A BRICS Revival?

ANA PALACIO

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WASHINGTON, DC – There was a time when everyone was talking about a group of fast-growing emerging economies with huge potential. But the BRICS – Brazil, Russia, India, China, and South Africa – struggled to transform themselves from a promising asset class into a unified real-world diplomatic and financial player. Is this finally changing?

The story of the BRICS begins with a November 2001 paper by Jim O’Neill, then the head of global economic research at Goldman Sachs Asset Management, called “The World Needs Better Economic BRICs” (the original grouping did not include South Africa). At a time when the world was dealing with the fallout of the dot-com bust and the September 11, 2001, terrorist attacks, O’Neill highlighted the BRICs’ vast potential, noting that their GDP growth was likely to accelerate considerably in the ensuing decades.

At the time, China and India were experiencing rapid economic growth, and Russia, aided by booming commodity prices, was recovering from the post-Soviet meltdown of the 1990s. Growth in the BRICs was outpacing that of the advanced economies so significantly that O’Neill predicted in 2003 that their collective GDP could overtake the then-Group of 6 largest developed economies by 2040.

While the world expected the BRICs to thrive economically, few expected them to form a united grouping. After all, they represent a mix of unsteady democracies and outright autocracies, each with its own distinctive economic structure. And two of them – China and India – have long been locked in a border dispute, with no sign of resolution.

But the BRICS saw their economic alignment as an opportunity to expand their global influence by creating an alternative to West-led international institutions. And, for a while, they seemed to be making progress.

An article on New Delhi not being ‘close’ to Washington is causing a storm in the India-US tea cup

Seema Sirohi

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A younger Tellis had no problem with India's selfishness. In fact, he argued the US should exercise 'strategic altruism' and strengthen India irrespective of returns. But the geopolitical environment has changed dramatically, and my guess is that today Tellis is reflecting the angst/expectations of sections of the US government.

The article does raise an important question: what would the US and India expect of each other if push came to shove in Asia?

Senior journalist who writes on foreign policy and India's place in the world.

There are multiple ways of looking at former US State Department senior adviser Ashley J Tellis' article that appeared earlier this month in Foreign Affairs, and that has created a stir in the realm of India-US relations. The most obvious is to have an instant freak-out because of the headline - 'America's Bad Bet on India: New Delhi Won't Side With Washington Against Beijing' -

Post-withdrawal, no “over-the-horizon” strikes in Afghanistan

Meghann Myers

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MQ-9 drones are useful for collecting surveillance and striking targets, but they can spend limited time over Afghanistan. (Massoud Hossaini/AP)

As the U.S. scrambled to get the last of its troops out of Afghanistan in late summer 2021, the Pentagon fielded endless questions about how it could prevent the country from becoming the terrorist training ground it had been before 9/11.

Biden administration officials touted robust “over-the-horizon” capabilities to both gather intelligence and strike terrorist groups to keep them in check. But some two years after the Biden administration announced the drawdown, the U.S. military hasn’t struck a single target in Afghanistan, and U.S. military leaders now concede they lack sufficient resources to do so.

In August 2021, then Pentagon spokesman John Kirby insisted the administration would “maintain robust over-the-horizon counter-terrorism capability, the kinds of capabilities that you’ve seen us use in just the last 24-36 hours,” as the U.S. prepared to evacuate the last of its troops. “We still have that capability. We will use that capability,” an assertion Kirby repeated again this year, as Biden National Security Council spokesman, and also repeated to Military Times by multiple military officials.

But the military commander in charge of that region didn’t sound so confident, warning that terrorist groups inside Afghanistan may soon be ready to launch attacks abroad.

“Specifically, ISIS-Khorasan, Senator,” Army Gen. Erik Kurilla, head of U.S. Central Command, told lawmakers during a Senate Armed Services Committee hearing in March. “It is my commanders’ estimate that they can do an external operation against U.S. or Western interests abroad in under six months with little to no warning,” he said, with the caveat that he believes the U.S. homeland is still safe.

The CIA did target and kill al-Qaida leader Ayman al-Zawahiri in July 2022. And the Taliban killed the suspected mastermind behind the 2021 ISIS bombing of Kabul’ airport’s Abbey Gate, that left 13 U.S. troops and about 170 Afghans dead during the chaotic U.S. withdrawal.

But neither of those involved the U.S. military, calling into question whether that “over-the-horizon” capability is as robust as was claimed, or simply has been delegated to the CIA, therefore is outside the U.S. military’s purview.

Keeping tabs

The Implications of the Arrest of Imran Khan on Pakistan’s Stability

Syed Fazl-e-Haider

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[Editor’s Note: This is a developing story. Since the writing of this article, the Islamabad High Court (IHC) has declared Imran Khan’s arrest “invalid and unlawful,” releasing him from jail and granting Khan two weeks of bail in the Al-Qadir Trust corruption case and 10 days of protective bail for the three charges of terrorism he faces. Further, the IHC has decided that Khan may not be arrested again until May 15 for any cases filed before May 9; similarly, he may not be arrested until May 17 for any cases filed after this date (Dawn, May 12). Whether this move will deescalate the tense situation in Pakistan is not yet known.]

Pakistan’s former Prime Minister Imran Khan and his party, Pakistan Tehreek-e-Insaf (PTI) (also known as “The Justice Movement”), have been facing terrorism charges. This comes after the current coalition government, led by Shehbaz Sharif, launched a crackdown on PTI in March. At that time, PTI supporters were set to hold a rally in Lahore to kick off the election campaign in Punjab and Khyber Pakhtunkhwa provinces (Business Recorder, March 9). Pakistani authorities ultimately arrested Khan at the Islamabad High Court on May 8 as part of a corruption case, for which he was attending a hearing. His arrest has sparked countrywide protests and brought normal life and business activities in Pakistan to a halt (Dawn, May 9).

