‘You’re asking me if the president spoke to President Zhang?’ said Moss, playing for time. ‘Is that what you’re asking?’
‘Yes, sir.’
‘The president speaks to numerous world leaders on a regular basis. That’s an important part of his job.’
‘Then let me repeat the question as specifically as I can. Is it true, Mr Moss, that President Knowles spoke to President Zhang on the night before Fidelian filed for bankruptcy and asked for his help in making sure a deal was done?’
Moss hesitated. Technically he could answer no to this. The president had spoken to Zhang on the morning of Fidelian’s failure.
Impulse got the better of him. ‘No,’ he said.
‘So he didn’t speak to him before Fidelian failed about the need to rescue the bank?’
‘Margaret, you know I can’t give a list of every conversation the president has.’
He took other questions, but the journalists kept probing on the point of a conversation between Knowles and Zhang, sensing an evasiveness in Moss’s answer and homing in on it with the instinct of sharks for blood. Moss refused to answer the question again, or any variant of it, citing his principle of answering any given question only once. He didn’t know if this was convincing anyone. He could feel himself sweating. He was a man of middle height with a shaven head and he knew that when he sweated, his head glistened. The reporters could probably see it.
Then he got a different question.
‘How’s the president holding up?’
‘He’s fine,’ said Moss guardedly.
‘Really? He’s just come through what has undoubtedly been the worst midterm results for a governing party since Clinton in 1994. He’s got the biggest financial crisis on his hands since Bush in ’08. He’s suffering the biggest general attack on him since Obama over health care. Half of his own party is casting doubt on his suitability for the nomination at the next general election and the other half is damning him, if you will, by faint praise. It’s clear now he’ll face a credible bid by Senator Hotchkiss to take that nomination away from him.’ The journalist smiled. ‘So I just wondered, how’s he doing?’
Moss saw smiles around the press room. He hesitated for a moment, wondering whether he should refute those points one by one. Then he decided it wasn’t worth gracing a question like that with anything more than a rebuttal.
‘He’s fine. Thanks for asking. The president has a strong constitution and he’s upstairs in the Oval Office right now doing what needs to be done for this country. But I’ll be sure to tell him you inquired. And I wouldn’t go blowing things up too much. I know you guys like to do that, but this president and this administration are firmly in control. Okay, one more. Owen?’
‘I don’t know if we’re blowing things up,’ said the journalist Moss had picked out. ‘Let me ask you this. We’re hearing a large number of rumors circulating right now, that the Fed put a deal together, that the deal was rejected, that the people who rejected it were the Chinese government, and just now we’ve heard that the president was on the phone to President Zhang about precisely this thing hours before they did that. And it appears that you are not able to confirm or deny any one of these rumors. Now, I’m not asking you again, because I know you’re just going to tell me you don’t address rumors or you’ve answered that question already or whatever. So what I’m going to ask you is, Dean, what do you want me to report?’
Moss stared at him. ‘That’s your call, Owen.’
‘So it is. But I’m giving you a chance to help me out here. Because right now, from what I’ve heard, all I can say is that the White House refuses to deny that any of those things happened.’
Dean Moss could feel the eyes of the entire corps on him. His mind raced, searching for a response.
‘What I would like you to report, what I suggest you would report – because you’ve asked me, and because it’s the most important thing, a lot more important than rumors of what might or might not have happened prior to Fidelian Bank filing for bankruptcy – is what’s happening now. What’s going to happen over the next few days. The president is working with his advisors to understand the implications of these events and what further action, if any, needs to be taken to ensure that the economy – which is strong and still has a lot of growth in it according to the Treasury Department and projections from just about every respected commentator – the president is working to make sure we stay on track to get that growth and make sure it reaches into every corner of this country. And let me also say, there’s a lot of other things the president and this administration are doing. You guys tend to focus on one thing at a time, and that’s understandable, but that’s not how the presidency works. There are other things going on, important things, that we shouldn’t lose sight of as well.’
The reporter looked at him skeptically.
‘Take Jungle Peace. That’s an important intervention that America’s engaged in to change the lives of hundreds of thousands of people in Uganda and free them from a scourge that’s blighted them for thirty years. Have we stopped that because of this? No, sir, we haven’t.’
‘Where are the results? When you went in there you told us there were going to be results.’
‘Watch.’ Moss looked at the reporters around the room. ‘Just watch.’
FOUR MILES AWAY, in the Pentagon, Gary Rose was meeting with Defense Secretary John Oakley and Mortlock Hale, chairman of the Joint Chiefs of Staff. Pete Pressler was on the line from the Abraham Lincoln off the coast of Kenya.
Rose didn’t beat around the bush. He wanted to know what was happening. A few days earlier, Pressler had reported that surveillance had revealed what appeared to be an extensive LRA camp in dense jungle a few miles south of Uganda’s border with Sudan. Further surveillance had confirmed the finding and suggested that the encampment most likely included some of the senior leadership of the LRA, possibly including Joseph Koni, if he was alive. The founder of the LRA hadn’t been sighted for years and there were conflicting reports if he was alive and, if so, whether he still exerted command over the group. The camp was clearly significant. Yet nothing had been done.
