A CBS/New York Times Poll taken in February reports the following responses to the question “What do you think is the most important problem facing this country today?”

It’s clear from these figures that the American electorate is focused on domestic problems, not international ones. And right now President Obama’s domestic strategy is badly frayed.

The election of Scott Brown in Massachusetts to Ted Kennedy’s seat in January was not a fluke. With unemployment remaining near 10 per cent and mortgage foreclosures continuing to rise, and despite the stimulus package, the electorate is not sure how Obama’s policies have made things better. The fact that fiscal and monetary stimuli might have prevented the economy from going off the cliff wins the president no points.

Despite this rocky start, Obama could still recover his rhetorical footing and redefine the parameters of domestic legislation debate in time for 2012. It is not difficult to see how he could even be re-elected again, especially if the domestic economy starts to improve. 

Foreign policy, however, is a much greater challenge. While Obama’s presidency could be wrecked by foreign policy developments, it cannot be redeemed by them. The chances for success in the five major tests that the administration confronts—North Korea, Iran, Middle East peace, Afghanistan/Pakistan and Iraq—range from hard to next-to-impossible. Prospects are no brighter with regard to the four big issues of global governance: climate change, financial sector reform, macro-economic policy coordination and transnational terrorism.

North Korea’s policies with regard to nuclear weapons will not change because of external pressure. South Korea and China, the two countries that could really pressure North Korea, are more worried about destabilisation than nuclear weapons. Given its population of 22 million and per capita income of below $US2000, the collapse of the North Korean regime would burden South Korea and even China. Nevertheless, Kim Jong-Il and the small coterie around him could possibly be bribed into policy change. North Korea’s nuclear weapons policy is driven by regime choice, not structural circumstances. The leaders of North Korea could decide that they would prefer more lobsters and easier access to the outside world to isolation and nuclear weapons. The Six-Party Talks could work.

Iraq might continue on a reasonable trajectory—limited violence, some form of electoral democracy, economic growth, US withdrawal—but even if it does, it will not enhance Obama’s standing with the domestic electorate. If anything, success or something that could be called success in Iraq, would validate the policies of the Bush administration. But a better bet would be that Iraq will be a military dictatorship in five years’ time. Given the institutional weakness of the government and the continued focus on building up Iraq’s security forces, the army will become the strongest institution in the country. Assuming the military would be prepared to keep Iraq away from transnational terrorism and to maintain a distance from Iran, this might be a satisfactory, although far from an ideal, outcome for the US, and one that would not damage Obama. If, however, Iraq descends into violence or aligns itself with Iran, the Obama Administration would bear the cost.  


There is little doubt that Iran will eventually get nuclear weapons. The conditions that allowed nuclear weapons to contribute to global stability during the Cold war—secure second strike capability, sophisticated organisational control, non-millenarian foreign policy objectives and unified government—are all absent in Iran. Iran's nuclear weapons could be used purposefully—to end the sinful domination of the West or precipitate a crisis that would rally the domestic population around the regime—or inadvertently because of poor command and control or hair-trigger launch protocols designed to respond to a first strike that might, or might not, be real.

Despite the fact that nuclear weapons in Iranian hands represents a grave threat, Obama will not be able to prevent this from happening. Sanctions will only work if they are targeted to convince the regime's leaders that they are more likely to survive if they abandon rather than continue their current nuclear trajectory. Such a project would be difficult under any conditions and the difficulty is amplified by the reluctance of China and some other countries to support stronger sanctions. An attack against Iran by the US or even Israel might be the best course for long-run world peace, but it would engulf the administration and weaken its chances of success on domestic issues. In the Middle East, President Obama will not be able to broker a peace deal. On the non-Israeli side, the conditions are simply not conductive: Palestine is divided; the Palestinian Authority lacks authority and capacity; and compromise with Israel would de-legitimise Hamas in the eyes of its own supporters. For Israel, force has worked to end rocket attacks from Lebanon, dramatically reduce attacks from Gaza, and contain suicide bombers from the West Bank. On the other hand, compromise and conciliation—Oslo, Camp David, unilateral withdrawal from Lebanon and Gaza—has failed. For the moment, distrust between the two sides is high. While active third-party engagement by the US, the European Union, and leading Arab states might produce a peace deal, given the demands of his domestic agenda, President Obama will not take on such a role.


In the election campaign Obama described the war in Afghanistan as a war of necessity. By endorsing a March 2009 policy review and appointing General Stanley McChrystal, he locked himself, at least rhetorically, into a counter-insurgency strategy. A counter-insurgency strategy, however, requires a political structure upon which the components of effective governance, including the military and police, can be built. Afghanistan does not have such a structure. The Karzai government is not only corrupt, but also incompetent.

The best hope for progress in Afghanistan would be change in Pakistan. The Pakistani military has, since September 11, 2001, been both the recipient of billions of dollars of US aid and a major supporter of radical groups in Afghanistan that have been attacking NATO's International Security Assistance Force. That this double game is now clear does not mean that it will end. Still, the terrorist attacks inside Pakistan may convince the high command that Islamic radicals are a greater threat to the security of the state than India. Alas, it is all too easy to imagine a nightmare scenario in which the Pakistani state unravels and nuclear weapons, or the state itself, fall into the hands of Islamic radicals.


Compared with any time before 1990, great power relations are more peaceful than they have ever been. Despite this comity, it will be very difficult to make progress on two of the four major global public good issues, financial sector reform and macro-economic policy coordination and next to impossible on the other two, climate change and transnational terrorism. The G-20 has established a Financial Stability Board and Mutual Assessment Process to look at financial sector reform and macro-economic policy coordination. There is agreement among major financial centres in some areas, such as regulating all the financial institutions that could threaten global stability and higher capital requirements, but not all. Macro-economic policy coordination involving both savings and exchange rates will be more difficult but not impossible, if only because, even ignoring domestic political impediments, there is no consensus on what the appropriate policies ought to be. Moreover, successful international coordination of financial sector reform and macro-economic policies can only help Obama's electoral chances indirectly, by improving the performance of the US economy.

With regard to the two other global public goods issues–climate change and transnational terrorism–there is no opportunity for dramatic progress. The 2009 climate change conference produced a less than modest outcome, the three page non-binding Copenhagen Accord. There is no consensus on how to understand or address transnational terrorism, with the European countries adopting a criminal model and the US edging away from a war model toward something else, but what that something else might be is not yet clear.

In his first year in office, Barack Obama's domestic accomplishments were disappointing. The passage of the health care bill, however, has potentially given him the opportunity to regain control of the domestic agenda, pass additional legislation, and ride the crest of an economic recovery to re-election in 2012. Foreign developments, in contrast, could wreck his administration—a radicalised autocratic Iraq, a nuclear-armed Iran, a collapsed Pakistan—but they cannot save it. The only exception would be another mega-terrorist attack against the US—that would be a game changer.