Friday News Roundup — May 7, 2021
Recommendations from Our Space Project; Supply Chain Stress; Israel’s Drawn-out Electoral Drama; China’s Pacific Build Up Grows Closer; U.S.-Russia Relations ‘Worse than Cold War’
Happy Friday from Washington, DC. This week, CSPC launched the newest report in our National Security Space Program, “Maintaining Momentum in National Security Space”. We invite you to read the whole thing, but our key findings are:
Maintain the Space Force Momentum: Continued oversight and direction from President Biden, Secretary Austin, and the next Secretary of the Air Force is needed to ensure that the Space Force can solidify its missions and requirements and ensure coordination with Congress and across the Executive Branch.
Acquisition Reform: The private sector space industry is rapidly innovating, and the Department of Defense needs to change the way it does business in order to adapt. Acquisition processes that were born in a different age need reform in order to get new capabilities into service quickly.
Competition Among Launch Providers: The proliferation of launch providers and non-governmental demand for space access means that the U.S. Government does not need to lock in block purchases of launches. More flexible arrangements — while still ensuring access to space — will push costs lower and foster even more competition.
Closing the Space “Kill Chain”: The Space Force needs to define the effects that it is pursuing, rather than focusing on the platforms it operates. A holistic approach will allow the Space Force to consider more areas where commercial technologies can complement or supplement their approach.
Create a Rules-Based Order for Space: The United States needs a whole-of-government approach to create internationally agreed “rules of the road” for space, especially in crowded space environments like near-Earth orbit and eventually the moon. This will ensure that the commercial, civil, scientific, and national security purposes of space can continue to function
You can also watch our launch event (pun absolutely intended) with Bretton Alexander, Vice President, Government Sales at Blue Origin, Jeffrey Manber, CEO of Nanoracks, and Lars Hoffman, Senior Vice President at Rocket Lab. We also hosted an event in our Geotech program on the semiconductor shortage with Susie Armstrong, Senior Vice President for Engineering at Qualcomm, and Jimmy Goodrich, Vice President for Global Policy at the Semiconductor Industry Association.
This week, CSPC also mourned the loss of long-time supporter and Trustee Eli Broad. Mr. Broad’s entrepreneurial spirit, leadership vision, and deep commitment to philanthropy changed countless lives for the better and we will dearly miss his dedication and commitment.
In The Diplomatic Courier, Joshua reviewed Timothy Frye’s “Weak Strongman: The Limits of Power in Putin’s Russia.”
This week in the Roundup, Dan analyzes what the semiconductor shortage means for globalization and technological innovation. Michael checks in on the ins and outs of Israel’s political crisis. Ethan looks at the Chinese build up on Kirbati, 1,200 miles from Hawaii, and Joshua covers how the Kremlin regards the relationship with Washington (spoiler, not well). As always, we end with some stories you may have missed.
The (Supply) Chains that Bind Us
Dan Mahaffee
The predictions about the post-pandemic world abound. Some of these concepts, from reshaped downtowns to the end of business travel, come from how work and play have changed, or how trends in technology and remote collaboration were accelerated by working remotely. Some of these will come to pass, but old habits and preferences will also gradually return. On the other hand, there are the predictions that come from the hard lessons learned — or at least in the process of being learned — about how the pandemic revealed existing vulnerabilities and weaknesses that need to be addressed. Supply chains, their resilience, and a shift away from some just-in-time supply chains is precisely one of these lessons. As the current semiconductor shortage demonstrates, there are lessons that we are still learning.
At this week’s event, as we discussed the ongoing semiconductor shortage, resulting from what Jimmy Goodman and Susie Armstrong eloquently described as a “perfect storm” of factors currently constraining semiconductor supplies, the vulnerability to something far worse than the current semiconductor shortage became clear. The combination of factors, increased demand, constrained supply, pale in comparison to what a conflict over Taiwan or the Korean Peninsula could do to these supply chains, not to mention future natural disasters of the tectonic, volcanic, or pandemic varieties.
