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Good afternoon and welcome to The Rundown. This week, AEI is getting in touch with its spiritual side, so we are taking a break from the snark. Think about joining us online for what promises to be an enlightening set of meetings with His Holiness the Dalai Lama. Have a great week, Your AEI Foreign and Defense Policy Studies team

Tweet of the Week

Sadanand Dhume @Dhume Dept. of Useless Information: The temperature in Sochi right now is the same as in Islamabad. pic.twitter.com/H9WK6i98uU

In the News
His Holiness the Dalai Lama
Recent years have made clear that the free enterprise system is under immense strain. But the answer is not simply to double down on budgetary arguments, tout low-tax solutions, and explain economic basics. We must stop considering free enterprise purely in terms of economic gain and wealth creation and begin considering it in terms of human fulfillment. In working with his Holiness the Dalai Lama, AEI seeks to create an open forum among scholars, social and political leaders, doctors, and scientists to discuss the ways in which material prosperity, spiritual development, and ethical leadership can maximize human flourishing. We look forward to a conversation with His Holiness about how the free enterprise system can offer the best path toward happiness when predicated on ethical leadership, morality, and compassion for others. Watch live on Thursday, February 20, at 9:00 a.m. at AEI.org.

Middle East
Yemens state news agency reported that heavily armed militants attacked Yemen's main prison in central Sanaa on Thursday, killing seven people and helping 29 inmates escape, many of them convicts in terrorism-related charges. Yemen is at a pivotal moment today, three years after the outbreak of popular protests, and the future of America's strategy against al Qaeda in the Arabian Peninsula is on the line. Yemen is in the midst of a political transition that will eventually reform and decentralize the government. But the success of the effort is by no means assured. Critical Threats Projects Katherine Zimmerman takes a closer look at Yemens political transition process and al Qaedas Yemen affiliate, which continues to ex ploit security conditions in the country. For much of the last decade, the United States kept two aircraft carrier strike groups in the Persian Gulf or its immediate vicinity. This made sense: Not only did those carriers help support US operations in Iraq and Afghanistan but they also guarded US allies against a resurgent Iranian threat. This is no longer true. The United States has now dropped its carrier complement down to one aircraft carrier in the Persian Gulf and that single carrier spends more time outside the Persian Gulf than inside. Michael Rubin takes to the AEIdeas blog to examine US aircraft carrier presence, arguing that Americas Gulf allies believe the United States is abandoning them. That is how they interpret the 'Pivot to Asia,' and the secrecy involved in the initial Iran talks. Already, important US allies like the United Arab Emirates and the Sultanate of Oman are making accommodation with Iran simply because they no longer trust US resolve or intentions.

Diplomacy
The Obama administration acknowledged Tuesday that diplomacy, the main pillar of its Syria policy, is failing even as civil war is destroying the country, leaving open the question of what the United States will or can do to stop the slaughter. While Obamas embrace of negotiation with Americas enemies seems to have become the norm in US foreign policy circles, it represents a sharp departure from past administrations and from generally accepted statecraft. History shows that this approach offers very high if unintended costs. Michael Rubin writes for The Washington Post: Times may have changed, but does dancing with the devil work? Often, diplomats advocate dialogue simply because other strategies are unattractive. Americans are exhausted after more than a decade of war in Afghanistan and Iraq, while sanctions are often little better: If they work, they do so only slowly and often at tremendous cost, both in lost commerce and collateral damage to the wrong people." Also be sure to check out Rubins new book, Dancing with the Devil: The perils of engaging rogue regimes.

Asia
China has joined Asia's largest multinational military exercises for the first time in what analysts said was a breakthrough for the Peoples Liberation Army. Seventeen soldiers, mainly from the Guangzhou Military Command, have been sent to the annual Cobra Gold drills led by the United States and Thailand.

Reactions to the Chinese Communist Partys announcement of major economic reforms in November have ranged from unbridled optimism to skepticism about the partys ability to implement sweeping change. In fact, the reforms themselves are flawed in multiple ways. Most are inauthentic, lacking credit, or nonviable. However, the areas of land and finance offer more limited prospects for true reform. Derek Scissors's newly released AEI report examines Chinas economic reform plan, predicting that the most likely outcome is that the party will claim success but the economy will slowly stagnate, harming Chinas partners. Rea d more here. Recent Beijing-Taipei talks provide us a chance to reflect on five faulty assumptions about Taiwan, many developed during and since the normalization process with China in the 1970s. Dan Blumenthal lists them out for ForeignPolicy.com. Number one? That Taiwan and China would reunify after a "decent interval." Read four more misconceptions here. When on Thursday US Ambassador to India Nancy Powell met Narendra Modi, chief minister of Gujarat and Bharatiya Janata Party prime ministerial candidate, Ambassador Powell ended a nine-year American boycott of the controversial politician. Critics may argue that the US has jumped the gun, effectively endorsing Mr. Modi ahead of national elections due by May and abandoning a principled stand for human rights in favor of realpolitik. In his latest Wall Street Journal editorial, Sadanand Dhume argues, They are wrong. You can fault Washington for waiting until this close to an election to reach out to Mr. Modi. But the decision itself is eminently sensible. Also read Dhumes AEIdeas piece on the 3 reasons the US ambassador to India should meet with Narendra Modi.

Defense
The US Navy would get the largest chunk of the additional $36 billion the White House is considering giving to the Pentagon for fiscal year 2016, according to defense sources. Borrowing a smart move from Robert Gatess playbook, Secretary of Defense Chuck Hagel will preview the major changes in President Obamas forthcoming defense budget request for 2015 in advance of their official release. While the presidents budget is not arriving on Capitol Hill until March 4, Hagel will hold a public press conference a week before highlights from the massive document are released. Mackenzie Eaglen's latest for US News & World Report looks at the many uncomfortable budget choices ahead, arguing that it is time for Congress to take a more thoughtful and strategic approach when examining individual decisions they do not like within the larger budget. Read more here.

Best of Blogs
Marc Thiessen brings you the best of what AEI's foreign and defense policy scholars are reading this

week... Ian Bremmer in Politico Magazine on 5 statistics that explained the world this week Mikheil Saakashvili in The New York Times discusses Czar Vladimirs illusions George Packer at The New Yorker writes, Games in Sochi, siege in Homs Christopher Griffin in RealClearWorld considers The war of wills between US and Iran Daniel Pipes in National Review Online reviews Obamas hollow promises abroad Arthur Herman in the New York Post claims Israels fortune is Putins horror Matthew Levitt in The Weekly Standard considers Imad Mughniyehs legacy six years on Aryn Baker at Time writes, Al-Qaeda splinter faction shows how not to be a terrorist David Keyes in The Daily Beast on The poet Iran executed

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