End of Mania, Time to Deliver
What can the world look forward to in Obama-era? - Revathi Sivakumar

What is at the epicenter of perceived change? Where does the symbol of rising hopes, inversely proportional to the sliding global economy, lie? Who is the man seen to possess a magic cure for the ills of the world? One charismatic figure: Barack Hussein Obama.

Obama seems to promise change, but will his Presidentship also mark a turning point in the actual substance of policy? Can he bring in a new era of progressive policies?

So far it appears so. Currently, he has certainly been liberal with his promises. Among many important domestic and foreign policy objectives, his announcements have promised a progressive plan to revive the economy, provide reasonable health care, strengthen public education and social security systems, work towards energy alternatives to challenge climate issues, end the war in Iraq and finish the Afghanistan mission, and work with allies to prevent Iran from developing a nuclear weapon. Obama’s plans are important as they will have a significant impact on world affairs economically, politically and even socially.

The Paki factor
So what does Obama harbour for world change? For India, the Pakistan question is of immediate importance, and currently, the US too views that country as the most vital focus of its foreign policy. At the end of January, Obama ordered drone attacks on select areas of Pakistan, but there is a real fear of what may happen if the situation in Pakistan continues to deteriorate.

In Afghanistan, in spite of the military presence currently being planned, the US is braced for the fact that no outright victory is possible. Pockets of Taliban rule in the Pashtun-dominated South and East of the country will continue. NATO forces may also be deployed to work with local district leaders, on the condition that the Taliban would not provide refuge for Al Qaeda or other terrorist organisations, and would not battle with other ethnic groups in Afghanistan. This would hopefully help the country to maintain a ‘moderate’ Taliban force here, without territorial ambitions outside Afghanistan.

But in Pakistan, terrorist groups, whether allied with Al Qaeda or not, harbour ambitions about other parts of Pakistan too and beyond its borders. Besides, Pakistani youth in Europe and America have been coming to the country to train under the Al Qaeda and its sister organisations.

Most intelligence agencies concede that terrorist incidents in the West can be traced back to Pakistan even before the Al Qaeda leadership fled Afghanistan to take shelter in the Pak-Afghan border areas.

Hence, the Obama administration’s real concern is Pakistan. This nation’s fight against extremism and its stability is crucial for the US and its allies. The Obama administration is thus taking immediate steps to grant Pakistan $1.5 billion annually for the next ten years, to ease Pakistan’s current economic problems, especially in view of the global recession and the declining access to resources. There is also a proposal to set up reconstruction opportunity zones, in order to earmark a substantial part of the new assistance for tribal areas. Obama has also mooted a proposal to assist Pakistan in training its army and paramilitary forces, for counter-insurgency operations.

In return, Obama wants Paki cooperation and commitment in fighting the militants, and the assurance of support to US troops carrying supplies to Pakistan. The Americans also look for better intelligence sharing between NATO, the Afghan military and the Pakistani military. A single intelligence-sharing centre near Khyber has not functioned too well, hence, this needs to be improved.

However, the air is one of mutual suspicion and distrust. Obama continues his drone attacks on Pakistan’s tribal areas, but Pakistan needs to ensure that targets are properly identified and civilian casualties are avoided, while militants such as Baitullah Mehsud and Fazlullah are identified for capture and killed.

Other countries
Regarding other countries, it is too early to understand whether Obama’s policies will be consistent with his early statements. Firstly, the US government wants to secure loose nuclear materials from terrorists within four years, and negotiate a verifiable global ban on the production of new nuclear weapons material. They want to pursue tough, direct diplomacy without preconditions to end the threat from Iran. If Iran abandons its nuclear program and support for terrorism, they would offer incentives such as membership in the World Trade Organization, else, they would step up their economic pressure and political isolation.

Obama’s administration also announced a temporary halt to the trials of terror suspects at Guantanamo Bay. A delay of 120 days is being sought "in the interests of justice". Obama’s request was interpreted, essentially, as a holding operation, preparing the way for the prison camp to be closed down. Though the final closure of Guantanamo will take time, it will set the tone for diplomatic friendship. The new President wants to build potential friends, rather than enemies in the world: "We will extend a hand if you are willing to unclench your fist", he said. He has indicated that many curbs on relations with Cuba could also be lifted, which would thus ease relations with a traditional adversary.

And finally, Obama has already set a provisional timetable for handing Iraq back to the Iraqis, and made Afghanistan a priority – although many European countries, including Britain, will take some persuading before they contribute more troops. But his most urgent challenge is the Middle East in the aftermath of Israel's attack on Hamas in Gaza. With his own openness to new ideas, and a team comprising Hillary Clinton and George Mitchell, he has a chance here that he must not let slip.

