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Strategy Review: The Accidental Superpower

Strategy Review: The Accidental Superpower

There’s a certain genre of popular nonfiction which I really enjoy, one where scholarly intellectuals develop a grand strategic theory to explain the state of the world. I have reviewed a number of them over the years on this blog, and inevitably I tie them in to my favorite grand theory of all, the generations theory of William Strauss and Neil Howe. I mean, logically, if different scholars find different patterns in social, political and military history, then those patterns can be compared and related to one another. These different thinkers might be looking at the same patterns from different perspectives.

The latest work in this genre that I’ve picked up is The Accidental Superpower by Peter Zeihan, who is a geopolitical analyst who emphasizes the importance of geography and demography in determining the fate of nations. The Accidental Superpower was published in 2014, and already has multiple follow up books which I might also read, though I thought that this one alone provided many great insights into the power dynamics of the world today.

Zeihan starts with a quick survey of the rise of human civilization with important technological turning points, leading up the emergence of the United States as a global power. As Zeihan sees it, the United States is fated to superpowerdom (that’s the “accident” of it) by geographic advantages: two oceans protecting its flanks, with many excellent harbors on the coasts, and a massive navigable river system in a fertile heartland. These are the features which make it such a wealthy nation. It’s not its culture or its system of government which make it wealthy; it’s the wealth which makes its culture and government even possible. It’s because of the vast supply of capital that comes with low transport and security costs that the U.S. can have a free-wheeling capitalist society. At least that is how I understood the argument.

Another consequence of these advantages is that the United States, at the conclusion of World War II and the start of the Cold War conflict with the Soviet Union, was able to craft a unique postwar order via the Bretton Woods free trade agreements. What this amounts to is a pact between the U.S. and its Cold War allies: we will protect you from the Reds, and you will participate in our free trade regime, which includes access to our markets. The U.S. was able to do this because it had the only big navy left on the oceans (so it could protect the trade routes), and because it has so many economic advantages that it can easily prosper in a non-protectionist, open global market.

At least that’s how it used to be. Now that the Soviet Union is no longer a threat, there is less of a pressing need for the U.S. to maintain the Pax Americana. The U.S. public is wearying of the costs of this maintenance, including the economic costs to the domestic labor market (read: loss of manufacturing jobs and lack of wage growth because the labor market has gone global). This is the familiar story of the recent long era of economic growth and relative world peace, accompanied by growing popular discontentment at fading economic prospects, culminating, so far, in an era of grievance-ridden political strife.

Zeihan avoids discussing domestic U.S. politics. In fact, he spends most of his book analyzing the state of affairs in other countries around the world, and concluding that none of them will fare as well in the near future as the United States will. The era of globalization sustained by Bretton Woods will wind down (is winding down), and a more chaotic era (which Zeihan calls “the coming disorder”) will result. In this disordered world the U.S. will remain preeminent, thanks to its geographic advantage.

Zeihan does discuss generations, but only in the demographic sense, not in the Strauss and Howe sense which explains changes in social mood and social priorities. For Zeihan, the importance of generations is in how they participate in the economy at different phases of life: young adults drive consumer spending, mid-lifers are the capital holders who provide a tax base, and children and the elderly are both burdens. For a healthy economy, you really don’t want an “inverted age pyramid,” where the elderly population is larger than the population of young and mid-life adults trying to sustain them. Luckily for the United States, it has the advantage there as well, with higher fertility rates and more immigration than other developed nations have.

For Zeihan, globalization came about because of the security needs of the United States vis-à-vis the Soviet threat. With that threat gone, globalization will come to an end. He was writing this before Trump’s challenge to NATO, before Brexit and before the pandemic, all events which have held up this prediction. Using demographics, Zeihan predicts that with Boomers retiring and Gen Xers replacing them as the tax base, capital will become dear and financial markets will suffer: another prediction held up by current events.

