Keen readers of danieldrezner.com may have noticed that I haven't blogged much about offshore outsourcing since my NYT op-ed in late September. This has been for several reasons:

a) I had a book manuscript to finish;
b) There was an election occupying my attention;
c) I was a bit burned out on the topic.

Well, the election is over, the book manuscript is off my desk, and a few months have passed since I've blogged about the topic. So... I'm back, baby!!

So what's been written that's worth reading on the topic since I've been away?

A couple of selections:

1) Mary Amiti and Shang-Jin Wei, "Fear of Service Outsourcing: Is It Justified?" Their answer would appear to be no:

The recent media and political attention on service outsourcing from developed to developing countries gives the impression that outsourcing is exploding. As a result, workers in industrial countries are anxious about job losses. This paper aims to establish what are the hypes and what are the facts. The results show that although service outsourcing has been steadily increasing it is still very low, and that in the United States and many other industrial countries “insourcing” is greater than outsourcing. Using the United Kingdom as a case study, we find that job growth at a sectoral level is not negatively related to service outsourcing.

Here's a link to a more accessible precis, which closes with the following:

Although service outsourcing is growing rapidly, it still remains a small fraction of industrial countries’ GDP. And it is not dominated by lopsided, one-way outsourcing from developed to developing countries. In fact, most industrial countries do not outsource more (when adjusted for economic size) than many developing countries. The United States, for example, which is a large importer of business services, is also a large exporter of these services and, as has been noted, has a growing net surplus in business service trade.

As for fears about job loss, our studies show that jobs are not being exported, on net, from industrial countries to developing countries as a result of outsourcing. In fact, the evidence suggests that job losses in one industry often are offset by jobs created in other growing industries. (emphasis added)

One problem with this study is that the data stop in 2002 -- and, to be fair, most opponents of offshore outsourcing argue that the phenomenon didn't really heat up until the last two years.

2) Kate Bronfenbrenner and Stephanie Luce, "The Changing Nature of Corporate Global Restructuring." This report was prepared for the US-China Economic and Security Review Commission (USCC) and argues that existing estimates of job losses due to offshoring have been underestimated. From the executive summary:

Despite the increasing amount of trade between China and the US, and the increase in foreign direct investment from the US into China, there is no government body that collects information detailing the incidence of production shifts out of the US to China or any other country.... In order to conduct this research we developed a methodology that involves a combination of online media tracking and corporate research and the creation of a database including information on all production shifts announced or confirmed in the media during that period. In July 2004 the USCC asked us to update that research, starting with an initial period of January 1 through March 31, 2004....

Altogether we found announcements or confirmations for shifts of 48,417 jobs out of the US to other countries in January-March including 23,396 to Mexico, 8,283 to China, 3,895 to India, 5,511 to other Latin American countries, 4,419 to other Asian countries, and 2,933 to all other countries. Based on our estimates that media tracking captures approximately two-thirds of production shifts to Mexico and about a third of production estimates to other countries, these data suggest that in 2004 as many as 406,000 jobs will be shifted from the US to other countries compared to 204,000 jobs in 2001.

This is a serious study, and does a good job of suggesting that the Bureau of Labor Statistics has underestimated the raw number (though not necessarily the percentage) of jobs lost through offshoring in the first quarter of this year. However, that topline number seems based on some dodgy assumptions and serious guesstimation. And be sure to read pages 8-16 to get a sense of their methodology -- it's still unclear to me whether their count includes all actual and announced plant closings/layoffs during that time period, or just one or the other.

3) The University of South Florida's Globalization Research center commissioned Innovation Insight to produce a report, "Baseline Analysis of Offshoring in the Tampa Bay Region." From the executive summary:

The Tampa Bay region is estimated to have imported approximately $627 million in “other” private services from the US and abroad in 2002, including $33 million in fi nancial services, $97 million in business and professional services, and approximately $12 million in information technology (database plus computer services). However, the Tampa Bay has a signifi cant import/export surplus when it comes to private services; for all “other” private services combined, the region exported $478 million more than it imported in 2002.

Offshoring practices are increasing the demand for selected “soft skills” in US employees, in particular project management and defi nition skills, fl exibility, cultural sensitivity and facility, training, creativity, and organization skills.

Take those numbers with a small grain of salt. This paragraph best expresses the sentiment of the report:

We explored analysis, statistics, and relations between a number of other data sources for evidence of employment shifts caused by offshore outsourcing. Unfortunately, the US economy has demonstrated some large employment shifts away from agriculture, mining, and manufacturing into service and professional industries, and has also has seen its unemployment levels rise and fall during recent recessions. Tampa Bay’s economy refl ects national economic trends; our findings suggest that if an intra-sector shift (from one occupation or industry category to another) due to offshoring exists, it is so small compared to ongoing large scale (macro) employment shifts that it is effectively obscured. In other words, given existing data sources, it is difficult to tell which occupations are changing specifically due to offshoring or just the evolution of the national economic structure.

4) Finally, do check out Corante's new blog on outsourcing, which takes a critical view of the phenomenon (link via Tyler Cowen).

Thanks to Bruce Bartlett and Amardeep Singh for being good enough to help keep me up to speed.

I urge any and all readers to click over to the 2004 Weblog Awards and vote among the myriad categories. Unbeknownst to me -- thanks to R.H. for the link -- I see that I'm nominated for "Best of the Top 100 Blogs".

So... vote for me, dammit!! I've never won one of these awards, and if at all possible I'd like to avoid becoming the Harold Stassen of the blogosphere. And, looking at the voting to date, I appear to be getting my ass kicked. UPDATE: Ah, now I see why I'm getting my ass kicked -- Megan McArdle is playing dirty -- really, really dirty.

Logicians among the readership are invited to reconcile the conundrum of how the Best of the Top 100 Blogs would not therefore better than the Best Overall Blog -- since all of them are Top 100 blogs.

The Ukrainian Supreme Court has now declared the presidential runoff election results invalid -- and has ordered that a repeat of the runoff be re-staged throughout the entire country on December 26. The Ukrainian parliament speaker has already urged the implementation of the Supreme Court ruling.

All of this comes less than 24 hours after Russian President Vladimir Putin slammed the idea of holding a runoff election. (click on this San Jose Mercury News timeline for the backstory.] After President Bush made a rhetorical push-back, Putin responded today by muttering dark warnings about the unipolar world:

"Attempts to rebuild the multifaceted and diverse modern civilization, created by God, in line with the barrack room principles of a unipolar world appear to be extremely dangerous," Putin said in a speech at the Jawaharlal Nehru Memorial Fund in New Delhi.

