The
formative period of the American experience began with the opening of
the Ohio River Valley by the National Road. For the next century
Americans moved from the coastal states inland, finding more and better
lands linked together with more and better rivers. Rains were
reliable. Soil quality was reliable. Rivers were reliable. Success and
wealth were assured. The trickle of settlers became a flood, and yet
there was still more than enough well-watered, naturally connected lands
for all.
And
this happened in isolation. With the notable exception of the War of
1812, the United States did not face any significant foreign incursions
in the 19th century. It contained the threat from both Canada and
Mexico with a minimum of disruption to American life and in so doing
ended the risk of local military conflicts with other countries. North
America was viewed as a remarkably safe place.
As
a result, life for this dominant “Northern” culture got measurably
better every single year for more than five generations. Americans
became convinced that such a state of affairs — that things can, will
and should improve every day — was normal. Americans came to believe
that their wealth and security is a result of a Manifest Destiny that
reflects something different about Americans compared to the rest of
humanity. The sense is that Americans are somehow better — destined for
greatness — rather than simply being very lucky to live where they do.
It is an unbalanced and inaccurate belief, but it is at the root of
American mania and arrogance.
Many
Americans do not understand that the Russian wheat belt is the steppe,
which has hotter summers, colder winters and less rain than even the
relatively arid Great Plains. There is not a common understanding that
the histories of China and Europe are replete with genocidal conflicts
because different nationalities were located too close together, or
that the African plateaus hinder economic development. Instead there is
a general understanding that the United States has been successful for
more than two centuries and that the rest of the world has been less
so. Americans do not treasure the “good times” because they see growth
and security as the normal state of affairs, and Americans are more
than a little puzzled as to why the rest of the world always seems to
be struggling. And so what Americans see as normal day-to-day
activities the rest of the world sees as American hubris.
But not everything
goes right all the time. What happens when something goes wrong, when
the rest of the world reaches out and touches the Americans on
something other than America’s terms? When one is convinced that things
can, will and should continually improve, the shock of negative
developments or foreign interaction is palpable. Mania becomes
depression and arrogance turns into panic.
An
excellent example is the Japanese attack on American forces at Pearl
Harbor. Seventy years on, Americans still think of the event as a
massive betrayal underlining the barbaric nature of the Japanese that
justified the launching of a total war and the incineration of major
cities. This despite the fact that the Americans had systemically shut
off East Asia from Japanese traders, complete with a de facto energy
embargo, and that the American mainland — much less its core — was never
threatened.
Such
panic and overreaction is a wellspring of modern American power. The
United States is a large, physically secure, economically diverse and
vibrant entity. When it acts, it can alter developments on a global
scale fairly easily. But when it panics, it throws all of its ample
strength at the problem at hand, and in doing so reshapes the world.
Other
examples of American overreaction include the response to the Soviet
launch of Sputnik and the Vietnam War. In the former, the Americans
were far ahead of the Soviets in terms of chemistry, electronics and
metallurgy — the core skills needed in the space race. But because the
Soviets managed to hurl something into space first the result was a
nationwide American panic resulting in the re-fabrication of the
country’s educational system and industrial plant. The American defeat
in the Vietnam conflict similarly triggered a complete military
overhaul, including the introduction of information technology into
weapon systems, despite the war’s never having touched American shores.
This paranoia was the true source of satellite communications and
precision-guided weapons.
This mindset — and
the panic that comes from it — is not limited to military events. In
the 1980s the Americans became convinced that the Japanese would soon
overtake them as the pre-eminent global power even though there were
twice as many Americans sitting on more than 100 times as much arable
land. Wall Street launched its own restructuring program, which
refashioned the American business world, laying the foundation of the
growth surge of the 1990s.
In
World War II, this panic and overreaction landed the United States
with control of Western Europe and the world’s oceans, while the
response to Sputnik laid the groundwork for a military and economic
expansion that won the Cold War. From the Vietnam effort came technology
that allows U.S. military aircraft to bomb a target half a world
away.
Japanophobia
made the American economy radically more efficient, so that when the
Cold War ended and the United States took Japan to task for its trade
policies, the Americans enjoyed the 1990s boom while direct competition
with leaner and meaner American firms triggered Japan’s post-Cold War
economic collapse.
Land, Labor and Capital
All
economic activity is fueled — and limited — by the availability of
three things: land, labor and capital. All three factors indicate that
the United States has decades of growth ahead of it, especially when
compared to other powers.
The
United States is the least densely populated of the major global
economies in terms of population per unit of usable land (Russia, Canada
and Australia may be less densely populated, but most of Siberia, the
Canadian Shield and the Outback is useless). The cost of land — one of
the three ingredients of any economic undertaking — is relatively low
for Americans. Even ignoring lands that are either too cold or too
mountainous to develop, the average population density of the United
States is only 76 people per square kilometer, one-third less than
Mexico and about one-quarter that of Germany or China.
