"Syria - A 'Road to Damascus' for Obama?"

Sydney M. Williams

Thought of the Day

“Syria – A ‘Road to Damascus’ for Obama?”

August 8, 2011

The past week could be considered a Hebdomadis Horribilis for President Obama. On Wednesday the President signed a bill permitting the country to increase its borrowings. However, the next day stocks voted as to the bill’s merits: the DJIA closed down 513 points, or 4.3%. On Friday, after the close, Standard & Poor’s weighed in: they lowered the country’s credit rating for the first time in its history – from AAA to AA+. And on Saturday, thirty-one U.S. and seven Afghan soldiers were killed when Taliban forces shot down a helicopter coming to the aid of trapped forces. The majority of the dead were Seals, including members of Seal Team Six that killed Osama bin-Laden.

It is little wonder then that the President has said so little as Syrian President Bashar al-Assad moved tanks and troops into the city of Hama, the scene of his father Hafez al-Assad’s murder of 20,000 citizens in 1982. (On Sunday, another forty-two people were killed, as President al-Assad’s troops attacked the city of Deir al-Zour.) Seemingly oblivious to the loss of human life in Syria and despite our embassy being attacked in the past few weeks, the President pushed the Senate to confirm confirmation for Robert Ford, the man he has chosen to be the first U.S. Ambassador to Syria since 2005. Ironically, at the end of last week Italy recalled her Ambassador and the European Union imposed new sanctions.

Over the past five months, since the “Arab Spring” swept the region, the Syrian regime has murdered between 1600 and 2000 of their courageous citizens. Yet serious condemnation has been slow in coming. The U.N. Security Council finally, last week, issued a statement condemning the “use of force against civilians by the Syrian authorities.” Yet there was no threat of meaningful sanctions by that august body that has spoken in such moral tones about human rights, but has done so little to punish violators.

In June 2009, President Obama went to Cairo to deliver a speech which was motivated by his perception that the rift in Muslim relations caused by his predecessor needed repair. He sought a “New Beginning.” In soaring terms, he called for a world “where governments serve their citizens, and the rights of all God’s children are respected.” Two years later, the al-Assad regime has not only not served its citizens, it has been murdering them. Instead of maintaining respect for the oppressed and the fallen, Mr. Obama has chosen to honor their nation by restoring diplomatic relations.

On the eve of his birthday last Wednesday at a $35,000-a-plate dinner in Chicago, Mr. Obama’s rhetoric reached new highs. Our foreign policy has “got to be about respecting human rights all around the world and making sure that America continues to be a beacon of hope” – except, apparently, for those who live in Hama and other Syrian cities where the cries of the oppressed are droned out by the reality of “Realpolitiks.”

It is certainly true that America cannot intervene in every country where dictators rule. On a daily basis we must live with the world as it is, not as we would wish it to be. We must choose our battlefields carefully – lest we become embroiled in so many that we can finish none. There has been reluctance on many of Syria’s neighbors to call for “regime change” for fear of anarchy, or simply a belief that the devil you know is better than the one you do not. On the other hand, that is no reason to honor such countries by sending ambassadors, or in not imposing tough sanctions.

There is a terrible sanctimonious-tinged hypocrisy when those in the West who have long benefitted by the human rights for which so many Syrians yearn, ignore their pleas and respond only with empty words of comfort. The relationship between Iran and Syria – homes to two of the Mideast’s most hateful regimes – is strong and physically separated only by Iraq. One can only imagine the strength that the region would possess had Saddam Hussein been allowed to remain in power. Iraq’s fledgling democracy is critical to a longer lasting peace in the area. A careless and premature withdrawing of U.S. troops, as desirous an eventuality as that is, risks intensifying the power of Syria and Iran.

The symbolism of these dictator-led countries is important. Elliott Abrams, in an op-ed in last Tuesday’s Wall Street Journal, opined: “The single event that would most help bring down the Assad’s would be the fall of Moammar Gadhafi in Libya.” It remains unclear that the lesson from the “Arab Spring” is that dictators are doomed, or that they will win by killing protestors.

The reactions of the Administration to the events of this past spring and in particular to atrocities of the regime of Bashar al-Assad in Syria thus far do not signal a liberal change in direction on the Road to Damascus, despite the beautiful words uttered at Cairo University on June 4, 2009.

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Off of Standard & Poor’s downgrade of U.S. debt on Friday, futures suggest, unsurprisingly, a negative opening to today’s market. While a rush into safe assets is understandable because a downgrade increases the level of uncertainty surrounding risk assets. S&P’s decision may serve as a wake-up call to Congress and the Administration – a “Sputnik Moment” as Burton Malkiel wrote in this morning’s Wall Street Journal. Washington needs to put into action those words of the President that he has spoken but not acted upon, a need to return to fiscal prudence.

How far the market declines, no one knows. Al Tobia, co-owner of Sidus Investment Management Company asks an interesting question, though. It is worth considering a time almost nine years ago, when the market was reeling from the after-effects of the internet-tech bubble in early October 2002. The S&P 500 bottomed around 768. If one had been smart or lucky enough to have had bought stocks at that time, the subsequent total compounded annual return would have been slightly over seven percent. If, instead, one had bought the Ten-Year Treasury that October, the total return would have been almost exactly the same. Today, with stocks selling at multiples of about eleven times forecasted earnings and yielding about 2%, and with the Ten-Year yielding 2.5%, which vehicle is more likely to provide the best return over the next nine years? “Safety” may work for the moment, but do Ten-Year Treasuries yielding 2.5%, with a lowered credit rating, make sense as a long term investment?