"The more persistently and effectively the authors and followers of this idea act the more often mankind will come up against dangerous disproportions in economic and social development and against global threats of international terrorism, organized crime, and drug traffic," he said.

What's becoming clear is that the correlation of forces within Ukraine are tilting in favor of a runoff election that would presumably lift Viktor Yushchenko to power. The emerging question is whether the correlation of forces outside Ukraine will permit this to happen. Will Putin tolerate the blow to his reputation that would come with a Yushchenko victory (remember, he and his administration campaigned hard for Yanukovich)?

Still developing....

It looks like the Bush administration has reached the same conclusions as danieldrezner.com about the cost of taking the Boeing/Airbus dispute to the World Trade Organization. Edward Alden reports on the U.S. decision in the Financial Times:

The US will offer an olive branch to Peter Mandelson, the European Union's new trade commissioner, next week by delaying any escalation of the dispute over subsidies to Airbus and Boeing, a US trade official said on Thursday.

The move means Washington will wait until early next year before deciding whether to seek formal settlement of the dispute before a World Trade Organisation panel.

Robert Zoellick, the US trade representative, and Mr Mandelson are set to meet for the first time on Monday in Paris. Mr Zoellick is attending a conference in France before travelling to Africa....

“While no one should doubt our resolve to press ahead with this case, we want to give the new trade commissioner time to review the issue,” the US official said.

Washington's decision may fuel speculation in Brussels that the US no longer intends to push the issue now that the November presidential elections are safely behind. EU officials have charged that the case was politically motivated.

As the story suggests, this could heat up again early next year. But it's good to see the administration attempt another bilateral accomodation.

I initially feared that the general interest book for December may not necessarily of general interest, since it's Faithful: Two Diehard Boston Red Sox Fans Chronicle the Historic 2004 Season by Stewart O'Nan and Stephen King. However, then I remembered that this would be the pefect stocking stuffer for anyone who hates the Yankees, which accesses a broad spectrum of Americans. Publisher's Weekly says that, "Of all the books that will examine the Boston Red Sox's stunning come-from-behind 2004 ALCS win over the Yankees and subsequent World Series victory, none will have this book's warmth, personality or depth." That's good enough for me! Well, that plus the awesome cover photo.

The international relations book this time around is an oldie but a goodie -- Kenneth Waltz's Man, The State, and War. In my Classics of International Relations Theory class this year, this book easily sparked the most animated discussion. The reason is that this text -- in combination with Thomas Schelling's The Strategy of Conflict -- transformed the way people (or at least Americans) studied international relations.

Prior to Waltz, the great books in international relations either had a strong teleology embedded in their theory (Kant, Lenin) or came at the problem of international relations from a normative cast that colored their positive analysis (Hobbes, Angell, even Morgenthau).

After Man, The State, and War, the discipline underwent two changes -- first, it took on a much more positivist cast. The question of how to stop war was supplanted by the analysis of determining the causes of war. Although there is a normative explanation for this -- it is foolhardy to try and prevent war without understanding the causes of the phenomenon -- it has led to the discipline as a whole to shrink away from making policy prescriptions. Second, the field of study slowly shifted its explanations away from individual or even domestic-level approaches. Instead, the "system of states" -- i.e., the implications of anarchy at the global level -- became the overriding concern.

[Why not recommend Waltz's even-more-influential Theory of International Politics?--ed. As Henry Farrell points out, the price gouging on that book is pretty appalling.]

Another reason for recommending Waltz is this October address by Mitchell Reiss, the Director of Policy Planning for the State Department. The speech tries to place the Bush administration's foreign policy within the context of Waltz's Man, The State and War. It's certainly an interesting intellectual exercise -- though Reiss diplomatically elides Waltz's attack on assertive Wilsonianism -- the neoconservatism of its day.

Amanda Butler has an amusing post at Crescat Sententia about what it's like to celebrate Thanksiving in an ex-Soviet republic. That, plus the high stakes in Ukraine, caused me to open up the electronic diary I kept of the year I spent in Ukraine as a Civic Education Project lecturer to see how we celebrated Thanksgiving circa 1993.

Long diary entry after the jump...

11/27/93: I'm typing this in the Palace Hotel in Yalta. The trip here was interesting. Yalta is in the Crimea, which is supposed to be the garden spot of Ukraine. After a pleasant overnight trip, we got of at Simferapol and were greeted by a biting wind, snow blowing everywhere, and a temperature colder than in Donetsk. We were met by a guy from the local Renaissance foundation, who proved useless. We asked him where we could get tickets back to Donetsk; he answered that it was in the city centre. We then asked him repeatedly if there was an Intourist office at the train station; he said that you could only buy tickets there for the next day. It turned out later that he was of course wrong. It's real pathetic when I know more about how the system operates than the locals.

We hopped a minibus to Yalta; it's a two-hour drive. The snow was unusual for this area. This perhaps explained why they were throwing sand on the road by hand.

Yalta has a certain charm, there's no denying it. It existed prior to the USSR, which perhaps explains it. The streets are narrow and winding, and resemble the French Riviera, except there are no good restaurants, and people are much less snobbish. The boardwalk on the shore is lined with palm trees, and bears a more than passing resemblance to the Coisette in Cannes. Our hotel has high ceilings, spacious rooms, and constant power outages. It's also not prepared for subzero temperatures, so it is a tad cold in here. We had fun today, playing on the bumper cars. Lunch today was eaten to the sountracks of The Good, the Bad, and the Ugly, The Karate Kid, and something by Zamfir, Master of the Pan Flute. Actually, all we had was soup, but despite that fact we had to shell out 70,000 koupons [at the time, about $15] apiece. My guess is that the restaurant was pissed at us for ordering only soup, and therefore overcharged.

After this, we walked to the Hotel Yalta, a mammoth construction built by the Yugoslavs (yeah, they really knew how to hold things together) in the early 70's. In typical fashion, they built the hotel so that it's long side runs perpendicular to the ocean. Nothing is as depressing as a tourist hotel out of season, unless it's a Soviet hotel out of season. The building was 20 floors, with perhaps 50 rooms in each floor. Occupancy was maybe 10% now. The lobby level had tons of little shops which sold western products at outrageously high prices. To get down to the beach level, you have to take an elevator and then walk through a tunnel straight out of a nuclear shelter. On this level there was some more shops, a sauna, and a great Chinese restaurant, with the following dishes (the names are in English):

1) Macaroni and Meat
2) French Fried Meat
3) Meat and Mash Beans
4) Roasted Meat and Cauliflower
5) Roasted Beef on Iron Board (?!)
6) Pork with Onion

You get the idea. The place was obviously catering to westerners. There were signs for everything in at least German and English in addition to Russian. The service was, however, a bit lacking. We wanted to rent out a sauna room for CEP, and was told that the sauna was only open in the daytime until 5 PM, and that it would be impossible to use it after that. This begs the question: who exactly did they build this hotel for? It's too expensive for Russians and too inadequate for westerners. It was pointed out to me at this point that there are a lot of stupid westerners. Maybe so; after all, I'm here.

