Interesting article on the first page of the Financial Times. Fingerprints lead up to Kim Jong-il.

By Scott Stewart and Fred Burton

On the morning of July 17, a guest at the JW Marriott hotel in Jakarta came down to the lobby and began walking toward the lounge with his roll-aboard suitcase in tow and a backpack slung across his chest. Sensing something odd about the fellow, alert security officers approached him and asked him if he required assistance. The guest responded that he needed to deliver the backpack to his boss and proceeded to the lounge, accompanied by one of the security guards. Shortly after entering the lounge, the guest activated the improvised explosive device (IED) contained in the backpack, killing himself and five others. Minutes later, an accomplice detonated a second IED in a restaurant at the adjacent Ritz-Carlton hotel, killing himself and two other victims, bringing the death toll from the operation to nine — including six foreigners.

The twin bombings in Jakarta underscore two tactical trends that STRATFOR has been following for several years now, namely, the targeting of hotels in terrorist attacks and the use of smaller suicide devices to circum­vent physical security measures. The Jakarta attacks also highlight the challenges associated with protecting soft targets such as hotels against such attacks.

Hotels as Targets

During the 1970s the iconic terrorist target became the international airliner. But as airline security increased in response to terrorist incidents, it became more difficult to hijack or bomb aircraft, and this difficulty resulted in a shift in targeting. By the mid-1980s, while there were still some incidents involving aircraft, the iconic terrorist target had become the embassy. But attacks against embas­sies have also provoked a security response, resulting in embassy security programs that have produced things like the American “Inman buildings”, which some have labeled “fortress America” buildings due to their foreboding pre­sence and their robust construction designed to withstand rocket and large IED attacks. Due to these changes, it became far more difficult to attack embas­sies, many of which have become, for the most part in our post-9/11 world, hard targets. (This is certainly not universal, and there are still vulnerable embas­sies in many places. In fact, some countries locate their embas­sies inside commercial office buildings or hotels.)

Overall, however, this trend of making embas­sies hard targets has caused yet another shift in the terrorist para­digm. As STRATFOR has noted since 2004, hotels have become the iconic terrorist target of the post-9/11 era. Indeed, by striking an international hotel in a capital city, militants can make the same type of statement against Western imperialism and decadence that they can make by striking an embassy. Hotels are often full of Western business­men, diplomats and intelligence officers, providing militants with a target-rich environment where they can kill Westerners and gain international media attention without having to penetrate the extreme security of a modern embassy.

Our 2004 observation about the trend toward attacking hotels has been borne out since that time by attacks against hotels in several parts of the world, including Pakistan, Afghanistan, Iraq, Jordan, India and Egypt. In addition to attacks against single hotels, in the attacks in Mumbai, Amman, Sharm el-Sheikh — and now Jakarta — militants staged coordinated attacks in which they hit more than one hotel.

Hotels have taken measures to improve security, and hotel security overall is better today than it was in 2004. In fact, security measures in place at several hotels, such as the Marriott in Islamabad, have saved lives on more than one occasion. However, due to the very nature of hotels, they remain vulnerable to attacks.

Unlike an embassy, a hotel is a commercial venture and is intended to make money. In order to make money, the hotel needs to maintain a steady flow of customers who stay in its rooms; visitors who eat at its restaurants, drink at its bars and rent its banquet and conference facilities; and merchants who rent out its shop space. On any given day a large five-star hotel can have hundreds of guests stay­ing there, hundreds of other visitors attending conferences or dinner events and scores of other people eating in the restaurants, using the health club or shopping at the luxury stores commonly found inside such hotels. Such amenities are often difficult to find outside of such hotels in cities like Peshawar or Kabul, and therefore these hotels also become gathering places for foreign business­men, diplomats and journalists residing in the city, as well as for wealthy natives. It is fairly easy for a militant operative to conduct surveillance of the inside of a hotel by posing as a restaurant patron or by shopping in its stores.

Of course, the staff required to run such a huge facility can also number in the hundreds, with clerks, cooks, housekeepers, waiters, bellboys, busboys, valets, florists, gardeners, maintenance men, security personnel, etc. These hotels are like little cities with activities that run 24 hours a day, with people, luggage, food and goods coming and going at all hours. There are emerging reports that one of the suicide bombers in the Jakarta attack was a florist at one of the hotels and it is pos­sible that he used his position to smuggle IED components into the facility among floral supplies. If true, the long-term placement of militant operatives within the hotel staff will pose daunting challenges to corporate security directors. Such an inside placement could also explain how the cell responsible for the attack was able to conduct the detailed surveillance required for the operation without being detected.

Quite simply, it is extremely expensive to provide a hotel with the same level of physical security afforded to an embassy. Land to provide standoff distance is very expensive in many capital cities and heavy reinforced-concrete construction to withstand attacks is far more expensive than regular commercial construction. Such costs must be weighed against the corporate bottom line.

Moreover, security procedures at an embassy such as screening 100 percent of the visitors and their belongings are deemed far too intrusive by many hotel managers, and there is a constant tension between hotel security managers and hotel guest-relations managers over how much security is required in a particular hotel in a specific city. In fact, this debate over security is very similar to the tension that exists between diplomats and security personnel at the U.S. Department of State. And the longer the period between succes­sful attacks (there had not been a succes­sful terrorist attack in Jakarta since September 2004 and in Indonesia since October 2005), the harder it is to justify the added expense — and inconvenience — of security measures at hotels. (Of course, in very dangerous places such as Baghdad, Islamabad and Kabul heavy security is far easier to justify, and some hotels in such locations have been heavily fortified following attacks on other hotels in those cities.)

