The World in 2017

The Most Consequential Decision...
The Most Consequential Decision…

Geo-political orders are, by their nature, impermanent. Today, the order that the United States created in 1945 has mostly run its course, and in the coming years, a new set of political, economic and security arrangements will succeed it. The questions to be answered are what those arrangements will be, and who will set them.

In our “winning is everything” culture, talk of the end of the 1945 order is internalized as an acknowledgement of national decline, of second rate status, of humiliation. Of course, nothing could be further from the truth.

By virtue of a very rare combination of geography, population, demographics, infrastructure and wealth – both physical and financial – America is unquestionably the strongest nation on earth, and will continue to be so for the foreseeable future. Today, nearly three quarters of a century after WWII, the US, with 4/10ths of one percent of the global population generates 22 percent of the global GDP. In contrast, China, the fastest growing economic power of the last 30 years, requires 18 percent of the global population to generate 13 percent of global output. The American advantage is real, and if not squandered, enduring.

The question is not strength, but of optimization. The existence of a structure or organization created to meet a need in the last 70 years does not, by itself, confirm its continued utility. Consider our results.

The framework of international political, security and economic policies undertaken by the United States after WWII removed more people from poverty and created more prosperity than at any other time in human history. Counter to almost every historical precedent, the US did not subjugate its former enemies, but invested in their political economic and social rebirth as free and independent nations. For every leftist who talks about American imperialism after WWII, one need only look at the stark difference between eastern Germany and western Germany after 1990 to understand the distinction between an order based on shared responsibility and prosperity, and one of naked political and economic oppression.

The post-war American order, designed to rehabilitate, integrate and grow global prosperity, also sought to defend against Soviet Russia as a political and military threat. The collapse of the Soviet Union in 1991, in retrospect, was the zenith of the US geo-political order, where a transition to free market economies and representative governments based on popular sovereignty, swept large swaths of the globe, and defined the last decade of the 20th century. It was all accomplished without a shot fired between the superpowers, managed under American leadership.

It was a triumph without precedent.

Today, core structures of the original American blueprint remain central to global order and prosperity. The World Trade Organization (WTO), successor to the GATT (General Agreement on Tariffs & Trade), settles economic disputes in a conference room instead of a battlefield. The World Bank coordinates aid and investment to the least developed countries to seed organic economic growth and prosperity. The American military continues to police the sea lanes to ensure the free flow of commerce, and US security guarantees maintain political assurance in Europe, the Middle East and Asia.

At the same time, profound changes are in the making, which challenge the limits of America’s design and will confront the next American president on Day #1. How we navigate these changes will inform how well the US – and the world – transition to the next political order.

Russia:  as a country, Russia is in relative decline. Its economy is roughly as large as that of Texas and based almost exclusively on oil and minerals. Russia is also the first industrialized country to reverse health and mortality gains with a population that is declining in absolute terms and will continue to do so for the foreseeable future.  With a population of 143 million today, analysts at the UN estimate that will drop to between 115-120 million by 2030.

This demographic unraveling and economic weakness, coupled with an acute sense of historical grievance under Vladimir Putin’s rule, has again made Russia a threat to global order. Russia’s disproportionate power in relation to its actual strength is made possible by its military. Russia’s nuclear arsenal, coupled with discreet but highly effective enhancements to its conventional combat capability have provided Putin the tools to destabilize, intervene and control regions he deems vital to Russia’s long-term survival.

The covert take-over of Crimea and the continued, Russian-supported separatist’s fight against the government of Ukraine, are historically predicable moves to secure territory that would serve to block future land invasion routes into the Russian heartland.

From an American and European perspective, the Ukrainian move is menacing, but not a direct threat. However, in order to secure all land approaches to Russia, Putin must gain political control over the Baltic states and prevent a resurgent Turkey from moving east into Georgia and through the Caucasus mountains into the oil producing regions that are a Russian life-blood. Both are NATO.

We see early Putin moves in the constant intimidation of the Baltic States, which hold the distinction of being the only countries in NATO that were former provinces of Russia. We see it in constant Russian demands that NATO missile defense systems, designed to counter Iranian threats, be cancelled as Russia sees these as a direct threat to their nuclear forces. We can also see it in Russia’s provocative involvement in the Syrian civil war as a means of counter-balancing Turkey’s Sunni influence in the region with the Shia regime in Damascus, aligned with Iran, keeping the Turks busy in the south, instead of the east.

Western economic sanctions have paradoxically increased Russia’s threat, not decreased it. With the sanctions in place, and taking into account the collapse in commodity prices globally, Russia is in a period of severe economic recession. That necessarily limits Putin’s time and room to maneuver.

The Russian challenge for the next president will be the unfavorable, asymmetrical balance between the West and Russia in territory that Putin considers vital.