Again, Zeihan focuses on geopolitics and demography. He doesn’t get much into culture or domestic U.S. politics. What generations theory (in the Strauss & Howe sense) could add to his thinking is the idea that after the Great Financial Crisis in 2007-08, there was a shift in the social mood. Americans were past a tipping point and no longer receptive to an open and interconnected world. The free trade regime of Bretton Woods, set up by older generations as an expression of American power and prestige, was now seen by new generations as corrosive to American cultural integrity and economic security. The long boom of economic growth and rising asset valuations of the ’90s and ’00s was now seen as the product of excessive risk-taking. In this new era, spooked financial markets avoid risk, and we depend on central banking monetary policy and government stimulus to sustain economic growth, tools which at this point have exhausted their potential.

Generational theory draws on cultural and attitudinal explanations for shifts in social behavior, and these ideas dovetail well with Zeihan’s more strictly material viewpoint. Generational theory even offers an explanation for the end of the Bretton Woods regime and the coming disorder: it’s the inevitable decay of an institutional framework that accompanies the progression of generations. It’s the long arc of the generational cycle, and though the previous order is now crumbling, out of the disorder some new regime will emerge.

Before concluding this review, I would like to connect some of Zeihan’s thinking to other strategists I have reviewed on this blog. One of them is legal scholar Philip Bobbitt, whose idea of the “market-state” has been covered here multiple times. Bobbitt claims that a new constitutional order is emerging to replace the nation state, one in which markets have more power than governments. Now, it seems quite possible that this idea of a new order only makes sense in world of globalized free trade, which we now have reason to believe is coming to an end.

So maybe the nation state will have a chance to make a comeback. Or, as I speculated in one post, a new constitutional order will emerge which is like the nation state, but adapted to the new strategic environment. This certainly makes sense in a scenario of global disorder following U.S. withdrawal from its role as the free world’s security guarantor. All the nations scramble to get their footing and find a way that works. But then there’s the question of the coalition supporting Ukraine’s defense against Russia’s invasion, led by the United States. It suggests that the U.S. is maintaining its security role, even as global trade is being severely disrupted. But that might not last; President Biden, who represents the old generation and the old order, could soon be replaced by a MAGA leader. The balls are all up in the air.

One final note on the market-state: Bobbitt defined different flavors of this constitutional order. To wit: an individualistic “entrepreneurial” kind, which the United States has; a “managerial” kind with more state control, which is typical of European countries; and a “mercantile” version with protected domestic markets, which is what Japan has. I bring this up because Zeihan’s descriptions of the geographical foundations of nations’ economies goes a long way to explain why there are different flavors of the market state. The capital rich U.S. can afford a more entrepreneurial mode of life, whereas nations without all the geographic and resource advantages that the U.S. has need more regulation and government control. Zeihan’s geography-based model of national fortune is very powerful, and probably the best thing I got out of reading his book.

The other strategist I was reminded of when I read The Accidental Superpower is Thomas P. M. Barnett, who wrote The Pentagon’s New Map about a decade earlier. Barnett is a military strategist who developed a geopolitical theory that divided the world into a “Functioning Core” of stable states and a “Non-Integrated Gap” of failed states. He looked at the history of post-Cold War American military interventions (going back to Panama in 1989, technically on the cusp of the Cold War), and concluded that the U.S. faced a new post-Cold War mission of integrating the Gap states into the Core. He tried to map out a blueprint for how the U.S. could succeed at this mission, sort of a new phase of Pax Americana and maintenance of the global free trade regime. He critiqued how President Bush was handling it with the Iraq War, noting that the key was bringing in a strong alliance network for long-term post-conflict stabilization; unilateral regime-toppling was not enough.