And
it is not as if the space available is clustered in one part of the
country, as is the case with Brazil’s southern interior region. Of the
major American urban centers, only New Orleans and San Diego cannot
expand in any direction. In fact, more than half of the 60 largest
American metropolitan centers by population face expansion constraints
in no direction: Dallas-Fort Worth, Philadelphia, Washington,
Atlanta, Phoenix, Minneapolis-St. Paul, St. Louis, Denver, Sacramento,
Cincinnati, Cleveland, Orlando, Portland, San Antonio, Kansas City, Las
Vegas, Columbus, Charlotte, Indianapolis, Austin, Providence,
Nashville, Jacksonville, Memphis, Richmond, Hartford, Oklahoma City,
Birmingham, Raleigh, Tulsa, Fresno and Omaha-Council Bluffs. Most of
the remaining cities in the top 60 — such as Chicago or Baltimore —
face only growth restrictions in the direction of the coast. The point
is that the United States has considerable room to grow and American
land values reflect that.
Labor
Demographically,
the United States is the youngest and fastest growing of the major
industrialized economies. At 37.1 years of age, the average American is
younger than his German (43.1) or Russian (38.6) counterparts. While he
is still older than the average Chinese (34.3), the margin is narrowing
rapidly. The Chinese are aging faster than the population of any country
in the world save Japan (the average Japanese is now 44.3 years old),
and by 2020 the average Chinese will be only 18 months younger than the
average American. The result within a generation will be massive
qualitative and quantitative labor shortages everywhere in the developed
world (and in some parts of the developing world) except the United
States.
The
relative youth of Americans has three causes, two of which have their
roots in the United States’ history as a settler state and one of which
is based solely on the United States’ proximity to Mexico. First,
since the founding populations of the United States are from somewhere
else, they tended to arrive younger than the average age of populations
of the rest of the developed world. This gave the United States — and
the other settler states — a demographic advantage from the very
beginning.
Second,
settler societies have relatively malleable identities, which are
considerably more open to redefinition and extension to new groups than
their Old World counterparts. In most nation-states, the
dominant ethnicity must choose to accept someone as one of the group,
with birth in the state itself — and even multi-generational
citizenship — not necessarily serving as sufficient basis for inclusion.
France is an excellent case in point, where North Africans who have
been living in the Paris region for generations still are not considered
fully “French.” Settler societies approach the problem from the
opposite direction. Identity is chosen rather than granted, so someone
who relocates to a settler state and declares himself a national is for
the most part allowed to do so. This hardly means that racism does not
exist, but for the most part there is a national acceptance of the
multicultural nature of the population, if not the polity. Consequently,
settler states are able to integrate far larger immigrant populations
more quickly than more established nationalities.
 |
Early American settlers massacre Native Americans |
Yet Canada and
Australia — two other settler states — do not boast as young a
population as the United States. The reason lies entirely within the
American geography. Australia shares no land borders with immigrant
sources. Canada’s sole land border is with the United States, a
destination for immigrants rather than a large-scale source.
But
the United States has Mexico, and through it Central America. Any
immigrants who arrive in Australia must arrive by aircraft or boat, a
process that requires more capital to undertake in the first place and
allows for more screening at the point of destination — making such
immigrants older and fewer. In contrast, even with recent upgrades, the
Mexican border is very porous. While estimates vary greatly, roughly
half a million immigrants legally cross the United States’ southern
border every year, and up to twice as many cross illegally. There are
substantial benefits that make such immigration a net gain for the
United States. The continual influx of labor keeps inflation tame at a
time when labor shortages are increasingly the norm in the developed
world (and are even beginning to be felt in China). The cost of American
labor per unit of output has increased by a factor of 4.5 since 1970;
in the United Kingdom the factor is 12.8.
The
influx of younger workers also helps stabilize the American tax base.
Legal immigrants collectively generate half a trillion dollars in
income and pay taxes in proportion to it. Yet they will not draw upon
the biggest line item in the U.S. federal budget — Social Security —
unless they become citizens. Even then they will pay into the system for
an average of 41 years, considering that the average Mexican immigrant
is only 21 years old (according to the University of California) when
he or she arrives. By comparison, the average legal immigrant — Mexican
and otherwise — is 37 years old.