11/27/93: Whew, Lord, where to begin. Yesterday we went back to the Hotel Yalta to use the sauna. It was about ten of us. We get to the service desk, and they tell us it's not possible, the saunas are reserved now. I got very angry in Russian at him, and we started arguing. Finally, in a fit of pique, he said, "What is it with you Americans?! Why do you think that if you come you can do something immediately?"

I was tempted to answer, "Because there's a service sector in our economy, you nimrod." but didn't. Americans are a blunt bunch, but we are also pragmatic. Instead, I mentioned casually that there were ten of us, and that perhaps we would return several times to use it in the spring if we came back to Yalta. At this point, he quickly changed his tune, called another hotel, and booked us in a sauna there, which he frankly said was better. We all hopped into a minivan, and a guy drove us to the neighboring hotel and fixed us up in the sauna. We were given the run of a sauna (which had a tea room) and access to a swimming pool for three hours, for the princely sum of $25. Now this was decadence.

Even though it was a day late, we had a wonderful Thanksgiving dinner, with all the trimmings (the turkeys were imported from Georgia). Just like a Thanksgiving dinner in the states, the side dishes were finished too soon and there was leftover turkey. Dinner was slightly delayed, because the power went out in the hotel several times. This has been a common problem in Yalta. The Crimean peninsula does not have its own functioning power station. An atomic plant was built several years ago, but it was so obviously unsafe that it was never switched on.

That night we went drinking in the hotel bar. We were the only westerners in the bar. During the evening, one of the locals dragged me from our table and offered me a vodka shot in the spirit of American Ukrainian friendship. This is a common practice. It is telling that I immediately downed the shot, said thank you, and walked back to my table as if nothing had happened. I've been in this country too long.

That night I got dressed up to go visit a local casino, the Casino 777. There had been signs all over, and I haven't been to one yet in this country (or my country, for that matter). I bought 15 dollars worth of chips (denominated in rubles, interestingly enough). The place was very nice, with maybe 10 blackjack and roulette tables. Each table had a rather attractive woman who dealt cards with as much dexterity as in Las Vegas. The bar was well stocked. Unfortunately, there was no one gambling. Admittedly, it's out of season, but on a Saturday night, it was astonishing to see this many people employed, doing nothing.

There was one other person gambling, a 40-year old man, and he was speaking only English with an Irish accent. His dress was Hollywood: Blazer over unbuttoned black silk shirts with lots of jewelry, and the week-old beard. I watched him lose about 150 dollars. I introduced myself, and, as I was only speaking Russian until that time, shocked the hell out of him. He was so pleased to see a Westerner that he bought me drinks for the rest of the night. I had the best vodka-tonics I have ever had (Schweppes bitter lemon and Absolut, with ice) and spent the better part of two hours with a wonderful Paddy named D----.

He's an actor in a BBC movie, starring Sean Bean, being shot here called "Sharp" (It will also be shown on Masterpiece Theatre). The movie is set in 1810 Spain, but being shot here. The reason, Darra explained, was that this movie needed a lot of extras and the Ukrainians are cheap. One of the dealers was an extra and paid only 9,000 kps a day (the wage was fixed from August). They had hired an entire army company to play a part in the movies, and every day they have to leave Simferapol at 3:00 AM to get to Yalta in time for shooting. The cast and crew of 400 were staying in a sanitorium, and the meals were catered. Apparently this caused almost 530 people to show up regularly for the lunch.

We had the usual conversation about life here, and he was just flummoxed by the place. I don't know how healthy it was for him to be here. He mentioned that he hadn't had a drink for five years before this shoot, but he was slurring his words badly (the woman behind the bar told me in Russian that she liked him, but thought he drank too much. That's something for a Russian to say). Of course, he mentioned the women. His problem is even worse than mine; he had a 16-year old interpreter blatantly offer sex. Apparently, during the shoot last year, 12 members of the cast and crew got the clap.

Paddy's view of this place was gloomy. He had been here last year for twenty weeks as well, and said that people were much less hopeful. He said, "I'm a Paddy, for Chrissakes, we have the worst poverty in Europe, and we're still hopeful. An Irishman would always be cheerful, but even I've become cynical about this place."

A year ago, lexicographers said that blogs were hip and trendy. Now the Associated Press reports the following:

The most requested online definition this year was "blog" - a word not even yet officially in the dictionary, Merriam-Webster says.

Editors had planned to include "blog" - the short term for Web log - in the 2005 annual update of both the print and online versions of Merriam-Webster's 11th Collegiate Dictionary, said Arthur Bicknell, spokesman for the dictionary publisher.

But in face of demand, the company quickly added an early definition to some of its online sites, defining "blog" as "a Web site that contains an online personal journal with reflections, comments, and often hyperlinks provided by the writer."

Typically, it takes about 20 years of usage for a word to become prominent enough to merit a place in an abridged dictionary. Some Internet terms and new diseases, such as AIDS and SARS, have made it in a fraction of that time.

"Blog" began appearing in newspapers and magazines in 1999, according to the publisher's records. Merriam's lexicographers suspect the prominence blogs attained during the presidential campaigns and conventions this year sent people scrambling for a definition.

Link via Tom Sullivan. From an international relations perspective, I'm intrigued to see that "sovereignty" came in ninth by their metric of popularity.

UPDATE: If Microsoft has its way, you will become one with the blog.

I believe I am officially the last scholar-blogger in America to point out that Gary Becker and Richard Posner have decided to start a blog together. It's a testimony to their intellectual heft that their "test" post already has sixteen trackbacks. Having participated in workshops with both of them, all I can say is that the rest of the blogosphere is in for a treat.

Henry Farrell makes a keen observation about the legitimation effects of senior scholars taking up blogging:

There are lots and lots of philosophy blogs and law blogs, but many other academic disciplines, including economics, seem surprisingly under-represented in the blogosphere. I suspect that one of the important causal factors is legitimation. Junior academics may be unwilling to get involved in blogging. Not only is it a time-suck, but it may seem faintly disreputable - senior scholars in many fields of the social sciences take a dim view of ‘popularizing.’ However if there is a well known senior scholar in a discipline who blogs, it’s much easier for junior people in that discipline to dip their toes in the water without worrying that it’ll hurt their tenure chances.