In many places, hotel guests are subjected to less security scrutiny than visitors to the hotel, as the hotel staff seeks to make them feel welcomed, and it is not surprising that militants in places like Mumbai (and perhaps Jakarta) have been able to smuggle weapons and IED components into a hotel concealed inside their luggage. We have received a report from a credible source indicating that one of the Jakarta attackers had indeed been checked into the JW Marriott hotel. The source says the attacker, posing as a guest, was an Indonesian but was likely from a remote area because he did not appear to be familiar with how to use modern conveniences such as the room’s Western-style toilet. That the attackers were Indonesians supports the theory the attack was conducted by the Southeast Asian group Jemaah Islamiyah (JI) or a JI splinter group. JI has conducted (or is a suspect in) every high-profile terror attack in Indonesia in recent years.

Sources advise that significant similarities exist between the unexploded device discovered in the attacker’s hotel room in the JW Marriott and known JI explosive devices used in past attacks and recovered in police raids. This is another strong indication JI was involved.

One other important les­son that travelers should take from this string of hotel attacks is that, while they should pay attention to the level of security provided at hotels, and stay at hotels with better security, they should not rely exclusively on hotel security to keep them safe. There are some simple personal security measures that should also be taken to help mitigate the risk of stay­ing at a hotel.

Size is Not Everything

As STRATFOR has noted since 2005, the counterterrorism tactic of erecting barricades around particularly vulnerable targets — including government buildings such as embas­sies and softer targets such as hotels — has forced militants to rethink their attack strategies and adapt. Instead of building bigger and bigger bombs that could pos­sibly penetrate more secure areas, operational planners are instead thinking small — and mobile. In fact it was the October 2005 triple-bomb attacks against restaurants in Bali, Indonesia, by JI and the November 2005 triple suicide-bombing attacks against three Western hotels in Amman, Jordan, that really focused our attention on this trend.

Like the July 7, 2005, London bombings, these two attacks in Jakarta and Amman used smaller-scale explosive devices to bypass security and target areas where people congregate. Such attacks demonstrated an evolution in militant tactics away from large and bulky explosives and toward smaller, more portable devices that can be used in a wider variety of situations. Flexibility provides many options, and in the case of the operative who attacked the JW Marriott on July 17, it appears that he was able to approach a meeting of foreign business­men being held in the lobby lounge and attack them as a target of opportunity. A vehicle-borne IED (VBIED) detonated in front of the hotel would not likely have been able to target such a group so selectively on the fly.

Of course, this trend does not mean that large VBIEDs will never again be employed any more than the trend to attack hotels means aircraft and embas­sies will never be attacked. Rather, the intent here is to point out that as security has been increased around targets, militants have adapted to security measures designed to stop them and they have changed their tactics.

At first glance, it would seem logical that the shift from large VBIEDs would cause casualty counts to drop, but in the case of JI attacks in Indonesia, the shift to smaller devices has, in fact, caused higher casualty counts. The August 2003 attack against the JW Marriott in Jakarta used a VBIED and left 12 people dead. Likewise, the September 2004 attack against the Australian embassy in Jakarta used a VBIED and killed 10 people. The use of three smaller IEDs in the 2005 Bali attacks killed 23, more than JI’s 2003 and 2004 VBIED attacks combined. Additionally, the 2005 attacks killed five foreigners as opposed to only one in the 2003 attack and none in the 2004 attacks. The operatives behind the July 17 attacks surpas­sed the 2005 Bali attacks by managing to kill six foreigners.

The reason that smaller is proving to be more effective at killing foreigners is that the rule for explosives is much like real estate — the three most important factors are location, location and location. Though a larger quantity of explosives will create a larger explosion, the impact of an explosion is determined solely by placement. If a bomber can carry a smaller explosive into the center of a heavily packed crowd — such as a wedding reception or hotel lobby — it will cause more damage than a larger device detonated farther away from its intended target. These smaller devices can also be used to target a specific person, as seen in the December 2007 assas­sination of former Pakistani Prime Minister Benazir Bhutto .

A person carry­ing explosives in a bag or concealed under clothing is much more fluid and can thus maneuver into the best pos­sible position before detonating. In essence, a suicide bomber is a very sophisticated form of “smart” munition that can work its way through gaps in security and succes­sfully seek its target. This type of guidance appears to have worked very effectively in the July 17 Jakarta attacks. As noted above, of the seven victims in this attack (the nine total deaths included the bombers), six were foreigners. JI has received criticism from the Islamist community in Indonesia for killing innocent bystanders (and Muslims) and such targeted attacks will help mute such criticism.

In addition to being more efficient, smaller IEDs also are cheaper to make. In an environment where explosive material is difficult to obtain, it is far easier to assemble the material for two or three small devices than the hundreds of pounds required for a large VBIED. An attack like the July 17 Jakarta attack could have been conducted at a very low cost, probably not more than a few thousand dollars. The three devices employed in that attack (as noted above, there was a third device left in the hotel room that did not explode) likely did not require much more than 60 pounds of explosive material.

This economical approach to terrorism is a distinct advantage for a militant group like Noordin Mohammad Top’s faction of JI, Tanzim Qaedat al-Jihad. Due to the Indonesian government’s crackdown on JI and its factions, the Indonesian militants simply do not have the external funding and free­dom of action they enjoyed prior to the October 2002 Bali attack. This means that, at the pre­sent time, it would be very difficult for JI to purchase or otherwise procure the hundreds of pounds of explosive material required for a large VBIED — coming up with 60 pounds is far easier.

