Bill Owens: Confounding And Confusing Events 10/21/19
POTUS’ decision to abandon the Kurds along the Turkish-Syria border was purportedly based upon his desire to pull troops out of harm’s way and keep us out of endless wars. Within days, however, he ordered additional troops and equipment into Saudi Arabia which is clearly engaged in a conflict with Iran. We abandon one ally in an act that can only be described as one of cowardice, and put troops in harm’s way on behalf of another ally. It looks like our decisions are based upon oil and money. Virtually all members of Congress, former State and Defense department officials expressed dismay while our troops (Green Berets have described their feelings as those of shame). POTUS announced on October 18th that ceasefire has been agreed to which gave away Kurdish land and appears to be without benefit to the US or the Kurds, and as one might expect, there are reports of continued fighting. There is a rumor on the street that Turkey is investigating Elizabeth Warren and the Kurds are searching fir dirt on other democratic candidates. Just kidding.
Then to no one’s surprise, except maybe POTUS’, the Kurds have now teamed up with Syria to fight the invading Turks. This puts the Kurds in the Syria, Russia and Iran camp. Good job POTUS!
The turnover in the Administration is astounding with the last departure, the Acting Secretary of Homeland Security, which has been rumored for weeks with leaks about significant policy disagreements. One wonders how people like Secretary Esper, Chairman of the Joint Chiefs General Milley and others can possibly feel comfortable with this most recent decision with regard to the Kurds. If we go looking for allies in the future, I suspect they will be very hard to find.
On the US China trade front, the Wallstreet Journal couches its description of the agreement reached between the parties as the “US, China a step forward on trade”. A reading of the actual agreement reflects not so much a step forward, but rather a pause on additional trade sanctions. The parties still have not reached agreement with regard to the major issues which were the driving force for the Trade War in the first place. There is no agreement on currency manipulation, on required technology transfers to China, investments in China or protections of intellectual property. The likelihood, in my view, that the US will actually negotiate a favorable resolution of the significant issues is slim to none. “Trade Wars are easy to win” is the famous POTUS quote, except he hasn’t.
This week has seen some interesting twists and turns in the Ukraine investigation. Acting Chief of Staff Mulvaney admitted in a morning press conference that, in fact, there was a quid pro quo with regard to the aid and the investigation desired by POTUS. He subsequently walked it back in the afternoon, but when added to comments from Ambassador Sondland and others, that reality is now beginning to settle in. The defining issue will be the actual recording and I wonder how long it will take to get there.
The Canadian elections draw closer and the numbers remain about the same with the Liberals and Conservative in essentially a statistical dead heat with neither likely to win sufficient seats in order to be able to form a majority government thus, without the support of the other parties, no government will be formed. It seems unlikely that the Conservatives will be able to do so, given the fact that the NDP and the Green Party are third and fourth in the polling.
Speaking of Canada, Members of Congress identified a new area of concern for the USMCA. A shield for the tech industry is included and that now gives further pause to moving this deal forward.
The Federal Reserve of San Francisco issued a report with the apparent consent of the full board of directors of the Fed. The report indicates that there are substantial potential impacts from climate change, including concerns about the value of homes and businesses along the coast, which from a credit and risk perspective are issues that need to be addressed. Lending to homeowners and/or businesses that are likely to be swamped as well as given the fact that there is likely to be less and less flood insurance available, are all troubling to lenders, but this is in conflict with the rest of the Trump Administration. We know how POTUS pounced on Chairman Powell about cutting rates, we will see how he reacts to this report.
On a lighter note, Sam Adams has brought back a beer that has an alcohol level of 29%. It is illegal in about 15 states and it will be interesting to see how they market this product. Drinking a few of those would certainly help to dull what we are seeing going on in Washington and throughout the rest of the world. Cheers!
Bill Owens is a former member of Congress representing the New York 21st, a partner in Stafford Owens in Plattsburgh, NY and a Senior Advisor to Dentons to Washington, DC.
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