the PKK. To Kurds in Diyarbakir, Turkey; historically, southeastern provincial areas are one of the four parts (RojovaSyria, Irbil-Iraq, and Sanandaj-Iran) of greater Kurdistan.

How events unfolded to the present

Pre-Syrian civil war, Turkey's aim was to prevent Iran's influence to spread west to gaining access to resource rich Mediterranean. It tolerated President Assad while maintaining a trade relationship with Damascus. Yet post-Syrian civilwar, Turkey wanted Assad's removal with a set of transitions that would replace him with a democratic but moderate Sunni Syrian. With Iran, it saw a halt in their strategy to where it changed course to not access the Mediterranean to avoid US forces. Instead, Iranian militias supported by Iraqi Shia militias along with Hezbollah of Lebanon was instrumental in driving out ISIS and anti-Assad Syrian rebel forces to secure the Tehran-Tel Afar- Mayadin - Deir ez Zor- Damascus belt.


While the south remained Iran's concern, in Syria's north, a presence of Syrian Kurdish YPG forces supported by US military advisors began to unfold as they took over what initially many Turkish Generals had wanted as a buffer zone following to become an intended no-fly zone. This long stretch of an approximate 500-mile border with 10 active crossing points of which 5 now belonged to the YPG culminated into a serious cause for concern for Turkey. The fear is that for the unity of greater Kurdistan the Syrian-YPG will connect with Turkish-PKK, supported by havens in Iraqi Kurdistan and what is perceived as their offshoot organization: though denied, the Kurdish Freedom Hawks (TAK) who were responsible for the March 2016 Ankara bombing, will collaborate to reawaken the 1980s bloody war against Turkey.

Will Not be tolerated

For Turkey, a mini-Kurdish enclave outside of its south east borders with an autonomous Iraqi Kurdistan will not be tolerated as it constitutes strategic threats beyond it can permit. Since
August 2016, Turkish forces directly intervened into Azaz and Afrin, inside Syrian territory to
quash developments of ISIS and YPG units resulting in a blockade of Kurdish expansion moving
further west.

Reality now

Presently there are approximately 5.4 million Syrian refugees in Turkey and is the only country to host such a large Syrian population. Though removal of Assad maybe not be a priority, a moderate Sunni leadership is still in hopes but that can easily become a dream as reality now dictates Russian and Iranian support that has given new life to this Syrian regime. However, militarily Syria is weak to take back all it has lost to the Free Syrian Army (FSA), ISIS and its affiliated jihadist. The consistent threat for Turkey grows, as Syria can become a state that allows Kurdish fighters to fight freely in the north of its borders. The bigger challenge is to maintain European and Middle Eastern ally support and sympathy. Just as Turkey did in fighting the jihadist but now to keep that momentum in fighting the YPG.

Suppression at a time of Plea – What is really happening in Iran


"Those who damage public property, disrupt order and break the law must be responsible for their behavior and pay the price," Abdolreza Rahmani-Fazli (Iran's interior minister). "The spreading of violence, fear and terror will definitely be confronted." As Iran’s Interior Minister talks tough and cracks down on the voices on the ground one would like to understand why the moderate government of President Hasan Rouhani not listening?

Unlike the 2009 protests which was about the Iranian Presidential election results, the present December 2017 protests in Iran are about lack of jobs, youth unemployment, rise in cost of living, rising in cost of basis goods. A recent BBC Persian service survey found that Iranians have become 15% poorer in the last 10 years. So why hasn’t the Iranian President, his Ministers and the Iranian Supreme Leader, aware of such issues from years back have been a silent observer.


Unlike most countries with sanctions and with the present business climate in the region, Iran has fared relatively well. It ranked 6th in attracting foreign investments (Tehran Times, January 23, 2012). Although unofficial sources say working conditions are amongst the bottom 25% in world labor index.

