Putin Crimea Gambit Creating Generational Rift in Russia!!

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Putin Crimea Gambit Creating Generational Rift in Russia!!

Putin"s reckless Ukraine gambit

Vladimir Putin’s surprise decision to ask for a Russian-style War Powers resolution from his parliament dramatically ups the ante in the Ukraine crisis and positions Russia for full-scale military action. It also signals Putin’s commitment to use all necessary means—many of which have already been in use in Crimea—to keep Ukraine in Russia’s orbit. If Putin follows through on his threat to invade Ukraine, he will signal yet again that the post-Cold War era that began with the “Velvet Revolutions” of 1989 has ended. The damage to Russia’s relations with the West will be deep and lasting, far worse than after the Russian-Georgian war. Think 1968, not 2008.

President Barack Obama’s handling of the Western response to the Ukraine crisis is now arguably the biggest test of his presidency. It is a crisis that no one anticipated and that the West has been frustratingly divided over since the European Union’s original, misguided attempt to force Ukraine to make an either-or choice about going east or west. For too long we have heard U.S. officials says repeatedly, “The Europeans are taking the lead.” That needs to stop.

Russia rolled over tiny Georgia with ease and the military phase of the crisis ended quickly. Ukraine will pose a much bigger challenge to Russia militarily, and the crisis will be more protracted and take a far less predictable path. The country is badly divided, of course, but anti-Russian sentiments are strong and undoubtedly growing in many parts of Ukraine. The forces of Ukrainian nationalism are on the rise throughout much of the country, provoked by Moscow’s disregard for Ukrainian sovereignty and irresponsible attempts to portray the Maidan revolution as a fascist triumph—patently offensive to a nation that suffered so much during World War II.

We should not take for granted that even in Ukraine’s east and south, where so many ethnic Russians live, that a military occupation will be a cakewalk. Many local residents surely do not want to become Russia’s 90th province. In Ukraine’s west, where the Soviet Army had to fight a protracted counterinsurgency campaign after WWII against Ukrainian nationalist guerrillas, armed resistance is certain to be strong. During the revolution, many army depots and armories were overrun so there are more weapons floating around Ukraine than at any point since 1991. And the leadership of the main instruments of coercion – the Army, the Interior Ministry, and the intelligence service – are all in the hands of political leaders with strong Ukrainian nationalist credentials.

Any invasion—which is what it would be—of a vast country of 46 million in the heart of Europe, sharing borders with NATO allies Poland, Hungary, Slovakia and Romania, would pose a major security challenge for the United States and other key European powers. Even without further Russian action, allies such as the Baltic countries will be seeking U.S. reassurance. Lithuania has already asked for Article IV consultations under the NATO Treaty in response to a clear threat to its security. These countries likely will also ask for hard reassurances—such as deployments of U.S. and other allied troops and equipment on their territory—as Turkey did in 2012 when Syria shot down a Turkish jet. They will also need help to shore up their eastern borders and prepare for possible flows of refugees from Ukraine. The Baltic states will probably ask for similar reassurances. One can also expect cyber attacks and intrusions, false alarms and an atmosphere of tension the likes of which have not been seen since the worst days of the Cold War.

Post-revolutionary Ukraine is in bad shape. Its economy is wrecked. Government institutions broke down completely after the Yanukovych government disappeared overnight. Corruption and criminality, Ukraine’s twin scourges, remain basically intact. Thanks to Russia’s unexpected moves in Crimea, the West will now have to put Humpty Dumpty back together on its own. These tasks demand that the president designate a senior point-person for coordinating Ukraine policy in all its complexity. Deputy Secretary of State William Burns, one of America’s ablest diplomats and an old Russia hand, is the obvious choice.

The break in the West’s relations with Russia is bound to be deep and lasting. The G-8 will be its first casualty with the Western powers likely to reconstitute the G-7 in its original form as a direct rebuff to Putin. Other important international mechanisms —the U.N. Security Council, ad hoc diplomatic efforts on Syria, the P5+1 process on Iran, the Six-Party talks on North Korea, and so on—will be filled with renewed acrimony and dysfunction. Some may break down entirely. Inevitably, there will be congressional calls for sanctions against Russia, which the White House will be hard-pressed to resist no matter how much it may want to preserve the shreds of cooperation with Russia on Iran, Syria or Afghanistan. The West and Russia are in uncharted waters.

Eugene Rumer is a senior associate and the director of the Carnegie Endowment for International Peace’s Russia and Eurasia Program.

Andrew S. Weiss is vice president for studies at the Carnegie Endowment. He served on the National Security Council staff during the Clinton administration.

POLITICO – TOP Stories

Putin"s reckless Ukraine gambit

BlackBerry deal bolsters Foxconn"s makeover gambit

BlackBerry deal bolsters Foxconn"s makeover gambit
http://s1.reutersmedia.net/resources/r/?m=02&d=20131224&t=2&i=823964959&w=580&fh=&fw=&ll=&pl=&r=CBRE9BN05MW00

By Clare Jim and Poornima Gupta

TAIPEI/SAN FRANCISCO Mon Dec 23, 2013 9:01pm EST

Employees work inside a Foxconn factory in the township of Longhua in the southern Guangdong province in this May 26, 2010 file photo.

