This week the Dutch Ministry of Security and Justice announced that it will pay for the successful achievement of employment and prison recidivism outcomes among short-term adult prisoners as part of the new “Work After Prison” social impact bond (SIB)—the fifth such transaction in the Netherlands and one of about 60 in the world. In a SIB—which is a mix of results-based financing, a public-private partnership, and impact investing—private investors provide upfront capital for preventive social services, and in turn an outcome funder (usually government) pays them back plus a return contingent upon the achievement of agreed-upon outcomes. Where consistent social outcomes achievement poses challenges, this model has considerable potential to create a path forward.

What is the social challenge?

Each year in the Netherlands, around 40,000 adults are incarcerated and about 30,000 are released. What’s troubling is that the rate of recidivism two years after release from prison is nearly 50 percent. And the costs of successful reintegration and reduced recidivism rates are high and include enormous amounts of social benefits paid out to previously incarcerated individuals. Multi-pronged approaches are often necessary including programs that address housing needs, employment, mental health and substance abuse issues, and debt settlement. Addressing all of these challenges simultaneously is difficult and often the right incentives are not in place for the outcomes of importance to be at the forefront of decision-making. But SIBs may offer a promising way to meet these hurdles.

Who are the players in the SIB?

In a typical SIB, the players at the table include an outcome funder (government), investors (usually impact investors including foundations), a service provider or providers (usually a non-governmental entity but it can also be public), and the beneficiary population. In addition, there can be external evaluators who assess whether or not the agreed-upon outcome has been achieved; and, in many SIBs, there is also an intermediary party that brings the stakeholders to the table, structures the deal, manage the deal, or conducts performance management for the service provider.

The Dutch SIB for prison recidivism has a total of 10 players not including the beneficiary population. Most interestingly, this deal differs from all four previous SIBs in the Netherlands in that the outcome funder, the Ministry of Security and Justice, is at the national level rather than subnational level—the previous outcome funders were all municipal governments. Notably, less than half of the SIBs in the world have a national-level outcome funder. The Dutch bank ABN Amro, the Start Foundation, and Oranje Fonds are equal investors (and have all invested in previous Dutch SIBs). Three organizations that are part of the Work-Wise Direct Consortium—Exodus Foundation, Restart, and Foundation 180—will provide services to the population in need. Society Impact, an organization supporting social entrepreneurship and innovative financing in the Netherlands, acted as a matchmaker in the transaction by helping to bring all parties to the table. An evaluation arm of the Ministry of Security and Justice and a research entity, Panteia will evaluate whether or not outcomes are achieved.

The beneficiary population includes 150 adults who have been in prison between three and 12 months. There is no targeting based on type of crime, age, or gender and consent must be provided by the participant and the municipality.

What’s at stake?

There are two outcome metrics established in this SIB. In a period of two and half years, the outcome funder will repay investors the principal investment of 1.2 million euros plus a maximum return of 10 percent of the investment (but expected return is around 5 percent) contingent upon: 1) a 25 to 30 percent decrease in the social benefits issued to the previously incarcerated participants (which is estimated to require a 882-month increase in labor force participation by the entire group); and 2) a 10 percent reduction in recidivism among the participants.

Who will benefit?

The beneficiary population

In theory, with all eyes on the target (outcomes), beneficiary populations have a greater chance of success with this results-based financing mechanism compared to traditional input-based financing contracts. The potential for greater collaboration among stakeholders, performance management, and adaptive learning should all bode well for the delivery of the set goals. This could allow for improvements even beyond the targets within the impact bond structure such as improved family life, higher earnings, and increased civic participation.

The outcome funder (and taxpayers)

For the Ministry of Security and Justice, the SIB provides an opportunity to shift to private investors the implementation and financial risk of funding social service programs. If outcomes are achieved, then the ministry repays the investors an amount that represents the value they place on outcome achievement, and if outcomes are not achieved, then they do not pay. What’s more, the ministry could benefit from reduced costs as a result of shifting from remedial to preventive services. Additional cost savings, in particular the reduction in social welfare benefits, and other inherent benefits will be accrued to other government entities as well as society as a whole.

The service providers

There can be multiple benefits for services providers. First, the availability of upfront capital allows them to do their job better. Second, the longer-term (multi-year) contract reduces time spent on grant proposals and allows for more steady funding flows. Third, the SIB can provide an opportunity to strengthen the providers’ systems of data collection. Fourth, it allows the service providers to conduct a rigorous evaluation of their program. Further, SIBs can allow for flexibility and learning-by-doing in the delivery of the social services.

The investors

The three investors in this SIB have an opportunity to earn a financial return of maximum 10 percent if outcomes are successfully achieved. In addition, they benefit from having contributed to the improvement of the lives of the target population and their families. Furthermore, they could generate an impact that goes way beyond the SIB itself. They have the potential to create larger systemic change in the provision of social services by shifting government’s focus away from how services are delivered to which outcomes they want to achieve and by helping to build systems of monitoring and evaluation that allow for systematic assessment of those outcomes.