Hmmm.... this leads to a small problem for Henry and myself. As one of the commenters to Henry's post points out, "I’ve noticed this lack of blogging from big names in my own field of political science." Indeed, perusing Crooked Timber's list of poli sci bloggers, I certainly do not see anyone approaching the stature that Becker or Posner have in their fields. To go further, there is no tenured political scientist at a top twenty institution who also blogs (see below).

[Insert sound of lonely wind blowing here--ed.]

To which I say.... shame on my tenured brethren!! To be sure, a lot of blogging (and some of my blogging) is entirely unrelated to matters of scholarship -- but that doesn't mean it has to be this way. Tyler Cowen has an excellent post in response to Eszter Hargittai on how blogging and scholarship are compliments rather than substitutes. Surely these reasons must be persuasive to some of my letter-writers for tenure senior people in political science!

Readers both in an out of political science are hereby invited to suggest which senior political scientist they would like to see start a blog. Must be someone who holds a Ph.D. in political science and holds a full-time tenured position at a Ph.D.-granting institution [Doesn't that impose some ideological constraints?--ed. Feh -- as Jonah Goldberg put it, "wrong and liberal are not synonymous terms."]

UPDATE: Hey, it turns out there is a tenured political scientist at a top twenty institution who's a blogger. Michael Munger -- chair of the department of political science at Duke, former president of the Public Choice Society, a prolific scholar who lists his occupation as "professional wrestler" in his Blogger Profile -- has had a blog since June of this year.

[He also appears to be threatening you with bodily harm--ed. Oh, yeah??!! Like I'm really scared of some newbie, candy-assed, penny-ante North Carolina blogger who calls himself "KGrease"? Bring it on, Duke boy!!! I'm not sure this kind of discourse is going to encourage other tenured faculty to start blogging--ed.]

It's dangerous to ascribe a common set of preferences to the heterogeneous collection of NGOs, social movements, activist networks, charities, churches, and even some individual philanthropists that comprise "global civil society." But most people who study these entities would acknowledge a rough consensus among these groups that a) genetically-modified organisms (GMOs) should be regulated to within an inch of their existence; and b) land mines are evil and should be banned.

So I wonder which side of the fence these groups will fall on when they read about this tidbit blogged by Warren Ginn:

A Danish company, Aresa Biodetection, has developed genetically-modified flowers that change color when their roots come in contact with nitrogen dioxide in the soil. Explosives used in mines produce NO2 as the chemicals gradually decay. The company plans to sow fields of NO2-sniffing Arabidopsis thaliana (Thale or mouse cress) in areas riddled with long-forgotten ordinance from Angola to Cambodia.

Link via Virginia Postrel.

Aresa's web site has this to say on how these GM products would accelerate land mine removal:

There is only one method with global validity for the removal of landmines. This method (prodding) consists of putting a stick into the ground, locate the mine, remove it and detonate it. It is highly time consuming and risky....

By adding our process to the current prodding or other processes, we expect to represent the most cost efficient method ever invented, and increase speed for projects by a factor of 10 times. At the same time the risk will be reduced significantly, as mines will be located before prodding and removal takes place.

Pretty cool.

Thank God the Bush administration is protecting me and other consumers from.... cheap seafood. Jeffrey Sparshott explains the Bush administration's heroic act of protectionism in the Washington Times:

The Bush administration yesterday said Chinese and Vietnamese shrimp are sold at unfairly low prices in the United States, siding with U.S. fishermen as they try to fend off overseas competition.

The decision reaffirms new trade barriers on the country's most popular seafood, though the new duties meant to counter the competition are not as high as requested by the industry.

"Although U.S. shrimpers believe the [Commerce] Department understates the amount of dumping in certain instances, they reaffirm our contention that shrimp is dumped in the U.S. market," said Eddie Gordon, president of the Southern Shrimp Alliance, which represents shrimpers from North Carolina, South Carolina, Georgia, Florida, Alabama, Mississippi, Louisiana and Texas....

U.S. importers expect to pay more for shrimp from the two countries, though the impact on consumers is unclear.

"We're just looking at a very small segment of the market," said James Jochum, assistant secretary of commerce for import administration. "Putting on these various duties ... it's very unclear the direct impact it may have on prices."

The U.S. shrimp industry contends there will be no impact, though importers warn that prices certainly will rise.

One wonders... if consumer prices won't be affected, why would the Southern Shrimp Alliance seek protection in the first place?

The Economist has an update on the brutal competition between Airbus and Boeing. The highlights:

It is always the way with Airbuses: you wait for years, and then three come along at once. In January, the European aircraft manufacturer will roll out the first of its A380 super-jumbos, in preparation for its first test flight by the end of March. Before that, however, it is set to unveil plans for two versions of a smaller, wide-bodied plane, aimed at the mid-sized market.

The rivalry between Boeing and Airbus, the big commercial-aircraft duopoly, has never been more intense. While Boeing struggles to persuade mainstream airlines to buy its latest offering, the 250-seater 7E7, Airbus will soon announce two versions of a new plane, dubbed the A350, to attack it head on....

At its next meeting, on December 10th, the board of the parent company of Airbus, European Aeronautic Defence and Space company (EADS), is expected to rubber-stamp a decision to launch two souped-up versions of its A330, fitted with new wings and engines to increase the range and carrying capacity and so compete with Boeing’s plane. Boeing’s new design claims to offer savings of 15-20% on fuel by making extensive use of lightweight composite materials instead of the usual aluminium.

Anticipating Airbus’s response, last month Boeing persuaded the American government to complain to the World Trade Organisation (WTO) about the subsidies Airbus receives from European governments. Refundable launch aid from Germany, France, Britain and Spain could cover one-third of the over €3 billion cost of developing the A350. Crucially, this aid does not have to be repaid if a plane flops, giving Airbus an unfair advantage in product development, which it has ruthlessly exploited in the past decade.

Boeing is spending almost $6 billion to develop the 7E7, with further contributions from its partners in Japan and Italy. The European Union is counter-protesting to the WTO that Boeing gets all sorts of indirect aid from the American government.

The likeliest result is that both sides are found guilty of breaking the rules but that subsidy continues to flow.

I suspect the Economist is correct. The trouble with this case is that the fixed costs for commercial aircraft are high enough to ensure increasing returns to scale for the entire market. Which means that this may be one of those situations where strategic trade theory applies.

Which means that the WTO is ill-suited to resolving this dispute.

Andrew Martin has a fascinating front-pager in today's Chicago Tribune about how rising immigration from less developed countries into the United States is altering the mix of goods that American farmers cultivate:

A growing demand for goat meat among New York City Muslims has been a boon to a livestock auction tucked away in the middle of Amish country.