Even though JI is fragmented and its abilities have been degraded since the 2002 Bali attack, a cell like the one headed by Top certainly maintains the ability and the expertise to conduct low-cost, carefully targeted attacks like the July 17 Jakarta bombings. Such attacks are easily sustainable, and the only real limiter on the group’s ability to conduct similar attacks in the future is finding attackers willing to kill themselves in the process. Perhaps a more significant limiter on their operational tempo will be the law enforcement response to the attack, which could force the cell to go underground until the heat is off. It might also be difficult to move operatives and IEDs from safe houses to targets when there is more scrutiny of potential JI militants.

Increased security at potential targets could also cause the cell to wait until complacency sets in before attacking a less wary — and softer — target. Of course, the group’s operational ability will also be affected should the Indonesian government capture or kill key operatives like Top and his lieutenants.

From the standpoint of security, the challenges of balancing security with guest comfort and customer service at large hotels will continue to be a vexing problem, though certainly it would not be surprising to see an increase in the use of magnetometers and X-ray machines to screen guests and visitors at vulnerable facilities. This may also include such measures as random bomb-dog searches and sweeps in areas where dogs are not a cultural taboo. Additionally, in light of the threat of suicide bombers using smaller devices or posing as guests, or even placing operatives on the hotel staff, much more effort will be made to implement proactive security measures such as protective intelligence and countersurveillance, which focus more on identify­ing potential attackers than on his or her weapons.

Hotel staff members also need to be taught that security is not just the role of the designated security department. Security officers are not omnipresent; they require other people on the hotel staff who have interactions with the guests and visitors to be their eyes and ears and to alert them to individuals who have made it through security and into the hotel and appear to be potential threats. Of course, the traveling public also has a responsibility not only to look out for their own personal security but to maintain a heightened state of situational awareness and notify hotel security of any unusual activity.

© Stratfor

By George Friedman

At Friday prayers July 17 at Tehran University, the influential cleric and former Iranian Pre­sident Ali Akbar Hashemi Rafsanjani gave his first sermon since Iran’s disputed pre­sidential election and the subsequent demonstrations. The crowd listening to Rafsanjani inside the mosque was filled with Ahmadinejad supporters who chanted, among other things, “Death to America” and “Death to China.” Outside the university common grounds, anti-Ahmadinejad elements — many of whom were blocked by Basij militiamen and police from entering the mosque — persistently chanted “Death to Russia.”

Death to America is an old staple in Iran. Death to China had to do with the demonstrations in Xinjiang and the death of Uighurs at the hands of the Chinese. Death to Rus­sia, however, stood out. Clearly, its use was planned before the protesters took to the streets. The meaning of this must be uncovered. To begin to do that, we must consider the political configuration in Iran at the moment.

The Iranian Political Configuration

There are two factions claiming to speak for the people. Rafsanjani represents the first faction. During his sermon, he spoke for the tradition of the founder of the Islamic republic, Ayatollah Ruhollah Khomeini, who took power during the 1979 Iranian Revolution. Rafjsanjani argued that Khomeini wanted an Islamic republic faithful to the will of the people, albeit within the confines of Islamic law. Rafsanjani argued that he was the true heir to the Islamic revolution. He added that Khomeini’s succes­sor — the current supreme leader, Ayatollah Ali Khamenei — had violated the principles of the revolution when he accepted that Rafsanjani’s archenemy, Mahmoud Ahmadinejad, had won Iran’s recent pre­sidential election. (There is enormous irony in foreigners describing Rafsanjani as a moderate reformer who supports greater liberalization. Though he has long cultivated this image in the West, in 30 years of public political life it is hard to see a time when has supported Western-style liberal democracy.)

The other faction is led by Ahmadinejad, who takes the position that Rafsanjani in particular — along with the generation of leaders who ascended to power during the first phase of the Islamic republic — has betrayed the Iranian people. Rather than serving the people, Ahmadinejad claims they have used their positions to become so wealthy that they dominate the Iranian economy and have made the reforms needed to revitalize the Iranian economy impos­sible. According to Ahmadinejad’s charges, these elements now blame Ahmadinejad for Iran’s economic failings when the root of these failings is their own corruption. Ahmadinejad claims that the recent pre­sidential election represents a national rejection of the status quo. He adds that claims of fraud represent attempts by Rafsanjani — who he portrays as defeated pre­sidential candidate Mir Hos­sein Mousavi’s sponsor — and his ilk to protect their positions from Ahmadinejad.

Iran is therefore experiencing a generational dispute, with each side claiming to speak both for the people and for the Khomeini tradition. There is the older generation — symbolized by Rafsanjani — that has prospered during the last 30 years. Having worked with Khomeini, this generation sees itself as his true heir. Then, there is the younger generation. Known as “students” during the revolution, this group did the demonstrating and bore the brunt of the shah’s security force counterattacks. It argues that Khomeini would be appalled at what Rafsanjani and his generation have done to Iran.

This debate is, of course, more complex than this. Khamenei, a key associate of Khomeini, appears to support Ahmadinejad’s position. And Ahmadinejad hardly speaks for all of the poor as he would like to claim. The lines of political disputes are never drawn as neatly as we would like. Ultimately, Rafsanjani’s opposition to the recent election did not have as much to do with concerns (valid or not) over voter fraud. It had everything to do with the fact that the outcome threatened his personal position. Which brings us back to the question of why Rafsanjani’s followers were chanting “Death to Russia”?

Examining the Anomalous Chant

For months prior to the election, Ahmadinejad’s allies warned that the United States was planning a “color” revolution. Color revolutions, like the one in Ukraine, occurred widely in the former Soviet Union after its collapse, and these revolutions followed certain steps. An opposition political party was organized to mount an electoral challenge the establishment. Then, an election occurred that was either fraudulent or claimed by the opposition as having been fraudulent. Next, widespread peaceful protests against the regime (all using a national color as the symbol of the revolution) took place, followed by the collapse of the government through a variety of paths. Ultimately, the opposition — which was invariably pro-Western and particularly pro-American — took power.