A way forward

Six years after the implementation of the first SIB for prison recidivism in the United Kingdom, this creative idea has spread to at least 12 other countries with the aim of tackling some of the world’s most intractable social problems. The Netherlands, known globally as a leader on many social and environmental issues, is taking a leading role in the adoption of this mechanism. Moving forward, the rest of the world will be watching to see what lessons can be gleaned from these early experiments as the burden of tough societal issues and potential solutions become increasingly global in nature.

Over 200 delegates from 50 countries gather this week in Washington for the Presidential Summit on Entrepreneurship. The summit hosts entrepreneurs to teach and learn innovative ways to strengthen professional and social relationships between the U.S. and the Islamic world. During his first major address to the Muslim world, delivered in Cairo last June, President Obama pledged to increase engagement through entrepreneurship, exchange programs and multilateral service initiatives.

Volunteer-led development initiatives have begun to act on Obama’s call for citizen diplomacy and private-sector engagement. The Initiative on International Volunteering and Service at Brookings and the Building Bridges Coalition have fueled an emerging legislative initiative that calls for increasing the role of international volunteers in the U.S. diplomatic agenda and development programs. This Service World Initiative has drawn from Brookings research outlining options to advance the president’s call for multilateral service.

As seen last year, for the first time in history, the majority of the world’s population lived in urban areas. And this trend is accelerating at an unprecedented rate. By 2050, urban dwellers are expected to make up about 70 percent of Earth’s total population. These informed 21st century urban citizens demand 24-7 connectivity, smart electric grids, efficient transportation networks, safe food and water, and transparent social services. All these demands place a huge strain on existing city infrastructures and the global environment. Most affected by this rapid urban boom, are the emerging markets. So how do we tackle this development dilemma?

One way is for highly-skilled experts, from a range of countries, to volunteer their time in emerging markets to help improve economic development, government services and stimulate job growth. This type of pro-bono program has many benefits. It benefits the urban areas in these emerging markets by leveraging intelligence, connecting systems and providing near-term impact on critical issues such as transportation, water, food safety, education and healthcare. It benefits the expert volunteers by fostering their teamwork skills, providing a cultural learning experience, and broadening their expertise in emerging markets.

IBM, which chairs the Building Bridges Coalition’s corporate sector, hosts a range of volunteer-led global entrepreneurship programs that improve economic stability for small- and medium-sized businesses, increase technology in emerging markets and open doors for the next generation of business and social leaders. This program connects high-talent employees with growing urban centers around the world and fosters the type of leadership to help IBM in the 21st century.

Recently, IBM sent a group of experts to Ho Chi Minh City as part of its Corporate Service Corps, a business version of the Peace Corps. This was the first Corporate Service Corps mission to be made up of executives, and the first to help a city in an emerging market analyze its challenges holistically and produce a plan to manage them. As a result, the city has now adopted a 10-year redevelopment plan that includes seven pilot programs in areas ranging from transportation to food safety. IBM will also help the city set up academic programs to prepare young Vietnamese to launch careers in technology services. IBM will continue this program throughout the next couple years to evolve the next set of global business and cultural hubs utilizing the volunteer hours of some of its most seasoned experts.

The Presidential Summit this week will further Obama’s call to “turn dialogue into interfaith service, so bridges between peoples lead to action.” The policy initiative of the Building Bridges Coalition, coupled with entrepreneurial innovations such as IBMs, can foster greater prosperity and service between the U.S. and our global partners.

INTRODUCTION

Over the past decade, the focused attention of African nations, the United States, U.N. agencies and other multilateral partners has brought significant progress toward achievement of the Millennium Development Goals (MDGs) in health and malaria control and elimination. The potential contribution of these strategies to long-term peace-building objectives and overall regional prosperity is of paramount significance in sub-regions such as the Horn of Africa and Western Africa that are facing the challenges of malaria and other health crises compounded by identity-based conflicts.

National campaigns to address health Millennium Development Goals through cross-ethnic campaigns tackling basic hygiene and malaria have proven effective in reducing child infant mortality while also contributing to comprehensive efforts to overcome health disparities and achieve higher levels of societal well-being.

There is also growing if nascent research to suggest that health and other humanitarian interventions can result in additional benefits to both recipients and donors alike.

The social, economic and political fault lines of conflicts, according to a new study, are most pronounced in Africa within nations (as opposed to international conflicts). Addressing issues of disparate resource allocations in areas such as health could be a primary factor in mitigating such intra-national conflicts. However, to date there has been insufficient research on and policy attention to the potential for wedding proven life-saving health solutions such as malaria intervention to conflict mitigation or other non-health benefits.

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In late October at the United Nations Economic and Social Commission for Asia and the Pacific (UN ESCAP) headquarters in Bangkok, a multi-stakeholder coalition was launched to promote the role of youth and civil society in advancing post-2015 United Nations Sustainable Development Goals (SDGs). The youth initiatives, fostering regional integration and youth service impact in the Association of Southeast Asian Nations (ASEAN) and counterpart regions of Northeast and South Asia, will be furthered through a new Asia-Pacific Peace Service Alliance. The alliance is comprised of youth leaders, foundations, civil society entities, multilateral partners and U.N. agencies. Together, their initiatives illustrate the potential of youth and multi-stakeholder coalitions to scale impacts to meet SDG development targets through youth service and social media campaigns, and partnerships with multilateral agencies, nongovernmental organizations, corporations and research institutes.

