Micro-credit and the poor

A sense of urgency is clearly visible in some of the developing countries to accelerate the pace of poverty reduction. That is more notable in the heavily populated poor countries.

They are impressed by the ability of the Chinese to reduce the number of their poor. Having achieved that to a large extent in the coastal areas, China is now focusing on inland areas.

India, too, is showing some improvement. In Pakistan, it is not clear whether the number of its poor is increasing or decreasing. While the government argues it is on decrease, some research bodies maintain that the poverty has been increasing in recent years.

Anyway South Asia has the bulk of the 1.2 billion poor of the world living below the poverty line of a dollar a day. While the number of the poor in India is now said to be one-fourth of the population, in Pakistan it is estimated at about one-third of its population, which would make it about 50 million people, in view of the higher rate of population growth compared to India and Bangladesh.

The World Bank and the Asian Development Bank have made the people of Pakistan more aware of the poverty in their midst the urgency to reduce that, and have offered substantial financial help. For the second phase of the Pakistan Poverty Alleviation Fund which is coming to an end the World Bank has offered 250 million dollars of aid.

The two banks are ready to offer more if we have the capacity to use the funds effectively. So more funds are being offered to promote capacity-creation. The funds are being provided not only to directly combat poverty but also through other projects, like education, public health promotion, and infrastructure development which provide employment as well.

In fact, poverty is to be attacked from many fronts and the capacity of the individuals to earn more and be a more productive citizen enhanced as officially promised.

Now the people are to be enabled to earn more and become self-reliant citizens through the use of micro-credit and have a more community-based grass roots economy.

The visit of the founder and chief of Grameen Bank of Bangladesh has stimulated discussion on what micro-credit can do to the low-income community, and ultimately the country, as the beneficiaries of micro-credit become a real economic and ultimately political force.

Mr. Mohammad Yunus, whose book is called "Banker to the poor" says the Grameen Bank, established in 1983 in Bangladesh, has by now four million borrowers, 96 per cent of whom are women.

The bank boasts of a repayment rate of 99 per cent, which is indeed very remarkable. The concept became so popular that many NGOs in Bangladesh have adopted this kind of banking, benefitting another eight million poor, bringing the total to 12 million.

Grameen Bank now commands half a billion dollars of assets. and has expanded in several new directions, like creating companies for sectors as diverse as textiles, software and mobile phones. The mobile phones enable the women keep contact with the outside world to promote their business and prosper.

A major outcome of the pre-occupation of the women with a thriving business is that it keeps the population growth low. Bangladesh has a low population growth of 1.6 per cent per year in South Asia.

And the women are interested in education for themselves and their children for whom they can spare the money now. They also decide, in their groups, who in the assemblies will be a good representative for their business and the country. Let apart the women at the top in Bangladesh, these women entrepreneurs have increased women's power at the grass roots level.

For all the redoubtable success of Grameen Bank the credit is given without any collaterals. Even their group, usually of five, does not guarantee the return of the money, but these women's groups are helpful to the bank in return of the money. It all works through peer persuasion and peer pressure.

The credit is given not only without collateral but has a very low interest rates beginning with five per cent. The beggars get interest-free loans. The borrowers are partners in the bank.

When the Islamic banking system was established in Pakistan in 1985 by the Ziaul Haq government the people had hopes of getting interest-free loans instead of the high interest rates prevailing then. But as the system began operating the people were disappointed and its original supporters disillusioned.

The interest rate for borrowing went up from 14 per cent to 17 per cent, and that was called mark-up. The lending was collateral-based. Those who did not have the collateral to mortgage could not get a loan. The only thing finally agreed, after a great deal of wrangling, was that there would be no compound interest on borrowing under the Islamic banking system.

What the people are now familiar with is consumer banking and credit card purchases at relatively high interest rates in a deceptive manner. While consumer banking for buying cars, and other luxuries, house building etc., are usually for the well to do, or to provide well secured loans, we have now the other side - micro-credit for the poor or low income groups.

Ever since the Micro-credit Bank was established in Pakistan in the year 2000, which has been renamed as Kushali Bank, the demand for real micro-credit banking has been increasing without the costly trappings of western style banking.

Prime Minister Shaukat Aziz told a micro-credit conference, addressed by Mohammad Yunus as well, that Khushali Bank now functions in 50 districts with 250,000 clients out of 110 districts of the country and had disbursed Rs. 2 billion, which is not a large amount.