Even
illegal immigrants are a considerable net gain to the system, despite
the deleterious effects regarding crime and social-services costs. The
impact on labor costs is similar to that of legal immigrants, but there
is more. While the Mexican educational system obviously cannot compare
to the American system, most Mexican immigrants do have at least some
schooling. Educating a generation of workers is among the more
expensive tasks in which a government can engage. Mexican immigrants
have been at least partially pre-educated — a cost borne by the Mexican
government — and yet the United States is the economy that reaps the
benefits in terms of their labor output.
 |
Immigrant farm workers |
Taken together, all of these demographic and
geographic factors give the United States not only the healthiest and
most sustainable labor market in the developed world but also the
ability to attract and assimilate even more workers.
Capital
However,
it also boasts one of the lowest demands for capital. Its waterways
lessen the need for artificial infrastructure, and North America’s
benign security environment frees it of the need to maintain large
standing militaries on its frontiers. A high supply of capital plus a
low demand for capital has allowed the government to take a relatively
hands-off approach to economic planning, or, in the parlance of
economists, the United States has a laissez-faire economic system. The
United States is the only one of the world’s major economies to have
such a “natural” system regarding the use of capital — all others must
take a far more hands-on approach.
- Germany
sits on the middle of the North European Plain and has no meaningful
barriers separating it from the major powers to its east and west. It
also has a split coastline that exposes it to different naval powers.
So Germany developed a corporatist economic model that directly injects
government planning into the boardroom, particularly where
infrastructure is concerned.
- France
has three coasts to defend in addition to its exposure to Germany. So
France has a mixed economic system in which the state has primacy over
private enterprise, ensuring that the central government has sufficient
resources to deal with the multitude of threats. An additional outcome
of what has traditionally been a threat-heavy environment is that
France has been forced to develop a diversely talented intelligence
apparatus. As such, France’s intelligence network regularly steals
technology — even from allies — to bolster its state-affiliated
companies.
- China’s heartland on the Yellow River is exposed to both the
Eurasian steppe and the rugged subtropical zones of southern China,
making the economic unification of the region dubious and exposing it to
any power that can exercise naval domination of its shores. China
captures all of its citizens’ savings to grant all its firms access to
subsidized capital, in essence bribing its southern regions to be part
of China.
In
contrast, the concept of national planning is somewhat alien to
Americans. Instead, financial resources are allowed largely to flow
wherever the market decides they should go. In the mid-1800s, while the
French were redirecting massive resources to internal defenses and
Prussia was organizing the various German regional private-rail systems
into a transnational whole, a leading economic debate in the United
States was whether the federal government should build spurs off the
National Road, a small project in comparison. The result of such a
hands-off attitude was not simply low taxes but no standard income taxes until the 16th Amendment was adopted in 1913.
 |
16th Amendment adopted 1913 |
Such an attitude
had a number of effects on the developing American economic system.
First, because the resources of the federal government were
traditionally so low, government did not engage in much corporate
activity. The United States never developed the “state champions” that
the Europeans and Asians developed as a matter of course with state
assistance. So instead of a singular national champion in each industry,
the Americans have several competing firms. As a result, American
companies have tended to be much more efficient and productive than
their foreign counterparts, which has facilitated not only more capital
generation but also higher employment over the long term.
Consequently,
Americans tend to be less comfortable with bailouts (if there are no
state companies, then the state has less of an interest in, and means
of, keeping troubled companies afloat). This makes surviving firms that
much more efficient in the long run. It hardly means that bailouts do
not happen, but they happen rarely, typically only at the nadir of
economic cycles, and it is considered quite normal for businesses —
even entire sectors — to close their doors.
Another
effect of the hands-off attitude is that the United States has more of
a business culture of smaller companies than larger ones. Because of
the lack of state champions, there are few employers who are critical
specifically because of their size. A large number of small firms tends
to result in a more stable economic system because a few firms here
and there can go out of business without overly damaging the economy as
a whole. The best example of turnover in the American system is the
Dow Jones Industrial Average (DJIA).
The
DJIA has always been composed of the largest blue-chip corporations
that, collectively, have been most representative of the American
economic structure. The DJIA’s specific makeup changes as the U.S.
economy changes. As of 2011, only one of its component corporations has
been in the DJIA for the entirety of its 115-year history. In
contrast, German majors such as Deutsche Bank, Siemens and Bayer have
been at the pinnacle of the German corporate world since the mid-19th
century, despite the massive devastation of Europe’s major wars.
Because
the American river systems keep the costs of transport low and the
supply of capital high, there are few barriers to entry for small
firms, which was particularly the case during the United States’
formative period. Anyone from the East Coast who could afford a plow and
some animals could head west and — via the maritime network — export
their goods to the wider world. In more modern times, the disruption
caused by the regular turnover of major firms produces many
workers-turned-entrepreneurs who start their own businesses. American
workers are about one-third as likely to work for a top 20 U.S. firm as a
French worker is to work for a top 20 French firm.