The “Asia-Pacific Forum on Youth Volunteerism to Promote Participation in Development and Peace” at UN ESCAP featured a new joint partnership of the U.S. Peace Corps and the Korea International Cooperation Agency (KOICA) as well as USAID support for the ASEAN Youth Volunteering Program. With key leadership from ASEAN youth entitles, sponsor FK Norway, Youth Corps Singapore and Peace Corps’ innovative program in Thailand, the forum also furthered President Obama’s goal of Americans serving “side by side” with other nations’ volunteers. The multi-stakeholder Asia-Pacific alliance will be powered by creative youth action and a broad array of private and public partners from Thailand, Malaysia, Myanmar, Indonesia, Singapore, the Philippines, Australia, Korea, China, Mongolia, Japan, India, Nepal, Pakistan, the U.S. and other nations.

During the event, Dr. Shamshad Akhtar, ESCAP executive secretary, pointed out that “tapping youth potential is critical to shape our shared destiny, as they are a source of new ideas, talent and inspiration. For ESCAP and the United Nations, a dynamic youth agenda is vital to ensure the success of post-2015 sustainable development.”

Dr. Surin Pitsuwan, former ASEAN secretary-general, called for a new Asia-wide multilateralism engaging youth and civil society.  In his remarks, he drew from his experience in mobilizing Asian relief and recovery efforts after Cyclone Nargis devastated the delta region of Myanmar in May 2008. Surin, honorary Alliance chairman and this year’s recipient of the Harris Wofford Global Citizenship Award, also noted the necessity of a “spiritual evolution” to a common sense of well-being to redress the “present course of possible extinction” caused by global conflicts and climate challenges. He summoned Asia-Pacific youth, representing 60 percent of the world’s young population, to “be the change you want to see” and to “commit our youth to a useful cause for humanity.”

The potential for similar upscaled service efforts in Africa, weaving regional integration and youth volunteering impact, has been assessed in Brookings research and policy recommendations being implemented in the Common Market of Eastern and Southern Africa (COMESA). Recommendations, many of which COMESA and ASEAN are undertaking, include enabling youth entrepreneurship and service contributions to livelihoods in regional economic integration schemes, and commissioning third-party support for impact evidence research.

A good example of successful voluntary service contributions from which regional economic communities like ASEAN can learn a lot is the current Omnimed pilot research intervention in Uganda. In eastern Ugandan villages, 1,200 village health workers supported by volunteer medical doctors, Uganda’s Health Ministry, Peace Corps volunteers and Global Peace Women are addressing lifesaving maternal and child health outcomes furthering UNICEF’s campaign on “integrated health” addressing malaria, diarrheal disease and indoor cooking pollution. The effort has included construction of 15 secure water sources and 1,200 clean cook stoves along with randomized controlled trials.

Last week, the young leaders from more than 40 nations produced a “Bangkok Statement” outlining their policy guidance and practical steps to guide volunteering work plans for the new Asia-Pacific alliance. Youth service initiatives undertaken in “collective impact” clusters will focus on the environment (including clean water and solar villages), health service, entrepreneurship, youth roles in disaster preparedness and positive peace. The forum was co-convened by ESCAP, UNESCO, the Global Peace Foundation and the Global Young Leaders Academy.

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Around the world today, there are more than 15.5 million refugees and over 28.8 million internally displaced persons (IDPs) uprooted by conflict, in addition to some 32.4 million displaced in 2012 from their homes due to natural disasters. These displacement crises are not simply humanitarian concerns, but fundamental development challenges. Forced migration flows are rooted in development failures, and can undermine the pursuit of development goals at local, national and regional levels.

Linking humanitarian responses to displacement with longer-term development support and planning is not a new concern. Beginning in 1999, for example, the “Brookings Process” – under the leadership of Sadako Ogata and James Wolfensohn – sought to bridge humanitarian relief and development assistance in post-conflict situations. But the challenge remains unresolved, and has acquired new urgency as displacement situations are becoming more protracted, and situations such as the Syrian crisis show no signs of resolution.

The Brookings Global Economy and Development Program and the Brookings-LSE Project on Internal Displacement held a roundtable on these issues on May 14, 2013 with Sadako Ogata, former UN High Commissioner for Refugees, former Director of the Japanese International Cooperation Agency, and Distinguished Fellow at the Brookings Institution. Megan Bradley, Fellow with the Brookings-LSE Project on Internal Displacement, facilitated the roundtable, which followed Chatham House rules.

The roundtable addressed several key topics including:

• The relevance of the concept of human security to addressing displacement and development challenges
• Displacement as a development challenge in fragile states
• Protracted displacement
• Contrasts in the approaches and processes adopted by humanitarian and development actors

The event report provides a brief overview of the discussion.

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• Brookings IDP Roundtable with Sadako Ogata May 14 2013

My first response to the GDP report was “holy cow!”-- it’s not often that the U.S. economy contracts, and the headline says that this just happened in the final quarter of 2012. Many had expected weak growth; none had seen a contraction coming. But once you take a deep breath, read past the headline, and delve into the numbers, you’ll see that this is actually a pretty good (though not great) report. The internals are much better than the top-line belies. Under the hood, we see solid growth in both consumption and investment and as a result, private spending was humming along. Last quarter’s decline in U.S. GDP was all about inventories (which subtracted 1.3 percentage points from growth), as well as sharp cuts in defense spending. Neither of these are expected to persist.