The Pakistan Poverty Alleviation Fund has disbursed Rs. 4 billion to 40 partner organizations who distributed that to the needy persons for credit. Mr Shaukat Aziz says the Zarai-Taraqqiati bank and the First Women's Bank have also micro-credit wings.

Their recovery rate is also 98 per cent, which is very creditable. If the recovery rate is so good the government should provide larger credit under the scheme or organise larger self-financing by the poor credit-seekers.

Grameen Bank could become such a stunning success in Bangladesh because there are no feudal lords there. Feudalism does not welcome self-reliance among farmers. Their financial power is one of the major strangleholds they have on their people in the rural areas.

If they cannot subvert the system, they try to gain control of the system through their underlings. Feudalism is a key obstacle to progress and how the government can make a success of the micro-credit system in the face of such an omnibus road block remains to be seen - keeping in view the fact the government itself is controlled in the rural areas by the feudal lords.

To make a success of poverty reduction the country needs several other steps besides a large network of micro-credit. There should be far less corruption in the country, particularly the corrupt practices of the police in the rural areas. Corruption sucks away too much money from the public and makes that to be spent on very wasteful ways.

There should be low inflation in the country which is currently 9.1 per cent, and may come down to 8.5 per cent next month. There are reports that the rate of sales tax may be brought down from 15 per cent to 12.5 per cent. That is a welcome move, if true. The present rate of GST is truly too high and anti-growth in character.

The habit of saving should be more vigorously encouraged and the national savings rate raised to 20 per cent, if not 25 per cent, from the current 14 per cent. Currently, the focus is not on savings as much as on consumer banking or on spending tomorrow's earnings today. However as the rate of borrowing keeps on rising, though gradually, consumer banking may come down as the Badla rate does in the Karachi Stock Exchange.

The gross waste in public spending should also be reduced. Leslie Chapman, who wrote the revealing "Your Disobedient Servant" said that 40 per cent of the government spending in Britain was sheer waste and could be saved. By that standard the percentage of waste in government spending in Pakistan should be far higher. But neither the government nor the public in Pakistan is interested in eliminating waste in their spending. The Supreme Court of Pakistan, for example, has called for simple weddings.

What we see in response is more ostentatious weddings and far more lavish expenditure on weddings lasting many days. Governor of the State Bank of Pakistan Dr. Ishrat Husain told a micro-credit conference in Islamabad last week that in the area of micro-credit banking he would be a facilitator and not a regulator.

In the days when Islamic banking was introduced in the country its votaries said the Islamic bankers should also lead a simple life according to the tenets of Islam, and not lead the high life of a modern banker with luxurious perquisites paid for by the bank. The bankers did not bother, and stuck to their normal life.

Similarly if the micro-credit bankers lead an expensive life with luxurious perquisites that can cost the bank a great deal and it may charge high interest rates to cover the cost. Anyway Mohammad Yunus is not an ideal banker for our western-style bankers, although they gave him a standing ovation at the end of his lecture in Karachi.

With plenty of financial assistance available from international agencies, like the World Bank and Asian Development Bank, the question is how well the funds will be used through the micro-credit to combat poverty, promote employment and accelerate development.

If the women here are engaged in business as they are in Bangladesh they will seek education for themselves and have fewer children, and solve our population explosion problem as well. The varied benefits of micro-credit are obvious. The question is: how well, how widely and how soon will we promote that on a large scale in Pakistan.

Reviving no-war pact idea

In view of the overriding importance of promoting risk- reduction and strategic restraint, both in the nuclear and in conventional spheres, the failure of experts level talks between India and Pakistan to make any headway on CBMs in this respect has been less than encouraging.

In this context, reports about the Islamabad meeting of experts, held during the second week of December, speak of the proposal for a no-war pact having been mooted again, perhaps informally, by the Pakistani side.

While in 1980s, India may have argued that General Zia's offer for a no-war pact made and repeated during the days of the Afghan war against Soviet occupation, was meant primarily to safeguard Pakistan's eastern flank, a negative Indian stance on the proposal has continued since then.

According to diplomatic sources, Pakistan had mooted the idea of a no-war pact at the experts level meeting on confidence-building measures against conventional military threats, held in Islamabad on December 15, without eliciting any flexibility in the Indian stance.

The only time during the past many years when India had expressed a welcome reconsideration of its stance was during I.K. Gujral's term as foreign minister when he told the Lok Sabha on July 15, 1996, that India was willing to discuss with Pakistan all issues, including a 'non-aggression pact'.