In the mid-2000s, with 9/11 still fresh in memory, there was this kind of heady excitement about the projection of American power in the upper echelons of government and the military. It made Barnett’s kind of expansive strategic thinking possible – I recall in his book that he described himself as a “cockeyed optimist.” There really was a hope of bringing democracy and capitalism online in far-flung places and crafting a world where globalization worked for everyone. Now that the U.S.’s Middle Eastern military adventures are seen as a Vietnam-like failure, Barnett’s star has faded, though I have heard he is working on a new book.

One thing that Barnett and Zeihan have in common is that they are both Gen Xers, though about ten years apart in age. Barnett is early wave, and seems to have inherited a little bit of Boomer idealism. Peter Zeihan, on the other hand, is very much the pragmatist. He comes across to me as a hard-headed, just the facts, tell it like it is practical thinker, and his vision of the future is more pessimistic than Barnett’s. There won’t be a next wave of globalization, simply because it is not a strategic imperative for the one power on Earth that might bring it about.

As I mentioned, Zeihan has followed up The Accidental Superpower with a few other books. He also has a web site, “Zeihan on Geopolitics,” and is very active on Twitter, where these days he is focused on the war in Ukraine. He is a smart and knowledgeable guy whose insights are worth checking out.

Crowdfunded Medical Care Manifests the Rebuilding of Social Capital

Crowdfunded Medical Care Manifests the Rebuilding of Social Capital

Recently one of our friends put up a GoFundMe for medical expenses, meaning they started a campaign to raise money on a crowdfunding platform. They need help, to the tune of potentially tens of thousands of dollars, because their insurance is denying a claim for arcane reasons.

It was recently reported that one third of GoFundMe campaigns are to cover medical bills. Arguably, GoFundMe has become one of the nation’s major health insurance companies (although crowdfunding doesn’t work quite like insurance).

When I saw my friend’s post on social media, I knew was witnessing what has become a commonplace in the United States of America, which has the worst ratio of healthcare costs to healthcare performance in the developed world. I mean, it’s embarrassingly bad compared to other countries.

From https://www.washingtonpost.com/world/2021/08/05/global-health-rankings/

Granted, the U.S. is much larger and much more diverse than any of the other 10 countries on the chart above. But if we had something closer to universal health care, if we just had better insurance coverage for everyone, then maybe we could move closer in the direction of lower costs and higher performance.

That we don’t have universal health care could be attributed to our particular governmental system, with its gridlocked legislature in the thrall of special interests. I’m tempted to bring in this concept of the “market state,” which I have blogged about in the past. In this context, the gist of it is that government has less power over the economy than in the past, and we are governed more by informational markets.

In that case, substituting a mutual aid network easily enabled via the Internet for a fully functional healthcare system could just be the wave of the future. It’s how the informational market state does healthcare. Whee!

It doesn’t seem adequate. A better way to think about this might be in terms of living through the Crisis Era of the saecular cycle. Institutions have broken down to the point that we can’t rely on them. Instead, we rely on one another.

The Crisis Era is a time of gathering, of rebuilding the social capital that was lost during the previous social eras. That’s why we’re forming social networks, to which we can then turn in time of need. These social networks are a manifestation of the rebuilding of social capital.

Unfortunately, as a “system” this doesn’t work for anyone who doesn’t have a social network. It is dangerous to be isolated in these times. We need better institutions, that serve the people instead of special interests. But for our institutions to be reformed in this way, we first need to restore democratic government.

The Informational Market-State Culls the Herd

The Informational Market-State Culls the Herd

In the early months of the Covid-19 pandemic I blogged about how the crisis was proving to be a “tempering test of the market state.” What I mean by “market state” is this concept by legal scholar Philip Bobbitt of a newly evolving constitutional order. It’s an order where government has less power and instead markets provide the decision-making and regulation. It’s also been called the “informational market-state” or the “neoliberal market-state.” More and more I’ve become convinced that while Bobbitt is correct in his broader theory of periodic changes in the constitutional order, with the “market state” he has really just identified the priorities of the market-driven social era of the late twentieth and early twenty-first centuries. In the new era, I would expect faith in markets to collapse and a return to government regulation to be in demand.