And let’s not forget that this is the "advance" GDP estimate, which is only an early (an often inaccurate) guess as to what was happening. Typically, this estimate misses the mark by a full 1.3 percentage points.

I'm sure we will start seeing the use of the dreaded "R" word (recession). That's premature, and almost certainly wrong. The U.S. economy is growing, although probably slower than potential. Don’t let me overstate my sunny optimism though—the recovery is still precarious, and Congress could still blow it up.

Overall, there's nothing in today's GDP report to change my view: The U.S. economy was doing OK -- maybe even pretty well -- but definitely not great in the final quarter of 2012. While this morning's negative growth number is an attention grabber, realize it's for last quarter, it's an early guess, and it's contradicted by most other data which point to an economy that is still growing, although perhaps not fast enough.

And finally, a trivia question: When is the last time that the first big hint of bad economic news came from an advance GDP report? Answer: Never.

This morning's gross domestic product (GDP) report showed that the economic recovery continued through the first quarter of this year, growing at 2.5%. That's a reasonable (though not great) rate of growth, although a bit below expectations, which were for something closer to 3%.

There's good news and bad news buried in the detail. The good is that consumers seem interested in spending again. We'll see whether that holds up over coming months. The bad is that firms aren't so optimistic, and investment was lackluster.

Government spending continues to detract from economic growth, as it has for 10 of the past 11 quarters.

This report also provides the latest reading on the core PCE deflator, which is the rate of inflation targeted by the Fed. This measure shows inflation running at 1.2%, well below the Fed's target.

Let's not get lost in the detail. This GDP report provides a soon-to-be-revised and noisy indicator of what happened in the economy a few months back.

The bigger picture is that we have a fledgling recovery which needs help, but isn't getting it: Fiscal policy is set as a drag on growth, and monetary policy delivering below-target inflation.

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Forty years after its initial publication, Equality and Efficiency: The Big Tradeoff remains an influential work from one of the most important macroeconomists over the last century, Arthur M. Okun (1928-1980). Okun’s theory on market economies reminds readers of an engaging dual theme: the market needs a place, and the market needs to be kept in its place. Articulated in a way that remains relevant even during today’s discussions on broadening gaps in income inequality, Okun emphasized that institutions in a capitalist democracy prod us to get ahead of our neighbors economically after telling us to stay in line socially.

On May 4, The Brookings Institution Press re-released Okun’s classic work with a new foreword from Former Treasury Secretary Lawrence H. Summers, in addition to “Further Thoughts on Equality and Efficiency,” a paper published by Okun in 1977. The event included opening remarks from Brookings Senior Fellow George Perry, with a keynote address from Larry Summers. Following these remarks, David Wessel moderated a panel discussion with former Chair of the Council of Economic Advisers Greg Mankiw, Economic Studies’ Melissa Kearney and Justin Wolfers, and Washington Center for Equitable Growth's Heather Boushey regarding the history and impact of Okun’s work.

Download a copy of Lawrence Summers' opening remarks.

Ted Gayer, Vice President and Director of Economic Studies and Joseph Pechman Senior Fellow, reads Lawrence Summers's opening remarks.

David Wessel (right), Director of the Hutchins Center on Fiscal and Monetary Policy, moderates a panel discussion with N. Gregory Mankiw, Melissa Kearney, and Heather Boushey.

Janet Yellen, Chair of the Board of Governors of the Federal Reserve System, listens to the discussion from the audience. To Yellen's right is former Congressional Budget Office director, Doug Elmendorf.

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• 40 years later- The relevance of Okun’s "Equality and Efficiency: The Big Tradeoff"

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• 40 years later- The relevance of Okun’s "Equality and Efficiency: The Big Tradeoff"

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• Uncorrected Transcript (.pdf)

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• 20150504_okun_equality_efficiency_transcript
• 050415 Summers Okun Speech

Financial Data as Driving Force Behind Improved Learning

During the past decade, school enrollments have increased dramatically, mostly thanks to UNESCO’s Education for All (EFA) movement and the UN Millennium Development Goals. From 1999 to 2008, an additional 52 million children around the world enrolled in primary schools, and the number of out-of-school children fell by 39 million. In Sub-Saharan Africa alone, enrollment rates rose by one-third during that time, even with large population increases in school-age children.

Yet enrollment is not the only indicator of success in education, and does not necessarily translate into learning. Even with these impressive gains in enrollment, many parts of the world, and particularly the poorest areas, now face a severe learning crisis. The latest data in the EFA Global Monitoring Report 2011 reveal poor literacy and numeracy skills for millions of students around the world. In Malawi and Zambia, more than one-third of sixth-grade students had not achieved the most basic literacy skills. In El Salvador, just 13 percent of third-grade students passed an international mathematics exam. Even in middle-income countries such as South Africa and Morocco, the majority of students had not acquired basic reading skills after four years of primary education. Although the focus on children out of school is fully justified, given that they certainly lack learning opportunities, the failure to focus on learning also does a disservice to the more than 600 million children in the developing world who are already in school but fail to learn very basic skills.