Credit: Reuters/Bobby Yip/Files

TAIPEI/SAN FRANCISCO (Reuters) – Foxconn’s BlackBerry Ltd (BB.TO) deal marks the Taiwanese firm’s biggest step up the value chain – a chance to not just assemble smartphones, but help design them, too.

The agreement to design and market phones starting in Indonesia, the world’s fourth-most populous country but an under-penetrated market, is a boon to a mega-manufacturer trying to grow its margins while making a play for a bigger slice of the global mobile devices market.

Best known for putting together iPhones, Foxconn honed its skills by meeting Apple Inc’s (AAPL.O) exacting standards and supply chain rigor. It boasts a workforce of more than 1 million and the scale to negotiate cheaper component prices than BlackBerry could obtain on its own.

BlackBerry announced on Friday that Foxconn will help design the hardware for its future low-end devices as part of a 5-year deal, furthering the template for manufacturing specialists to scale the value chain. BlackBerry itself will remain focused on software technology.

The Canadian firm wants to produce many of the new phones in Indonesia – the first new model is code-named “Jakarta” – where Foxconn has been navigating bureaucracy for over a year to set up a manufacturing plant in Southeast Asia’s biggest economy.

Foxconn – the trading name of Hon Hai Precision Industry (2317.TW) – expects an agreement with local authorities in February, and plans to set up joint ventures with local private firms to tap the potentially vast Southeastern Asian market. While it waits to set up production facilities in Indonesia, Foxconn will make BlackBerry phones at its Chinese factories.

Indonesian government officials have said Hon Hai wants to gradually invest as much as $ 10 billion over 5 years with local partner Erajaya Swasembada (ERAA.JK), and Indonesia will offer the Taiwanese firm a tax package aimed at kickstarting the plan. Hon Hai has yet to confirm these details.

“BlackBerry wanted to develop new products in Indonesia, while we’re also tapping the local market there. They saw our ambition, so we started talking,” said Foxconn spokesman Simon Hsing. “The partnership gives us mutual benefits to explore existing and new emerging markets together.”

“TOTAL SOLUTIONS”

The first Foxconn-built BlackBerry – a low-cost 3G model based on BlackBerry 10 software and targeting Indonesia – could be rolled out by April.

“A strategic partnership with BlackBerry is a recognition of Foxconn’s capability and new business model as an IIDM (Innovative Integrated Design Manufacturer) as our chairman Terry Gou calls it,” said Foxconn’s Hsing. “We’re no longer just a contract maker; we provide total solutions – from design, manufacturing, component supply to logistic management.”

Hon Hai has become the world’s largest electronics manufacturer after years of helping Apple and other tech giants put together their gadgets. That experience means it brings a number of advantages to the table.

As Apple’s largest supplier, Foxconn has undergone years of manufacturing to the Cupertino company’s high standards. Its unmatched scale should allow it to buy components more cheaply, BlackBerry says. And Gou has made no secret of his ambitions to usher Foxconn into the increasingly crowded smartphone space, boosting margins as a result.

Foxconn has also extended its business this year to provide devices and applications that build on Mozilla’s Firefox operating system.

But in recent years, the rapid rise of rivals like Pegatron Corp (4938.TW) and increasingly tough demands from clients as competition intensifies may have put pressure on margins. Worker-rights advocates and major customers like Apple are also demanding Foxconn and other contract manufacturers improve wages and working conditions following a series of high-profile suicides and reports about untenable labor conditions at Chinese factories.

“Margins under this partnership with BlackBerry will definitely be higher,” said Arthur Liao, a Taipei-based analyst at Fubon Securities. “The most profitable bit will come from component sales and after-service, which includes inventory management and component repairs,” he said, adding that margins from after-service are usually above 15 percent, three times those on pure manufacturing.

FIH Mobile Ltd (2038.HK), Hon Hai’s handset making arm for non-Apple brands, will be the unit that collaborates with BlackBerry. The Hong Kong-listed company returned to a small profit in January-June after losing US$ 226 million in the same year-earlier period as orders fell from clients such as Nokia Oyj (NOK1V.HE). Current FIH clients include Sony Corp (6758.T) and HTC Corp (2498.TW).

According to Fubon’s Liao, FIH made around 50 million phones this year while Wistron Corp (3231.TW), BlackBerry’s contract maker, shipped around 20 million BlackBerries.

Shares in FIH, which on Monday forecast a net profit for the full year, have gained 9.4 percent to a 2-week high since the BlackBerry deal was announced.

GLOBAL FACILITY EXPANSION

BlackBerry’s decision to produce the devices in Indonesia and Mexico is a pay-off for Foxconn’s huge investment in those two markets. Foxconn has shifted part of its expanding production facilities to Mexico since 2009 as this is close to its major customer, Apple.

It’s unclear how far the BlackBerry brand travels beyond less-lucrative emerging markets.

Starting at the low-end means taking on Xiaomi and other emerging brands that excel at cut-rate smartphones, a potentially margin-eroding and debilitating battle.