Dozens of court cases have been filed against Khan and his party leaders. Many PTI leaders and activists have been detained for various charges, to include terrorism (Express Tribune, March 20). For example, a former minister in Khan’s cabinet, Fawad Chaudhary, another former minister, Sheikh Rashid, Khan’s nephew, Hassan Niazi, and former lawmaker Ali Zaidi are among the PTI activists who have been arrested. Ultimately, these terrorism cases against Khan, his party, and its followers reflect the goal of side-lining Khan ahead of the coming national election. These are to be held after July, when the present National Assembly’s five-year term comes to an end.

However, the question remains as to whether the strategy of cracking down on Khan and PTI will backfire and, if so, if the move might lead to violence. The countrywide protests that followed Khan’s arrest suggest that the former may be the case, as his arrest has only increased Khan’s popularity among his supporters.

Detailing the Terrorism Charges Against Khan

China’s Emerging Approach to Taiwan: Blockade and Disinformation

Chihwei Yu

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It has been suggested that China intends to unify Taiwan through a military operation within the next five years. However, based on the Chinese Communist Party’s (CCP) actions during the 1945-1949 civil war, military means may not be the most effective way for the People’s Republic of China (PRC) to achieve its longstanding goal of unification with Taiwan. Since its inception in 1921, the CCP has relied on producing and disseminating disinformation to advance its policy objectives. This strategy is also frequently employed by China towards Taiwan, with the aim of undermining the morale of Taiwanese society through the spread of certain kinds of false information, for example, by claiming that the U.S. will eventually betray Taiwan.

In fact, the CCP’s military tactics during the civil war share some similarities with its current Taiwan policy, particularly with regard to the so-called “Peiping Mode” (北平模式). This approach seeks to achieve its goals through a combination of deterring the opponent through superior force and employing United Front work, including deploying agents and spreading fake news to persuade opponents.

Can Blockade and Disinformation Succeed?

While more and more analysts and even some foreign officials argue that the probability of China launching an amphibious invasion of Taiwan is increasing, it would be highly irrational for the PRC to move to invade under the current conditions. Considering the risks entailed, it would be impossible for the People’s Liberation Army (PLA) to adequately prepare for an invasion without a general notification of personnel. Preparations would take at least six to ten weeks, not only because the PLA would have to concentrate its forces in southeastern China but also because Beijing would need to ensure sufficient munitions and supplies for a long fight. Furthermore, even if China could successfully launch a surprise attack without triggering global alarm, an occupation would provoke the Taiwanese population and hence, tremendously increase the cost to the CCP of governing Taiwan.

Can Beijing Seize the “Opportunity of the Century”?

Willy Wo-Lap Lam

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As President Xi Jinping said farewell to his host and Russian counterpart Vladimir Putin at the end of his visit to Moscow last month, a few Western media outlets caught the Chinese strongman’s parting words to his good friend on the doorstep of the Kremlin: “Let’s join hands in seizing [the opportunity provided by] changes that only appear once in a century” (Radio Free Asia, April 1; VOA Chinese, March 24).

Xi has sought to take full advantage of these “big changes that only come once in a century” (百年未有之大变局),or the “best opportunity in 100 years,” as a primary foreign policy goal since attaining “party core” status at the 19th Party Congress in 2017. More than five years ago, he indicated that the Chinese leadership was “facing the biggest changes [on the global scene] not seen in the past century.” The President and Chinese Communist Party (CCP) General Secretary explained that since the dawn of the 21st century, “a large number of countries with newly developed markets … are growing at an expedited pace.” Moreover, Xi added that “the multi-polarization of the world is developing rapidly, and the global distribution of power has become more balanced by the day,” and that “the currents and major trends of the world cannot be negated” (Netease, January 14, 2022; Sohu.com, January 19, 2018). This viewpoint was buttressed by Xi’s revival of one of his favorite Chairman Mao quotations: “The East is rising and the West is declining” (People’s Daily, November 24, 2022; Radio Free Asia, September 23, 2022).

Xi urged party cadres and comrades to “develop a strategic outlook and establish a global point of view.” He stressed that “while being conscious of the historical opportunity, we must assiduously fix our direction in accordance with once-in-a-century opportunities.” The supreme leader, who heads the CCP’s China’s policy-setting Central Foreign Affairs Commission as well as the Central Military Commission, also indicated that “never have the world’s [developing] countries’ been so united [in the quest] for equal economic opportunities and for a say in global rule-setting” (Qstheory.cn, August 27, 2021; Gov.cn, December 28, 2017). This touches on a related theme in Xi’s style of international diplomacy, which is working to forge a “universe with a common destiny,” particularly with countries barred by the U.S.-led Western coalition from playing a significant role in global affairs (Xinhua, September 3, 2018).

Opinion In Vienna, the U.S.-China relationship shows signs of hope

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As the United States and China veered toward confrontation in recent years, both sides gave lip service to the idea that they seek cooperation on issues of mutual interest. Little came from that rhetoric until last week in Vienna, when top Chinese and U.S. officials actually seemed to be creating a framework for constructive engagement.

After two days of intense meetings Wednesday and Thursday between national security adviser Jake Sullivan and top Chinese diplomat Wang Yi, the two nations used identical language to describe the meetings: candid, substantive, constructive. For diplomats, that amounts to a rave review.

Talking about resets in foreign policy is always risky, and that’s especially true with Washington and Beijing. These two superpowers might be “destined for war,” as Harvard professor Graham Allison warned in a book with that title. What they’ve lacked, in their increasingly combative relationship, has been common ground. But some shared space seems to have emerged during the long, detailed discussions between Sullivan and Wang.