The Baltic States are indefensible. With a huge military advantage, the Russians could overrun the three countries in a matter of hours or days. The only hurdle to Russian action is NATO’s Article V which states that an attack on any Member is an attack on all. An overt Russian move on the Baltic States would require the US to go to war with Russia, up to and including the use of nuclear weapons. It is a huge gamble for Russia to take.  But there are reasons Putin might take the risk anyway.

From a Cold War high of 300,000 troops in Europe, today the US has less than 30,000, spread out, throughout NATO countries. The stark fact is that there is no credible conventional deterrent to Russia in the Baltics nor eastern Europe. Political expansion of a military alliance occurred, apparently without any analysis of what it would take to defend the new Members, as no one seemed to think the Russians would see a military alliance on its doorstep as a threat.

What is an American president to do?

Beyond the immediate lack of forces to deploy to counter a Russian move on the ground, the US must also consider the prospect that any counter-raids it launched, on airfields or military bases, will most likely be on Russian soil. Russia attacks a NATO member state, the US attacks Russia’s national territory. During the Korean War, the US would not allow attacks on sovereign Chinese territory for fear of unintended escalation, even though Americans were in hand to hand combat with Chinese troops in Korea and desperately needed to ease the pressure by disrupting Chinese supply routes.

How would the Russians react to US fighters, cruise missiles attacking Russian territory?  Would it open up the option for Russian submarines to launch conventional attacks against military bases in the continental US?

But alternate proposition is equally untenable. For the US president, anything less than a full US commitment would shatter NATO and throw European security into chaos that would almost certainly result in a larger war. These choices are no longer the stuff of fiction. The Pentagon now recognizes the strategic dilemma.

China: 37 years of explosive economic growth have transformed China from of the most backward to one of the most powerful countries in the world, with vast economic power and a substantial, growing and increasingly modern military.

Like the Russians, the Chinese face a demographic crisis, for China as the result of the “One Child Policy.” In 2025, 200 million Chinese will be 65 or older, two and a half times the existing number. At the same time, China will experience a squeeze in working age citizens, creating a startling imbalance between productive workers and the requiring assistance in retirement.

At the same time, the Chinese have not forgotten their historical greatness as the Middle Kingdom, and how much more advanced their civilization had been from contemporary Western culture. The serial humiliations that have been visited upon China over the last 200 years, during a period of China’s decline, have not been forgotten either, and for the first time in centuries, China now has the power to correct what it interprets as historical wrongs, reasserting its control and authority, regardless of what the United States or other Asians nations believe.

This drive has manifested itself most provocatively in the most innovative and destabilizing action in recent history; China’s implantation of a plan to create man-made islands on reefs in the South China Sea, large enough to support radar, missile batteries and fighter aircraft, and claiming it to be Chinese territory.

There is no historical precedent for this artificial sovereignty.

These islands, hundreds of miles from the Chinese mainland, sit at the very heart of the South China Sea where $5.3 trillion in trade passes each year, $1.2 trillion of that trade destined for the US. Worse, almost every ASEAN nation, including the Philippines, with whom the US has a mutual defense treaty, have similar claims on the area.

Where the US once considered China only in the context of Taiwan, Beijing has now significantly changed the strategic paradigm, announcing no-fly zones on islands disputed with Japan (A US mutual defense agreement partner) and literally creating island bases to project military power into the heart of the South China Sea, made possible with advanced and dangerous weapons platforms that are capable of challenging what has been uncontested US control of the western Pacific, since 1945.

The challenge for the next US president will involve a decision on how hard to press China on these destabilizing actions. Each, mild, US show of strength thus far has only served as a justification for the next Chinese military upgrade to the Islands. The Chinese have paid lip service to diplomacy, clearly hoping that inaction will lead to a fait accompli.

To fail to challenge China on these actions would serve to undermine the confidence of allies in our mutual defense pledges. It certainly threatens US security relationships with ASEAN nations as well as a not inconsiderable amount of US trade. In a very real way, the islands change the balance of military power providing China with a “stand-off” military capability that can pose such a threat to US naval forces, particularly US carriers, as to keep them out of the region entirely.

On the flip side, to challenge China and miscalculate, invites war, where, like Russia in Europe, China enjoys and asymmetrical military advantage based on forces and geography.

Iran: like China, Iran is heir to one of humanities’ great civilizations, the Persian Empire. At one time, Persia extended from present day Iran to encompass part of India, all of Pakistan and Afghanistan, across Iraq, Syria, Turkey and Jordan, into modern day Egypt.