With significant advances in science, technology and medicine, in the last two decades the university registration specifically in Science and Technology (a cultural icon of Persia as the vanguard of Science and Mathematics education from centuries past) has gone up twenty times (Andy Coghlan, "Iran is top of the world in science growth" New Scientist. Retrieved 2 April 2016). This however has not translated to a robust work force or improving unemployment in this industry.

Before 2009, foreign investment has been relatively average as some sectors like that of oil and gas industries, vehicle manufacture, copper mining, petrochemicals, foods, pharmaceuticals and tourism were active. After Tehran signed the Joint Comprehensive Plan of Action with world powers on July 2015 and implemented it in January 2016 one of the bigger companies to invest in Iran has been Nestle.

“When it comes to Iran, this country is, I would say, a special market for us with considerable opportunities. We have here an 80 million population who have a lot of interest in premium-quality food. Iranians look for variety, which is what we can deliver,” Nestle’s Qazvin Factory Manager Faisal Haroon told Financial Tribune. A further $150M investment is projected in 2018.

Why Investment hasn’t helped

“Navigating the country's legal and regulatory regime is like walking in a minefield” says Amir Paivar of BBC Persian Reporter. Corruption is a larger problem in Iran than most would like to admit. For instance, obtaining any form of permits without "extra payments" is nearly impossible for the simple process of setting up any kind of a business channel to start.

Sanctions were only a small part of the problem in Iran’s economy as formal trade and most profitably black-market channels functioned relatively all too well because the time frame of such penalties imposed on Tehran had existed far too long. The harsher version of reality is Iranian economy is a controlled economy. “The extent of the Revolutionary Guards' control over the Iranian economy is ­apparent as soon as you enter the country” says Julian Borger of the Guardian (The Guardian,15 February, 2010). The joke amongst business circles in Iran is that if you don’t factor in the Revolutionary Guards (IRGC) stake within your business model; your business model is perilous. "The IRGC is really a corporation. It is a business conglomerate with guns," says Ali Ansari, an Iran expert at St Andrews University. Utilizing the frameworks of Limited Liability Company (LLC) and Independent contractors, the IRGC operates as the Iranian version of Northrup Grumman. However, many of the beneficiaries are not owned by IRGC, rather in a corp-to-corp setup (a very dark method of hiding true owners and stakeholders). Nevertheless, the IRGC is active in construction business, oil and gas, import-export, and telecommunications. "If you want to get things to and from Iran without paying excise duty, they are the people to go to," said Meir Javedanfar, an Iranian-Israeli analyst. "No big businessman in Iran is truly independent of them or the government."    

The Real Reason

Though these peaceful protests in several cities in Iran erupted out of economic reasons there is a political side to it as well. Since 2011 Iranians have seen their government take a more active role in their foreign policy in Iraq, Syria and Yemen rather than address the more pressing economic problems at home. This was especially true in the chanted demonstrations recently in Tehran “leave Syria, think about us”. According to the United Nations envoy to Syria, Staffan de Mistura, the Iranian government spends at least $6 billion annually on maintaining Assad's government. The larger message however is to Ayatollah Khamenei, to pay attention to the future challenges of the University youth and for the average Iranians who at the very basic level are suffering and cannot provide for their families. Realistically the forces like that of the Basij militia force will suppress these protests in what possibly would be the most barbaric repression since the Arab uprisings of 2011, but the seeds of discontent have been growing now for a very long time. To take no notice of it would be premature for the sole reason that the beginning of unfolded events that overthrew the Shah of Iran and Savvak in 1979 was relatively no different from what we are seeing today with exception to leadership, an iconic leadership like that of Imam Khomeini. 

Trump’s Pakistan problem

Trump administration has recently cut almost all security aid to Pakistan, cutting the already delayed $255m military aid which Pakistan has been anticipating for the better part of 2017 - citing that the country has “failed to deal with terrorist networks operating on its soil”.