The U.S. and Chinese officials are said to have talked for hours about how to resolve the war in Ukraine short of a catastrophe that would be harmful for both countries. They discussed how each side perceives and misunderstands the other’s global ambitions. They spoke in detail about the supremely contentious issue of Taiwan.

The frank discussion in Vienna was important because both sides have been running hard in the opposite direction in recent years. The Biden administration has concentrated on rebuilding U.S. military alliances and partnerships but has had little constructive engagement with Beijing. China has proclaimed a “no limits” partnership with Russia and has fostered an alliance of the aggrieved but, in the process, has rebuffed the superpower that matters most to its future.

What was different in Vienna? From accounts that have emerged, it was partly a matter of chemistry. Sullivan and Wang are both confident enough to talk off script. Over nearly a dozen hours of discussion, they threw schedules aside. They have the confidence of their bosses, Presidents Biden and Xi Jinping, to engage in detailed discussion about sensitive issues. They appear to have found a language for superpower discussion, like what once existed between the United States and both Russia and China but has been lost.

How China’s Echo Chamber Threatens Taiwan

Tong Zhao

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The risk of a military conflict in the Taiwan Strait is becoming dire. On Feb. 2, CIA Director William Burns stated that Chinese President Xi Jinping had ordered China’s military to be “ready by 2027 to conduct a successful invasion” of Taiwan. Although Burns added that this did not mean that Xi has decided to invade Taiwan, he described Xi’s move as “a reminder of the seriousness of his focus and his ambition.”

But the main factor that will determine whether Washington and Beijing come to blows over Taiwan is not necessarily Xi’s strategy for unification but the idiosyncrasies

China’s war chest: Beijing’s ‘great wall of steel’ faces obstacles to military supremacy

Amy Hawkins 

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The CIA believes that China’s leader, Xi Jinping, has told the military to be ready to invade Taiwan by 2027. At China’s annual parliamentary meetings in March, Xi said he would build China’s military into a “great wall of steel”, but stressed the need for a “peaceful development of cross-strait relations”.

China already has the world’s largest armed forces, with about 2 million active personnel. Its navy is also the world’s biggest, with an estimated 355 active vessels compared with the US’s 296. In 2021, Vice Adm Kay-Achim Schonbach, then the commander of Germany’s navy, said China was expanding its navy by the equivalent of France’s entire navy every four years.

An invasion of Taiwan would probably rely on a naval encirclement of the island, so China’s maritime capabilities will be of particular importance to those trying to glean how capable the People’s Liberation Army (PLA) is of achieving its aim.

On 7 April the Pentagon announced a $1.7bn deal with Boeing for 400 anti-ship Harpoon missiles. The buyer is reportedly Taiwan, although this has not been officially confirmed.

Part of China’s push to modernise its armed forces has been a strategy of pursuing “military-civil fusion”, with the aim of developing the PLA into a “world-class military”. The government encourages private businesses to support the development of military technology, in everything from AI to nuclear technology to drones.

This strategy is evident in China’s shipbuilding industry. The China Shipbuilding Group Corporation accounts for a fifth of global ship production and also produces vessels for China’s navy. Such a high level of integration is “relatively uncommon”, according to the Centre for Strategic and International Studies (CSIS), a thinktank.

It also hampers the ability of outside countries to understand or limit China’s military development.

“With little transparency and differentiation between military and civilian operations, it is impossible to determine the extent to which foreign ship orders may be helping to lower the costs” of the PLA’s naval modernisation, CSIS notes.

China outpaces Europe in regulating generative AI – on CCP terms

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Although the US leads in developing generative artificial intelligence technology, China has recently enacted regulation. This is to some extent motivated by its desire to maintain stability through internet censorship, but there are also forward-thinking angles to their regulation that could provide insights for European policymakers when developing their own frameworks.

In April, China’s internet regulator published draft provisions for governing generative artificial intelligence (AI) (生成式人工智能), aiming to ensure “healthy development and standardized application” of AI services that can create text, videos, voice, and images. OpenAI’s ChatGPT is just one of many such technologies swiftly emerging around the globe. Although the US leads in this, the Chinese government has leapfrogged it in creating a regulatory framework. China’s answer to ChatGPT – Baidu’s ERNIE Bot – is barely out of the gate with an underwhelming debut. But a deeper look at the development and commercialization of these technologies in China reveals that the government is actively trying to stay ahead of this growing trend.

This is in large part prompted by the Chinese Communist Party’s (CCP) desire to maintain social and political stability by keeping its internet censorship mechanisms intact. However, the ability to roll out broad restrictions unchallenged also allows Beijing to move fast. Information controls aside, China’s forward-thinking approach to regulating the input and output of large language models (LLMs) may still lend European lawmakers interesting angles when developing their own regulatory framework.

Generative AI has seen explosive growth in the last few years, showing its transformative potential for economies and societies but also raising massive governance challenges. ChatGPT and its peers have demonstrated stunning ability to comprehend and compose text, which will only improve with time. Image generators like Midjourney can generate original artwork based on text prompts. Advances in virtual and augmented reality technology to create immersive simulations are transforming fields from gaming to healthcare. Alongside these breakthroughs, generative AI already permeates social media in the form of photo- and video-enhancing filters. With these technologies have come a range of privacy, security, ethical, and socioeconomic concerns.

Widespread adoption for commercial use

Chinese spy bases on Myanmar’s Great Coco Island? Here we go again

ANDREW SELTH

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On 31 March, Chatham House published a report titled “Is Myanmar building a spy base on Great Coco Island?”.The tone of the report was measured and its conclusions sensible but, predictably perhaps, it has since given rise to a rash of speculative and tendentious articles about a supposed Chinese military facility on a remote island in the Andaman Sea.