Another key point raised during the discussion, from Susie’s industry perspective, was the importance of the legacy node chips — older chips, less cutting-edge and more commoditized in their sale and production, yet vital to nearly any electronic gizmo ranging from the systems in a Ford F-150 to your dishwasher control panel to the seeker in an AMRAAM missile. In an ever-more connected and digitized society, demand for, and reliance upon, these components will only increase. A difficult dynamic for industry and policymakers is that we must protect the cutting edge technologies, manufacturing tools, components, R&D, and intellectual property, while also acknowledging our dependence on others for basic resources and components, as well as manufacturing. As the Biden administration reviews U.S. strategic supply chains — semiconductors, batteries, rare earths, and pharmaceuticals — it will become clear that this dynamic exists across sectors.
Throughout history, conflict over resources has joined conflict over ideology in the course of competition between powers. In this modern great power competition, how we shape our supply chains and ensure their resilience is the latest version of this conflict over resources. In the dynamics of a modern, globalized economy protecting these supply chains can mean everything from investment review to deterring an invasion of Taiwan. Protecting resources means not only the literal resources, minerals and commodities, but also the intellectual property, talent, and skilled workforce in these vital sectors. The great power competition balance of power is counted in ships, tanks, planes, and missiles, as well as nanometer fabs, contracts, patent filings, and PhDs.
Still, as U.S. policymakers increasingly turn towards what would have once been dismissed as industrial policy, it is important to remember what the respective strengths of government and the private sector are. Again, the lessons of the pandemic with vaccines and medical equipment are useful here. Government can provide the logistical heft, surge capacity, and strategic preparation for crises, including those in strategic supply chains. Yet, innovation, R&D, product planning, and business strategy are best left to the private sector. Government should not pick winners, but it can fuel R&D with grants and tax credits to meet the incentives and subsidies of our competitors. Government should serve as a backstop for when adversaries or natural disasters disrupt commerce, not poor supply chain planning by individual companies. Government and the private sector should work together to balance the need to protect advanced technologies, with an understanding of the realities of global supply chains, commoditized components, and U.S. competitiveness. Finally, the government can lower barriers to trade and international investment with trusted friends. The globalization genie will never go back into its bottle, but a greater emphasis on near-shoring and restructuring supply chains to allies and partners can reduce dependence on Mainland China.
Congress is already moving ahead with measures on R&D, with bipartisan support for measures like the Endless Frontiers Act and CHIPS Act, while the aforementioned administration supply chain review is underway, along with more extensive outreach to allies on critical technologies. We’re moving in the right direction, but we are also catching up with adversaries who have focused on this competition for decades. This current semiconductor shortages—and the other supply chain pressures in critical sectors—are warnings of vulnerabilities we must address. The challenge is to move quickly now, while ensuring the long-term health of the innovation ecosystem that supports our technology leadership.
Israel’s Ongoing Electoral Crisis
Michael Stecher
Israel has been in an ongoing political crisis for the last 2 years. Since April 2019, the country has had 4 general elections, none of which produced stable governing coalitions that survived even a substantial fraction of their terms. In the most recent election, the right-wing Likud Party, headed by Prime Minister Binyamin “Bibi” Netanyahu won the most seats and he was given a mandate by Israeli President Reuven Rivlin to form a government. That mandate expired on Tuesday, and now Rivlin has given the leader of the second-largest party, Yair Lapid, the head of the Yesh Atid Party. Getting a Lapid-led coalition to a majority will require walking a very narrow path and could make some strange bedfellows, but most of the major players involved share one common goal: shuffling Netanyahu off the political stage and making room for the next generation of leaders.
Three factors sit at the heart of this crisis — for this analysis, I am indebted to Noah Millman:
The majority of voters in Israel are aligned with the political right. The right is not a monolith — it breaks down mostly on issues of religion in politics — but right-wing parties won around ⅔ of the vote in the last election
A majority of the right supports Netanyahu to be Prime Minister. Likud is the largest party in the Knesset and, along with the ultra-Orthodox parties and the ultranationalists, Netanyahu had the backing of 52 of the 76 right-of-center members (out of 120 total) of the Knesset to continue as Prime Minister
A majority of the country, however, supports the ABB Bloc (Anyone But Bibi), which is why he could not form a government.