The
largest American private employer — Wal-Mart — is the exception to
this rule. It employs 1.36 percent of U.S. workers, a proportion
similar to the largest firms of other advanced industrial states. But
the second largest private employer — UPS — employs only 0.268 percent
of the American work force. To reach an equivalent proportion in France,
one must go down the list to the country’s 32nd largest firm.
 |
America's largest private employer: Wal-Mart |
The U.S.
laissez-faire economic model also results in a boom-and-bust economic
cycle to a much greater degree than a planned system. When nothing but
the market makes economic apportionment decisions, at the height of the
cycle resources are often applied to projects that should have been
avoided. (This may sound bad, but in a planned system such
misapplication can happen at any point in the cycle.)
During
recessions, capital rigor is applied anew and the surviving firms
become healthier while poorly run firms crash, resulting in spurts of
unemployment. Such cyclical downturns are built into the American
system. Consequently, Americans are more tolerant of economic change
than many of their peers elsewhere, lowering the government’s need to
intervene in market activity and encouraging the American workforce to
retool and retrain itself for different pursuits. The result is high
levels of social stability — even in bad times — and an increasingly
more capable workforce.
Despite
the boom/bust problems, the greatest advantage of a liberal capital
model is that the market is far more efficient at allocating resources
over the long term than any government. The result is a much greater —
and more stable — rate of growth over time than any other economic
model. While many of the East Asian economies have indeed outgrown the
United States in relative terms, there are two factors that must be
kept in mind. First, growth in East Asia is fast, but it is also a
recent development. Over the course of its history, the United States
has maintained a far faster growth rate than any country in East Asia.
Second, the Asian growth period coincides with the Asian states gaining
access to the U.S. market (largely via Bretton Woods) after U.S.
security policy had removed the local hegemon — Japan — from military
competition. In short, the growth of East Asian states — China included —
has been dependent upon a economic and security framework that is not
only far beyond their control, but wholly dependent upon how the
Americans currently craft their strategic policy. Should the Americans
change their minds, that framework — and the economic growth that comes
from it — could well dissolve overnight.
The
laissez-faire economic system is not the only way in which the
American geography shapes the American economy. The United States also
has a much more disassociated population structure than most of the rest
of the world, developed and developing states both. As wealth expanded
along American rivers, smallholders banded together to form small
towns. The capital they jointly generated sowed the seeds of
industrialization, typically on a local level. Population rapidly spread
beyond the major port cities of the East Coast and developed multiple
economic and political power centers throughout the country whose
development was often funded with local capital. As large and powerful
as New York, Baltimore and Boston were (and still are), they are
balanced by Chicago, Pittsburg, St. Louis and Minneapolis.
Today,
the United States has no fewer than 20 metropolitan areas with an
excess of 2.5 million people, and only four of them — New York,
Philadelphia, Boston and Washington-Baltimore — are in the East Coast
core. In contrast, most major countries have a single, primary political
and economic hub such as London, Tokyo, Moscow or Paris. In the United
States, economic and political diversification has occurred within a
greater whole, creating a system that has grown organically into a
consumer market larger than the consumer markets of the rest of the
world combined.
And
despite its European origins, the United States is a creature of Asia
as well. The United States is the only major country in the world that
boasts not only significant port infrastructure on both the Atlantic
and the Pacific but also uninterrupted infrastructure linking the two.
This allows the United States to benefit from growth in and trade with
both Pacific and Atlantic regions and partially insulates the United
States when one or the other suffers a regional crash. At such times,
not only can the United States engage in economic activity with the
other region, but the pre-existing links ensure that the United States
is the first choice for capital seeking a safe haven. Ironically, the
United States benefits when these regions are growing and when they are struggling.
When
all these factors are put together, it is clear how geography has
nudged the United States toward a laissez-faire system that rewards
efficiency and a political culture that encourages entrepreneurship. It
is also clear how geography has created distributed economic centers,
transportation corridors and a massive internal market and provided easy
access to both of the world’s great trading basins. Byproducts of this
are a culture that responds well to change and an economy
characterized by stable, long-term growth without being dependent on
external support. In short, there is a geographic basis for U.S.
prosperity and power, and there is no geographic basis to expect this
condition to change in the foreseeable future.
Current Context: Threats to the Imperatives
Normally,
STRATFOR closes its geopolitical monographs with a discussion of the
major challenges the country in question faces. The United States is the
only truly global power in the modern age, but there are a number of
potential threats to American power (as STRATFOR founder George Friedman
outlined in his book “The Next 100 Years”). Indeed, over the next
century, any number of regional powers — a reunified Germany, a
reawakened Turkey, a revitalized Japan, a rising Brazil, a newly
confident Mexico — may well attempt to challenge American power.