Although the term non-aggression pact used by Gujral and the "no-war pact" suggested by Pakistan are sometimes used in the same context, it may be noted that in the absence of an agreed definition of aggression, a "non-aggression pact" does not have the same binding effect as a "no-war pact" does.

Military action by India against Pakistan in the hypothetical case of escalation of Kashmiri resistance would be justified by New Delhi on the ground that it had been forced to respond to (alleged) Pakistan involvement in Kashmir and had not therefore committed aggression in breach of the non-aggression pact.

A no-war pact on the other hand would be designed to preclude all war-like measures by either side, except obviously for self- defence in case of aggression. In the wake of the momentary show of flexibility by the then foreign minister, India had again reverted to its previous stance on the issue.

The idea of a no-war pact and its positive implications for durable peace on the subcontinent, indispensable for economic development and amelioration of poverty, are compelling enough to warrant reconsideration by India of its negative stance.

It is regrettable that political observers and government authorities in the West, so quick to pounce on any perceived dereliction by Pakistan, have not taken necessary cognizance of India's long- standing refusal to countenance a proposal which could act as the underpinning for sustained peace and regional cooperation.

A principal factor in India's negative reaction to the no-war proposal, when first made, was apparently the feeling that a no- war commitment, while the Kashmir struggle remained alive, would provide a safeguard and a cover under which Pakistan could, in Indian perception, fuel resistance in occupied Kashmir, without risking a war.

In the light of the changed circumstances since the January 6, 2004 declaration, the peace process under way and the measures taken by Pakistan to halt any infiltration across the LoC, India's continued refusal to negotiate a no-war pact could only mean an implicit, standing threat to Pakistan's security.

Much water has flowed down the Indus and the Ganges since the proposal for a no-war pact was first made by Pakistan. Although the overt achievement of nuclear capability by India and Pakistan may be regarded by certain quarters to have devalued the need for a no-war pact in view of the deterrent nature of the two sides' nuclear arms, this is in fact a dangerously fallacious reasoning.

A no-war pact would be a safer basis for averting the possibility of destructive war as the diplomatic safeguard against ruinous conflict. The deterrent provided by nuclear capability, with its ingrained hazards and risks, should only be seen as the ultimate safety value, which does not in any way, minimize the importance of a binding diplomatic pledge based on mutual understanding and guarantees provided under a no-war pact.

The proposed non-aggression pact does not affect the right and the duty of a state to use all means to defend its territory and independence against aggression. The pact would merely bind the parties concerned not to initiate war-like measures against the other party to the pact.

In the light of India's preponderant military strength, the proposed pact would provide the needed sense of security to Pakistan, without adding to India's security to any comparable extent, has lost whatever little validity it had, with the acquisition of nuclear capability by India as well as by Pakistan and the emergence of the nuclear deterrent.

South Asia continues to suffer from self-inflicted wounds. Provided India is prepared to move forward on the road to durable peace, the proposal for a no-war pact could serve as a window of opportunity, which will let into South Asia the winds of change and reconciliation, sweeping many other parts of the world.

As part of preparation for the second round of the composite dialogue on eight subjects (peace and security CBMs, Jammu and Kashmir, Siachen, Wullar Barrage, Sir Creek, counter-terrorism and narcotics control, trade and economic cooperation, friendly exchanges), meetings on nuclear CBMs and conventional CBMs were held in Islamabad this month. No accords were concluded and no agreements signed.

Inconclusive talks were held on the text of a draft agreement on advance notification of missile tests, on which agreement in principle had been reached as far back as the Lahore Summit of 1998 (in practice advance notice is already being given by the two sides on the basis of the verbal understanding reached).

The Islamabad meeting of experts also failed to operationalize the agreement on a hot line between the foreign secretaries of the two sides reached earlier this year. No advance was registered on important suggestions for nuclear restraint and risk reduction made earlier by the Pakistan side (and some by the Indian side).

No concrete confidence-building measures on conventional military threat have been reached either. The inherent dangers in the increasing conventional imbalance between two countries has not received the serious notice of the world community which it deserved.

Although India has emerged as one of the three largest arms importers in the world, it leaves no stone unturned to block the smallest acquisition of defence material by Pakistan, whose entire national budget is smaller than India's defence budget alone. On this score also, Pakistan received no satisfactory response from India at the meeting on conventional CBMs.