It is worth looking at the history of this story, if only to provide some context and inject a little balance into the public debate.

Back in 1992, an article “Government said helping to build naval base in Burma” published by the Kyodo News Agency claimed that China was building a “radar facility” on Myanmar’s Great Coco Island, just north of India’s Andaman and Nicobar group. This item caught the attention of other journalists and commentators, who published a series of increasingly alarmist stories in the mainstream press. As they tried to outdo each other, the narrative became ever more bizarre.

Without citing any evidence, the authors of these articles referred to antennae farms, radomes, giant telescopes and other specialised intelligence collection equipment. The small radar installed to service the airfield on the island was soon being described as a Chinese signals intelligence (SIGINT) station that could eavesdrop on Indian naval traffic, and an electronic listening post that could monitor Indian missile launches. It was also supposed to be able to intercept deep sea communications from Indian submarines.

Myanmar’s generals are very pragmatic, and will do whatever they have to do to survive, but they are also intensely nationalistic.

This nonsense was given greater credibility by some extraordinary statements by the Indian Foreign Minister, George Fernandez. In 1998, he claimed that China had leased Great Coco Island from Myanmar and was building a SIGINT base there to “encircle” India. His pronouncements seemed to be supported by late ANU Professor Des Ball, on record as stating that the reputed Great Coco Island facility was “one of the most important listening stations which China operates outside of China itself”.

Guo Wang: China’s Answer to Starlink?

Juliana Suess

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China is currently working on building a mega-constellation of satellites that will enable widespread internet coverage: Guo Wang. The potential motivations behind funding such an extensive and expensive project are manifold, and include China’s continuing expansion on the African continent.

Recent reports have highlighted China’s ambition to launch an internet-satellite constellation known as Guo Wang, which roughly translates to ‘state network’, and would consist of 13,000 satellites. The project first gained momentum in 2021 and is led by the company SatNet, created by the SASAC (China’s State-Owned Assets Supervision and Administration Commission), which oversees China’s biggest state-owned enterprises. It is thought that existing mega-constellations might be absorbed into Guo Wang, which could be an indication of the high priority the project has been given. Further, the fact that SatNet was created by the SASAC has been interpreted as an indication that the company enjoys ‘significant autonomy and state support’.

The questions that arise are why this project was conceptualised, and why it has gained so much traction and is being prioritised now. One of the reasons why the project may be in the spotlight now is the recent success of Starlink. SpaceX announced in December 2022 that the service has reached 1 million global subscribers. The commercial success and dual-use nature of this capability was highlighted on the world stage in the opening stages of the war in Ukraine, and has continued to dominate the headlines. While Starlink has been mentioned in the context of many capabilities and uses – including communications, command and control, and UAVs – its purpose and task is very simple: providing internet access, which in turn enables a host of different capabilities.

For all the praise and international coverage that Starlink has received, it is not without its faults. The system, despite promising worldwide coverage once the full constellation has been achieved, cannot currently be accessed in several parts of the world – notably Crimea, but also Russia, China and large swathes of Africa. While two dozen African countries – including Morocco, Egypt, Kenya and Tanzania – state that they will begin receiving the service in 2023 or 2024, there are another 20 countries in Africa and several in Central Asia, such as Kazakhstan, that state that service data is currently unknown. Meanwhile, countries in South Asia such as India and Pakistan state that regulatory approval is pending.

A China–Russia Alliance is Likelier Than We Think

Sam Etheridge

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China officially pursues a ‘non-alliance’ policy, but Western aid and support to Taiwan, economic competition – particularly the US restrictions on semiconductors – and the formation of ‘blocs’ perceived as hostile to Beijing in the Asia-Pacific will test this to the limit. The invasion of Ukraine will likely accelerate the deepening of ties by, over time, forcing China to pick a ‘side’ between Russia and the West. It is unlikely that the West will be Beijing’s choice.

While a formal China–Russia alliance is less likely than a continued strengthening of their strategic partnership, and the formation of a NATO-style collective defence structure is unlikely, China’s policy on alliances could be adjusted or ditched if it suits Beijing’s interests. Both countries have demonstrated flexibility in the past as international circumstances have changed. The West should prepare for this scenario and understand what is driving the two countries together, particularly as continued pressure against Beijing and Moscow appears certain.

Western Pressure

Both sides have gained significantly from their relationship. Russia has a wealthy and willing trading partner at a time of increasing international isolation. China has made technological gains from its relations with Russia and buys heavily discounted energy. Each side legitimises the other internationally. Despite these ‘positive’ elements, their ties are largely defined in opposition to the West. Historically, Western pressure against one or both countries (usually in the form of sanctions or blocs in their ‘near abroad’) has deepened their relations. The newly normalised relationship deepened after the 1989 Tiananmen Square massacre as the international community sanctioned China. The US’s much-heralded ‘Pivot to Asia’ and sanctions implemented against Russia in 2014 were followed by a flurry of economic and military agreements between Beijing and Moscow. This happened partially out of necessity, but also because the costs for each side of deepening relations were lowered as they had less reason to fear alienating Western countries.

Further Western sanctions on Russia after its invasion of Ukraine, the possibility of a forceful unification of Taiwan, the ‘Summit for Democracy’ and the ‘Quad’ have reinforced these drivers in Beijing and Moscow. For both countries, the growing economic, diplomatic, ideological and potentially even military confrontation with Western powers almost certainly trumps lingering (but waning) historical mistrust.

Dealing with Competing Interests

ChinaTalk: Sen. Warner on the RESTRICT Act, AI, Bipartisanship on China and a New Era of Intelligence

Jordan Schneider 

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We get into the RESTRICT Act, state capacity to analyze emerging technologies, the future of industrial policy, the nature and limits to bipartisanship around China, as well as the government’s role in regulating artificial intelligence.