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• Download the Full Paper

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Despite the notable success in enrolling children in primary school over the past decade, the education agenda is unfinished as millions of children are still excluded from learning opportunities and millions more leave school without having acquired the essential knowledge and skills needed to participate in society.

On January 27, the Center for Universal Education at Brookings hosted a half-day conference that focused on the research examining “what works in education” to achieve improved learning opportunities and outcomes. In addition to hearing from researchers studying the effectiveness of various education strategies, participants discussed how to facilitate a future research agenda that could have the most meaningful impact on learning. Senior Fellow Jacques van der Gaag moderated the discussion.

View the full event summary »

Transcript

• Improving Education in the Developing World: Evidence from Randomized Evaluations Presentation (.pdf)
• Sociocultural Gradients for Language Scores by Country Slide (.pdf)
• School Resources and Educational Outcomes in Developing Countries Presentation (.pdf)
• Making Learning for All a Reality Presentation (.pdf)
• Addressing the Global Learning Crisis Presentation (.pdf)

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• 0127_slide_vandergaag
• 0127_edinptoh
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• 0127_wagner

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Many within the United States and others abroad continue to question the United States’ role in the world. Understandably, Americans have grown wary of the country’s role in the world, some asking whether the U.S. still has the power and influence to lead the international community, while others question why the United States must still take on this seemingly singular responsibility. On the eve of a major speech by President Obama addressing these questions, Senior Fellow Robert Kagan released a new essay entitled, "Superpowers Don't Get to Retire: What Our Tired Country Still Owes the World," which was published in the latest edition of The New Republic. Kagan argued that the United States has no choice but to be “exceptional.”

On May 27, the Foreign Policy program at Brookings and The New Republic hosted an event to mark the release of the Kagan essay and in advance of President Obama’s address to the U.S. Military Academy at West Point. Kagan, a senior fellow in the Project on International Order and Strategy at Brookings, was joined by The New Republic's Leon Wieseltier and The Washington Post's Fred Hiatt.

After the program, the panelists took audience questions.

Read the full article»

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• America’s Leadership in the World and President Obama’s Foreign Policy
• America Has Never Been Isolationist
• Americans Take U.S.-Made World Order for Granted
• Obama Foreign Policy Looking for Dead Center of American Public
• Presidents Shouldn’t Hide Behind Polls on Foreign Policy

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• America’s Leadership in the World and President Obama’s Foreign Policy

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• Uncorrected Transcript (.pdf)

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• 20140527_americas_leadership_transcript

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With ongoing crises in Ukraine, Syria, and other regions of the world, U.S. global leadership is arguably as critical now as it has ever been. However, many question how the United States should exercise its leadership, what foreign policy agenda it should pursue, and how it should configure its military and security agencies going forward. In a recent speech at West Point, President Obama laid out his foreign policy agenda for the remainder of his presidency. While the Obama Administration will pursue the president’s agenda as laid out at West Point, others in Washington have different views on how best to manage U.S. foreign policy going forward.

On June 11, the Foreign Policy Program at Brookings will host Senator John McCain (R-AZ), former presidential candidate and member of the Senate Committee on Foreign Relations, for an address on the future of U.S. foreign and security policy. The address will be introduced by Brookings Senior Fellow and Director of Research for Foreign Policy Michael O’Hanlon, and the discussion following the Senator’s address will be moderated by Senior Fellow Robert Kagan.

After the program, Senator McCain will take audience questions.

Join the conversation on Twitter using #McCain

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On October 17, the Brookings Project on International Order and Strategy hosted a discussion with Brookings Senior Fellow Robert Kagan and MIT Professor Barry Posen on U.S. grand strategy. Amid a background of seeming geopolitical upheaval, the discussion focused on whether the United States should pursue a strategy that seeks to maintain U.S. pre-eminence and global leadership or whether the United States can or must adopt a more restrained posture.

In his May 2014 New Republic essay "Superpowers Don't Get to Retire," Kagan argued that the United States has an enduring responsibility and capacity to shape the world order.

Posen is the Ford international professor of political science and director of the security studies program at MIT. He is the author of the new book, Restraint: A New Foundation for U.S. Grand Strategy (Cornell University Press, 2014). Posen argues that consistent U.S. overreaching has led to numerous failures and unexpected problems and cannot be sustained. Posen urges the United States to adopt a strategy of restraint in the future use of U.S. military strength.

Brookings Fellow Jeremy Shapiro moderated the discussion.

Join the conversation on Twitter using #USStrategy

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• U.S. Grand Strategy: World Leader or Restrained Power?

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• Uncorrected Transcript (.pdf)

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• 20141017_us_grand_strategy_transcript

This week, Israeli Prime Minister Benjamin Netanyahu spoke at a joint meeting of Congress. His address sparked an intense debate among U.S. and Israeli lawmakers over the protocol issues raised by the invitation to speak, which came from the Republican speaker of the U.S. House of Representatives without consultation with the Obama White House, as well as the substance of the address — a broadside against Obama’s Iran policy — and its timing during the final days of a closely contested Israeli election.