The problem, according to Pressler, was operational. Using drones in a jungle environment was proving to be a steep learning curve. In the almost treeless mountains of Afghanistan, visibility was unimpeded and a strike could be launched from a mile away under direct vision from the cameras on the unmanned planes. Over jungle, the drones had to fly low and slow in order for infrared detection to operate, which alerted the targets to their arrival. When they heard the drones the LRA men ran, as Pressler put it, like rats out of a sack. To hit them then would require widespread devastation, which was beyond the firepower carried by unmanned vehicles. The second problem was that once the drones did start firing, the infrared was pretty much useless as the whole detection field exploded with heat. In retrospect, this was something they should have anticipated but the operational implications only sank in after drone pilots had fired during a few early sorties. Once they let their first missile fly, the men piloting the drones back in Creech air force base in Nevada had a whiteout on their screen and from that point on were firing blind.
That left two options. They could put a force of Apaches over the area and attack with devastating power, but the helicopter pilots wouldn’t have a great view of what they were shooting at. They would be more effective than unmanned aircraft, but if they failed to take out a significant number of the enemy in the first moments of the attack it was likely that the majority would get away under the jungle canopy. Alternatively they could put men on the ground, but they would be sending them against a military camp that presumably had been fortified and whose defenders were expecting an assault, with no visual reconnaissance and little prior intelligence on the nature of the resistance they would face. While this would be the most effective way of clearing the area, it carried obvious risks that the president, Pressler understood, was unwilling to entertain.
‘Or Pete c
ould continue to do what he’s doing now,’ added Hale. ‘Harassment and interdiction. If we look at the bigger picture, we are getting individuals coming out, not a lot maybe but a couple every day, walking out of the jungle and surrendering. Now, sure, these aren’t the hardline guys, mostly they’re kids who were stolen from some village. Also there have been a couple of unpleasant occurrences when local people got hold of some of these kids who’d come out. It wasn’t too pretty. We’re trying to do something about that because it doesn’t do much to encourage the others to give up. Anyway, the thing is, we could continue, and in many ways that’s the least risky option.’
‘But the longest,’ said Rose.
‘Yes, sir.’
‘Admiral Pressler, how long would all this take, do you think, if that’s all we did?’
‘Until we’ve got rid of the whole LRA?’ came back Pressler’s voice over the phone. ‘To be honest, Dr Rose, I don’t think anyone can say. This group’s survived in that jungle for thirty years. On the other hand, its pattern has been to regularly come out for food and medical supplies and fresh recruits. So we’re not looking at a self-sufficient force and we’re not looking at a force that can extract what it needs from its local population because there ain’t no population in that jungle to extract it from. Probably depends on what their stores are like. We must have degraded them to some degree but, again, we can’t say how much.’
‘So it could be a year,’ said Rose.
‘I wouldn’t want to put a time on it.’
‘General?’
Hale shrugged.
It could be two, thought Rose. That was what that shrug meant. Gary Rose didn’t know how General Hale had the barefaced cheek to sit there and tell him these things. In the discussions prior to the launch of the operation, he could distinctly remember Hale saying they’d get hits just about as soon as Pressler’s force was deployed.
Rose glanced at Oakley. The defense secretary was committed to a strategy of unmanned vehicles both in the air and on land as the leading edge of the US military, and wanted Uganda to be a showcase. He wanted to see the big successes achieved by drones to help him push his case. But if unmanned force wasn’t going to be enough, it wasn’t going to be enough. The defense secretary knew the president wanted to see results. He wasn’t going to wait two years on it.
‘Let’s come back to this camp,’ said Rose. ‘Admiral, sounds like you’ve got a way to make this happen.’
‘Even if we just bomb the hell out of it and don’t kill too many of the enemy,’ said Pressler, ‘that’s got to hurt them. We could do that with a bunch of cruise missiles. They must have supplies in there, infrastructure. If they lose that it’s got to hurt.’
Rose glanced at Oakley and shook his head slightly. That wasn’t going to be enough. He could imagine the reports in a press that was already lashing the president with everything it had. This was the first significant LRA camp they had found and an attack on it that didn’t kill a substantial number of combatants was going to look like a failure, no matter how many coconuts they blew up. It would look as if the LRA had outsmarted them. In the current media environment, the fact that a bloodless attack might contribute to a long-term strategy of attrition was a subtlety that wouldn’t survive the press’s appetite for something else they could use to beat up on the president.
‘Let’s think a little more aggressively,’ said Oakley.
‘I take it you’re not referring to putting men on the ground,’ said the general.
‘No,’ said Rose. The president didn’t want American servicemen in harm’s way.
‘Then he wants to do it with Apaches? Pete, where are you on that?’
‘We could do it. We’ve done the planning.’
‘And the LRA, they have the wherewithal to take out any of these machines?’
‘We don’t think so, sir.’
Hale looked back at Gary Rose. ‘There you go.’
‘Well, Admiral Pressler’s the operational commander,’ said Rose. ‘I don’t want him to think there’s any kind of political pressure. I hope that’s clear. Admiral, this is obviously your decision.’