As with China, the collapse of the Persian Empire brought annexation and servitude to others. In the 20th century the Shah’s 26-year, Western-backed rule, ended with the Islamic revolution, founded as a Shia counter-cultural response to contemporary Western values, symbolized by the United States. In outlook and focus, the revolutionary regime seeks to recreate the pride and greatness of the Persian Empire, coupled with the export of Shia theology. In so doing, Iran is not so much a part of the community of nations, but an agent provocateur in trying to undermine it.

In many respects, the Iranian experiment is no less revolutionary than that of the US, which was the first Republic since Athens.

In 37 years, the Iranian regime has made vast progress toward the recreation of Persian/Shia hegemony in the greater Middle East, policies that directly threaten US regional security interests, and through vigorous pursuit of terrorism, WMD and advanced missile technology, potentially threaten Europe and even the American homeland.

Iranian proxies run Lebanon. The terrorist army of Hezbollah, financed by Iran and heavily armed with sophisticated weapons, sits on Israel’s norther border, pinning down Iran’s second greatest enemy. The precipitous and pre-mature withdrawal of US combat forces from Iraq allowed Iran to consolidate Shia support in Iraq’s South, and opened direct logistical supply lines to Assad’s Shia-run Syria. Iran also supports insurgent Shia forces in Yemen. The combination of Iranian activity in Iraq and Yemen has created enormous security issues for the Sunni US ally, Saudi Arabia

In Syria, the current, five-year civil war has been a ferocious proxy fight between Iran’s full commitment of men, material and money to keep Assad in power at all costs, against the fractured efforts of Gulf Arab and regional Sunni countries to support the majority Sunni Syria. The decisive Russian intervention in Syria – where Iranian and Russian interests align – changed the balance of power in favor of Assad. The ceasefire that took effect yesterday is the first tangible sign that the Iranians have been successful in creating a zone on influence from the Mediterranean to the Afghan border.

Emboldened by its strategic success in Syria, and empowered by a flawed nuclear deal that dismantles sanctions and returns to the Iranian treasury 1/3rd of its annual GDP in otherwise frozen assets, Iran poses the third challenge to the next US president.

Abrogating the nuclear day may be satisfying, but having dismantled sanctions, resumed trade and returned cash, there will be no international consensus to re-impose penalties on Iran, not simply regarding the nuclear deal, but also with regard to obvious breaches in agreements covering missile tests and the shipment of high technology conventional weapons.

Iran is an outlaw nation whose true status is intentionally obscured by the economic benefits of engagement derived by the Europe, Russia and China.

The US can redouble efforts at regional engagement in both Syria and Iraq, but this effort will require time, money and likely US combat troops on terms that beneficial to the Iranians. A direct attack on Iran sets off a chain reaction of scenarios, which may have been tolerable in 2009, but are fateful today.

Terrorism: neither terror, nor its potential impact are new. Serbian terrorist assassination was the catalyst for what became WWI. Today, nearly 15 years after 9-11, the United States faces a complex, resilient and sophisticated terrorist threat that in many respects is greater than at any time since 2001. While Al Qaeda has been severely weakened, its offshoots, like franchises, thrive and metastasize in failed or failing states around the globe.

ISIS is the best known terror threat today, but it is not the major only one. The US faces threats from splinter groups and even narco-terrorism, whose goals are not religious extremism but territory and profit. And while San Bernardino stands out as an example of today’s risk, the probability of mass casualty events with explosives, “dirty bombs” (commercially available radiological material), chemical and even nuclear devices remains real. The potential for cyber-terrorism, which could severely damage the US economy through attacks on the US electrical grid or power plants remains wholly unappreciated by the citizenry.

The next president will have a range of options available, including increased covert pressure, more robust deployment of conventional military assets, complemented by security policies that harden US infrastructure against disruption and attack. To do so will require raising the priority of terrorism over that of global warming, and funding it accordingly.

Each of the challenges outlined here contains within it a new set of understandings that will shape the next geo-political order. NATO became obsolete when the Soviet Union collapsed, but political concerns kept it alive and expanding. As a result, NATO is deeply over-extended and understaffed for crisis. To acquiesce to Russian sphere of influence in its “near abroad” confounds 30 years of western thinking, and significantly recalibrates the value and extent of American security guarantees.

Is it unrealistic to expect China to adhere to international norms created and enforced by the US, over 70 years ago? Is increased vigilance or even conflict with the US’s second largest creditor a doomed enterprise to begin with? Can the US remain a meaningful world power without engaging?

Can Iran’s revolutionary theology be bargained with and contained within its own systemic contradictions before it becomes a clear and present danger to the US homeland?

Can the US prosecute a War on Terror that is comprehensive, multidimensional and candidly, brutal, without alienating friends and allies? Or do we retreat to Fortress America and play defense?

The choices are staggering, both in the complexity and implications. Each of these decisions will serve as the American contribution to our next political order.

The next President will have to deal with this.

Make sure to factor it in when you decide your choice at the ballot box.