Brookings scholars weighed in on the debate, through blog posts, op-eds and the media. These include:

Fellow Natan Sachs explained why Netanyahu’s speech was so controversial.  "Israelis, by and large, don't like it when their prime minister quarrels with the United States," Sachs told Vox. "For most voters, especially in the core base on the right and I think center right, here's Bibi doing something that opposition leaders cannot do: speak the way he does with his English and this reception from Americans.” Also read Sachs' blog post on the electoral implications of the speech as well as his Haaretz op-ed with recommendations for Israeli and American strategy toward the Iran nuclear talks.

Tamara Cofman Wittes, director of the Center for Middle East Policy (CMEP) at Brookings, appeared on Charlie Rose following the speech, and said, “I think the speech was very effective, as a speech, particularly at the end when Netanyahu was really playing to his domestic audience and political base more than anyone…I think that’s probably the video clip the Likud will be playing in  ads as the campaign winds down.”

Nonresident Senior Fellow Shibley Telhami looked at poll results examined U.S. public opinion related to Netanyahu’s speech. "Among Democrats, those holding favorable views of the Israeli prime minister declined from 25 percent in November to 16 percent in February, and among Independents from 21 percent to 14 percent. Correspondingly, unfavorable views increased from 22 to 26 percent among Democrats, and from 14 to 21 percent among Independents," he wrote in Foreign Policy.

A New York Times editorial examining Netanyahu's speech discussed American public opinion on the Iran nuclear deal, and cited Telhami’s poll results “show[ing] that a clear majority of Americans — including 61 percent of Republicans and 66 percent of Democrats — favor an agreement.” Telhami also organized and moderated the annual Sadat Forum earlier this week, featuring a discussion on the Iranian nuclear issue and the Netanyahu speech with Brookings Distinguished Fellow Ambassador Thomas Pickering, former president of the Carnegie Endowment for International Peace Jessica Matthews, and CMEP Senior Fellow Suzanne Maloney.

According to Ambassador Martin Indyk, who has served as director of the Foreign Policy program and was just named Brookings Executive Vice President, Netanyahu remained against any agreement. “He was pretty clear about his opposition to the deal,” Indyk told Foreign Policy. “I believe he wants to sink it, not modify it.”

Prior to the speech, Robert Einhorn, senior fellow in the Center for 21st Century Intelligence and Security and the Arms Control and Nonproliferation Initiative, wrote an op-ed published in the International New York Times discussing Netanyahu’s angle on the Iran talks. After Netanyahu’s speech, Einhorn appeared on Christiane Amanpour and argued that the deal was “not an ideal deal, but it’s a good deal, and one that’s better than any realistic alternative.” Einhorn, who formerly participated in the negotiations with Iran as a senior State Department official, was quoted in coverage of the speech published in the Washington Post and Politico, among others.

In an op-ed on U.S. News and World Report, Maloney argued that when it comes to a deal with Iran, “The ever-present illusion of a more perfect deal is not worth risking an imperfect, but minimally sufficient, bargain.”

With the prospect of a nuclear deal between Iran and the P5+1 looking increasingly likely and with the caveat that, “as always, Iran’s future behavior is hard to predict because its motives going into the nuclear negotiations are unclear and its decision-making is always opaque,” Senior Fellow Kenneth M. Pollack examined the possible scenarios and offered his thoughts on whether a nuclear deal would likely make Iran more or less aggressive — or neither. 

Bruce Riedel, senior fellow and director of the Brookings Intelligence Project, wrote about Netanyahu’s address in contrast to Saudi Arabia’s diplomacy. “As Israeli Prime Minister Benjamin Netanyahu plays center stage at the Congress this week to slam the Iran deal-in-the-making, the Saudis are playing a more subtle game,” Riedel wrote. “Iran is priority number one. It's more than just the nuclear issue.” The pot was also quoted in a Bloomberg News analysis of Gulf reaction to the state of play on Iran.

Last week, William Galston, who holds Brookings' Ezra K. Zilkha Chair in Governance Studies, wrote about the implications of Netanyahu’s speech, warning that “[t]he last thing he should want is a negative reception in the United States that fuels Israeli swing voters’ doubts about his capacity to manage Israel’s most important relationship.” And in his Washington Post column last week, Senior Fellow Robert Kagan argued that “there is no doubt that the precedent being set is a bad one” and regretted that “bringing a foreign leader before Congress to challenge a U.S. president’s policies…will be just another weapon in our bitter partisan struggle.”

And finally, for anyone wanting to see what our scholars were tweeting during Netanyahu’s speech, and reaction afterward, here’s a round-up.

For several years, President Obama has operated under a set of assumptions about the Middle East: First, there could be no return of U.S. ground troops in sizeable numbers to the region; and second, the United States had no interests in the region great enough to justify such a renewed commitment. The crises in the Middle East could be kept localized. The core elements of the world order would not be affected, and America’s own interests would not be directly threatened.

These assumptions could have been right, but instead they have proven to be wrong. The combined crises of Syria, Iraq, and the threat posed by the Islamic State (or ISIS) have not been contained. ISIS itself has proven both durable and capable, as the attacks in Paris showed. The Syrian conflict—with the resulting refugee flows—is destabilizing Lebanon and Jordan; it has put added pressure on Turkey’s already tenuous democracy; and it has exacerbated the acute conflict between Sunni and Shiite across the region. The multi-sided war in the Middle East has now ceased to be a strictly Middle Eastern problem. It has become a European problem, as well. The crisis on the periphery, in short, has now spilled over into the core.