But
rather than dwell on the far future, it is more instructive to focus
on the challenges of today and the next few years. STRATFOR now turns
to challenges to the United States in the current global context,
beginning with the least serious challenges and working toward the most
vexing.
Afghanistan
The
war in Afghanistan is not one that can be won in the conventional
sense. A “victory” as Americans define it requires not only the
military defeat of the opposing force but also the reshaping of the
region so that it cannot threaten the United States again. This is
impossible in Afghanistan because Afghanistan is more accurately
perceived as a geographic region than a country. The middle of the
region is a mountainous knot that extends east into the Himalayas. There
are no navigable rivers and little arable land. The remaining U-shaped
ring of flat land is not only arid but also split among multiple
ethnic groups into eight population zones that, while somewhat
discrete, have no firm geographic barriers separating them. This
combination of factors predisposes the area to poverty and conflict,
and that has been the region’s condition for nearly all of recorded
history.
The United States
launched the war in late 2001 to dislodge al Qaeda and prevent the
region from being used as a base and recruitment center for it and
similar jihadist groups. But since geography precludes the formation of
any stable, unified or capable government in Afghanistan, these
objectives can be met and maintained only so long as the United States
stations tens of thousands of troops in the country.
 |
America invades Afghanistan in 2001 |
Afghanistan
indeed poses an indirect threat to the United States. Central control
is so weak that non-state actors like al Qaeda will continue to use it
as an operational center, and some of these groups undoubtedly hope to
inflict harm upon the United States. But the United States is a long
way away from Afghanistan, and such ideology does not often translate
into intent and intent does not often translate into capacity. Even
more important, Afghanistan’s labor, material and financial resources
are so low that no power based in Afghanistan could ever directly
challenge much less overthrow American power.
The
American withdrawal strategy, therefore, is a simple one. Afghanistan
cannot be beaten into shape, so the United States must maintain the
ability to monitor the region and engage in occasional manhunts to
protect its interests. This requires maintaining a base or two, not
reinventing Afghanistan in America’s image as an advanced multiethnic
democracy.
China
Most
Americans perceive China as the single greatest threat to the American
way of life, believing that with its large population and the size of
its territory it is destined to overcome the United States first
economically and then militarily. This perception is an echo of the
Japanophobia of the 1980s and it has a very similar cause. Japan utterly
lacked material resources. Economic growth for it meant bringing in
resources from abroad, adding value to them, and exporting the resulting
products to the wider world. Yet because very little of the process
actually happened in Japan, the Japanese government had to find a means
of making the country globally competitive.
Japan’s
solution was to rework the country’s financial sector so that loans
would be available at below-market rates for any firm willing to import
raw materials, build products, export products and employ citizens. It
did not matter if any of the activities were actually profitable,
because the state ensured that such operations were indirectly
subsidized by the financial system. More loans could always be
attained. The system is not sustainable (eventually the ever-mounting
tower of debt consumes all available capital), and in 1990 the Japanese
economy finally collapsed under the weight of trillions of dollars of
non-performing loans. The Japanese economy never recovered and in 2011
is roughly the same size as it was at the time of the crash 20 years
before.
China, which
faces regional and ethnic splits Japan does not, has copied the
Japanese finance/export strategy as a means of both powering its
development and holding a rather disparate country together. But the
Chinese application of the strategy faces the same bad-debt problem
that Japan’s did. Because of those regional and ethnic splits, however,
when China’s command of this system fails as Japan’s did in the 1990s,
China will face a societal breakdown in addition to an economic
meltdown. Making matters worse, China’s largely unnavigable rivers and
relatively poor natural ports mean that China lacks Japan’s natural
capital-generation advantages and is saddled with the economic dead
weight of its vast interior, home to some 800 million impoverished
people. Consequently, China largely lacks the capacity to generate its
own capital and its own technology on a large scale.
 |
Asian industrial colossus: China |
None of this is a
surprise to Chinese leaders. They realize that China depends on the
American-dominated seas for both receiving raw materials and shipping
their products to global markets and are keenly aware that the most
important of those markets is the United States. As such, they are
willing to compromise on most issues, so long as the United States
continues to allow freedom of the seas and an open market. China may
bluster — seeing nationalism as a useful means of holding the regions
of the country together — but it is not seeking a conflict with the
United States. After all, the United States utterly controls the seas
and the American market, and American security policy prevents the
remilitarization of Japan. The pillars of recent Chinese success are
made in America.
Iran
Iran
is the world’s only successful mountain country. As such it is nearly
impossible to invade and impossible for a foreign occupier to hold.
Iran’s religious identity allows it considerable links to its Shiite
co-religionists across the region, granting it significant influence in
a number of sensitive locations. It also has sufficient military
capacity to threaten (at least briefly) shipping in the Strait of
Hormuz, through which roughly 40 percent of global maritime oil exports
flow. All of this grants Iran considerable heft not just in regional
but in international politics as well.