‘Pete, how quick could you do it?’
‘The planning’s done,’ said Pressler. ‘We could do it tomorrow. We’d go in at dusk, to maximize their difficulty in regrouping after the attack’s done. We just need the go-ahead.’
‘Well, I think what Dr Rose is saying,’ said Oakley, watching Rose’s face as he spoke, ‘is that if you say you can do it with Apaches and get a significantly better result than with drones, the president will okay it. Is that right, Gary?’
The national security advisor nodded. ‘I would think that’s right.’
31
THE FULL NATIONAL Security Council was in attendance, both its civilian and military representatives. Ed Abrahams and a number of key White House aides were seated around the room as observers. The president’s objective was to understand what lay behind President Zhang’s behavior and what he should do about it.
He asked Susan Opitz to kick off by giving a summary of the events leading up to the failure of Fidelian Bank and the financial aftermath in the four days that had followed. Her account was succinct – it made for pretty grim listening, and the brevity didn’t lighten it. The last three days had been the three worst on the markets since Knowles took office. Tuesday, the day of the midterms, had seen the steepest fall in a single day since 2014. Interbank lending was almost at a standstill and a number of banks remained solvent only because of the cash available under the extraordinary liquidity facility that the Federal Reserve was providing.
The president then asked Ryan Ferris, the director of national intelligence, to provide his assessment of the rationale for Zhang’s behavior. There was nothing to be gleaned from Chinese media and blogosphere sources, Ferris said. As far as could be gleaned from contacts within the regime, the balance of power remained as it had been. There had been no policy change, as far as they were aware, in relation to the US.
He asked if anyone else had preliminary remarks. John Oakley wanted to know what effect the rumors about the president’s call to Zhang were having on the markets.
‘They inject uncertainty,’ said Opitz. ‘Uncertainty creates volatility.’
‘When you analyze the timing of the market movements over the course of the week,’ said Marty Perez, ‘what’s clear is that it wasn’t the Fidelian bankruptcy alone that pushed the markets through the floor. It was the rumor that a deal was rejected that really crashed them. Then when the rumor came out about the president having spoken to Zhang, there was no resistance left.’
‘Don’t we think the market’s overreacting?’ said the vice-president skeptically. ‘Does the Fed really need to be doing all this stuff?’
‘Yes, sir. It does.’
‘Feels like you can create a panic just by doing too much.’
Marty Perez didn’t think much of the vice-president’s grasp of economic policy. ‘The Fed’s doing exactly what it needs to be doing,’ he said. ‘If anything, it needs to be doing more.’
The vice-president raised an eyebrow. It was his usual gesture when he didn’t believe something but was so far out of his depth that he couldn’t think of even a half-sensible way to challenge it. His raised eyebrows were a standard joke amongst White House staff.
Knowles gazed at the notes he had jotted down while Opitz was speaking. ‘So the fear driving what’s happening now, if I understand what’s been said – and particularly to your point, Marty, about the timing of the stock falls – is that the Chinese government purposely pushed Fidelian into bankruptcy. Is that correct?’
‘Yes, sir,’ said Perez. ‘The question everyone’s asking now, is who else are they going to do that to?’
‘How large is that risk? Do we have any idea?’
‘We don’t have exact numbers. We estimate China to be holding between one and a half and two trillion dollars in foreign reserves. The funds available to their three largest sovere
ign investment funds is in the region of another one to one and a half trillion. You can add another one and a half to two trillion in the wealth funds of Saudi Arabia and the Gulf States and three, four hundred billion in Russian wealth funds if you want to look at other countries that have significant stakes in our markets.’
The numbers were ridiculous. Tom Knowles had no idea where to even start with them. How did they ever get into that situation?
‘Marty, you’re not saying all of that money is in US stocks,’ said Rose.
‘No. I don’t believe anyone has done an analysis of that. But whatever the number, it’s large. If that concentration is used in a purposeful fashion, is it enough to move our markets? Absolutely.’
‘Well, can we at least get the number?’ said the president. ‘Can we at least have one or two facts?’
Perez nodded.
‘Okay. Now, I told Zhang exactly what was happening. So on the face of it – unless we believe he couldn’t influence the PIC, which I don’t think anyone believes – he’s done this in full knowledge. Before we assume that, have we got any evidence that says he didn’t?’
There was silence.
Ryan Ferris shook his head.
‘They’ve never behaved like this before,’ said Perez eventually. ‘That’s the best I can say. All these are funds set up by countries running huge surpluses – some of which, at least, like the oil-exporters, can’t expect those surpluses to last forever – and it makes perfect sense that they want to put that money to work. The line has always been that these are commercial investments made for commercial profit. That’s always been China’s line as well and as far as we’re aware their behavior in the past has always supported that.’
‘And they would have lost a hell of a lot of money on Fidelian,’ said Opitz. ‘That argues against it as well, but then we know they could have made that up in any number of ways.’
‘Anything else?’
No one replied.
‘Mr President,’ said Bob Livingstone. ‘It’s clear that President Zhang could have stopped this and didn’t. If that’s the case, the question is whether he anticipated what’s happened.’
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