The rise of Chinese gadget makers has already dented Apple’s and Samsung’s market share in China and other developing countries, and Xiaomi has said it will now focus on Southeast Asia – precisely where Foxconn and BlackBerry mean to kick off their partnership.

To be sure, that’s where the BlackBerry brand remains strong. While it has fallen out of favor in Western markets, it still has a cachet and name recognition in Asia, particularly in Indonesia and other promising markets like India.

It has other things going for it, too.

Foxconn will be helping in the design and manufacturing of the new phone, but taking on the inventory risk. Foxconn’s scale means it should be able to bring down the cost of the phone as it has the muscle to source components at lower prices.

“I’ve got a really good bill of materials right now because of Foxconn – you know their volumes. I can’t buy components at prices anywhere close to the ones they buy at,” BlackBerry CEO John Chen told reporters. “This is a testing ground for both us and Foxconn. They are testing us and we are testing them.”

(Additional reporting by Randy Fabi in JAKARTA and Michael Gold in TAIPEI; Editing by Emily Kaiser and Ian Geoghegan)

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Reuters: Business News

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House GOP"s New Gambit: Tie Obamacare To The Debt Limit

Sahil Kapur August 14, 2013, 4:35 PM

Even as their hardliners refuse to let up, senior Republicans have all but conceded that they won’t end up defunding Obamacare in a continuing resolution to keep the federal government open after the money runs out on Sept. 30. And even if they do shut down the government, top Republicans observe, it won’t actually stop Obamacare. The strategy makes little sense.

But House Republican leaders are taking so much fire from conservative advocates that they’re weighing a more dangerous gambit: taking the United States’ ability to pay its bills hostage to advance the party’s goal of disrupting and dismantling the Affordable Care Act. The country’s borrowing authority is set to expire later this fall and senior Republicans made a series of promises to their members since January that appear likely to culminate in a showdown.

GOP leaders don’t see a way to persuade their members to lift the debt ceiling without attaching it to fiscal reforms. So a strategy they’re considering, first reported in the conservative news outlets National Review and Washington Examiner, is to pass a two-month continuing resolution to keep government funded at existing levels until, roughly, the debt limit is reached. Then they would offer a sequester replacement in exchange for delaying or defunding Obamacare in order to avoid economic disaster.

A House Republican leadership aide described this plan as an option, but cautioned TPM that no decisions have been made yet. “I do, however, expect that the President’s health care law will certainly come up — in some form or fashion — in the debt limit debate,” said the aide, who spoke on condition of anonymity to discuss internal strategy.

A second House GOP leadership aide also said no decisions have been made.

House Republicans are right that sequestration is a significant leverage point for them — they’ve largely embraced the indiscriminate spending cuts passed in 2011, while Democrats are eager to replace them. But a strategy of tying Obamacare to the debt ceiling carries a series of seemingly fatal flaws and potentially disastrous outcomes.

For starters, President Obama and his senior officials have vowed, repeatedly, not to negotiate on the debt ceiling under any circumstances. Their view is that the country’s borrowing limit is too important to subject to ideological debates, that raising it is Congress’ responsibility, and if they stand firm Republicans will be forced to back down. Back in January, when Obama refused to negotiate over the upcoming debt ceiling breach, they caved and ended up temporarily raising it without any substantial strings attached.

“We are not negotiating on the debt ceiling,” Obama told Democratic lawmakers just weeks ago.

But even if Democrats agreed to package a debt ceiling hike with other reforms, they’ve rejected repeated GOP efforts to damage Obamacare and they’re not about to cave now, on the eve of the law’s rollout. Not only would it show dramatic weakness and send the wrong signal at the wrong time, it would disrupt the frantic efforts of administration officials to make sure the law’s central provisions are ready to go live on Jan. 1. Enrollment on the insurance marketplaces begins on Oct. 1, after which delay is even less likely. And Obama is all but certain to veto a bill that meaningfully damages his signature achievement.

Which is why the gambit is extremely dangerous. If Republicans cater to conservative demands and raise expectations that Obamacare will be weakened in a debt limit deal, it could push Congress to the brink of letting the United States default on its debt, a move that stands to send shock waves through the economy, if not grind it to a halt.

The likelier endgame is that Republicans ultimately come up with a shiny object to distract their base and portray it as a concession by Democrats. That could include symbolic moves like Senate Democrats permitting a vote on House GOP legislation to delay parts of Obamacare, such as the individual mandate. Of course, Democrats would vote down such a bill, but it’d give Republicans a political weapon to use against vulnerable red-state Democrats in the 2014 elections, when they hope to win the Senate majority.

It won’t be easy for Republicans leaders to pull their members back from the brink, but as things stand, they probably won’t have a choice. As the White House sees it, ideological concessions such as weakening Obamacare and spending cuts are out of the question, and the debt ceiling debate ends either in a GOP cave or default.

Sahil Kapur

Sahil Kapur is TPM’s senior congressional reporter and Supreme Court correspondent. His articles covering politics and public policy have been published in The Huffington Post, The Guardian and The New Republic. He can be reached at sahil [at] talkingpointsmemo.com.

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House GOP"s New Gambit: Tie Obamacare To The Debt Limit