I was hoping that the comments on Jerome's diary would have more to say about the original Financial Times story on the three camps supposedly inhabiting the White House. Since the string of comments has essentially turned into a retirement party for Wolfowitz, I'm hoping that those of you who have had enough champagne and are still lucid will drop by for a short, but serious and important discussion.
What's been happening with Wolfowitz is like an X-ray or a CT scan of the Republican party's higher reaches, revealing aspects of its internal structure normally hidden from view.
The FT story is, I think, correct in its identification of the main factions. The only inaccuracy is that faction #3, as several have already noted, is not very distinct from faction #1 (Paulson and the rest of the Treasury, and their silent partners in the money center banks, the multinationals, and other internationally oriented Republicans). Both are quite distinct from faction #2 (the Cheney-Rove forces, who are correctly described as indifferent to or downright antagonistic towards the World Bank).
It is important to understand this: This factional division within the White House is not just a result of Wolfowitz, nor even a result of this administration. The division of the Rs into an internationalist camp, pragmatic in its support of international organizations like the World Bank, and a nationalist camp, deeply hostile to international organizations, international law, and even military alliances that appear to be too constraining, has been around at least since the fight over the ratification of the League of Nations Treaty at the end of world War I. The nationalists tend to draw from extractive industires like oil, mining, and large parts of agriculture. Their only use for the rest of the world is as a place to mine or drill. Because their industries are the most affected by environmental regulation, they tend to be virulently anti-environmentalist. Because oil and minerals are easy to nationalize, they are also deeply hostile to producer country nationalism and demand a US foreign policy that is long on muscle and short on everything else.
Ever since the defeat of Landon in 1936, the nationalists have been relegated to second fiddle in Republican administrations. Although at times during the first Eisenhower and first Reagan terms they appeared to mount a serious challenge to the internationlaists, they never were strong enough to elbow them out of the way. Nixon-Ford were securely rooted in the internationalist wing; the Texan John Connolly was the only high level Nixon-Ford official with strong ties to the nationalists, and he left when it became apparent that his views were marginalized. Bush the Elder's team was also securely internationalist. Though the influence of the oil industry hardly vanished, the elder Bush was not about to let that industry interfere with the essentially internationalist dynamic underlying that administration's foreign economic policy. Bechtel, the corporate face of the Reagan-Bush administrations, certainly did a lot of business with the oil industry, but they were diversified in their interests in a way that Halliburton is not.
Bush the younger's administration is an altogether different critter. The centrality of Cheney and Rove testifies to the achievements of the nationalist camp. Not since the days of Harding, Coolidge and Hoover have the nationalists been so close to the throne. Thus it is not surprising that indifference to all things internationalist -- with the exception of making sure that key positions in Treasury and State were given to them as a side-payment -- has been the hallmark of this administration.
Why is this important? Because this administration is going to go away, but this schism is not. Given the mess that the nationalists have made, there will likely be a period when they will not be allowed to operate machinery or handle sharp objects, but rest assured that those nationalists who have already written off this administration are already turning their thoughts to the next time they are in power, and how they will avoid the mistakes of this one. Bush will go away, they will not.