The ABB Coalition is extremely diverse. It stretches from the Social Democratic Meretz Party to the pretty-far-right New Hope Party, whose head, Gideon Sa’ar, was recently described in a piece in the left-wing newspaper Haaretz as “terrifying”. It also includes one of the two Arab Israeli parties, the Joint List, not to be confused with the other, more conservative Arab party, the United Arab List. The United Arab List, better known by its Hebrew acronym Ra’am, has been Bibi-curious in recent weeks, but governing with their support was a red-line for many of Netanyahu’s nationalist allies.
The three leaders of the right-wing-but-ABB parties, New Hope’s Sa’ar (6 seats), Yisrael Beiteinu’s Avigdor Liberman (7 seats), and Yamina’s Naftali Bennett (7 seats) were all once close Netanyahu allies. Sa’ar has had various roles in Likud, including in the Cabinet, but broke with Netanyahu and ran to replace him as party leader in 2019. Liberman was Director-General of Likud when Netanyahu was leader of the opposition and Director-General of the Prime Minister’s Office during Netanyahu’s first term, before breaking off to form his own party that would cater directly to conservative immigrants from the former Soviet Union. Bennett was Netanyahu’s Chief of Staff, but the men now share a deeply personal animosity — for years, Netanyahu’s wife Sara forbade Bennett from entering the prime minister’s residence and tried to plant negative stories about him and his wife in the Israeli media.
Israeli parties are supposed to be flexible, but in recent years they have become expressions of singular leaders. Netanyahu did not begin this trend — that distinction probably goes to Ariel Sharon, who broke away from Likud in order to follow through on his plan to withdraw from the Gaza Strip — but he has been uniquely successful in keeping Likud as a comparatively big tent, while also retaining personal control over most of its functions. Everywhere else of the political spectrum, leaders arise and form their own parties, only to dissolve in short order.
In a sense, Israel has the inverse problem in its political crisis as the United States does. The U.S.’s system works best when its parties are weak, allowing individual legislators to strike bargains to benefit their districts, but partisanship has made compromise nearly impossible when the cameras are on. Israel’s system works best when the parties are strongest; parties horse trade for influence over particular issues that matter to their supporters, but they have become increasingly personalistic in recent decades.
What Bennett, Sa’ar, and Liberman share is a (correct) understanding that Netanyahu is a political vampire. Recent Israeli history is full of political leaders who extracted difficult concessions from Netanyahu to join his coalition, only to find themselves boxed out of important decisions inside the government and punished by their supporters for compromising, and their parties evaporate. Yesh Atid’s leader, Yair Lapid, now has the best chance of anyone in years to cobble together a (please forgive me for using this metaphor) team of rivals to unseat Netanyahu, but it will be difficult.
The outlines of the deal that Lapid would need to strike demonstrate just how hard this is going to be. Liberman and Sa’ar have been vocally ABB since 2019, but many in the ABB camp feared that Bennett would make a separate peace with Netanyahu, and most observers expect that the price that the ABB bloc paid to keep Bennett on-side will be that he will serve as prime minister at the outset, though in rotation with Lapid, despite his party only having 7 seats. That poses a problem for the Arab parties: the Joint List’s leader Ayman Odeh has said that he “would not replace one racist [Netanyahu] with another [Bennett].”
Netanyahu and his allies are also putting the screws to Bennett’s back-benchers, one of whom has already pledged not to support a government in coalition with the left or the Arab parties. All the big names want big ministerial portfolios, and they will need to be carefully balanced. Too many left-wingers and more members of the ABB right might defect, but a majority of this coalition’s support comes from the center and left. Even if they get that balance right, giving each faction the ability to influence policy in key areas but governing by consensus, they still do not have the 61 votes they need.