However,
many of these factors work against Iran. Being a mountainous state
means that a large infantry is required to keep the country’s various
non-Persian ethnicities under control. Such a lopsided military
structure has denied Iran the skill sets necessary to develop large
armored or air arms in its military. So while Iran’s mountains and
legions of infantry make it difficult to attack, the need for massive
supplies for those infantry and their slow movement makes it extremely
difficult for the Iranian military to operate beyond Iran’s core
territories. Any invasion of Iraq, Kuwait or Saudi Arabia while American
forces are in theater would require such forces — and their highly
vulnerable supply convoys — to march across mostly open ground. In the
parlance of the U.S. military, it would be a turkey shoot.
 |
Iranian military: Obsolete weaponry, lacking spare parts |
Mountainous regions
also have painfully low capital-generation capacities, since there are
no rivers to stimulate trade or large arable zones to generate food
surpluses or encourage the development of cities, and any patches of
land that are useful are separated from each other, so few economies of
scale can be generated. This means that Iran, despite its vast energy
complex, is one of the world’s poorer states, with a gross domestic
product (GDP) per capita of only $4,500. It remains a net importer of
nearly every good imaginable, most notably food and gasoline. There is a
positive in this for Iran — its paucity of economic development means
that it does not participate in the Bretton Woods structure and can
resist American economic pressure. But the fact remains that, with the
exception of oil and the Shiite threat, Iran cannot reliably project
power beyond its borders except in one place.
Unfortunately
for the Americans, that place is Iraq, and it is not a location where
Iran feels particularly pressured to compromise. Iran’s Shiite card
allows Tehran to wield substantial influence with fully 60 percent of
the Iraqi population. And since the intelligence apparatus that Iran
uses to police its own population is equally good at penetrating its
Shiite co-religionists in Iraq, Iran has long enjoyed better
information on the Iraqis than the Americans have — even after eight
years of American occupation.
 |
The U.S. invasion of Iraq resulted in abuses of Iraqi suspects |
It
is in Iran’s interest for Iraq to be kept down. Once oil is removed
from the equation, Mesopotamia is the most capital-rich location in the
Middle East. While its two rivers are broadly unnavigable, they do
reliably hydrate the land between them, making it the region’s
traditional breadbasket. Historically, however, Iraq has proved time and
again to be indefensible. Hostile powers dominate the mountains to the
north and east, while the open land to the west allows powers in the
Levant to penetrate its territory. The only solution that any power in
Mesopotamia has ever developed that provided a modicum of security is to
establish a national security state with as large a military as
possible and then invade neighbors who may have designs upon it. More
often than not, Persia has been the target of this strategy, and its
most recent application resulted in the Iraq-Iran War of 1980-1988.
 |
Iraq-Iran war casualty |
Simply put, Iran sees a historic opportunity to
prevent Iraq from ever doing this to it again, while the United States
is attempting to restore the regional balance of power so that Iraq can
continue threatening Iran. It is not a dispute that leaves a great
deal of room for compromise. Iran and the United States have been
discussing for five years how they might reshape Iraq into a form that
both can live with, likely one with just enough military heft to resist
Iran but not so much that it could threaten Iran. If the two powers
cannot agree, then the Americans will have an unpalatable choice to
make: either remain responsible for Iraq’s security so long as Persian
Gulf oil is an issue in international economic affairs or leave and
risk Iran’s influence no longer stopping at the Iraq-Saudi Arabia
border.
At the
time of this writing, the Americans are attempting to disengage from
Iraq while leaving a residual force of 10,000 to 25,000 troops
in-country in order to hold Iran at bay. Iran’s influence in Iraq is
very deep, however, and Tehran is pushing — perhaps successfully — to
deny the Americans basing rights in an “independent” Iraq. If the
Americans are forced out completely, then there will be little reason
for the Iranians not to push their influence farther south into the
Arabian Peninsula, at which point the Americans will have to decide
whether control of so much of the world’s oil production in the hands of
a single hostile power can be tolerated.
Russia
Russia
faces no shortage of geographic obstacles to success — its wide-open
borders invite invasion, its vast open spaces prevent it from achieving
economies of scale, its lack of navigable rivers makes it poor, and
its arid and cold climate reduces crop yields. Over the years, however,
Russia has managed to turn many weaknesses into strengths.
It
has consolidated political and economic forces to serve as tools of
the central state, so that all of the nation’s power may be applied to
whatever tasks may be at hand. This may be woefully inefficient and
trigger periods of immense instability, but it is the only method Russia
has yet experimented with that has granted it any security. Russia has
even turned its lack of defensible borders to its advantage. Russia’s
vast spaces mean that the only way it can secure its borders is to
extend them, which puts Russia in command of numerous minorities
well-aware that they are being used as speed bumps. To manage these
peoples, Russia has developed the world’s most intrusive intelligence
apparatus.