Domestic economic direction
Even before formally taking office, Obama trained his attention on the worrying aspects of the economy. In his inaugural address, President Obama promised a "new era of responsibility" at this time of crisis at home and abroad. Losing no time, he presented an economic stimulus plan. The U.S. House of Representatives approved the 819-billion-dollar stimulus plan backed by the President and Democrats, sending it to the Senate. There, the huge bill grew larger, with the addition of a tax break for homebuyers pushing the bill past 900 billion dollars.

However, Republicans wanted to reduce government spending, add tax cuts and reduce the cost of mortgages for millions of homeowners. The bill thus came under fire.

In an article published in the Washington Post, Obama urged the Congress to pass it quickly in order to prevent a deeper and long-lasting recession in the country. "What Americans expect from Washington is action that matches the urgency they feel in their daily lives -- action that's swift, bold and wise enough for us to climb out of this crisis," he wrote.

He pointed out that without his stimulus package, more people lose their jobs, savings and homes. "If nothing is done, this recession might linger for years," he said. "Our economy will lose 5 million more jobs." The plan promises to create or save more than 3 million jobs over the next two years, providing immediate tax relief to 95 per cent of American workers. It will stoke spending by businesses as well as consumers alike. It is seen as a strategy for America's long-term growth and opportunity in areas such as renewable energy, health care and education. Obama asked the lawmakers to "place good ideas ahead of old ideological battles" and "act boldly to turn crisis into opportunity."

The Conservatives who urge caution discount this year’s presidential election, which in itself was a clear referendum on political philosophies. It is clear that progressive philosophy has won over resistance to change. For instance, Obama had promised guaranteed health care and tax breaks for the middle class, with more taxes on the rich. Though his opponents had cried foul, charging him with being a socialist and a “redistributor,” the whole of America voted for him.

Of course, the economic crisis is seen to make a progressive agenda tough. Solving the financial mess will require more funds than ever before. Moreover, increased government spending to support output and employment is called for. Next year’s federal budget deficit could touch $1 trillion. However, due to the depressed economy, running temporary deficits in the face of a depressed economy has to be viewed in the correct perspective. Americans are also counting on his bringing in a new health care plan. Hence, the economic crisis is, in itself, a chance to promote the progressive agenda.

Obama needs to prove that good morals translate into good economics now. Helping the poorer sections by providing better health and unemployment benefits is not only right, but a more effective way of stimulating the economy than cutting capital gains tax. Providing aid to state and local governments, so that they can continue with essential public services, is important for people who depend on them. It also helps to minimise job losses and arrest the economic downslide.  

Foreign economic agenda
However, in stark contrast to his activism at home, Obama's approach to global economic issues is cautious. He has had nothing significant to offer to counter the growing risk of protectionism converting world recession into a lengthy slump. This has worried experts and economists. In fact, the signals that have emerged so far seem to suggest that trade would not be a priority for this administration.

Experts point out that it’s early days yet. At the Group of 20 Summit in London, less than two months away, world economic leaders aim to coordinate action to stabilize financial markets and rekindle growth. What is the US thinking on the IMF reform, for instance? Or the fate of the Doha trade round? It is difficult to understand.

The Obama cabinet needs to connect with the realities of the crisis globally. Any policies that serve only national interests might exacerbate the crisis. It is surprising that in spite of so many months of preparation, there is yet no coherent response to the crisis as a worldwide phenomenon. Though the cabinet has some able and internationally experienced economic advisers, no one has a clue as to the response that is needed.  

Just days back, the Congress tried to insert a ‘Buy American’ provision into the stimulus package. The international outcry that followed forced the President to shoot it down. Such policies are feared to trigger a worldwide adoption of protectionist policies, which does not augur well for free trade or economic revival. Fortunately, Obama did oppose the provisions, even though just a few months ago, he was also touting a "Buy American" policy.

However, the mood in Congress, particularly among Democrats, is still belligerent. Obama needs to be firm and set out a coherent international economic strategy, which is as clear as his agenda for the domestic economy. If it needs to follow the policies of international cooperation, it would require nurturing open markets. While free trade is never easy to sell to domestic audiences, Obama needs to be firm and avoid protectionism. He should use his powers of eloquent speech and oratory to put forth his message.

But finally, one thing is clear. Whatever steps Obama takes, whether bold or cautious, they will be watched with complete interest by a world waiting for a miracle.