Here, where a covered shelter in a parking lot keeps Amish buggies dry when it rains, Mohammad Khalid arrives from Queens every Monday morning to buy as many as 50 goats, which end up in the meat case of Queens Discount Halal Meat by Wednesday afternoon.

"A good goat is a Boer goat," said Khalid, a Pakistani immigrant, pointing to a redheaded goat standing in a pen with his other purchases, all of them bleating and staring nervously at their new owner. "It's very good meat. Tender."

Khalid is one of a handful of Muslim buyers who trek to New Holland every week to buy goats and, to a lesser extent, sheep, for Muslim markets in New York and other East Coast cities.

While the idea of eating goat is considered distasteful by some in the United States, goat is the primary meat dish in many parts of the world. With the number of immigrants arriving from the Middle East, Mexico and Asia surging, so, too, does the demand for goat meat.

According to the most recent Census of Agriculture, which the Department of Agriculture publishes every five years, goats are among the fastest growing sectors of the livestock industry. The number of goats raised annually for meat increased from 1.2 million to 1.9 million--a jump of 58 percent--from 1997 to 2002. The number of farms that raise meat goats grew to 74,980 from 63,422.

"If you want to know who eats goat, it's anybody but white people, descendants of Northern Europe," said Susan Schoenian, a sheep and goat specialist with the University of Maryland extension service. "Now all the immigrants come from every other part of the world, and they all come from goat-eating parts of the world."

Many Muslims and Jews, for example, don't eat pork and Hindus and Sikhs do not generally eat beef.

"Goats cut across all religions," she added. "There's no taboos against eating goats. They are raised all over the Third World because they don't need a lot."

....by far the biggest state for goat meat--those raised specifically to be eaten--is Texas, where 16,145 farms reported raising 941,783 goats in 2002, according to the agriculture census. Texas is also the home to the nation's largest goat auction, in San Angelo, where many of the goats are shipped south to Mexico.

Since goat meat is better for you than other forms of meat -- the fat content is 50%-65% lower than similarly prepared beef while the protein content is roughly equal -- someone should be promoting the Goat Diet.

I don't have much to say about President Bush's announement that he intended to nominate Kellogg chairman Carlos M. Gutierrez as the new Commerce Secretary, beyond the observation that this is Bush's first post-election selection that did not spend the first term in the White House.

However, this sentence in Washington Post writer William Branigin's story about the appointment did leap out at me: "Latino Leaders magazine named Gutierrez as one of the nation's 10 most-admired Latinos last year (others included actress Salma Hayek, singer Julio Iglesias and baseball player Sammy Sosa)." (emphasis added)

The staff here at danieldrezner.com, ever eager for gratuitous references to Salma Hayek, applaud Mr. Branigin for finding a completely gratuitous excuse for mentioning the lovely and talented Ms. Hayek -- who, incidentally, recently became a spokesperson for Avon products:

Hat tip to Baseball Crank.

One of the themes of the book I've been working on (and on... and on, and on...) is that great powers create regional intergovernmental organizations that allow these states to advance their regulatory and political preferences among the most vulnerable states they can find. I label these kind of international governmental organizations as "neighborhoods."

Looks like China is trying to create its own neighborhood, according to the AP:

Rising power China moved Monday to expand its influence in a region long dominated by the United States, signing an accord with Southeast Asian nations aimed at creating the world's largest free trade area by 2010 — a sprawling market of nearly 2 billion people.

China's concerns about securing vital sea lanes and feeding its booming economy's ravenous appetite for oil and raw materials were seen as key motivations for the trade pact with the 10-nation Association of Southeast Asian Nations at the group's annual summit in Laos....

"China is using its huge market as a bait to lure ASEAN countries away from U.S. and Japan and build closer relations," said Chao Chien-min, a China watcher and political science professor at Taiwan's National Chengchi University.

"I think what Beijing has in mind is to forge good economic and trade relations now and then increase exchanges in other areas, particularly in the military and security arena," Chao said.

No need to hyperventilate -- as the story notes, the U.S. remains the primary economic presence in the region. This is more interesting as a harbinger of the future.

As my previous posts suggest, I've been very wary of what happens if Ukraine blows up. Fred Weir and Helen Womack's piece in the Christian Science Monitor encapsulates these fears pretty well.

That said, it's cheering to see signs that maybe Ukraine won't blow up -- this week.

AFP reports that President Kuchma has come out in favor of new elections in the disputed regions (Donetsk and Luhansk):

Outgoing President Leonid Kuchma said he was in favor of staging new elections in Ukraine to resolve a bitter dispute over a November 21 presidential vote won by his pro-Moscow prime minister.

"If we really want to preserve peace and agreement in Ukraine, and really want to build a legitimate democratic society that we so often talk about... then let's hold new elections," Kuchma said Monday in televised remarks.

Kuchma said he was ready to seek new solutions to the crisis even if this meant stepping outside the standard procedures for resolving the standoff.

"The situation we find ourselves in today in Ukraine demands not only strictly legal decision, but also political decisions," Kuchma said.

That last quotation is significant, because Yanukovich has stated his preference all along for strictly legal solutions.

Yanukovich has acceded to Kuchma's preferences, according to Reuters:

Ukrainian Prime Minister Viktor Yanukovich said Monday he would agree to stage a new presidential vote in two regions if mass fraud were proven to have occurred in the Nov. 21 election.
"If there is proof of cheating, that something illegal occurred there and if there is no doubt among experts, I will agree with such a decision," he said in televised comments, referring to two regions in his native eastern Ukraine.

Meanwhile, the Kyiv Post reports that the secessionist threat has freaked out some of the oligarchs:

Signs are emerging... that factions in Ukraine’s political and business elite who previously supported the candidacy of Prime Minister Viktor Yanukovych are switching sides and putting their chips on Yushchenko.

Citing a statement issued by President Leonid Kuchma’s son-in-law Viktor Pinchuk, opposition television station Channel 5 reported on Nov. 29 that the deputy and business mogul opposes separatist movements in eastern Ukraine that are being spearheaded by Yanukovych and the Donetsk-based tycoons who continue to back him.

Pinchuk is reportedly Ukraine’s second richest man. His assets have been valued at about $3 billion.

Meanwhile, insiders allege that Donetsk-based businessman Rinat Akhmetov continues to back Yanukovych and the separatist movement in eastern Ukraine.

On Akhmetov, check out Tom Warner's story in the Financial Times.

Encouragingly, Interfax reports that Ukraine's defense minister has rejected the idea of a state of emergency.