Does this not call for a reassessment of the policies that have so far been tried in Syria and Iraq? Have not events in the Middle East, and now in Europe, reached the point where significant interests are at stake, thereby requiring a more substantial response by the United States?

Read Robert Kagan's more in-depth article on the subject in the Wall Street Journal.

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John Quincy Adams famously said that America “goes not abroad in search of monsters to destroy.” A diplomat, secretary of state, as well as the sixth president, Adams is often described as a “realist,” and as the founder of American foreign policy realism. But did his own policy choices square with that doctrine of restraint? Recently, President Obama has described his own views in explicitly realist terms; Hillary Clinton is widely viewed as a more ardent believer in the active use of American power; and the Republican candidates seem more eager to build walls than to engage the outside world.

On April 11, the Brookings Project on International Order and Strategy (IOS) hosted a discussion between Brookings Senior Fellow Robert Kagan and James Traub, columnist and contributor at foreignpolicy.com, lecturer of foreign policy at New York University, and now the author of the new book, “John Quincy Adams: Militant Spirit” (Basic Books, 2016). Kagan and Traub debated whether Adams was a foreign policy realist and whether his approach to foreign policy can still inform the policy choices facing the United States today. Brookings Fellow Thomas Wright, director of IOS, moderated the discussion.

Audio

• Was John Quincy Adams a realist? A debate

Transcript

• Transcript (.pdf)

Event Materials

• 20160411_john_quincy_adams_transcript

Editors’ Note: The economic, political, and security strategy that the United States has pursued for more than seven decades is under attack by leading political candidates in both parties, write Ivo Daalder and Robert Kagan. But the United States plays an essential role in supporting the international environment from which Americans benefit greatly. This article originally appeared in The Washington Post.

The economic, political and security strategy that the United States has pursued for more than seven decades, under Democratic and Republican administrations alike, is today widely questioned by large segments of the American public and is under attack by leading political candidates in both parties. Many Americans no longer seem to value the liberal international order that the United States created after World War II and sustained throughout the Cold War and beyond. Or perhaps they take it for granted and have lost sight of the essential role the United States plays in supporting the international environment from which they benefit greatly. The unprecedented prosperity made possible by free and open markets and thriving international trade; the spread of democracy; and the avoidance of major conflict among great powers: All these remarkable accomplishments have depended on sustained U.S. engagement around the world. Yet politicians in both parties dangle before the public the vision of an America freed from the burdens of leadership.

What these politicians don’t say, perhaps because they don’t understand it themselves, is that the price of ending our engagement would far outweigh its costs. The international order created by the United States today faces challenges greater than at any time since the height of the Cold War. Rising authoritarian powers in Asia and Europe threaten to undermine the security structures that have kept the peace since World War II. Russia invaded Ukraine and has seized some of its territory. In East Asia, an increasingly aggressive China seeks to control the sea lanes through which a large share of global commerce flows. In the Middle East, Iran pursues hegemony by supporting Hezbollah and Hamas and the bloody tyranny in Syria. The Islamic State controls more territory than any terrorist group in history, brutally imposing its extreme vision of Islam and striking at targets throughout the Middle East, North Africa and Europe. None of these threats will simply go away. Nor will the United States be spared if the international order collapses, as it did twice in the 20th century. In the 21st century, oceans provide no security. Nor do walls along borders. Nor would cutting off the United States from the international economy by trashing trade agreements and erecting barriers to commerce.

In the 21st century, oceans provide no security. Nor do walls along borders. Nor would cutting off the United States from the international economy by trashing trade agreements and erecting barriers to commerce.

Instead of following the irresponsible counsel of demagogues, we need to restore a bipartisan foreign policy consensus around renewing U.S. global leadership. Despite predictions of a “post-American world,” U.S. capacities remain considerable. The U.S. economy remains the most dynamic in the world. The widely touted “rise of the rest”—the idea that the United States was being overtaken by the economies of Brazil, Russia, India and China—has proved to be a myth. The dollar remains the world’s reserve currency, and people across the globe seek U.S. investment and entrepreneurial skills to help their flagging economies. U.S. institutions of higher learning remain the world’s best and attract students from every corner of the globe. The political values that the United States stands for remain potent forces for change. Even at a time of resurgent autocracy, popular demands for greater freedom can be heard in Russia, China, Iran and elsewhere, and those peoples look to the United States for support, both moral and material. And our strategic position remains strong. The United States has more than 50 allies and partners around the world. Russia and China between them have no more than a handful.

The task ahead is to play on these strengths and provide the kind of leadership that many around the world seek and that the American public can support. For the past two years, under the auspices of the World Economic Forum, we have worked with a diverse, bipartisan group of Americans and representatives from other countries to put together the broad outlines of a strategy for renewed U.S. leadership. There is nothing magical about our proposals. The strategies to sustain the present international order are much the same as the strategies that created it. But they need to be adapted and updated to meet new challenges and take advantage of new opportunities.