Moscow openly claimed that Western intelligence agencies, particularly the CIA, organized and funded the 2004–2005 Orange Revolution in Ukraine. These agencies allegedly used nongovernmental organizations (human rights groups, pro-democracy groups, etc.) to delegitimize the existing regime, repudiate the outcome of the election regardless of its validity and impose what the Rus­sians regarded as a pro-American puppet regime. The Rus­sians saw Ukraine’s Orange Revolution as the break point in their relationship with the West, with the creation of a pro-American, pro-NATO regime in Ukraine representing a direct attack on Rus­sian national security. The Americans argued that to the contrary, they had done nothing but facilitate a democratic movement that opposed the existing regime for its own reasons, demanding that rigged elections be repudiated.

In warning that the United States was planning a color revolution in Iran, Ahmadinejad took the Rus­sian position. Namely, he was arguing that behind the cover of national self-determination, human rights and commitment to democratic institutions, the United States was funding an Iranian opposition movement on the order of those active in the former Soviet Union. Regardless of whether the opposition actually had more votes, this opposition movement would immediately regard an Ahmadinejad win as the result of fraud. Large demonstrations would ensue, and if they were left unopposed the Islamic republic would come under threat.

In doing this, Ahmadinejad’s faction positioned itself against the actuality that such a rising would occur. If it did, Ahmadinejad could claim that the demonstrators were — wittingly or not — operating on behalf of the United States, thus delegitimizing the demonstrators. In so doing, he could discredit supporters of the demonstrators as not tough enough on the United States, a useful charge against Rafsanjani, whom the West long has held up as an Iranian moderate.

Interestingly, while demonstrations were at their height, Ahmadinejad chose to attend — albeit a day late — a multinational Shanghai Cooperation Organization conference in Moscow on the Tuesday after the election. It was very odd that he would leave Iran during the greatest postelection unrest; we assumed he had decided to demonstrate to Iranians that he didn’t take the demonstrations seriously.

The charge that seems to be emerging on the Rafsanjani side is that Ahmadinejad’s fears of a color revolution were not simply political, but were encouraged by the Rus­sians. It was the Rus­sians who had been talking to Ahmadinejad and his lieutenants on a host of issues, who warned him about the pos­sibility of a color revolution. More important, the Rus­sians helped pre­pare Ahmadinejad for the unrest that would come — and given the Rus­sian experience, how to manage it. Though we speculate here, if this theory is correct, it could explain some of the efficiency with which Ahmadinejad shut down cell phone and other communications during the postelection unrest, as he may have had Rus­sian advisers.

Rafsanjani’s followers were not shouting “Death to Rus­sia” without a reason, at least in their own minds. They are certainly charging that Ahmadinejad took advice from the Rus­sians, and went to Rus­sia in the midst of political unrest for consultations. Rafsanjani’s charge may or may not be true. Either way, there is no question that Ahmadinejad did claim that the United States was planning a color revolution in Iran. If he believed that charge, it would have been irrational not to reach out to the Rus­sians. But whether or not the CIA was involved, the Rus­sians might well have provided Ahmadinejad with intelligence of such a plot and helped shape his response, and thereby may have created a closer relationship with him.

How Iran’s internal struggle will work itself out remains unclear. But one dimension is shaping up: Ahmadinejad is try­ing to position Rafsanjani as leading a pro-American faction intent on a color revolution, while Rafsanjani is try­ing to position Ahmadinejad as part of a pro-Russian faction. In this argument, the claim that Ahmadinejad had some degree of advice or collaboration with the Rus­sians is credible, just as the claim that Rafsanjani maintained some channels with the Americans is credible. And this makes an internal dispute geopolitically significant.

The Iranian Struggle in a Geopolitical Context

At the moment, Ahmadinejad appears to have the upper hand. Khamenei has certified his re-election. The crowds have dis­sipated; nothing even close to the numbers of the first few days has since materialized. For Ahmadinejad to lose, Rafsanjani would have to mobilize much of the clergy — many of whom are seemingly content to let Rafsanjani be the brunt of Ahmadinejad’s attacks — in return for leaving their own interests and fortunes intact. There are things that could bring Ahmadinejad down and put Rafsanjani in control, but all of them would require Khamenei to endorse social and political instability, which he will not do.

If the Rus­sians have in fact intervened in Iran to the extent of providing intelligence to Ahmadinejad and advice to him during his visit on how to handle the postelection unrest (as the chants suggest), then Rus­sian influence in Iran is not surging — it has surged. In some measure, Ahmadinejad would owe his position to Rus­sian warnings and advice. There is little gratitude in the world of international affairs, but Ahmadinejad has enemies, and the Rus­sians would have proved their utility in helping contain those enemies.

From the Rus­sian point of view, Ahmadinejad would be a superb asset — even if not truly under their control. His very existence focuses American attention on Iran, not on Rus­sia. It follows, then, that Rus­sia would have made a strategic decision to involve itself in the postelection unrest, and that for the purposes of its own negotiations with Washington, Moscow will follow through to protect the Iranian state to the extent pos­sible. The Rus­sians have already denied U.S. requests for assistance on Iran. But if Moscow has intervened in Iran to help safeguard Ahmadinejad’s position, then the potential increases for Rus­sia to provide Iran with the S-300 strategic air defense systems that it has been dangling in front of Tehran for more than a decade.