Check out the ChinaTalk newsletter for a full transcript! https://www.chinatalk.media/

Art via midjourney prompt: corporate America’s naïveté vis-à-vis China

Learn more about your ad choices. Visit megaphone.fm/adchoices

Why the US delayed China sanctions after shooting down a spy balloon

Michael Martina

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WASHINGTON, May 11 (Reuters) - When an alleged Chinese spy balloon traversed the United States in February, some U.S. officials were confident the incursion would galvanize the U.S. bureaucracy to push forward a slate of actions to counter China.

Instead, the U.S. State Department held back human rights-related sanctions, export controls and other sensitive actions to try to limit damage to the U.S.-China relationship, according to four sources with direct knowledge of U.S. policy, as well as internal emails seen by Reuters.

The delays to items on the department's "competitive actions" calendar, a classified rolling list of steps the Biden administration has planned related to China, have alarmed some U.S. officials and revealed a divide between those in the U.S. government pushing for tougher action against China and others advocating a more restrained approach.

While the State Department signaled U.S. displeasure over the balloon by postponing Secretary of State Antony Blinken's scheduled visit to Beijing, an internal State Department message reviewed by Reuters shows senior U.S. officials delaying planned actions against China.

Rick Waters, deputy assistant secretary of State for China and Taiwan who leads the China House policy division, said in a Feb. 6 email to staff that has not been previously reported: "Guidance from S (Secretary of State) is to push non-balloon actions to the right so we can focus on symmetric and calibrated response. We can revisit other actions in a few weeks."

The sources said many measures have yet to be revived. The decision to postpone export licensing rules for telecom equipment maker Huawei and sanctions against Chinese officials for abuses of Uyghurs, has damaged morale at China House, they said.

President Joe Biden's administration has sought to prevent a further deterioration in ties with China's Communist government, which many analysts say have hit the lowest point since they began in 1979.

Former diplomats and members of Congress from both parties have argued that the U.S. must keep channels of communication open with Beijing to avoid misunderstandings and navigate crises.

But the sources said the current policy hews too closely to an earlier strategy of engagement that enabled China to extract concessions in exchange for high-level dialogues that often yielded few tangible results.

Wagner chief offered to give Russian troop locations to Ukraine, leak says

Shane Harris and Isabelle Khurshudyan

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In late January, with his mercenary forces dying by the thousands in a fight for the ruined city of Bakhmut, Wagner Group owner Yevgeniy Prigozhin made Ukraine an extraordinary offer.

Prigozhin said that if Ukraine’s commanders withdrew their soldiers from the area around Bakhmut, he would give Kyiv information on Russian troop positions, which Ukraine could use to attack them. Prigozhin conveyed the proposal to his contacts in Ukraine’s military intelligence directorate, with whom he has maintained secret communications during the course of the war, according to previously unreported U.S. intelligence documents leaked on the group-chat platform Discord.

Prigozhin has publicly feuded with Russian military commanders, who he furiously claims have failed to equip and resupply his forces, which have provided vital support to Moscow’s war effort. But he is also an ally of Russian President Vladimir Putin, who might well regard Prigozhin’s offer to trade the lives of Wagner fighters for Russian soldiers as a treasonous betrayal.

The Discord Leaks

Dozens of highly classified documents have been leaked online, revealing sensitive information intended for senior military and intelligence leaders. In an exclusive investigation, The Post also reviewed scores of additional secret documents, most of which have not been made public.

Who leaked the documents? Jack Teixeira, a young member of the Massachusetts Air National Guard, was charged in the investigation into leaks of hundreds of pages of classified military intelligence. The Post reported that the individual who leaked the information shared documents with a small circle of online friends on the Discord chat platform.

What do the leaked documents reveal about Ukraine? The documents reveal profound concerns about the war’s trajectory and Kyiv’s capacity to wage a successful offensive against Russian forces. According to a Defense Intelligence Agency assessment among the leaked documents, “Negotiations to end the conflict are unlikely during 2023.”

Exclusive: G7 leaders to target Russian energy, trade in new sanctions steps

Trevor Hunnicutt and Andreas Rinke

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The logo of the G7 Finance Ministers and Central Bank Governors' meeting is displayed at Niigata station, ahead of the meeting, in Niigata, Japan, May 10, 2023. REUTERS/Issei Kato

WASHINGTON/BERLIN, May 14 (Reuters) - Leaders of the Group of Seven (G7) nations plan to tighten sanctions on Russia at their summit in Japan this week, with steps aimed at energy and exports aiding Moscow's war effort, said officials with direct knowledge of the discussions.

New measures announced by the leaders during the May 19-21 meetings will target sanctions evasion involving third countries, and seek to undermine Russia's future energy production and curb trade that supports Russia's military, the people said.

Separately, U.S. officials also expect G7 members will agree to adjust their approach to sanctions so that, at least for certain categories of goods, all exports are automatically banned unless they are on a list of approved items.

The Biden administration has previously pushed G7 allies to reverse the group's sanctions approach, which today allows all goods to be sold to Russia unless they are explicitly blacklisted.

That change could make it harder for Moscow to find gaps in the sanctions regime.

While the allies have not agreed to apply the more-restrictive approach broadly, U.S. officials expect that in the most sensitive areas for Russia's military G7 members will adopt a presumption that exports are banned unless they are on a designated list.

Debt and Dysfunction in America

MICHAEL R. STRAIN

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The latest debt-ceiling drama playing out in Washington is more worrying than usual. Even if President Joe Biden and congressional Republicans come to terms, the economic and financial damage could be severe, especially if the world loses patience with a US political system that appears to lack adequate guardrails.