What's going on? There are three possibilities:

1) Yanukovich's secessionist ploy has alienated/frightened even those with a vested interest in the status quo in Ukraine. Stephen Lee Myers suggests this in his NYT piece today. To them, Yushchenko in power is (barely) preferrable to civil war.

2) Yanukovich and Kuchma are confident that a revote in Donetsk and Luhansk can be stage-managed by them to produce a favorable outcome. Regardless of vote-tampering, Ukrainian nationalists are very unpopular in that neck of the woods.

3) Kuchma is making an offer that he knows Yushchenko will refuse. See this SCSUScholars post for more on that possibility. UPDATE: This Bloomberg report by Halia Pavliva and Julian Nundy has some details that suggest this possibility:

Kuchma's offer to recount the vote would include the participation of international observers, his spokeswoman, Olena Hromnytska, said. If a recount doesn't satisfy the opposing sides, then he would offer fresh elections in the two regions.

If that isn't accepted, Hromnytska said, the president would call new nationwide elections. Under Ukrainian law, any candidate in the initial two-round balloting, including Yanukovych or Yushchenko, would be disqualified from the rerun, she said. (emphasis added)

Developing....

Apologies for the lack of comments over the past 24 hours -- there was a massive spam attack that caused the good people at Hosting Matters to shut things down temporarily.

Comment away!!

Ukrainian opposition leader Viktor Yushchenko and his supporters are now making demands of president Leonid Kuchma. Here's the Reuters report -- but Maidan has an English translation of the actual demands:

The Committee of National Salvation of Ukraine, headed by Viktor Yushchenko, has issued an ultimatum to Leonid Kuchma.

Within 24 hours, the Committee demands that Kuchma fulfill the following terms:

1) Discharge Yanukovych from his position of Prime Minister, because of his instigation and support of the falsification of the election and in the separatist actions;

2) On the demands of of the decision of the Verkhovna Rada (Ukrainian Parliament) of November 27, immediately to begin an investigation into new candidates for membership of the Central Election Committee;

3) Discharge from their positions the directors of the Donetsk, Luhansk and Kharkiv regional administrations -- the initiators of the break-up of Ukraine;

4) Give a deadline to the Attorney General and the Security Services of Ukraine to open a criminal investigation against the separatists/secessionists of Ukraine.

In the case of noncompliance with the ultimata, "we will judge Kuchma's inaction as a crime against the people, with results indicated in the Criminal Code of Ukraine," continues the ultimatum.

"If the demands are not met, we will begin blocking with people the movements of Kuchma himself on the territory of Ukraine. We know where he is and how he is moving about. And we are able to ensure that he will not make a single step without complying with our demands," stated Yulia Tymoshenko, who read the ultimatum at the meeting.

That 24 hours thing is funny, because according to the Post-Modern Clog, "Kuchma has given the protesters blockading the Cabinet building a 24-hour deadline to clear out."

Actually, it's not funny. Supporters of Yushchenko want to believe that Prime Minister Viktor Yanukovich commands little support, even in the Eastern part of the country - but Reuters reports that "an estimated 150,000 demonstrators took to the streets in Donetsk" in support of Yanukovich. Yanukovich may be a toady of Kuchma and potentially Vladimir Putin, but he's not wrong when he says, "If only one drop of blood is shed, we won't be able to stop the flow." The thing is, both sides have now dug in, and although the Ukrainians are masters at muddling through, it's becoming increasingly difficult to see how this can be resolved through non-violent means.

Peter Finn writes in the Washington Post:

The stoking of historical fears about what many perceive as a Russophile East and a nationalist West could continue to split this country long after the dispute over voting is settled, if they do not rupture it beforehand, analysts say.

"I think the tragedy of this campaign is the use of stereotypes by both sides, but especially Yanukovych's people," said Yulia Tishchenko, an analyst at the Ukrainian Center for Independent Political Research, "and the dangerous consequences are now becoming apparent. Everyone thinks that if they lose, they lose everything."

[Why can't there be a velvet divorce between the regions, a la Czechoslovakia?--ed. Erin Arvedlund explains the myriad economic problems with this idea in the New York Times, but it's even more problematic than that. Yushchenko's response to the eastern threats of autonomy show that nationalists are, well, nationalist -- they don't want only half the country.]

I have to think Yushchenko is gambling on Kuchma lacking the ability to use force. However, Mark Franchetti reports in London's Sunday Times that:

Some feared that the joyful street parties and open-air concerts could still turn into a bloodbath. Lurking in the background, phalanxes of stone-faced riot police and Ukrainian special forces in black body armour and helmets, brandishing machineguns and batons, stood guard silently around the presidential palace.

The key to the revolutions of 1989 was the compliance of the security forces in bowing to the wind of change. There has been little sign that today those same forces would be prepared to switch sides and join the opposition.

(link via NRO's Andrew Stuttaford)

The other thing to worry about is the Russian response to any escalation in the crisis. What will Putin do? Helen Womack reports in the Christian Science Monitor that, "The likelihood for a fresh poll increased when a spokesman for the Foreign Ministry in Russia, which had overtly backed Yanukovich, said Moscow also now favored a rerun." However, Askold Krushelnycky and Mark Franchetti report in London's Sunday Times about a more disturbing possibility:

A senior figure in the Ukrainian presidential administration who declined to be identified said that Boris Gryzlov, President Vladimir Putin’s personal envoy to Ukraine, had promised “diplomatic cover” against any international backlash prompted by such a move.

Developing... and not in a way that I'm at all sanguine about.

The British press has some very interesting takes on what's happening in Ukraine.

In the Guardian, Ian Traynor thinks the "Orange Revolution" is made in the USA:

Ukraine, traditionally passive in its politics, has been mobilised by the young democracy activists and will never be the same again.

But while the gains of the orange-bedecked "chestnut revolution" are Ukraine's, the campaign is an American creation, a sophisticated and brilliantly conceived exercise in western branding and mass marketing that, in four countries [Yugoslavia, Georgia, Belarus, and now Ukraine] in four years, has been used to try to salvage rigged elections and topple unsavoury regimes.

Funded and organised by the US government, deploying US consultancies, pollsters, diplomats, the two big American parties and US non-government organisations, the campaign was first used in Europe in Belgrade in 2000 to beat Slobodan Milosevic at the ballot box.

John Laughland goes even further in his Guardian essay:

Whether it is Albania in 1997, Serbia in 2000, Georgia last November or Ukraine now, our media regularly peddle the same fairy tale about how youthful demonstrators manage to bring down an authoritarian regime, simply by attending a rock concert in a central square. Two million anti-war demonstrators can stream though the streets of London and be politically ignored, but a few tens of thousands in central Kiev are proclaimed to be "the people", while the Ukrainian police, courts and governmental institutions are discounted as instruments of oppression.

