Integrating Instruments of Power and Influence: Lessons Learned and Best Practices Robert E. Hunter, Edward Gnehm and George Joulwan Rand Corporation, 2008. 151pp.
Reviewed by Courtney N. Meyers
This timely book suggests a changed approach in the way the United States handles future conflicts of the type now under way in Iraq and Afghanistan. Such situations require a reconstruction phase to put in place new foundations in infrastructure and governance, a task for which the armed services of the U.S. and other countries have so far been ill-prepared to handle. The report is intended to be a blueprint for the now, new Obama administration. It focuses on a new consensus emerging in Washington – that over-reliance on military power should be rebalanced by tapping inter-governmental civilian resources to manage the end phase of conflicts that resemble civil wars or forcible regime changes.
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Russia is critically important to the European Union’s energy supply, as we all know, but it is important to analyze this situation in detail. For example, while about one-third of the EU oil consumption comes from Russia, oil is a fungible commodity with worldwide markets. When it comes to gas, one-fourth of EU-consumed gas comes from Russia. This element is not fungible: it comes in pipelines and so there will not be major global markets in gas for a long, long time to come – certainly not before and unless liquefied natural gas expands tremendously. My country, Finland, is somewhat an extreme case because one-half of all the energy we consume comes from Russia, including 100 percent reliance on Russia for our natural gas. But in trying to assess these dependency figures, one has to take into account a few things. For example, the role of gas in the energy balance of different countries varies hugely. So Poland, I understand, is for the time being one hundred percent dependent on Russian gas, but gas is relatively minor in their energy mix because Poland is basically a coal-based economy. In my country, about 10 to 15 percent of all primary energy comes from gas and therefore from Russia. There is only one pipeline.
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Russia is at the heart of the difficulties of energy security in Europe. One of the problems, of course, is that Russia just isn’t investing enough in their own gas development. (It’s even more acute on oil: within five years, they won’t have enough to play games with, whether they want to or not.) It’s a key problem: they need to attract outside capital. Gazprom desperately needs it because it has huge debts and a very low stock price. So there is trouble ahead if we don’t collectively figure out a way to get that attended to, whatever their internal or external intentions are. Now on natural gas, Europe reportedly faces a shortfall of somewhere between 120-150 billion cubic meters annually by 2030. How can it be covered? This issue has a climate change component because if Europe doesn’t get the gas (from Russia or elsewhere), they are going to use other fuel for their power plants, including the coal-fired power plants they’re building now. How are they going to deal with the carbon emissions that result? As I read it in the papers, the EU plans to make it up by allowing member states to use “offsets” that will come – up to 50 percent of them – from outside the EU. In a sense, Europe would only do 50 percent of these nations’ purported clean-up and instead get cheaper offsets from operations in China or India or elsewhere.
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 Energy is one of those words like “love” and “finance”: it means different things to different people. Essentially, in the U.S., energy security means oil when the politicians talk about it. In Europe, when they are talking about energy security, they are really talking about gas, as recent events highlight. Now, I’m in the oil and gas business. It’s a rather specific world. I think in talking about energy, it is very important to focus on the basics of resources, technology, markets, investment, regulation, etc. But when you listen to politicians, they spin off into intergalactic discussions which are somewhat divorced from reality. I can be all the more frank about this because I used to be in government myself. Several years ago there was a man with the Japan National Oil Company here in Washington, a very clever man, and when he was going home, I asked him for his opinion of Washington. He paused and said, “In Washington, everybody has opinion, nobody knows anything.” I certainly do not know everything, but I think it is terribly important that things be rooted in reality. Energy is a fashionable issue and politicians can run amuck on fashionable issues. Reality-check.
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