The Relationship

From its inception the US-Pakistan relationship was that of convenience. United States for its part was amongst the first nations to establish diplomatic relations with the new state of Pakistan in 1947 mainly because of the Pro-American and Pro-Capitalist Pakistan Muslim League (PML) that governed the Pakistan’s most prosperous Punjab province. Having endured independence from Britain and the horrors of partition from India, it was natural for Pakistan to ally with the United States as its rival India would side with the Soviet Union. United States for its part found strategic partners in Pakistan military dictators. Beginning from General Ayub Khan, who in return for US military aid allowed the first spy missions to the Soviet Union resulting in the 1960 U-2 incident capture of Gary powers.

United States found Ayub’s successor General Yahya Khan an integral partner in the bulwark against Communism when Indian backed East Pakistan (present day Bangladesh) declared Independence in 1971, the United States fearing Soviet backed-India to be the de-facto power in the subcontinent, secretly encouraged the shipment of military equipment from the Shah's Iran into Pakistan. The defeat of the Pakistan military and the loss of East Pakistan to its emergence in independent Bangladesh remains an open wound in the psyche of the Pakistan military. In return for past US support, Pakistan Military authorized secretly to open the path to the 1972 Nixon visit to its close ally China leading to the normalization of relations between US and China.

The US-Pakistan relationship began to show its deficits in the vociferous but charismatic Oxford-educated, non-military backed, democratically elected Zulfiqar Ali Bhutto. It was Bhutto’s warming up to Soviet Union and his obsession with developing nuclear weapons that scarred his relationship with the United States so when the Pakistan military and its General Muhammad Zia-ul-Haq commanded a coup against him, the approval from Washington was not slow.

When Soviet Army invaded Afghanistan in 1979, United States now had a reason to work with General Zia-ul-Haq through “Operation Cyclone” to make Afghanistan the Soviet Union’s Vietnam. Covert aid funded by United States, Saudi Arabia and UAE but the execution and the cash control of the operation would be implemented by Pakistan’s Inter-Services Intelligence (ISI). Through arming, training and funding of both moderate and radical factions of the Mujahedeen, many who were Afghan refugees and from tribes of Pakistan’s rural northern provinces which centuries old Afghan tribal links, the covert operation paid off. After 1986, the tide turned towards these Mujahedeen groups. Al-Qaeda arrived at his time and so did Osama Bin laden; building partnerships with many of these militant groups through Saudi Intelligence and Inter-Services Intelligence (ISI).  The Mujahedeen with assistance from the ISI, managed shelters at the northern, western and southern borders of Pakistan were now winning against the Soviet Army resulting in their defeat and withdrawal in February 1989. The Mujahedeen groups left such a brutal legacy after the war where provincial Afghan towns, cities and eventually Kabul were all under attack and ransacked by feuding Mujahedeen Warlords as each militant group battled the other for control.

With the Soviet Union no longer a threat, the United States lost interest in state-building or any reconstruction in Afghanistan while Pakistan’s Inter-Services Intelligence (ISI) reaped the rewards of an intermediary, forming strategic relationships with Mujahedeen groups resulting and using them as a quality asset. So, when the Taliban was victorious in getting rid of the Mujahedeen Warlords, they did so with the blessings of the ISI. Afghanistan now was a client state. With its western borders secure, Pakistan’s military could now concentrate on their eastern front in its battle with India over the province of Kashmir; using some of the United States funding that had provided for the Afghan war effort that would be diverted by ISI to assist radical extremist and violent groups to battle the Indian Army.

Pakistan’s U-turn Strategy

With democratically elected Pakistani governments coming and going for much of the 1990s, the Pakistan’s military again staged another coup. The International community was against recognizing General Pervez Musharaf as the new leader of Pakistan but after the horrors of 9/11 all that would change. Pakistan suddenly found itself being warned by their former ally, the United States to assist in the removal of the Afghan Taliban, a group the Pakistan military had groomed for nearly half a decade.