If the United States perceives an entente between Moscow and Tehran emerging, then the entire dynamic of the region shifts and the United States must change its game. The threat to Washington’s interests becomes more intense as the potential of a Rus­sian S-300 sale to Iran increases, and the need to disrupt the Russian-Iranian entente would become all the more important. U.S. influence in Iran already has declined substantially, and Ahmadinejad is more distrustful and hostile than ever of the United States after having to deal with the postelection unrest. If a Russian-Iranian entente emerges out of all this — which at the moment is merely a pos­sibility, not an imminent reality — then the United States would have some serious strategic problems on its hands.

Revisiting Assumptions on Iran

For the past few years, STRATFOR has assumed that a U.S. or Israeli strike on Iran was unlikely. Iran was not as advanced in its nuclear program as some claimed, and the complexities of any attack were greater than assumed. The threat of an attack was thus a U.S. bargaining chip, much as Iran’s nuclear program itself was an Iranian bargaining chip for use in achieving Tehran’s objectives in Iraq and the wider region. To this point, our net assess­ment has been accurate.

At this point, however, we need to stop and reconsider. If Iran and Rus­sia begin serious cooperation, Washington’s existing dilemma with Iran’s nuclear ambitions and its ongoing standoff with the Rus­sians would fuse to become a single, integrated problem. This is something the United States would find difficult to manage. Washington’s primary goal would become pre­venting this from happening.

Ahmadinejad has long argued that the United States was never about to attack Iran, and that charges by Rafsanjani and others that he has pursued a reckless foreign policy were groundless. But with the “Death to Rus­sia” chants and signaling of increased Rus­sian support for Iran, the United States may begin to reconsider its approach to the region.

Iran’s clerical elite does not want to go to war. They therefore can only view with alarm the recent ostentatious transiting of the Suez Canal into the Red Sea by Israeli submarines and corvettes. This transiting did not happen without U.S. approval. Moreover, in spite of U.S. opposition to expanded Israeli settlements and Israeli refusals to comply with this opposition, U.S. Secretary of Defense Robert Gates will be visiting Israel in two weeks. The Israelis have said that there must be a deadline on negotiations with Iran over the nuclear program when the next G-8 meeting takes place in September; a deadline that the G-8 has already approved. The consequences if Iran ignores the deadline were left open-ended.

All of this can fit into our old model of psychological warfare, as representing a bid to manipulate Iranian politics by making Ahmadinejad’s leadership look too risky. It could also be the United States signaling the Rus­sians that stakes in the region are rising. It is not clear that the United States has reconsidered its strategy on Iran in the wake of the postelection demonstrations. But if Rafsanjani’s claim of Rus­sian support for Ahmadinejad is true, a mas­sive re-evaluation of U.S. policy could ensue, assuming one hasn’t already started — prompting a reconsideration of the military option.

All of this assumes that there is substance behind a mob chanting “Death to Rus­sia.” There appears to be, but of course, Ahmadinejad’s enemies would want to magnify that substance to its limits and beyond. This is why we are not ready to simply abandon our pre­vious net assess­ment of Iran, even though it is definitely time to rethink it.

© Stratfor

Summary

Georgian opposition movements have planned mass protests for April 9, mostly in Tbilisi but also around the country. These protests could spell trouble for Pre­sident Mikhail Saakashvili. The Western-leaning pre­sident has faced protests before, but this time the opposition is more consolidated than in the past. Furthermore, some members of the government are expected to join in the protests, and Rus­sia has stepped up its efforts to oust Saakashvili.

Analysis

Opposition parties inside Georgia are planning mass protests for April 9, mainly in the capital city of Tbilisi but also across the country. The protests are against Pre­sident Mikhail Saakashvili and are expected to demand his resignation. This is not the first set of rallies against Saakashvili, who has had a rocky pre­sidency since taking power in the pro-Western “Rose Revolution” of 2003. Anti-government protests have been held constantly over the past six years. But the upcoming rally is different: This is the first time all 17 opposition parties have consolidated enough to organize a mass movement in the country. Furthermore, many members of the government are joining the cause, and foreign powers — namely Rus­sia — are known to be encouraging plans to oust Saakashvili.

The planned protests in Georgia have been scheduled to coincide with the 20th anniversary of the Soviet crackdown on independence demonstrators in Tbilisi. The opposition movement claims that more than 100,000 people will take to the streets — an ambitious number, as the protests of the past six years have not drawn more than 15,000 people. But this time around, the Georgian people’s discontent is greatly intensified because of the blame placed on Saakashvili after the Russo-Georgian war in August 2008. Most Georgians believe Saakashvili pushed the country into a war, knowing the repercus­sions, and into a serious financial crisis in which unemployment has reached nearly 9 percent.

Georgia’s opposition has always been fractured and so has only managed to pull together sporadic rallies rather than a real movement. But the growing discontent in Georgia is allowing the opposition groups to finally overcome their differences and agree that Saakashvili should be removed. Even Saakashvili loyalists like former Parliament Speaker Nino Burjanadze and former Georgian Ambas­sador to the United Nations Irakli Alasania have joined the opposition’s cause, targeting Saakashvili personally. The problem now is that opposition members still do not agree on how to remove the pre­sident; some are calling for referendums on new elections, and some want to install a replacement government to make sure Saakashvili does not have a chance to return to power. But all 17 parties agreed to start with large-scale demonstrations in the streets and go from there.

If the movement does inspire such a large turnout, it would be equivalent to the number of protesters that hit the streets at the height of the Rose Revolution, which toppled the pre­vious government and brought Saakashvili into power in the first place.

Saakashvili and the remainder of his supporters are pre­pared, however, with the military on standby outside of Tbilisi in order to counter a large movement. During a demonstration in 2007, Saakashvili deployed the military and succes­sfully — though violently — crushed the protests. But that demonstration consisted of 15,000 protesters; it is unclear if Saakashvili and the military could withstand numbers seven times that.