The writer is former ambassador.

Rail transit not suitable

A renowned transport expert, who teaches urban planning at McGill University, Prof Madhav Badami does not consider rail transit to be the panacea for the clogged urban arterials. According to him rail transit is inflexible, expensive, and does not relieve congestion in metropolises in developing countries.

Prof Badami is equally critical of the metro rail system in New Delhi. He wrote his doctoral dissertation on the mobility challenges in New Delhi. According to him the land use patterns in New Delhi and the lack of affordability for market-based transit fares resulting from persistent poverty limit metro rail's potential in relieving traffic congestion.

Earlier in June, I visited Delhi to participate in an international forum on urban service delivery. Experts from China, the Philippines, and other developing nations at the forum were of the view that the rail transit may not be the best alternative for relieving urban traffic congestion in developing countries.

There are at least three major impediments to rail's success in South Asia. First, compared with the bus rapid transit systems, rail transit is many times more expensive to build and operate.

Second, the unique land use patterns in South Asian cities may not be suitable for high-capacity rail transit. Third, the average commuter in Karachi or New Delhi cannot afford to pay even the minimum fare required by the rail transit to break even.

Therefore, state subsidy is required for capital and operating costs. Even if debt finance covers the one-time capital costs, the long-term operating subsidies are hard to find in these time of fiscal austerity.

According to The Times of India, the head of Karachi Mass Transit Cell, Mr. Zaheer-ul- Islam, was in New Delhi last week to meet the operators of Delhi metro rail corporation (DMRC). He also rode in the Delhi metro. He may or may not have sat in one of the 10,000 buses that ply on New Delhi's roads every day.

The success story in New Delhi is not the Delhi metro. Instead, it is the compliance to the Supreme Court's decision that converted all public transit vehicles in New Delhi, including buses, taxis, and rickshaws, from diesel and petrol to CNG.

I found the citizens of New Delhi more proud of the conversion to CNG, which significantly improved the air quality, than of Delhi Metro. The almost five million urban commuters in New Delhi pose a mobility challenge that is beyond the capacity of Delhi metro, even when its network is completed.

Most trips in New Delhi are walk or bike trips, followed by bus-based transit trips. Cars and motorized two-wheelers constitute the remaining trips. The Delhi Metro carries a fraction of trips, not enough to reduce congestion by any means. Even in the western world, rail transit relies on the network of buses, which act as a feeder network to provide commuters for the rail transit.

Consider Montreal and Toronto. Both cities operate underground rail transit. In Montreal, almost 50 per cent of the transit trips, and in Toronto more than 60 per cent of all transit trips are made on buses. Without the extensive bus networks, the underground rail transit system may collapse because of lack of ridership.

This could happen even when the transit systems are heavily subsidized. For instance, transit riders in Montreal cover only 55 per cent of the annual operating costs of nearly 750 million dollars.

The federal and provincial (state) governments in the developed world provide huge subsidies for urban transit. In the European metropolises, transit subsidies run as high as 60 to 70 per cent of the operating costs. Could the same transit subsidies be sustained in the developing countries?

The experience in Pakistan shows that subsidy-based transit is unlikely to succeed. Earlier, provincial transit agencies operated urban and intercity transit. However, the provincial governments in Pakistan have divested from public transit in the past decade.

When the public transit system in Punjab was abolished, the bus fleet had shrunk from more than 1000 buses to fewer than 50 operating buses. The workforce of the Punjab road transport corporation during the same period had increased manifold. With fewer than 50 operating buses and almost no revenue, Punjab government abolished the money-losing enterprise in 1998.

If the Metro system in Karachi is operated on state subsidy, it is likely to meet the same fate. The ultimate goal for the planners in developing countries is to provide not just rail transit, but affordable mass transit capable of serving the mobility needs of all segments of society.

Rather than focusing on specific technology, the planers in Pakistan should first determine the transit fare that is affordable by most urban commuters. Based on that affordable fare and the demand for urban mobility, a transit system should then be devised. This approach will help design a subsidy-free transit system, which may be sustainable over the long run.

The affordability gap in urban transit provision is the challenge. Researchers argue that even the minimum bus fare is beyond the reach of most low-income commuters in Pakistan.

If you are in doubt, just ask the bus franchise operators in Pakistan, who are contractually prevented from raising bus fares even when the operating costs, especially fuel costs, have increased manifold. Commuters react sharply to any attempt to raise bus fares.