The widely touted “rise of the rest”—the idea that the United States was being overtaken by the economies of Brazil, Russia, India and China—has proved to be a myth.

For instance, one prime task today is to strengthen the international economy, from which the American people derive so many benefits. This means passing trade agreements that strengthen ties between the United States and the vast economies of East Asia and Europe. Contrary to what demagogues in both parties claim, ordinary Americans stand to gain significantly from the recently negotiated Trans-Pacific Partnership. According to the Peterson Institute for International Economics, the agreement will increase annual real incomes in the United States by $131 billion. The United States also needs to work to reform existing international institutions, such as the International Monetary Fund, so that rising economic powers such as China feel a greater stake in them, while also working with new institutions such as the Asian Infrastructure Investment Bank to ensure that they reinforce rather than undermine liberal economic norms.

The revolution in energy, which has made the United States one of the world’s leading suppliers, offers another powerful advantage. With the right mix of policies, the United States could help allies in Europe and Asia diversify their sources of supply and thus reduce their vulnerability to Russian manipulation. Nations such as Russia and Iran that rely heavily on hydrocarbon exports would be weakened, as would the OPEC oil cartel. The overall result would be a relative increase in our power and ability to sustain the order.

The world has come to recognize that education, creativity and innovation are key to prosperity, and most see the United States as a leader in these areas. Other nations want access to the American market, American finance and American innovation. Businesspeople around the world seek to build up their own Silicon Valleys and other U.S.-style centers of entrepreneurship. The U.S. government can do a better job of working with the private sector in collaborating with developing countries. And Americans need to be more, not less, welcoming to immigrants. Students studying at our world-class universities, entrepreneurs innovating in our high-tech incubators and immigrants searching for new opportunities for their families strengthen the United States and show the world the opportunities offered by democracy.

Americans need to be reminded what is at stake.

Finally, the United States needs to do more to reassure allies that it will be there to back them up if they face aggression. Would-be adversaries need to know that they would do better by integrating themselves into the present international order than by trying to undermine it. Accomplishing this, however, requires ending budget sequestration and increasing spending on defense and on all the other tools of international affairs. This investment would be more than paid for by the global security it would provide.

All these efforts are interrelated, and, indeed, a key task for responsible political leaders will be to show how the pieces fit together: how trade enhances security, how military power undergirds prosperity and how providing access to American education strengthens the forces dedicated to a more open and freer world.

Above all, Americans need to be reminded what is at stake. Many millions around the world have benefited from an international order that has raised standards of living, opened political systems and preserved the general peace. But no nation and no people have benefited more than Americans. And no nation has a greater role to play in preserving this system for future generations.

Earlier this summer, we examined how the Big Four banks – Bank of America, Citigroup, JPMorgan Chase, and Wells Fargo – performed before, during, and after the 2007-09 financial crisis.  We also blogged about the lending trends within these large banks, expressing concern about the growing gap between deposits taken and loans made by the Big Four, and calling on policymakers to explore the issue further.  We have conducted a similar analysis on the regional banks - The regional banks: The evolution of the financial sector, Part II - and find that these smaller banks are actually faring somewhat better than their bigger counterparts.

Despite the mergers and acquisitions that happened during the crisis, the Big Four banks are a smaller share of banking today than they were in 2007.  The 15 regionals we evaluated, on the other hand, are thriving in the post-crisis environment and have a slightly larger share of total bank assets than they had in 2007.  The Big Four experienced rapid growth in the years leading up to the crisis but much slower growth in the years since.  The regionals, however, have been chugging along: with the exception of a small downward trend during the crisis, they have enjoyed slow but steady growth since 2003.

There is a gap between deposits and loans among the regionals, but it is smaller than the Big Four’s gap.  Tellingly, the regionals’ gap has remained basically constant in size during the recovery, unlike the Big Four’s gap, which is growing.  Bank loans are important to economic growth, and the regional banks are growing their loan portfolios faster than the biggest banks.  That may be a good sign for the future if the regional banks provide more competition for the big banks and a more competitive banking sector overall.

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The White House Council of Economic Advisers (CEA) was created by Congress in 1946 to advise the president on ways “to foster and promote free competitive enterprise” and “to promote maximum employment, production and purchasing power.” President Truman, who signed the Employment Act of 1946 into law, was unenthusiastic about the Council and didn’t nominate members for nearly six months. Yet the CEA, comprised of three individuals whom Congress says are to be “exceptionally qualified,” has not only survived but also prospered for 70 years and remains an important part of the president’s economic policy decisionmaking.

On February 11, the Hutchins Center on Fiscal and Monetary Policy at Brookings marked this anniversary by examining the ways the CEA and other economists succeed and fail when they set out to advise elected politicians and tap the expertise of some of the “exceptionally qualified” economists who have chaired the Council over the past four decades.

You can join the conversation and tweet questions for the panelists at #CEAat70.

Video

• Panel 1: The CEA in Moments of Crisis
• Panel 2: The CEA and Policymaking
• Panel 3: Current Economic Policy Issues

Audio

• The Council of Economic Advisers: 70 years of advising the president

Transcript

• Uncorrected Transcript (.pdf)

Event Materials

• 20160211_economic_advisers_transcript