There is also concern that protests are planned in the Georgian seces­sionist region of Adjara, which rose up against and rejected Saakashvili’s government in 2004 after the Rose Revolution. This region was suppres­sed by Saakashvili once and has held a grudge ever since, looking for the perfect time to rise up again. Tbilisi especially wants to keep Adjara under its control because it is home to the large port of Batumi, and many of Georgia’s trans­port routes to Turkey run through it. If Adjara rises up, there are rumors in the region that its neighboring seces­sionist region, Samtskhe-Javakheti, will join in to help destabilize Saakashvili and the government. Georgia already officially lost its two northern seces­sionist regions of Abkhazia and South Ossetia to Rus­sian occupation during the August 2008 war and is highly concerned with its southern regions try­ing to break away.

These southern regions, like the northern ones, have strong support from Rus­sia; thus, Moscow is square in the middle of tomorrow’s activities. Rus­sia has long backed all of Georgia’s seces­sionist regions, but has had difficulty penetrating the Georgian opposition groups in order to organize them against Saakashvili. Though none of the 17 opposition groups are pro-Russian, STRATFOR sources in Georgia say Rus­sian money has been flowing into the groups in order to nudge them along in organizing the impending protests.

Rus­sia has a vested interest in breaking the Georgian government. Rus­sia and the West have been locked in a struggle over the small Caucasus state. That struggle led to the August 2008 Russo-Georgian war, after which Moscow felt secure in its control over Georgia. Since Rus­sian Pre­sident Dmitri Medvedev and U.S. Pre­sident Barack Obama met April 1 and disagreed over a slew of issues, including U.S. ballistic mis­sile defense installations in Poland and NATO expansion to Ukraine and Georgia, Rus­sia is not as secure and is seeking to consolidate its power in Georgia. This means first breaking the still vehemently pro-Western Saakashvili. This does not mean Rus­sia thinks it can get a pro-Russian leader in power in Georgia; it just wants one who is not so outspoken against Moscow and so determined to invite Western influence.

The April 9 protests are the point at which all sides will try to gain — and maintain — momentum. The 2003 Rose Revolution took months to build up to, but the upcoming protests are the starting point for both the opposition and Rus­sia — and opposition movements in Georgia have not seen this much support and organization since the 2003 revolution. April 9 will reveal whether or not things are about to get shaken up, if not completely transformed, in Georgia.

Stratfor

Due in large part to fears of dire consequences if nothing were done to tackle the economic crisis, China rushed through a 4 trillion yuan (US$586 billion) economic stimulus package in November 2008. The plan cobbled together existing and new initiatives focused on mas­sive infrastructure development projects (designed, among other things, to soak up surplus steel, cement and labor capacity), tax cuts, green energy programs, and rural development.

Ever since the package was pas­sed in November, Beijing has recited the mantra of the need to shift China’s economy from its heavy dependence on exports to one more driven by domestic consumption. But now that the sense of immediate crisis has pas­sed, the stimulus policies are being rethought — and in an unusual development for China, they are being vigorously debated in the Chinese media.

Debating the Stimulus Package

In a country where media restrictions are tightening and private commentary on government officials and actions in blogs and online forums is being curtailed, it is quite remarkable that major Chinese newspaper editorials are taking the lead in questioning aspects of the stimulus package.

The question of stimulating rural consumption versus focusing the stimulus on the more economically active coastal regions has been the subject of particularly fierce debate. Some editorials have argued that encouraging rural consumption at a time of higher unemployment is building a bigger problem for the future. This argument maintains that rural laborers — particularly migrant workers — earn only a small amount of money, and that while having them spend their meager savings now might keep gross domestic product up in the short term, it will drain the laborers’ reserves and create a bigger social problem down the road. Others argue that the migrant and rural populations are underdeveloped and incapable of sustained spending, and that pumping stimulus yuan into the countryside is a misallocation of money that could be better spent supporting the urban middle class, in theory creating jobs through increased middle-class consumption of services.

The lack of restrictions on these types of discus­sions suggests that the debate is occurring with government approval, in a reflection of debates within the Communist Party of China (CPC) and the government itself. Despite debate in the Chinese press, Beijing continues to pre­sent a unified public face on the handling of the economic crisis, regardless of internal factional debates. Maintaining Party control remains the primary goal of Party officials; even if they disagree over policies, they recognize the importance of showing that the Party remains in charge.

But, as the dueling editorial pages reveal, the Party is not unified in its assess­ment of the economic crisis or the recovery program. The show of unity masks a power struggle raging between competing interests within the Party. In many ways, this is not a new struggle; there are always officials jockey­ing for power for themselves and for their protégés. But the depth of the economic crisis in China and the rising fears of social unrest — not only from the migrant laborers, but also from militants or separatists in Tibet and Xinjiang and from “hostile forces” like the Falun Gong, pro-Democracy advocates and foreign intelligence services — have added urgency to long-standing debates over economic and social policies.

In China, decision-making falls to the pre­sident and the pre­mier, currently Hu Jintao and Wen Jiabao respectively. They do not wield the power of past leaders like Mao Zedong or Deng Xiaoping, however, and instead are much more reliant on balancing competing interests than on dictating policy.

Party and Government Factions

Hu and Wen face numerous factions among the Chinese elite. Many officials are considered parts of several different factional affiliations based on age, background, education or family heritage. Boiled down, the struggle over the stimulus plan pits two competing views of the core of the Chinese economy. One sees economic strength and social stability centered on China’s mas­sive rural population, while another sees China’s strength and future in the coastal urban areas, in manufacturing and global trade.