Pakistan military General Pervez Musharaf needed the United States to make his recent coup against the democratically elected government of Nawaz Sharif to be legitimate. He also wanted to remove Pakistan from the US and UN sanctions imposed on them for their new status as a nuclear-armed state and badly needed economic assistance to revive Pakistan’s economy. In return Pakistan would assist United States military and NATO through intelligence and logistics cooperation in Operation Enduring Freedom. However, privately amongst Musharaf’s cabinet; some military Generals believed that immediate safe havens for its asset, the Taliban in Pakistan’s northern, western and southern borders though temporarily would be a key strategy until the United States and their allies leave Afghanistan.

Through the Coalition Support Fund, the United States has paid to date an approximate $8.6 billion (initially promised $18 billion) to the Pakistan Military for its assistance in the war effort in Afghanistan and for the use of two of its airports in Shamsi Airfield and Dalabandin in Pakistani Baluchistan. Pakistan was promised $1.5 billion annually from 2001 onwards but in the very first year that did not happen.

The Decline

In 2009 the Kerry-Luger Bill proposed $1.5 billion in annual assistance to Pakistan was not transferred due to the significant differences between the Obama administration’s policy of US drone use in Pakistan air space and Pakistan’s policy on Indian Administered Kashmir. It further laid conditions for further economic aid package in-return the Pakistan military will not obstruct and interfere in Pakistan’s elected civilian governments.

This enraged Pakistan’s military who until now had been able to control much of Pakistan’s defense and foreign policy in partnership with the elected civilian government but suddenly found the United States to actively work against their own interests. 

The relationship took a bitter turn for the absolute worst when a secret operation conducted by US Navy Seals in Abbottabad, Pakistan led to the finding and death of Osama bin Laden in May 2, 2011. Under an intelligence assessment Bin-Laden’s Abbottabad home was at a close proximity to a Pakistan military academy adding to suspicions that perhaps the Pakistan military had known all along not just his whereabouts but perhaps even had assisted him in some unknown capacity.

Six years on, the US-Pakistan relationship is stagnant. Pakistan has slowly edged away to China to seek the benefits of military and economic aid. China is already involved is several Pakistan infrastructure projects. With Trump taking a confrontational tone to Pakistan there is little hope in this US administration where the relationships can be normalized. But if not Pakistan, which country can take the role to battle the militancy to find a political solution? Russia, China, or India. All are potentially able but lack the historical relationships that only Pakistan provides.

Why Pakistan is hesitant

For US military with significant engagements in Iraq from 2003 onwards, Afghanistan was not a priority but by 2008 a resurgent Taliban was making gains and even with an additional 48,500 troops the US military was unable to stop their advances in other provinces. By December 2009, President Obama sent more troops bringing the total to 100,000. But while Afghanistan saw a surge in violence so did Pakistan. The Pakistan military for the majority of its relationship through the Pashtun tribal elders was successful as events in Afghanistan unfolded to hold them to keep their promises to not fight against the US and NATO forces but from 2007 onwards this became a difficulty. Suddenly factions of fighters were splitting from the main umbrella groups that formed the Taliban. Revolting against tribal elders, sometimes even assassinating them. These factions were now forming alliances with other groups to take on even the Pakistan Army and the Pakistan state.

One of the reasons this happened was because in 2002 when the Pakistan military under the insistence of the US government, conducted incursions into South Waziristan and neighboring tribal areas to originally combat foreign militants fleeing from the war in Afghanistan into the neighboring tribal areas of Pakistan and. after some fighting, the Pakistan military came to a settlement with key tribal elders to advise militants against attacks on US and NATO forces. However, in 2006 a U.S. missile strike in Bajaur, accidentally killing school children in the Federally Administered Tribal Areas was noted by Pakistan military analysts as a key factor in the rise of tribal militancy resulting in the formation of Tehrik-i-Taliban Pakistan and other militant groups.

