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Radnor Geopolitical Report

Chicago, February 2009



Strategic geopolitical intelligence for decision-makers





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Michael Granger is chairman of the Capital Access Forum. Radnor is working with the forum, the Minority Business Development Agency of the Commerce Department, the Treasury Department, George Washington University and several leading businesses to produce a Leadership Forum in Washington on May 11-12, 2009. Please contact Radnor for additional information.







Afghanistan: Is Escalation a Fait Accompli?

by Michael Granger

The crowding of crises

Sometimes one crisis can crowd out another to the point that one does not get the attention it deserves. The economic crisis is crowding out the Afghanistan war. Behind the scenes, in secret war councils, the Obama administration is deliberating the Afghanistan war, but the crowding out is certainly true in the public's mind.

As a result, there has been scant public debate about how we should handle this problem war and almost a resignation that more troops will be sent to that theatre, for better or for worse. Although there seemed to be a consensus during the primary and general elections that the United States lacked the forces to succeed in that forsaken land, it is now up to the winner to fix the problem.

Be careful what you ask for

Candidate Obama campaigned vigorously for sending more troops to Afghanistan when President Bush had the problems, but now they belong to President Obama. The problems in Afghanistan were used to perfection to underscore his opposition to the Iraq war and it was an irrefutable argument. Candidate Obama had only to invoke Afghanistan to score a knockdown in the debates. So now that he is in office, is the escalation of the Afghanistan war a fait accompli? Is the president trapped in his campaign position or is there another way forward?

Even without public debate about how to handle Afghanistan, President Obama must realize that his policy will be a bet-your-presidency policy. That is why he will be well served to shelve the campaign position and draw up a new policy with all the implications of escalation, or the lack thereof, taken into account.

The American people would reward a president who carefully considers all the grave issues attendant to escalating our military involvement in Afghanistan and would respect a decision based on sound analysis and considered judgment. The American people are very sophisticated about assigning blame for problems or failure, but Afghanistan offers no simple solution. And taking over a war from another president has proved to be fatal for some of the most promising presidencies.

Hand-me-down wars

Many presidents have faced the challenge of presiding over a war started by their predecessors. The Vietnam war was the result of the policy to contain communism started with the Truman Administration, seamlessly moving through successive administrations, Eisenhower to Kennedy to Johnson, Nixon and Ford. With the exception of Ford, who was left with the results, each in the chain of custody accepted and prosecuted the war with a view towards achieving victory over the insurgents and the communist North.

In the frame of mind of the 1950's and 1960's, in which communism represented a legitimate threat to our way of life, the presidents felt they had no other alternative but to try to achieve military victory in Vietnam. But public opinion in the face of mounting casualties had other ideas.

Afghanistan is different because it was that country from which the most devastating attack ever on the continental United States was launched. This is precisely the reason why President Obama has such a difficult decision to make. President Obama would do well to consult a wide range of experts and political leaders before he takes this decision. He needs to spend significant face time with people who have actually been in the field and less with those in the rear with the beer and the gear.

Johnson was reluctant to escalate the Vietnam War, but was apparently afraid that he would be branded as weak for not flexing American military might. By his own admission, he could not muster the courage to do what he felt was right, to end the war. So, although Afghanistan is no Vietnam, Obama should carefully study the process by which Johnson and Nixon escalated the Vietnam War. This is not to say that Obama should not escalate, but he should first know why he is doing what he decides to do. And most importantly, he should make sure that the nation is brought along and prepared for and supportive of his decision.

What are the objectives?

The first decision of Obama's war council, with a clean slate (the slate is never clean!), is to determine the policy objectives of the Obama administration. Is the primary objective to democratize Afghanistan? Is it to merely prevent terrorists from launching attacks on the United States and its allies from sanctuaries in Afghanistan? Is it to depart with the means of quickly returning to liquidate threats from perpetrators of terrorist acts?

Only with well defined policy objectives can we be assured that we will have the right strategy to achieve the desirable outcomes. We want to know what will be left in the wake of silent guns in Afghanistan.

We must be realistic about what we can achieve in Afghanistan; a lasting peace may not be one of those achievements. It may be that the price the Afghan people pay for having such a complex society is the abhorrent conduct of fringe elements of the society. In any event, if and when we leave, and if we leave them intact, the Taliban should be strongly inclined to police themselves and other splinter elements, knowing the severe consequences of not doing so.

Is there détente with terrorists?

Any approach that involves leaving the Taliban intact begs the question: Can there be détente with terrorists? Could the Taliban ever be reduced to a peaceful opposition party in Afghanistan? And as much as we may not like to admit it, Pakistan is teetering on being a failed state. If a country lacks control of a substantial portion of its territory over which it has every right to exercise sovereignty, and if the government lack complete control of its military, call it what you like, but the conclusion that it is a failed state is difficult to escape. It is as if out of these two difficult countries a third, Talibanistan, has been forged.

The answer or the truth to these questions and issues can only be determined by diplomacy, including the use of force to bring the Taliban to the negotiating table. But this should not be presupposed to be the strategy the administration should pursue, because Obama is a long way from completing the process that gets him to a strategy. Perhaps it should be approached as a business decision, which is that we cannot use what we have already invested as the basis for staying. Today, we must use just the facts on the ground and the policy objectives.

President Obama should have deep and wide consultations on all the implications of escalating the war in Afghanistan. He needs to become a student of JFK's and Johnson's deliberations before they escalated the Vietnam War. He should resist the temptation to follow in the footsteps of those world leaders throughout history who felt compelled to demonstrate toughness by using their war making powers. This is not to say that the military option should not be on the table, but escalation should not necessarily be a fait accompli unless it achieves our policy objectives in Afghanistan and the region.

If he decides to escalate, the president should keep in mind an important axiom of war: The invading force must possess numerical superiority.

Michael Granger

Michael Granger is a pioneer in working to provide capital to minority and underserved businesses. He coined the term domestic emerging markets to recognize the emerging businesses in the U.S. economy that lacked access to capital. Mr. Granger's areas of expertise include private equity investments, analysis of technology companies, buyouts, and growth acquisition transactions. Mr. Granger has been an active private equity professional for the past two decades, focusing on acquisitions for investment purposes and integration of businesses. Since 1985, he has worked with Cigna Venture Capital and Xerox Venture Capital, before founding his own firm, Ark Capital Management in 1992.

He also served four years of active duty in the U.S. Marine Corps during the Vietnam era.

Granger earned his B.S.E.E. from the University of Massachusetts in 1982 and an MBA from Dartmouth College's Amos Tuck School of Business Administration in 1985.

He is also Founder and Chairman of the Capital Access Forum, a Chicago-based company designed to improve access to capital for emerging entrepreneurs. Under his leadership, the Forum has had four successful conferences, bringing private equity firms and entrepreneurial companies together. His publications include: Case Study on Hospital Management Companies; an editorial piece in the Wall Street Journal on Capital Gains Tax Reduction; and a Study on Venture Capital Opportunities in the Telecommunication Industry (Tuck Today Magazine). In addition to serving on a White House panel of industry leaders convened by the President's Chief Economic Advisors, Granger has also actively participated in numerous other boards and commissions.

He is among the earliest supporters of President Barack Obama.

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