Two key figures in the Standing Committee of the Politburo (the center of political power in China), Vice Pre­sident Xi Jinping and Vice Pre­mier Li Keqiang, highlight this struggle. These two are considered the core of the fifth-generation leadership, and have been tapped to succeed Hu and Wen as China’s next leaders. They also represent radically different backgrounds.

Li is a protege of Hu and rose from the China Youth League, where Hu has built a strong support base. Li represents a newer generation of Chinese leaders, educated in economics and trained in less-developed provinces. (Li held key positions in Henan and Liaoning provinces.) Xi, on the other hand, is a “princeling.” The son of a former vice pre­mier, he trained as an engineer and served primarily in the coastal export-oriented areas, including Hebei, Fujian and Zhejiang provinces and Shanghai.

In a way, Li and Xi represent different proposals for China’s economic recovery and future. Li is a stronger supporter of the recentralization of economic control sought by Hu, a weakening of the regional economic power bases, and a focus on consolidating Chinese industry in a centrally planned manner while spending government money on rural development and urbanization of China’s interior. Xi represents the view followed by former Pre­sident Jiang Zemin and descended from the policies of Deng. Under that view, economic activity and growth should be encouraged and largely freed from central direction, and if the coastal provinces grow first and faster, that is just fine; eventually the money, technology and employment will move inland.

Inland vs. the Coast

In many ways, these two views reflect long-standing economic arguments in China — namely, the constant struggle to balance the coastal trade-based economy and the interior agriculture-dominated economy. The former is smaller but wealthier, with stronger ties abroad — and therefore more political power to lobby for pre­ferential treatment. The latter is much larger, but more isolated from the international community — and in Chinese history, frequently the source of instability and revolt in times of stress. These tensions have contributed to the decline of dynasties in centuries past, opening the space for foreign interference in Chinese internal politics. China’s leaders are well aware of the constant stres­ses between rural and coastal China, but maintaining a balance has been an ongoing struggle.

Throughout Chinese history, there is a repeating pattern of dynastic rise and decline. Dynasties start strong and powerful, usually through conquest. They then consolidate power and exert strong control from the center. But due to the sheer size of China’s territory and population, maintaining central control requires the steady expansion of a bureaucracy that spreads from the center through the various administrative divisions down to the local villages. Over time, the bureaucracy itself begins to usurp power, as its serves as the collector of taxes, distributor of government funds and local arbiter of policy and rights. And as the bureaucracy grows stronger, the center weakens.

Regional differences in population, tax base and economic models start to fragment the bureaucracy, leading to economic (and at times military) fiefdoms. This triggers a strong response from the center as it tries to regain control. Following a period of instability, which often involves foreign interference and/or intervention, a new center is formed, once again exerting strong centralized authority.

This cycle played out in the mid-1600s, as the Ming Dynasty fell into decline and the Manchus (who took on the moniker Qing) swept in to create a new centralized authority. It played out again as the Qing Dynasty declined in the latter half of the 1800s and ultimately was replaced — after an extended period of instability — by the CPC in 1949, ushering in another period of strong centralized control. Once again, a more powerful regional bureaucracy is testing that centralized control.

The economic reforms initiated by Deng Xiaoping at the end of the 1970s led to a three-decade decline of central authority, as economic decision-making and power devolved to the regional and local leadership and the export-oriented coastal provinces became the center of economic activity and power in China. Attempts by the central government to regain some authority over the direction of coastal authorities were repeatedly ignored (or worse), but so long as there was growth in China and relative social stability, this was tolerated.

With Hu’s rise to power, however, there was a new push from the center to rein in the worst of exces­ses by the coastal leaders and business interests and refocus attention on China’s rural population, which was growing increasingly disenfranchised due to the widening urban-rural economic gap. In 2007 and early 2008, Hu finally gained traction with his economic policies. The Chinese government subsequently sought to slow an overheating economy while focusing on the consolidation of industry and the establishment of “superministries” at the center to coordinate economic activity. It also intended to put inland rural interests on par with — if not above — coastal urban interests. When the superministries were formed in 2008, however, it became apparent that Hu was not omnipotent. Resistance to his plans was abundantly evident, illustrating the power of the entrenched bureaucratic interests.

Economic Crisis and the Stimulus Plan

The economic program of recentralization and the attempt to slow the overheating economy came to a screeching halt in July 2008, as skyrocketing commodity prices fueled inflation and strained government budgets. The first victim was China’s yuan policy. The steady, relatively pre­dictable appreciation of the yuan came to a stop. Its value stagnated, and there is now pres­sure for a slight depreciation to encourage exports. But as Beijing began shaping its economic stimulus package, it became clear that the program would be a mix of policies, representing differing factions seeking to secure their own interests in the recovery plan.

The emerging program, then, revealed conflicting interests and policies. Money and incentives were offered to feed the low-skill export industry (located primarily in the southeastern coastal provinces) as well as to encourage a shift in production from the coast to the interior. A drive was initiated to reduce redundancies, particularly in heavy industries, and at the same time funding was increased to keep those often-bloated industrial sectors afloat. Overall, the stimulus represents a collection of competing initiatives, reflecting the differences among the factions. Entrenched princelings simply want to keep money moving and employment levels up in anti­cipation of a resurgence in global consumption and the revitalization of the export-based economic growth path. Meanwhile, the rural faction seeks to accelerate economic restructuring, reduce dependence on the export-oriented coastal provinces, and move economic activity and attention to the vastly underdeveloped interior.

Higher unemployment among the rural labor force is “proving” each faction’s case. To the princelings, it shows the importance of the export sector in maintaining social stability and economic growth. To the rural faction, it emphasizes the dangers of overreliance on a thin coastal strip of cheap, low-skill labor and a widening wealth gap.