That means that, in order for this to work at all, at least one of the two Arab parties will have to support the government on votes of confidence. That would be a first in Israeli history and a big win for Arab Israelis. There are areas of overlap for this broad coalition, so it is not impossible — there is probably broad agreement on reducing the role of religion in state functions, for example, and even basic responsibilities like passing a government would be an improvement — but it would be extremely tenuous. Maybe having Netanyahu thundering in opposition will help such a coalition stick together, if it can manage to be formed at all.
Lapid has 28 days to pull this off. After that, there will be a 21-day period where any Member of Knesset can form a government as long as they can get 61 votes, and all bets would be off. If that fails, Knesset dissolves and Israel goes back to its fifth election in less than 3 years. Israel would continue to muddle through with a caretaker government and Netanyahu’s trial for corruption would move slowly towards its conclusion. The ABB bloc is currently projecting confidence that they can make it happen, but of course they would at this point. 2 months from now, Israel will either have a government that walks a tightrope every day or begin a new round of elections. Either way, as long as the right remains in the majority, a majority of the right supports Netanyahu, and a majority of the country opposes him, governance will remain in short supply.
When the U.S. builds ships, China builds islands
Ethan Brown
China continues its east-ward expansion across the Pacific theater with a bold new thrust: plans were recently unveiled regarding an old airbase and bridge system on Kiribati island under China’s intent to upgrade and revitalize the facilities. A Kiribati opposition lawmaker named Tessi Lambourne told Reuters that she was particularly concerned about the project, as it was unclear if this fell within the Belt and Road (and island?) Initiative, or something else entirely. Yes, the headline on this column is trope-y in that building islands is not a new vector for the Chinese Communist Party, but the location — deep in the shipping lanes used by the international order, and particularly between the United States and its South Pacific partners in New Zealand and Australia — sets a new benchmark for Chinese expansionist aggression in maritime endeavors.
The Kiribati Island Group lies in close proximity to the Gilbert Islands chain, and the tiny Republic presides over the Line and Phoenix group islands, occupying about 1000km of surface area in the central Pacific. Despite the small population and entirety of the nation being no more than 1m above sea level, Kiribati controls one of the worlds largest economic exclusion zones, over 3.5 million square km of ocean. The island chains under Kiribati purview are notorious for hosting some of the bloodiest battles of the theater in World War II. Some names related to Kiribati carry the somber weight of that conflict — Tarawa, the Butaritari Atoll, and Betio (location of Operation Galvanic) — all of which were subject to Imperial Japanese conquest in the days following the December 7th attacks that ushered the United States into the global conflagration.
Today, pillboxes, bunkers, coastal defense guns, and various military vehicle wrecks still line many of these beaches in and around Kiribati. Japan’s military forces saw Kiribati and the Gilberts as a critical node in surging their furthest defense perimeter around the Pacific rim, and as such, American strategic planners knew early on that retaking the Kiribati and Gilbert chains would be critical in pushing back the rising sun. I would go into more detail and then fail to bring this column back to the policy issues of Chinese aggression, so I must suggest Ian Toll’s Pacific War Trilogy — a far superior retelling of the conflict that raged across these islands.
The plans for China’s ambitions center on the Kanton Atoll, and although those planning materials have not been publicly released, this is notable on the geopolitical scale for multiple reasons. First, Kiribati’s President Taneti Maamau won a narrow electoral victory in 2019, running on a pro-China platform after having led the nation’s efforts to sever diplomatic ties with Taiwan. Kanton has historically hosted a myriad of U.S. space and missile tracking missions in preceding decades, making the recent lean towards China concerning to American and allied strategists. Academic investigation in 2019 by the Australian Strategic Policy Institute identified Kiribati as a primary target for Chinese expansion due to its economic value and strategic location, findings which soon led Beijing to label the ASPI as “anti-Chinese” rhetoric. On brand rhetorically, a senior advisor to Pacific governments (kept anonymous per Reuters reporting based on the sensitivity of the issue) has dubbed the Kanton plans “China’s Fixed Aircraft carrier”.