WASHINGTON, DC – Is American politics so dysfunctional that the United States government can’t even pay its bills on time? That is the central question behind the latest debt-ceiling drama playing out in Washington. So far, efforts to increase the country’s borrowing limit suggest the answer could very well be yes.

The first sign of dysfunction is that elected officials have only just started talking to each other. The US is barreling toward a catastrophic default next month, and yet President Joe Biden, House Speaker Kevin McCarthy, and other congressional leaders did not meet to discuss the situation until May 9, and a second meeting, set for May 12, was postponed.

Biden’s refusal to negotiate has been another cause for concern. He wants Congress to lift the debt ceiling without any accompanying conditions, including cuts to federal spending. While Biden may be right on the merits, the US system of government does not always settle disputes based on who is right on the merits.

Who’s Afraid of Central Bank Digital Currencies?

YANIS VAROUFAKIS

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ATHENS – When First Republic Bank failed, the Federal Deposit Insurance Corporation organized a shotgun sale of its assets to JPMorgan Chase. That violated the FDIC’s cardinal rule that no bank owning more than 10% of insured US deposits should be allowed to expand further by absorbing another US bank. But, because sparing taxpayers the cost of another bank bailout took precedence, the US authorities permitted – indeed helped – America’s largest bank, already a too-big-to-fail (TBTF) institution, to grow even larger.

In a rare show of bipartisanship, Democrats and Republicans alike applauded the FDIC’s actions, rejoicing that JPMorgan had stepped in with a “private sector” plan to avoid burdening the taxpayers. Unfortunately, the truth was less heroic: Jamie Dimon, JPMorgan Chase’s ubiquitous boss, negotiated a $50 billion credit line and a loss-sharing deal with the FDIC that will result in a $13 billion loss to US taxpayers. In short, the resolution of First Republic burdened Americans both with a hefty tax bill and with the larger systemic risks implicit in a bigger TBTF bank.

First Republic was small, but its fate is a harbinger of bigger things. Owing to the rise in prices and (to a lesser extent) wages, the US public debt as a share of national income shrank. But with the Federal Reserve boosting interest rates to arrest inflation, the value of Treasury bills sitting on the banks’ books declined (why buy a second-hand, low-yield bond when you can buy a higher-yielding fresh one?). And since most of the safe assets held by banks are Treasury bills, bankruptcies like those of Silicon Valley Bank, Signature Bank, and First Republic ensued.

This dynamic is unlikely to end any time soon. More banks will fail, which will help TBTF banks pose even larger systemic threats to society. Besides misleading the public that their taxes are being spared, the authorities are setting the stage for a future banking crisis, which will force an exasperated public to pay even more.

There is an alternative to the tax-funded absorption of small banks like First Republic by megabanks like JPMorgan. And it would not shift the cost of backing uninsured deposits to the taxpayer: Fed deposit accounts or, equivalently, the gradual rollout of a Fed-issued digital dollar.

The conflict cannot end until Ukraine is part of the West

IVO DAALDER

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Ivo Daalder, former U.S. ambassador to NATO, is president of the Chicago Council on Global Affairs and host of the weekly podcast “World Review with Ivo Daalder.” He traveled to Ukraine as part of a GLOBSEC-organized delegation.

On a recent trip to Kyiv, the talk along Ukraine’s corridors of power was decidedly different from those in Washington and European capitals. Far from focusing on the much-discussed counteroffensive Ukrainian forces are about to launch, senior government officials were instead more concerned about the country’s long-term future.

“Ukraine will survive,” a very seasoned spymaster told a group of former senior officials who traveled to Kyiv from the United States and Europe. “The most difficult point will come after the war,” he added.

At its core, the war in Ukraine is a fight not over territory but over the country’s future. Russia is determined to control Ukraine’s political destiny — if not its territory. And in this, Russian President Vladimir Putin is not unique, representing a historic Russian tradition of seeking security in empire — which, at a minimum, includes Russia, Belarus and Ukraine.

Even if Ukraine succeeds in pushing Russia’s military forces all the way back to its 1991 borders, the conflict won’t truly end. Ukrainian intelligence officials estimate that if the fighting were to stop this year, Russia would already be able to reconstitute sufficient capabilities to restart the war by 2027-2028 — even with economic sanctions remaining in place.

So, in order to truly end the conflict, Russia will have to understand — or be made to understand — that Ukraine’s future will be decided in Kyiv, not Moscow. And Kyiv has made it abundantly clear that it sees that future in the West, as an integral part of the Euro-Atlantic institutions.

The Western Private Sector as an Actor in the Russia-Ukraine War: Implications for Israel

Arkady Mil-Man Georgy Poroskoun 

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Economic and security assistance to Ukraine, along with a mass departure from Russia: private Western companies play a significant role in the war in Europe that has been raging for over a year. What lies behind the intervention of these companies, how is it significant, and what in this regard is important for Israel?

On the eve of the hostilities between Russia and Ukraine that erupted in February 2022, and even more so in the course of the war, many private companies, at their own initiative, adopted an active stance on the conflict in two main spheres: sending direct and intensive aid to Ukraine, and curbing or ceasing operations in Russia. These measures have an impact on the economic situation on both sides of the conflict, as well as on the course of the war. This is an important and partly new phenomenon that could have implications for Israel.

Aid to Ukraine

During the war between Russia and Ukraine, some Western companies, at their own initiative, adopted pro-Ukraine stances. At the same time, the Ukrainian government invested extensively in building a comprehensive system of support in all areas, which has enabled its positive influence on the course of the war.

Communication, storage, and information services: For the first time ever during a military conflict, the Ukrainian government attempted to impede the Russian war effort through a wide variety of digital measures, while recruiting broad support from Western tech giants. For example, after an official request to Google, the company restricted access to certain features of its maps, and also blocked access to several YouTube channels of Russian state media.