This centralization, combined with Russia’s physical location in the
middle of the flat regions of northern Eurasia, makes the country a
natural counterbalance to the United States and the state most likely to
participate in an anti-American coalition. Not only does Russia’s
location in the flatlands of Eurasia require it to expand outward to
achieve security (thus making it a somewhat “continent-sized” power),
its natural inclination is to dominate or ally with any major power it
comes across. Due to its geographic disadvantages, Russia is not a
country that can ever rest on its laurels, and its strategic need to
expand makes it a natural American rival.
Unfortunately
for the Americans, Russia is extremely resistant to American
influence, whether that influence takes the form of enticement or
pressure.
- Russia’s
lack of a merchant or maritime culture makes any Bretton Woods-related
offers fall flat (even today Russia remains outside of the WTO).
- Russia is the biggest state in its region, making it rather
nonsensical (at least in the current context) for the United States to
offer Russia any kind of military alliance, since there would be no one
for Russia to ally against.
- Russia’s
maritime exposure is extremely truncated, with its populated regions
adjacent only to the geographically pinched Baltic and Black seas. This
insulates it from American naval power projection.
- Even the traditional American strategy of using third parties to hem
in foes does not work as well against Russia as it does against many
others, since Russia’s intelligence network is more than up to the task
of crippling or overthrowing hostile governments in its region (vividly
demonstrated in Russia’s overturning of the Kremlin-opposed
governments in Ukraine, Georgia and Kyrgyzstan in recent years).
This means that the only
reliable American option for limiting Russian power is the same
strategy that was used during the Cold War: direct emplacement of
American military forces on the Russian periphery. But this is an
option that has simply been unavailable for the past eight years. From
mid-2003 until the beginning of 2011, the entirety of the U.S.
military’s deployable land forces have been rotating into and out of
Iraq and Afghanistan, leaving no flexibility to deal with a resurgence
of Russian power. The American preoccupation with the Islamic world has
allowed Russia a window of opportunity to recover from the Soviet
collapse. Russia’s resurgence is an excellent lesson in the
regenerative capacities of major states.
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Russia's second quagmire after Afghanistan: Chechnya |
Merely 12 years ago, Russia was not even in complete
control of its own territory, with an insurgency raging in Chechnya and
many other regions exercising de facto sovereignty. National savings
had either disappeared in the August 1998 ruble crisis or been looted
by the oligarchs. During the American wars in the Islamic world,
however, the Russians reorganized, recentralized and earned prodigious
volumes of cash from commodity sales. Russia now has a stable budget
and more than half a trillion dollars in the bank. Its internal wars
have been smothered and it has re-assimilated, broken or at least cowed
all of the former Soviet states. At present, Russia is even reaching
out to Germany as a means of neutralizing American military
partnerships with NATO states such as Poland and Romania, and it
continues to bolster Iran as a means of keeping the United States
bogged down in the Middle East.
Put
simply, Russia is by far the country with the greatest capacity — and
interest — to challenge American foreign policy goals. And considering
its indefensible borders, its masses of subjugated non-Russian
ethnicities and the American preference for hobbling large competitors,
it is certainly the state with the most to lose.
The United States
The
greatest threat to the United States is its own tendency to retreat
from international events. America’s Founding Fathers warned the young
country to not become entangled in foreign affairs — specifically
European affairs — and such guidance served the United States well for
the first 140 years of its existence.
But
that advice has not been relevant to the American condition since
1916. Human history from roughly 1500 through 1898 revolved around the
European experience and the struggle for dominance among European
powers. In the collective minds of the founders, no good could come from
the United States participating in those struggles. The distances were
too long and the problems to intractable. A young United States could
not hope to tip the balance of power, and besides, America’s interests —
and challenges and problems — were much closer to home. The United
States involved itself in European affairs only when European affairs
involved themselves in the United States. Aside from events such as the
Louisiana Purchase, the War of 1812 and small-scale executions of the
Monroe Doctrine, Washington’s relations with Europe were cool and
distant.
But in
1898 the Americans went to war with a European state, Spain, and
consequently gained most of its overseas territories. Those territories
were not limited to the Western Hemisphere, with the largest piece
being the Philippines. From there the Americans participated in the age
of imperialism just as enthusiastically as any European state.