Rail transit is much more expensive than buses. The capital and operating costs of magnetic levitation trains, favoured by General Pervez Musharraf, are even more prohibitive.

Transit experts in Shanghai, the only city where MagLev trains are operating, have found that transit fares for the airport-bound MagLev train are beyond the reach of most commuters.

Rather than searching for rail-based solutions in New Delhi or Shanghai, the planners should explore the success of bus rapid transit in Curitiba and Bogota. With low capital and operating costs, these bus rapid transit systems have revolutionized urban mobility. Transit operators from the West are flocking to the two Latin American metropolises, which have developed indigenous solutions for their low-income population.

Even the transport experts at the Indian Institute of Technology in New Delhi are devising a bus rapid transit system for the capital. Why? Because bus rapid transit is affordable, flexible, and it has the capacity and potential to relieve congestion. The goal for the planners is not to be awe-struck by the glitzy technology, but to provide affordable mass transit for all.

The writer is a professor of transport planning and infrastructure investments at McGill University, Montreal, Quebec, Canada.

Glimmers of hope

Since September 11, 2001, I've written a column once a year pointing out the good news, which is that Islamic extremism is losing. The movement, in all of its variations, has been unable to garner mass support in any Muslim country.

While people in many countries still despise their governments - and that of the United States - this has not translated into support for Osama bin Laden's ideas. It doesn't mean the end of terrorism by a long shot. Small groups of people can do great harm in today's world. But it does mean that the political engine producing this religious radicalism is not gaining steam.

In those places in the Muslim world where political life is open, the evidence is overwhelming. In the elections in Malaysia and Indonesia this year, secular parties trounced Islamic ones. Malaysia's case is particularly instructive.

Prime Minister Abdullah Ahmad Badawi ran on a platform of reform and good government, reckoning that voters cared more about ending corruption than enacting Islamic law. The result was a devastating defeat for the Islamist party, its worst showing in 30 years.

In 2004, however, one can point to more than simply the absence of support for fundamentalism. There are glimmers of reform, even in the Arab world, the place that remains the locus of the problem. Governments are talking about changing their economic and even political systems. Some are doing more than talking.

Jordan has begun serious economic reforms. Egypt, which remains the most tragic case of lost potential in the Arab world, could be rousing from its slumber.

An energetic new prime minister has appointed a team with strong reformist credentials, including businessmen in the cabinet (a first in Egypt). The reforms they have proposed are bold and far-reaching. Markets are taking note: Egyptian stocks are up 100 per cent this year.

This early enthusiasm could easily dissipate. Arab elites remain enormously resistant to reform and will try to scuttle plans for change. But I sense that they are on the defensive. For the first time, other views are being aired. Consider the contrast between two conferences on reform held in the past 10 days.

The first, the official "Forum for the Future," held in Morocco, ended with the foreign ministers of the region endorsing reform but adding that it couldn't happen until a Palestinian state was established. Some also insisted that Iraq be free of foreign troops.

These are the usual strange excuses for repression and oligarchy in the Arab world. "Until foreign policy problems are solved," the governments seem to be saying, "we have no choice but to keep punishing our people."

But now there are Arab voices saying "Enough." At Dubai's Arab Strategy Forum a few days later, Sheik Mohammed bin Rashid Maktum, Dubai's ruler, said pointedly in his opening address, "I cannot see why a crisis, no matter how severe, should delay economic reform or plans to eradicate illiteracy. . . .What is the relation between foreign affairs and corruption?"

Interestingly, these voices are mainly being heard from the Persian Gulf, which has become the centre of reform in the Arab world. Dubai is far ahead of all others in terms of economic openness and efficiency. But Qatar and Bahrain are moving in the same direction with radical plans. It is a strange reversal. In the 1950s and 1960s, the large Arab states, led by Egypt, were seen as the modernizing forces in the region.

The Gulf monarchies were backward Bedouin societies. Now progress, at least economic progress, is coming from the Gulf, while countries such as Syria appear to be stuck in the Stone Age.

Indeed, despite the stirrings in Egypt, what is most likely is an increasing divide in the Arab world between the small, nimble states on the periphery - the Persian Gulf states, Jordan, Morocco - and the slumbering giants.

Although many in the region would be dismayed by this division, it is a healthy development. Pan-Arabism, which was never more than hot air anyway, has been one of the ideologies that has kept Arabs from modernizing.