The western imagination is now so gripped by its own mythology of popular revolution that we have become dangerously tolerant of blatant double standards in media reporting. Enormous rallies have been held in Kiev in support of the prime minister, Viktor Yanukovich, but they are not shown on our TV screens: if their existence is admitted, Yanukovich supporters are denigrated as having been "bussed in". The demonstrations in favour of Viktor Yushchenko have laser lights, plasma screens, sophisticated sound systems, rock concerts, tents to camp in and huge quantities of orange clothing; yet we happily dupe ourselves that they are spontaneous....

The blindness extends even to the posters which the "pro-democracy" group, Pora, has plastered all over Ukraine, depicting a jackboot crushing a beetle, an allegory of what Pora wants to do to its opponents.

Such dehumanisation of enemies has well-known antecedents - not least in Nazi-occupied Ukraine itself, when pre-emptive war was waged against the Red Plague emanating from Moscow - yet these posters have passed without comment. Pora continues to be presented as an innocent band of students having fun in spite of the fact that - like its sister organisations in Serbia and Georgia, Otpor and Kmara - Pora is an organisation created and financed by Washington.

It gets worse. Plunging into the crowd of Yushchenko supporters in Independence Square after the first round of the election, I met two members of Una-Unso, a neo-Nazi party whose emblem is a swastika. They were unembarrassed about their allegiance, perhaps because last year Yushchenko and his allies stood up for the Socialist party newspaper, Silski Visti, after it ran an anti-semitic article claiming that Jews had invaded Ukraine alongside the Wehrmacht in 1941. On September 19 2004, Yushchenko's ally, Alexander Moroz, told JTA-Global Jewish News: "I have defended Silski Visti and will continue to do so. I personally think the argument ... citing 400,000 Jews in the SS is incorrect, but I am not in a position to know all the facts." Yushchenko, Moroz and their oligarch ally, Yulia Tymoshenko, meanwhile, cited a court order closing the paper as evidence of the government's desire to muzzle the media. In any other country, support for anti-semites would be shocking; in this case, our media do not even mention it.

Laughland is associated with the British Helsinki Human Rights Group (BHHRG), which should not be confused with British Chapter of the International Helsinki Federation for Human Rights. BHHRG has posted two scathing reports about the Orange Revolution -- one on Yushchenko's "Shadow of Anti-Semitism" and this report on the election's second round, in which they conclude, "BHHRG finds no reason to believe that the final result of the 2004 presidential election in Ukraine was not generally representative of genuine popular will."

Beyond the Guardian, Peter Unwin writes in the Independent that Europe is needlessly riling the Russian Bear over Ukraine (link via Clive Davis):

[W]as not Putin trying to prop up an unconscionable dictator? Maybe, but it is naive to think that the election was a clear clash of baddies and goodies. No one disputes that the election was at the very least deeply flawed. But it is childishness to imagine that all the abuse was on one side. Yulia Tymoshenko, for example, whom we saw on TV preaching democracy beside Viktor Yushchenko, made herself a billionaire from nothing in 10 years. The fruit of honest enterprise alone? It seems unlikely. A truly convinced democrat? Perhaps.

All the same, the Ukrainians invited in observers who have condemned the outcome of the election in forthright terms. The next move is the Ukrainians'. But for the West to go eyeball to eyeball with Putin over the outcome merely complicates Ukraine's domestic problems and takes East-West relations back a dangerous step to the bad old days. By all means tell Putin privately to keep his nose out of Ukrainian affairs - and keep our own out too.

While we are about it, we might make an effort to see Ukraine and the world through Putin's eyes. His job is to make Russia rich and strong. To do so he needs neighbours who want to co-operate with him. But in the past five years he has seen most of eastern Europe absorbed into the European Union and Nato. Fifteen years ago the Russians had an army on the Elbe. Now Nato's reach extends to within 100 miles of St Petersburg. Must Putin now ask proud Russians to accept that Ukraine too should go down that path: new elections this year, then Nato bases, then European Union membership by 2020?...

Look at all this, lastly, in terms of western Europe's interests. Do we really want to see the EU take in 50 million Ukrainians as well as 70 million Turks? Do we want a union so disparate that it can never make itself effective as a political voice in tomorrow's world? Do we, for that matter, want an EU facing an implacably hostile Russia, hostile to us because we have so recklessly forced our way into Russia's back yard? American neo-cons may want that, but we should not. (emphasis added)

Well, now it's clear to me -- the Bush administration has carefully crafted a crisis in Ukraine to force western Europe back into our arms while finally installing an anti-Semitic government in Ukraine.

[Seriously?--ed.] Seriously, there are a couple of things going on here. Let's deal with BHHRG and Laughland first -- well, let's reference this Chris Bertram post first, since it encapsulates where this line of criticism is coming from. Basically, if a cartoon version of Edmund Burke were divined into existence and asked to monitor elections in regions outside Western Christendom, the result would be BHHRG. In the former Soviet bloc, this means they expect voters to prefer Slavophiles over Western reformers -- and if they prefer the latter, it must be because of perfidious Western interference. Their suspicion of outsiders, particularly poor outsiders, is also at the roots of Unwin's fears of Ukrainan entrance into the EU.

Their charge of anti-Semitism seems partially blunted by the fact that a) Principal elements of the Jewish community support Yushchenko; and b) As someone who's travelled all around that country, let's be clear that a mild form of anti-Semitism is probably one of the few traits that unites the different regions.

As for Traynor's allegations, they are both true and vastly exaggerated. It's probably true that the groups identified by Traynor have helped fund opposition groups in the countries listed. That said, to suggest that the U.S. government was the architect behind the massive demonstrations that ousted Slobodan Milosevic, Eduard Shevardnandze, and are threatening Leonid Kuchma overlooks a) The genuine resentment these leaders have generated among their populations; and b) The ability of the U.S. government to "coordinate" such a disparate bunch of organizations (Traynor's thesis requires the Bush administration to be in league with George Soros). There's an element of the paranoid style in these reports that sounds... vaguely familiar. [UPDATE: This charge of American orchestration of events seems particularly amusing after reading Bradford Plumer castigate the Bush administration over at the Mother Jones blog for not planning enough for these contingencies. From what I've read, this is a case where all the planning in the world wasn't going to change what happened.]