Where the United States is concerned, the ‘loss’ of Kiribati as a strategic partner to rival Beijing would be profound, particularly considering the proximity to key defense nodes like Oahu, Midway, and Guam. Kiribati would put Chinese resources — especially the potential intelligence collection ilk and those affecting the sensitive environment of the subsistence population — closer to the homeland than any existing forward site (publicly known at least). The politics in the Pacific have not been kind to the United States in recent years, with the Solomon Islands also taking a pro-China platform, further isolating pro-U.S. Taiwan in the trans-Pacific arena. A reconstructed operating base in Kiribati, potentially positioned to interdict global shipping lanes, or at least bend such traffic to the economic authoritarianism of Beijing, would dramatically alter the balance of power in this current era of strategic competition (#GPC is so 2020). This is to say nothing of the potential proximate offensive threat of PLA assets within striking distance of Hawaii (now go read Austin Cole and P.W. Singers “Ghost Fleet”).
A recent interview I conducted with some members of the SOCOM community yielded some interesting factoids about the new era of post-Afghanistan conflict, and Kiribati falling under Chinese Communist influence exemplifies some of those findings. The unfortunate reality is that while we in the policy, defense and strategy communities rely on the concept of ‘great powers’ competition and liminal conflict, what exactly that term constitutes remains a vague direction in which to funnel our strategic resources against a changing international order. Undoubtedly, the ripple effects of these plans in Kanton demonstrate that while we in the U.S. are still arguing over what is and isn’t part of strategic competition, our rivals and adversaries aren’t bothering to wait for proper terminology and doctrine to become indoctrinated, they are out there in the reaches competing their tails off, while we’ve allowed low-yield priorities like Afghanistan to erode readiness for such competition. In the near term, the coming budget crunch between the service branches will further constrain the defense enterprise, and a location like the Kanton Atoll could well fade into Beijing’s shadow, representing a missed critical opportunity for partnership building, as diplomatic and defense priorities are slow to align policies.
Francis Fukuyama’s “Political Order” Volume One (yes, I’m digging hard for source material this week) concludes with the assertion that locales will change socially and politically within modernity’s globalization theory, when even austere locales adapt to the current world order with new technology and shrinking spheres of influence via economic cooperation, or co-opting, as in the case of China’s Belt and Road Initiative in Kiribati. The Pacific, generally considered to be a bulwark against threats to the U.S. homeland due to the sheer expanse, gets smaller every day.
U.S.-Russian Relations Worse than the Cold War, According to Moscow
Joshua C. Huminski
According to Russia’s Foreign Minister, Sergey Lavrov, the relationship with the United States is at a worse position than even during the Cold War due to a lack of mutual respect. Speaking with Dmitry Kiselyov, the host of a weekly news program on Russian state television, Lavrov said, “During the Cold War, the tensions were flying high, and risky crisis situations often emerged, but there was also a mutual respect.” He added, “It seems to me there is a deficit of it now.”
Lavrov’s comments follow a tumultuous period in which Russian forces withdrew from Ukraine’s border, Washington applied new and robust sanctions against Moscow for election interference and the SolarWinds hack, and Russia announced that the United States would top the list of “unfriendly” countries, which bans Russian citizens from working in those countries’ diplomatic missions.
Some 80,000 troops remain near the border, down from the 100,000 estimated as part of the largest deployment of Russian troops since the 2014 annexation of Crimea. Russia denied that the troop deployments were anything other than a test of the forces’ readiness. The exercises ended on April 22 and forces were due to return by May 1. Defense minister Sergei Shoigu said the forces, “demonstrated their capacity for solid national defense.” That said, Shoigu noted that arms and equipment would be stored near Voronezh, some 100 miles from the Ukrainian border for use later in the year.