An exclusive channel of communication in the service of the army: Following a Russian cyberattack against the ground communication terminals of Viasat Inc. early in the invasion, the Ukrainian military and many civilian customers were left without a critical satellite communication hub that provided internet and additional services. The Ukrainians turned to Elon Musk, the owner of SpaceX, which provides the satellite internet service Starlink. Musk agreed, and thousands of terminals were donated to Ukraine, in particular to military units, in order to enable the continuity of command and control. A small portion of the terminals that were transferred was bought by the US administration and crowdfunding. The cost of Musk's donation is estimated at $80-100 million. Starlink provided Ukrainian forces with the exclusive ability to contain an attack against Viasat, and it is still one of the main means of communication for Ukrainian operational activity.

Crumbling nuclear order needs leadership and commitment

Dr Marion Messmer

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North Korea’s test of a solid-fuel intercontinental ballistic missile (ICBM) is just the latest incident at a time of heightened nuclear risk across the globe, coming alongside Iran’s near weapons-grade uranium enrichment and Russia’s plans to station nuclear weapons in Belarus.

The US has also announced plans to deploy nuclear-armed submarines in the Pacific after requests for security assurances from the Republic of Korea which is increasingly concerned about the threat from North Korea. This announcement comes just weeks after Russia announced the deployment of its own nuclear-armed submarines in the Pacific.

Such an alarming uptick in nuclear-related activities highlights the increasing salience of nuclear weapons in global politics and the problems in nuclear diplomacy, but the multilateral toolkit can still provide effective responses. 

Putin’s announcement of the suspension of Russia’s participation in New START marked a hiatus in strategic arms control between the US and Russia, but international nuclear relations have gradually deteriorated over several years as tensions between nuclear-armed states escalated and various nuclear arms control agreements been breached or abandoned.

Such an alarming uptick in nuclear-related activities highlights the increasing salience of nuclear weapons in global politics and the problems in nuclear diplomacy

There still remains a widespread commitment within the Treaty for Non-Proliferation of Nuclear Weapons (NPT) to eventual multilateral nuclear disarmament, a strong norm of maintaining the ban on testing nuclear weapons, and the principle of nuclear non-proliferation. But the NPT is under threat as the international political environment becomes more contested.

Dilemmas of Deterrence

Joseph S. Nye

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History reminds us that some factors, like credibility, are crucial to the success of countries' efforts to prevent undesirable behavior by others. But studying the limits of these efforts is equally important for identifying a strategy that works.

We live in a world where geopolitical stability relies largely on deterrence. But how can we prove that deterrence works?

Consider the ongoing war in Europe. Beginning in December 2021, US President Joe Biden warned Russian President Vladimir Putin that Russia would face severe new sanctions if he invaded Ukraine, to no avail. Then, when the United States and its European allies thwarted Russia's plans by providing arms to Ukraine, Putin brandished the nuclear option. But Western aid continued unabated.

Did deterrence fail or succeed? Answering this question poses a challenge because it requires assessing what would have occurred absent the threat. It is hard to prove a negative. If I put a sign on my front door saying, "No Elephants," and there are no elephants in my house, did I deter them? It depends on the likelihood of literate elephants entering in the first place.

The Ukraine war demonstrates how risk reduction is not always an either/or choice, but often a matter of degree. Perhaps Putin, counting on a flimsy Western alliance, believed the sanctions would fail. But he has so far refrained from striking supply lines in NATO countries. And while the West, for its part, has continued to arm Ukraine despite Putin's nuclear saber-rattling, it has been reluctant to provide longer-range missile systems or modern warplanes.

Credibility is essential for deterrence to work: threatening a maximum response to defend a minor interest strains credulity. This is particularly true when a nuclear power promises to extend its umbrella to defend a distant country....

Speeding Toward Instability? Hypersonic Weapons and the Risks of Nuclear Use

Evan B. Montgomery, Toshi Yoshihara

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Today, states are pursuing an array of supposedly "disruptive" or "game-changing" technologies that could alter how they organize, train, equip, and employ their forces, including their nuclear forces. The 2022 National Defense Strategy emphasized the link between some of these technologies and the risk of nuclear use, noting that "a wide range of new or fast-evolving technologies and applications are complicating escalation dynamics and creating new challenges for strategic stability."

One class of emerging military capabilities frequently cited as one such technology is hypersonic weapons: unpowered projectiles and self-propelled vehicles that can travel at greater than five times the speed of sound, follow midcourse trajectories that make detection difficult, and execute complex aerodynamic maneuvers in the terminal phase of their flight, all of which could enable them to reduce defender warning time, penetrate missile defenses, and deliver conventional or nuclear payloads against targets with a high degree of accuracy. Moreover, the United States, Russia, and China are all in various stages of developing, producing, and fielding such platforms. These developments have led to a debate over the utility, cost, and risks of hypersonic weapons.

In Speeding Toward Instability?, authors Evan Braden Montgomery and Toshi Yoshihara examine both the key drivers of nuclear escalation and the broader set of challenges facing both the conventional and nuclear balance to address the critical questions in this debate. In their analysis, they find that hypersonic weapons are not uniformly a threat to stability, and are unlikely to upset strategic stability between the United States and China in the way that critics fear they might. However, their analysis also indicates that there are wider-ranging implications of China's ongoing nuclear buildup that current assessments fail to explore. In discussing these potential escalation pathways, Montgomery and Yoshihara also assess implications for U.S. strategic policy, especially at the theater level.