Competition will force each state to focus on its own future. And as some succeed, others will follow, and regional trade and tourism - currently abysmally low - will expand. Perhaps this will forge a new Arab community, one created by the practical realities of contact, culture and commerce rather than war, rhetoric and politics.

We're a long way away from all this. But in the spirit of the season, let's give thanks for glimmers of hope. -Dawn/ Washington Post Service

'Terrorism is not caused by poverty'

Congress has implemented an important part of the September 11 commission's recommendations by approving changes President Bush supported in US intelligence operations as a way to combat global terrorism and the proliferation of weapons of mass destruction.

Now it's the time to address another critical component of the commission's report that can help increase global security and protect us against future attacks. The report calls for an increased investment in the full range of diplomatic, development and humanitarian tools to improve conditions in and relations with regions of the world that might be breeding grounds for terrorism.

These are the very tools encompassed within the U.S. international affairs budget. The commission did not see these international initiatives as superfluous to national security.

It saw them as essential elements of a strategy to prevent another attack on American soil: "... long-term success [in efforts to topple the Taliban and pursue Al Qaeda] demands the use of all elements of national power: diplomacy, intelligence, covert action, law enforcement, economic policy, foreign aid, public diplomacy, and homeland defence."

"Terrorism is not caused by poverty," the commission said. "Yet when people lose hope, when societies break down, when countries fragment, the breeding grounds for terrorism are created ... Economic and political liberties tend to be linked."

Most of the strategies on the commission's to-do list fall under the purview of the international affairs budget, which in fiscal 2005 amounts to about $30 billion. That's a little over 1 percent of the total U.S. budget.

We've made progress the past several years in providing support to U.S. international affairs efforts, increasing the budget from $26 billion in fiscal 2002, the last budget before the Sept. 11 attacks.

Still, this year's budget, just passed by Congress, fell short of President Bush's request by $1.5 billion. We need to do better; the international affairs budget must reflect the new world reality and our increased need for a vigorous national security strategy.

This budget, which includes international assistance and other global programmes, has evolved into the most significant non-military tool in the U.S. foreign policy arsenal and has gained widespread support in Congress and among national security specialists, especially in the wake of the Sept. 11 attacks.

Like the use of strong military action and effective intelligence gathering, the strategies promoted by the international affairs budget are essential tools in the fight against global terrorism, against the spread of weapons of mass destruction and our efforts to promote global stability.

The Sept. 11 commission warned, "The greatest danger of another catastrophic attack in the United States will materialize if the world's most dangerous terrorists acquire the world's most dangerous weapons." Next year's international affairs budget will include more than $400 million in spending for non proliferation, de-mining and anti-terrorism programmes.

Further, the commission believes that our efforts to promote economic growth in other countries through increased development, humanitarian assistance and expanded trade can enhance our security at home.

Next year's international affairs budget includes $300 million for trade promotion and export financing; nearly $8 billion for humanitarian and development assistance and the Millennium Challenge Account, intended to spur economic growth and democracy; and $1.5 billion in contributions to the World Bank and other international financial institutions, also in the business of promoting growth and stability in the world's trouble spots.

The commission noted, "Education that teaches tolerance . . . and respect for different beliefs is a key element in any global strategy to eliminate Islamist terrorism."

It urged the United States to support a global effort to educate children in Muslim states as part of the goal of reducing illiteracy in the Middle East. The current budget includes $400 million for international basic education.

Other parts of the international affairs budget enhance global stability and prevent terrorism by fighting drug trafficking, funding international peacekeeping, fostering economic development, fighting the spread of HIV-Aids and assisting international refugees.

Debt restructuring initiatives in the budget could create better economic conditions in countries where poor people are susceptible to terrorist recruitment.

The September 11 commission devoted itself to examining ways America could be made safer, and it determined that initiatives such as those funded by the international affairs budget are essential tools in the U.S. foreign policy arsenal.

It recognized that activities such as economic development and democratization abroad are not simply good things to do as members of the international community; they are strategic imperatives that address the link between a failed state and our own country's vulnerability to foreign threats.

We strongly support one of the commission's key recommendations for making our country safe: investing in the non-military tools of national security. -Dawn/Washington Post Service

James A. Baker III was secretary of state under president George H.W. Bush. Warren Christopher was secretary of state under president Bill Clinton. They serve on the Advisory Council to the US Global Leadership Campaign.