While there was, and remains, a dispute over whether or not the forces were intended as a demonstration or coercive diplomacy, or a prelude to an escalation, that misses the point — deployed and mobilized forces could well be used for intervention. A U.S. official noted that the forces still remain a threat, and, according to Secretary of State Antony Blinken said, “If Russia chooses to act recklessly or aggressively, we’ll respond… But we’re not looking to escalate.”
In the case of the sanctions, the White House appears to believe that the sanctions resulted in the drawdown of the forces. Daleep Singh, a White House international economic aide said, “Our intention was to act in a proportionate manner, and to be targeted in our approach, and to signal that we had the capacity to impose far greater costs if Russia continued or escalated its behavior.” Singh added, “The results so far have been pretty close to what we had hoped for.”
The White House’s expectations that the sanctions worked is far too assertive and unjustified by the evidence at hand. The sanctions’ imposition and the withdrawal of the forces may be correlated but correlation is not causation. For one, the new round of sanctions was unlikely to have taken full effect by the time the withdrawal was announced. It also assumes that the troop build-up was solely aimed at provoking a response from the United States. Again, it may have been part of it, but it likely was also aimed at Kiev, NATO, and domestic audiences. In the case of the former, it was likely part of coercive diplomacy. In the case of the latter, it fits with President Putin’s effort to gin up tensions and gain domestic support.
That Lavrov made these comments on Kiselyov’s program is not surprising. Kiselyov is a notorious propagandist for the Kremlin and hosts one of the more hyperbolic programs on Russian state television. As with Putin’s attempts to mobilize domestic opinion and support through the Ukraine deployment, Lavrov’s remarks are intended to whip up popular sentiment against the United States and the West, and to portray Russia as under siege from the international community.
To be sure, relations are more contentious and adversarial than in recent years, but to say that they are worse than the Cold War is certainly an exaggeration. From Russia’s perspective, the largely unified response (certainly in comparison with recent years) from the West in response to Moscow’s actions is alarming. Moscow may have played its hand too aggressively and, in turn, created a self-fulfilling prophecy. What comes next will define the direction of the relationship. In his remarks Lavrov also noted that it has a “positive” attitude towards the Biden administration’s proposal to hold a summit with Putin, but it needs to analyze all aspects of the proposal, so the door is not fully closed; even during the Cold War Moscow and Washington maintained an open dialogue.
News You May Have Missed
Ok, that might be a slightly exaggerated take on the situation. The border between France and Belgium was laid out in the 1820 Treaty of Kortrijk and a series of 300 pound stones were set along the border to mark it. A farmer in the Belgian village of Erquelinnes, however, did not see the legacy of hard fought negotiations by 19th Century diplomats. He saw a big, heavy stone in his field, so he moved about 7’ into France. A group of French citizens who go on day hikes along the border to check the stones for some reason spotted that it was out of place and reported it to the authorities. Government officials expressed hope that the farmer can be convinced to move the stone back, but suggested that a bilateral commission may be set up to adjudicate the issue. No military forces have been mobilized in response to this incident … yet.
Royal Navy, French Boats in Standoff Near Jersey
Readers may recall that one of the final hangups to the Brexit negotiations was fishing rights for European fisherman in UK territorial waters. The Crown Dependency of Jersey, one of the Channel Islands directly off the French coast, has begun issuing licenses for French fishing boats to operate in Jersey’s territorial waters. Several French fisherman are protesting that their allotments are insufficient. Two French police boats and two Royal Navy patrol boats have been dispatched to monitor the situation. The British tabloids and French politicians, of course, are showing their usual restraint, or lack thereof, in coverage.
Rio de Janeiro Residents Accuse Police of Executions
In the latest of long-running battles with police and complaints by residents of favelas, or Brazil’s notoriously lawless slums, police are accused of abuses and extrajudicial executions in the latest violence which left 25 dead, including one officer. This latest raid involved over 200 police, armored vehicles, and helicopter-borne snipers. Human rights groups and Amnesty International have described scenes of violence, bloodshed, and evidence of forensic manipulation.
The views of authors are their own, and not that of CSPC.