Putin’s Missile War Russia’s Strike Campaign in Ukraine

Ian Williams

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Russia’s missile campaign against Ukraine has severely underperformed expectations. In the invasion’s early days, Russia underestimated the necessary scale and effort of its missile campaign. Since then, Russia has changed course multiple times, most recently moving to target Ukrainian electrical grid and civilian infrastructure during the winter months. Russia’s haphazard missile campaign reflects both internal strategic failures and Ukraine’s critical forward thinking in the days prior to the invasion. Early Russian failures also gave time for Ukraine to develop its air defense strategy and capabilities which have only grown in effectiveness, thanks in large part to Western aid. This report provides an in-depth review of these and related “missile war” dynamics.

This report is made possible by general support to CSIS. No direct sponsorship contributed to this report.

Europe’s AI Act Nears Finishing Line — Worrying Washington

Hadrien Pouget

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European parliamentarians are considering additions to the initial Artificial Intelligence (AI) Act’s draft lists of either prohibited or high-risk applications.

The AI Act’s main thrust is to require programmers working on high-risk applications to document, test and take other safety measures. Parliament is poised to rope in more applications than initially proposed, including broad categories such as systems “likely to influence democratic processes like elections,” or “General Purpose AIs” which can be integrated into different applications, such as OpenAI’s ChatGPT.

Big Tech is predictably resistant. The US government has voiced concern. An increase in scope could raise overall transatlantic tensions surrounding tech regulation. So far, Washington has remained relatively silent as Europe clamps down on tech. Through the Trade and Technology Council, Washington and Brussels have focused on collaboration and expressed a desire to harmonize their regulatory approaches to AI.

A broadening of the AI Act could test this cooperative spirit. US companies and regulators were already worried about the AI Act, fearing it was trying to tackle too many applications and would become ineffective and burdensome. US actors are sensitive as the EU’s recent Digital Services Act and Digital Markets Act were perceived as unjustly targeting US companies. In this environment, an increase in the AI Act’s scope could risk losing the neutral appeal it enjoyed until now.

A looming collision must and can be avoided. US critics should recognize that the AI Act is not the “one-size-fits-all” solution it is often imagined to be. While the Act attaches a single set of generic requirements to high-risk AI systems, the requirements could — and should — be adapted to different applications. “Appropriate levels” of accuracy or robustness will be customized to different high-risk contexts. This would allow flexibility in enforcement and potential alignment with international standards — and the US and EU have already identified standards as an area for cooperation. Recent AI Act proposals also offer opt-out mechanisms for companies who do not think their AI systems pose any risks.

Winners and Losers in the AI Arms Race

BARRY EICHENGREEN

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Generative artificial-intelligence models like ChatGPT will revolutionize the economy, though no one can say when. Equally important, no one can say where, though there is no reason why AI, like previous general-purpose technologies, shouldn’t produce widely shared net benefits.

BERKELEY – The first rule of forecasting, the financial journalist Jane Bryant Quinn once observed, is this: give them a forecast or give them a date; just never give them both.

So, here’s a not very bold forecast: Generative artificial-intelligence models like ChatGPT will revolutionize the economy. We just can’t say when.

Nor can we say where. Among the key questions lost amid the flurry of commentary on generative AI is which countries will benefit, and which will not.

Bridging the AI Regulation Gap

CÉDRIC O

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PARIS – On March 22, the Future of Life Institute published an open letter calling for a six-month moratorium on the development of generative artificial intelligence systems, citing the potential dangers to humanity. Since the publication of that letter, numerous high-profile figures have voiced similar concerns, including AI pioneer Geoffrey Hinton, who recently resigned from Google to raise the alarm about the “existential threat” posed by the technology he played so pivotal a role in developing.

The seriousness of these warnings should not be underestimated. Demands for government intervention rarely originate from tech companies, which in recent years have fiercely resisted efforts by American and European policymakers to regulate the industry. But given the economic and strategic promise of generative AI, development cannot be expected to pause or slow down on its own.

Meanwhile, members of the European Parliament have voted in favor of a more stringent version of the AI Act, the landmark regulatory framework designed to address the challenges posed by “traditional” AI systems, trying to adapt it to tackle the so-called “foundation models” and advanced generative AI systems such as OpenAI’s GPT-4. As one of the main negotiators of the European Union’s groundbreaking Digital Markets Act (DMA) and Digital Services Act (DSA), I recognize the importance of creating a human-centered digital world and mitigating the potential negative impact of new technologies. But the speed at which the EU is developing restrictive measures raises several concerns.

To Restrict, or Not to Restrict, That Is the Quantum Question

Sam Howell 

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Innovation power—the ability to invent, scale, and adapt emerging technologies—will determine which country prevails in the great power competition of the 21st century. Export controls accordingly assume a central position in the U.S. foreign policy toolkit, carrying the ability to significantly impact an adversary’s innovation potential. In October 2022, the Biden administration introduced semiconductor, artificial intelligence, and supercomputing-related export controls on China and has since hinted that similar restrictions on other technologies, including quantum information science, may soon follow.

U.S. policymakers are right to identify quantum information science as a critical technology area ripe for restriction, but introducing export controls now is likely to cause more harm than good.

Establishing U.S. leadership in quantum information science, which includes the subfields of quantum computing, quantum sensing, and quantum communications, ranks among the Biden administration’s highest national security priorities. Quantum technologies promise to dramatically increase computing power and speed, enabling machines to solve problems beyond the capacity of current-generation computers. They are also inherently dual use, meaning they can be applied to both military and civilian contexts.

The potential strategic advantages of quantum technologies are numerous and significant. Quantum-enabled countries could crack an adversary’s encryption methods, build unbreakable communications networks, and develop the world’s most precise sensors. The first country to operationalize quantum technologies will gain the ability to threaten adversaries’ corporate, military, and government infrastructure more quickly than an adversary can establish effective defenses. Beyond the direct military applications, quantum technologies could further deliver significant economic advantages in a range of industries, from aerospace and defense to pharmaceuticals and automotive.