Finally, as to the charge of corruption among Yushchenko's supporters -- particularly Ms. Tymoshenko -- click here, here, and here for more background (and here's a link to Tymoshenko's web site). I have no doubt that Yushchenko and his supporters are not as clean as the driven snow. However, while Tymoshenko's stage of primitive accumulation seems well past, Yanukovich's supporters are still in their prime and show no signs of changing tack.

Which is pretty much the way to evaluate the current lay of the land in Ukraine. Yushchenko and his supporters are not innocent democrats -- but I'm not sure that anyone who has ever held political office (save maybe Vaclav Havel) fits that description.

For another corrective to these reports, see Nick Paton Walsh's article in the... er... Guardian.

As to Unwin's realpolitik concerns, those can not just be dismissed away, and I'll try to blog about them soon.

UPDATE: Matthew Yglesias makes some excellent contrarian points. To be clear -- I find the arguments made by Laughland, Traynor, and BHHRG to be badly slanted and grossly exaggerated -- but some of the points they are making not completely devoid of truth.

Richard Balmforth reports for Reuters that multiparty talks among the parties with a stake in last week's disputed election aren't going well in Kiev:

Talks to end Ukraine's presidential election standoff are going badly, the outgoing president says while the country seethes with street rallies and threatened to break apart over the crisis.

"As I understand, the (working group) talks are going on with considerable difficulty. No one can say what sort of compromise can be found or whether one will be found at all," President Leonid Kuchma said on Sunday.

"But I believe ... that a compromise is very necessary for Ukraine," he said opening the meeting of the National Security and Defence Council.

In the capital Kiev, tens of thousands of supporters of opposition candidate Viktor Yushchenko rallied again, undaunted by freezing drizzle. Yushchenko told them talk of autonomy in eastern regions loyal to his opponent threatened national unity.

The formal winner of last week's election, Prime Minister Viktor Yanukovich, told a rally of his supporters in the east of the country that the rowdy but so far peaceful protests had brought Ukraine to the edge of disaster.

"As prime minister, I say that today we are on the brink of catastrophe. There is one step to the edge," he told a packed hall in Severodonetsk.

"Do not take any radical steps. I repeat, none ... When the first drop of blood is spilled, we will not be able to stop it."

Yanukovich was in eastern part of the country to rally regions and elites loyal to his cause:

Ukrainian Prime Minister Viktor Yanukovich on Sunday called for an emergency meeting of local congressmen to safeguard the constitutional system and break the election standoff.

Yanukovich, who was announced to have won the Nov. 21 presidential runoff by the Central Elections Commission on Wednesday, made the appeal in his tour to the eastern town of Lugansk.

According to the Ukraine National News Agency, about 3,500 deputies from councils at various levels, including 30 from the Supreme Council of Ukraine, will attend the meeting in Severodonetsk, another eastern town.

The reports said Moscow mayor Yuri Luzhkov is also expected to attend the meeting, which will explore ways to handle the election standoff and "safeguard the constitutional system."

In a somewhat ominous development, the AP's Anna Melnichuk reports that Kuchma is calling for an end to the protestors' blockade of government buildings in Kiev, calling it a "gross violation of the law." In Kiev, Post-modern Clog posts that, "Everybody is buzzing right now about martial law." To be fair, he also notes, "at this point it's only a report of discussions and nothing more solid than that." Still, Yushchenko now seems more cognizant of this possibility. UPDATE: SCSU Scholars is keeping track of this thread of scuttlebutt.

Meanwhile, Time has its Ukraine package, which has three interesting tidbits of information. The first suggests the depth of the protest at the vote-rigging:

It was both a symbol and a symptom of the revolution that rippled across Ukraine last week. On Thursday, as the presenter of state-controlled UT-1's main morning news program was updating viewers on the Central Electoral Commission's decision to declare Prime Minister Viktor Yanukovych the winner of the country's Nov. 21 presidential vote, Natalya Dmitruk, the woman who translates broadcasts into sign language for the deaf, decided to send a very different message. "When the presenter started to read the news," Dmitruk told TIME, "I said: 'I address all deaf viewers. [Challenger Viktor] Yushchenko is our President. Do not believe the Electoral Commission. They are lying.'" In a week filled with extraordinary acts of political protest, Dmitruk's silent rebellion was one of the most defiant.

The second tidbit suggests the extent to which Putin wants to keep Ukraine within its orbit:

Sources well briefed on Kremlin affairs tell TIME that as protests in Kiev gathered momentum, Putin urged the much-discredited outgoing President Leonid Kuchma, eager to secure a safe retirement amid charges of corruption and political violence, to declare Yanukovych the winner. The sources say Putin made it clear that Moscow would not accept a Yushchenko victory. If the Russian President sticks to that hard line, it could provoke serious trouble, abroad and at home. "The Russians have raised the stakes," says Stephen Sestanovich of the U.S. Council on Foreign Relations. "They've made this a very emotional issue domestically and there will be a lot of people on Putin's nationalist flank saying, 'Are you going to take this lying down?'"

Finally, the Time writers note that should the Ukraine problem fail to resolve itself, the Bush administration would find itself in a pickle:

However the disputed election finally plays out, it has undermined the Bush Administration's cozy relations with Putin, at least behind the scenes. In his first term, Bush was willing to give Putin a free hand in what Russia calls the "near abroad," the states that spun off from the broken Soviet Union. At the same time, Bush has made encouraging democracy around the world a central pillar of his presidency. In Ukraine, those two policies clash mightily. Washington spent much of Ukraine's bitterly fought presidential campaign studiously avoiding confrontation with Putin, and stuck to that line in the early days after the vote. But at midweek, Secretary of State Colin Powell made clear Washington's support for Yushchenko, saying the U.S. was "deeply disturbed by the extensive and credible reports of fraud." The following day, at an E.U.-Russia summit in the Hague, Putin emphasized that the dispute should be settled without outside interference. No other country has a "moral right to push a major European state to mass disorder," he warned. The Kremlin regards countries like Ukraine, Moldova and Belarus as vital buffers between Russia and the West. Like Russian rulers for the past two centuries, Putin "equates security with well-defined 'zones of interest,'" says James Sherr, an Eastern Europe specialist at Oxford University. Those zones have shrunk in recent years as the Baltic states and Georgia turned sharply toward the West. Putin doesn't want to see the same thing happen in Ukraine. But analysts in the U.S. worry that Putin may have overplayed his hand. If he were seen to be encouraging the east in its secessionist plans, the protests could turn violent.

This puts Bush's comments from this Friday in the proper perspective.

Developing.....

UPDATE: This BBC report has a good summary of the developments to date.

ANOTHER UPDATE: There appears to be another problem with the blog which is preventing people from posting comments -- and for that I apologize. Hopefully the problem will be fixed tomorrow. Problem solved!!