Theodore Roosevelt’s Great White Fleet steamed around the world, forcing
Japan to open itself up to foreign influence and announcing to the
world that the Americans were emerging as a major force. Once that
happened, the United States lost the luxury of isolationism. The United
States not only was emerging as the predominant military and economy of
the Western Hemisphere, but its reach was going global. Its
participation in World War I prevented a German victory, and by the end
of World War II it was clear that the United States was one of only two
powers that could appreciably impact events beyond its borders.
Such
power did not — and often still does not — sit well with Americans.
The formative settler experience ingrained in the American psyche that
life should get better with every passing year and that military force
plays little role in that improvement. After every major conflict from
the American Revolution through World War I, the Americans largely
decommissioned their military, seeing it as an unnecessary, morally
distasteful expense; the thinking was that Americans did not need a
major military to become who they were and that they should have one
only when the need was dire. So after each conflict the Americans, for
the most part, go home. The post-World War II era — the Cold War — is
the only period in American history when disarmament did not happen
after the conflict, largely because the Americans still saw themselves
locked into a competition with the Soviet Union. And when that
competition ended, the Americans did what they have done after every
other conflict in their history: They started recalling their forces en
masse.
At the
time of this writing, the American wars in the Islamic world are
nearly over. After 10 years of conflict, the United States is in the
final stages of withdrawal from Iraq, and the Afghan drawdown has begun
as well. While a small residual force may be left in one or both
locations, by 2014 there will be at most one-tenth the number of
American forces in the two locations combined as there were as recently
as 2008.
This
has two implications for the Americans and the wider world. First, the
Americans are tired of war. They want to go home and shut the world
out, and with the death of al Qaeda leader Osama Bin Laden on May 2,
2011, they feel that they have the opportunity to do so. Second, the
American military is battle-weary. It needs to rest, recuperate and
digest the lessons of the wars it has just fought, and American
politicians are in a mood to allow it to do just that. But while the
U.S. military is battle-weary, it is also battle-hardened, and alone
among the world’s militaries it remains easily deploy-able. Three years
from now the U.S. military will be ready once again to take on the
world, but that is a topic to revisit three years from now.
 |
U.S. forces inside mosque - Iraq |
Between now and then, potential American rivals will
not be able to do anything they wish — American power is not
evaporating — but they will have a relatively free hand to shape their
neighborhoods. American air and sea power is no small consideration,
but inveterate land powers can truly be countered and contained only by
ground forces.
- Russian
power will consolidate and deepen its penetration into the borderlands
of the Caucasus and Central Europe. While the Americans have been busy
in the Islamic world, it has become readily apparent what the Russians
can achieve when they are left alone for a few years. A U.S.
isolationist impulse would allow the Russians to continue reworking
their neighborhood and re-anchor themselves near the old Soviet empire’s
external borders, places like the Carpathians, the Tian Shan Mountains
and the Caucasus, and perhaps even excise NATO influence from the
Baltic states. While the chances of a hot war are relatively low,
STRATFOR still lists Russia’s regeneration as the most problematic to
the long-term American position because of the combination of Russia’s
sheer size and the fact that it is — and will remain — fully nuclear
armed.
- Iranian power will seek to weaken the American position in the
Persian Gulf. A full U.S. pullout would leave Iran the undisputed major
power of the region, forcing other regional players to refigure their
political calculus in dealing with Iran. Should that result in Iran
achieving de facto control over the Gulf states — either by force or
diplomacy — the United States would have little choice but to go back in
and fight a much larger war than the one it just extracted itself
from. Here the American impulse to shut out the world would have
imminent, obvious and potentially profound consequences.
- STRATFOR does not see Chinese power continuing to expand in the
economic sphere on a global scale. China suffers under an unstable
financial and economic system that will collapse under its own weight
regardless of what the United States does, so the United States turning
introverted is not going to save China. But America’s desire to retreat
behind the oceans will allow the Chinese drama to play itself out
without any American nudging. China will collapse on its own — not
America’s — schedule.
- German power will creep back into the world as Berlin attempts to
grow its economic domination of Europe into a political structure that
will last for decades. The European debt crisis is a catastrophe by all
definitions save one: It is enabling the Germans to use their superior
financial position to force the various euro nations to surrender
sovereignty to a centralized authority that Germany controls. Unlike the
Russian regeneration, the German return is not nearly as robust,
multi-vectored or certain. Nonetheless, the Germans are manipulating the
debt crisis to achieve the European supremacy by diplomacy and the
checkbook that they failed to secure during three centuries of military
competition.
The
Americans will resist gains made by these powers (and others), but so
long as they are loath to re-commit ground forces, their efforts will
be half-hearted. Unless a power directly threatens core U.S. interests —
for example, an Iranian annexation of Iraq — American responses will
be lackluster. By the time the Americans feel ready to re-engage, many
of the processes will have been well established, raising the cost and
lengthening the duration of the next round of American conflict with
the rest of the world.
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