This makes the present circumstances extremely complicated for the present Pakistan civilian government that has been rocked by the resignation of its own Pri-Minister due to the Panama papers and at the same time convincing a Pakistan military to take on not just its own ally but formerly one of CIA’s main asset during the Soviet war in Afghanistan.  The Haqqani network unlike other Pakistan military assetts is by far a more organized, heavily armed, well-funded, large in numbers and command huge support of tribes from both sides of the Afghan-Pakistan border (Rassler, Don; Vahid Brown (14 July 2011). The fear is just as Pakistan military has seen some of its own assets turn into militant groups and turn against them, it simply cannot afford to take on the might of the Haqqani network. Perhaps Pakistan military still believes that it needs all its assets to handle what will be left by US and NATO forces after they leave Afghanistan. No different from when the Soviet army left to have Pakistan military to clean up the mess.

WINNERS & LOSERS of 2017 Tax Overhaul



No Congress since 1871 has managed to do Tax Overhaul with significant changes but should this Congress manage to do so there will be massive economic repercussions. 


At the top of it is the proposal to lower corporate tax rate from 35% to 20% bringing to the same levels as Afghanistan, Nepal and Yemen.  At the same time retaining the top individual rate for the wealthiest at 39.5%. Keep in mind the tax is imposed on Corporation net profits and six US States like Nevada, Ohio, South Dakota, Texas, Wyoming and Washington do not charge a Corporate Tax. This at the very least targets wealthy States like California, New York and New Jersey but close to 30 states (Mostly Red) are not that affected.

At the very basic level the standard tax deduction increases from $6,350 to $12,000 for individuals, and from $12,700 to $24,000 for married couples. This would mean that deduction alone may possibly finance the top rate tax to 35 percent but the real strategy here is to increase the number of taxpayers within this bracket on the standard deduction.

Estate tax exemption nearly doubles to $11.2m, up from $5.49m, and will be eliminated by 2024.  Realistically the federal estate tax is a tax on property (real estate, stock, or other assets) has largely concentrated on inheritance. Only the wealthiest estates pay the tax because it is levied only on the portion of an estate’s value that exceeds a specified exemption level — $5.49 million per person (effectively $10.98 million per married couple) in 2017. It does limit to some degree the large tax breaks that extremely wealthy households get on their wealth as it grows, which can otherwise go untaxed. However murky this seems to be the estate tax has been an important source of federal revenue for a century.


Alternative Minimum Tax - A bracket to ensure the wealthy cannot avoid taxes by taking advantage of deductions - will be repealed. This is a major source of revenue for the federal, state and local governments and so major public services including roads, highways, schools, police, fire stations and even state universities may be affected. 

Corporate profits from overseas will no longer be taxed, but a minimum 10% tax will be placed on US foreign subsidiaries. This will be an incentive for US Companies to stay at home but many already have larger operations overseas. Its far costly to bring these jobs back and taxing foreign subsidiaries outside the US will be tricky and even at 10% is hardly real revenue to account for.  

Child tax credit expands from $1,000 to $1,600 per child. This will benefit most communities but also keep in mind child tax credit increases are great news for parents, who find the credit is an easy way to reduce their tax bills dollar for dollar and possibly get a refund. 

There is no change to a limit on pre-tax contributions to 401(k) retirement funds. Presently the IRS stated that for 2018 workers can contribute up to $18,500 in their 401(k) up from $18,000 for 2017. For those age 50 or older, contribution of $6,000 is permitted for a total of $24,500.

Federal deductions for state and local income and sales taxes will be eliminated. Standard deductions ensure that all taxpayers have at least some income that is not subject to federal income tax and they generally increase each year due to controlling inflation. This is a huge source of concern as the value of the dollar may fall in uncertainty and cause volatility in US and overseas markets (Remember the 2008/09 Sub-Prime Mortgage crisis).

Local property taxes can be deducted from federal income, but are capped at $10,000. This is a major source of revenue for local governments, i.e. counties and there is little or no effect as far as real-estate value is concerned and may attract different income groups but not necessarily a higher Income groups.  


Winners: Corporations and Businesses, Wealthy heirs, Most families and Single income earners. 

Losers: Wealthy homeowners in Democratic states (i.e. California, New York, New Jersey), Ivy League Universities, Manufacturers Testing Drugs for rare conditions (Innovation and Investment for a better and affordable Health care will be a source of concern.)