The InternationaList: May 23, 2008

How To Catch a Tiger in Sri Lanka
By Christian Caryl
For years, most experts have argued that insurgencies aren't won on the battlefield but on the political front. Now events in Sri Lanka have called that axiom into question. Last week the Tamil Tigers admitted defeat after a brutal two-and-a-half-decade civil war when their leader, Velupillai Prabhakaran, was killed and their forces routed by the Sri Lankan military. Observers around the world are now keen to know what lessons lie in the government's success against the Tigers, who wanted independence for the country's small Tamil minority—and whether those lessons can be applied to counterinsurgencies elsewhere. Sri Lanka's strategy turned on a few key tactics. First, the government created heavily armed village militias to protect civilians. Second, whenever it cleared an area of rebels, it quickly moved in enough professional soldiers to hold the ground. Third, it took the fight to the enemy, deploying highly trained commandos to snoop out guerrilla bases deep in the jungle, where they used GPS devices and called in airstrikes. Many of these tactics are replicable elsewhere—in fact, they should sound especially familiar to Central Command chief Gen. David -Petraeus, whose military "surge" in Iraq relied on many of the same techniques.

But other parts of Sri Lanka's victory will prove harder to copy. Tim Fish of Jane's Defence Weekly in London says that cutting off the Tigers' seaborne supply lines proved critically important. In landlocked Afghanistan, which shares a notoriously porous 1,600-mile border with Pakistan's lawless tribal areas, that's obviously impossible. In Sri Lanka, moreover, as the war dragged on, the population, just 11 percent of which is Tamil, agreed to tolerate the suspension of some civil rights, as when Tamil refugees were put in temporary holding camps to screen fighters from civilians. Critics also claim that the government's indiscriminate use of artillery and air power in the final phases of the campaign likely led to huge civilian casualties—again with little public outcry. It's hard to imagine Washington blessing a similar approach in Baghdad or Kabul—or locals standing for it. Meanwhile, Sri Lanka underscores one other lesson: how long it actually takes to win a counterinsurgency (26 years, in this case). By that measure, America's wars against its guerrilla enemies have only just gotten started.

Pakistan's Other Nuclear Threat
By John Barry
As the Taliban battles Pakistan's military just 60 miles from Islamabad, one question frightens experts around the world: what about the nukes? The good news is that Pakistan's warheads, estimated at about 100, are guarded by an elite unit screened for loyalty. So long as the Army holds together, these main sites are essentially invulnerable. But Pakistan's nuclear-research and -production facilities are another story. Kahuta, the main R&D complex, covers many square miles and employs thousands, and it is merely the biggest of more than a dozen facilities. Pakistan has received $100 million or so from the U.S. to improve security at these sites, but it has been slow to address the loyalty of employees. Kahuta was, after all, the workplace from which A. Q. Khan managed to sell nuclear blueprints to rogue regimes. More recently, U.S. officials think extremists have made determined efforts to infiltrate the site, perhaps even applying for jobs there. They may not be able to get their hands on warheads, but leftover uranium could make for a dirty bomb-—and plenty of terror.

Hong Kong Gets Snubbed As a Hub
By Michael Pettis
Since the financial crisis struck, the conventional wisdom has been that Manhattan bankers should pack their bags for Hong Kong, since Asia's financial hubs would inevitably profit from the distress in New York and London. But history suggests the opposite: that today's financial capitals will actually grow stronger in the decade to come.

Big centers have advantages over smaller, newer rivals: more money, more extensive business networks and lower trading costs. Of course, smaller hubs have advantages, too—namely, local knowledge and favorable time zones. During booms, their disadvantages—less liquidity, higher costs—shrink in importance, and investors move in to exploit local markets. When the boom ends, however, trading costs rise sharply, and the moneymen return to what's familiar. The same process is at work today. Stock-market trading volume has declined sharply in nearly every emerging center—by 50 percent in Hong Kong in the first quarter of 2009, for example.

New York's supremacy isn't guaranteed to last. But if Asian trading floors do start seeing more American faces, it won't be a result of the current crisis.
Pettis Teaches Finance In Beijing.

Britain's Not-So-Great Expectations
By William Underhill
These should be dark days for David Cameron, leader of Britain's Conservatives. A spending scandal has revealed some embarrassing details about extravagant expenses claimed by his legislators. Among the rule-bending bills submitted to taxpayers: a new helipad, swimming-pool repairs and moat dredging. Though the revelations have targeted the Labour Party as well, you'd think they'd have hurt the Tories most by reviving the upper-class, out-of-touch image Cameron has worked to dispel.

So why is Cameron still so far ahead in the polls? Support for the Conservatives still stands strong at around 40 percent, while Labour has dropped several points to 28 percent or lower, depending on the poll. Twice as many voters think the scandal damages Labour more than the Tories, according to pollsters ICM. The reason? Cameron's Conservatives seem to have discovered the upside of low expectations. In the words of Harold Wilson, Labour's leader in the 1960s: "The Labour Party is a moral crusade—or it is nothing." Such a lofty standard only sets the party up for a fall. The Conservatives, by contrast, have never quite shed their image as the party of the rich, despite Cameron's efforts. "Sleaze is what the Conservatives do," says political analyst Mike Smithson. "Tories expect their MPs to have helipads built or their moats cleaned out" at public expense. These low standards may soon lead Conservatives to 10 Downing Street, where taxpayers cover all the expenses.

Drinking Liberally In Iraq
By Larry Kaplow
In the first years after Saddam Hussein's overthrow, the dream of a secular Iraq seemed to be disappearing fast, as professionals fled the country, headscarves for women became a must and liquor stores were shuttered. Religious parties became the dominant force in Iraqi politics.

Now secularism seems to be enjoying a revival. Religious militias in Iraq are on the retreat and bars have reopened. Prime Minister Nuri al-Maliki's Islamic Dawa Party has been downplaying its religious roots to woo moderates—in January's local elections it avoided using religious symbols on campaign materials in some areas. And secularists did better than expected in the vote. With parliamentary elections expected early next year, Iraqi liberals are hoping to win more than the roughly 20 percent of the vote they've received in the past. Ghassan Atiyyah, a respected political analyst who fled the country during the civil strife, recently visited to join others building slates of secular contenders.

But the secular upswing may turn out to be a mirage. Maliki's recent gestures to moderates, like more liquor licenses, could turn out to be a cynical attempt to steal votes from truly nonsectarian parties. Ayad Jamal Addin, a prominent liberal, admits, "Our funds are weak, our organization is weak, our media is weak." If Maliki's strategy succeeds, Iraq's secular parties will get weaker still.