Fighting it Out in the Media

With conflicting paths now running in tandem, competing Party officials are seeking traction and support for their programs without showing division within the core Party apparatus by turning to a traditional method: the media and editorials. During the Cultural Revolution, which itself was a violent debate about the fundamental economic policies of the People’s Republic of China, the Party core appeared united, despite major divisions. The debate played out not in the halls of the National People’s Congress or in press statements, but instead in big-character posters plastered around Beijing and other cities, promoting competing policies and criticizing others.

In modern China, big posters are a thing of the past, replaced by newspaper editorials. While the Party center appears united in this time of economic crisis, the divisions are seen more acutely in the competing editorials published in state and local newspapers and on influential blogs and Web discus­sion forums. It is here that the depth of competition and debate so well hidden among the members of the Politburo can be seen, and it is here that it becomes clear the Chinese are no more united in their policy approach than the leaders of more democratic countries, where policy debates are more public.

The current political crisis has certainly not reached the levels of the Cultural Revolution, and China no longer has a Mao — or even a Deng — to serve as a single pole around which to wage factional struggles. The current leadership is much more attuned to the need to cooperate and compromise — and even Mao’s methods would often include opportunities for “wayward” officials to come around and cooperate with Mao’s plans. But a recognition of the need to cooperate, and an agreement that the first priority is maintenance of the Party as the sole core of Chinese power (followed closely by the need to maintain social stability to ensure the primary goal), doesn’t guarantee that things can’t get out of control.

The sudden halt to various economic initiatives in July 2008 showed just how critical the emerging crisis was. If commodity prices had not started slacking off a month later, the political crisis in Beijing might have gotten much more intense. Despite competition, the various factions want the Party to remain in power as the sole authority, but their disagreements on how to do this become much clearer during a crisis. Currently, it is the question of China’s migrant labor force and the potential for social unrest that is both keeping the Party center united and causing the most confrontation over the best-path policies to be pursued. If the economic stimulus package fails to do its job, or if external factors leave China lagging and social problems rising, the internal party fighting could once again grow intense.

At pre­sent, there is a sense among China’s leaders that this crisis is manageable. If their attitude once again shifts to abject fear, the question may be less about how to compromise on economic strategy than how to stop a competing faction from bringing ruin to Party and country through ill-thought-out policies. Compromise is acceptable when it means the survival of the Party, but if one faction views the actions of another as fundamentally detrimental to the authority and strength of the Party, then a more active and decisive struggle becomes the ideal choice. After all, it is better to remove a gangrenous limb than to allow the infection to spread and kill the whole organism.

That crisis is not now upon China’s leaders, but things nearly reached that level last summer. There were numerous rumors from Beijing that Wen, who is responsible for China’s economic policies, was going to be sacked — an extreme move given his popularity with the common Chinese. This was staved off or delayed by the fortuitous timing of the rest of the global economic contraction, which brought commodity prices down. For now, China’s leaders will continue issuing competing and occasionally contradictory policies, and just as vigorously debating them through the nation’s editorials. The government is struggling with resolving the current economic crisis, as well as with the fundamental question of just what a new Chinese economy will look like. And that question goes deeper than money: It goes to the very role of the CPC in China’s system.

Rodger Baker and Jennifer Richmond

© Stratfor

Primo viaggio di Hillary Clinton: Cina. Il segretario di Stato americano cerca di tenere aperte le porte dell’Oriente. L’Europa sarà bypas­sata, farà il coccio tra i vasi di ferro (se non crolla tutto). Ecco il discorso della Clinton alla Asia Society a New York il 13 febbraio scorso. Spiega bene perchè gli Stati Uniti cercheranno di rafforzare le alleanze guardando verso il Pacifico.

Il destino non è solo cinico e baro, ma anche illuminante e onesto. La vicenda del Tibet ci offre uno specchio della confusione in cui è piombata la politica estera americana nel second term di Bush. L’11 marzo scorso il rapporto annuale del Dipartimento di Stato sui diritti umani toglieva Pechino dalla “black list”, ma il destino spesso gioca a dadi e pochi giorni dopo a Foggy Bottom si sono ritrovati con il Tibet di nuove in fiamme e il Dalai Lama che oggi si dice pronto a lasciare. Così gli Stati Uniti e l’Europa si sono parlati all’ora del tè e dopo lunga meditazione hanno pensato di invitare la Cina alla “moderazione”, invito che a Pechino hanno tradotto con un pragmatico “di monaci ammazzatene, ma solo un po’”. Pes­sima situazione. Aggravata dal fatto che spostando il proprio cannocchiale miope sui Balcani a Washington sono riusciti a illudere il Kosovo di essere uno Stato e di conseguenza alimentare il caos etnico nell’ex Jugoslavia, cosa di cui francamente non si sentiva il bisogno. Qual è la linea politica del Dipartimento di Stato in materia di libertà e democrazia? E’ quella ideale, wilsoniana che vuole estendere la democrazia — e perfino esportarla nella sua visione neoconservatrice — oppure è quella flip flop sulla Cina che prende con una mano (investimenti e finanza globale) e non restituisce con l’altra (democrazia e diritti civili) facendo finta che il Tibet sia un problema di “moderazione” e non invece un tema che — usando la stessa logica applicata al Kosovo — diventa un punto importante dell’agenda per la libertà e la democrazia? Si può tenere il tacco dello stivale sul Tibet e “liberare” il Kosovo dalla Serbia? E’ meglio l’ordine e l’ingiustizia o il disordine e la giustizia? Gli Stati Uniti e l’Europa devono riorganizzare molto in fretta le proprie idee sul mondo contemporaneo e le sfide che propone perchè un conto è avere una politica estera che si modella caso per caso, un altro è avere una linea che sta diventando un caso.