But let’s grant that the market state premise is correct. We are now in an individualistic, market-regulated constitutional order. In the earlier blog post, I framed the Covid-19 tempering test in these terms:

The Covid dilemma as it relates to this constitutional order is this: if the market state is supposed to protect the citizen while maximizing opportunities, what does it do when these goals are mutually exclusive? Simply put, an endemic disease that is highly infectious and lethal entails restricting economic activity in order to save lives, but that necessarily reduces economic opportunity

It would seem, based on the experience of the past year, that the market state’s resolution to the dilemma is simply to accept the loss of life. A premium in human lives must be paid in order to maintain the open society so vital to sustaining economic opportunity and generating financial wealth. The latest guidance from the CDC puts the onus on individuals to mitigate against the coronavirus as they see fit, certainly in keeping with the logic of the market state.

Some individuals have more leeway to make these choices than others, a fact not lost to many on social media.

I’ve seen a ton of posts like the one above, about how the CDC, and our society as a whole, have abandoned the vulnerable. It’s a brutal truth about our current state, where the government has essentially given up on the pandemic. It was just too big a creative leap to get out of our “normal” mode of an open society. And since we couldn’t get to herd immunity, we’re settling for herd culling.

How sustainable this will be, I do not know. Covid-19 is now the third leading cause of death in the United States, well ahead of vehicular accidents. And it’s even worse for certain age groups, and presumably also for the immunocompromised. It’s just a cold fact that if we keep going the way we’re going, then one fallout of this crisis era will be significant population loss. It wouldn’t be unprecedented in the grand scheme of things.

The Crisis Era in Terms of Khaldun’s Theory of Dynasty Formation

The Crisis Era in Terms of Khaldun’s Theory of Dynasty Formation

I recently posted about The Muqaddimah by Ibn Khaldun, a remarkable book on world history that was written in the 14th century, but has many ideas about political and social science that fit right in with modern philosophical views. In my post I couldn’t help but wonder what the author would say about the state of the world today, were he to somehow be here to observe it. He was a pretty successful guy in his time, as I understand it, and to time travel him to our mess of an era would probably be rude, but I guess if it was just for a consultation and then he got sent back home it would be OK.

So how he would describe the state of our civilization today? He would obviously be amazed at all the advanced technology, and at the population level and degree of urbanization across the planet, which he would have thought was unachievable because of the inherent limitations of “sedentary culture.” He also, I imagine, would be surprised by the prevalence of democratic government. While he mentions the Greeks and Romans in The Muqadimmah, I don’t recall that he ever acknowledges their systems of government in ancient times. He may not have even been aware of them.

If he actually was aware of the nature of ancient Greek and Roman government, he would certainly recognize them as the antecedents of our modern democratic systems. If not, their existence would be a real eye-opener for him. Either way, I think he could still find a way to frame his understanding of our government in terms of his theory of dynastic formation. He would say something to the effect that we had invested royal authority in a representative body by means of cleverly crafted laws. Assuming he had access to all the history between his time and now, he would also note that the laws were often found faulty and had to be revised, and sometimes broke down altogether in periods of incredibly destructive warfare. He might wonder if we really knew what we were doing.

He would probably be disappointed with the relative statuses of Christianity and Islam today. In The Muqaddimah he frequently refers to the European Christians as a people, but does not have much to say about them except to acknowledge that they live up to the north of the areas he is mainly interested in, which are Spain, North Africa and the Middle East (he uses different names), that is, the Muslim world. He is writing during the Islamic Golden Age, after all. If he were here today, he would have to face the reality that European Christians have successfully spread their culture to new lands across the seas and are generally richer and more powerful than the nations of the Islamic world.

Looking at the United States today, he would probably observe a decline in religious organization, and note that religion no longer acted as a restraining influence. He would then observe that the royal authority of the representative government was also in decline, and would probably attribute that to the generational distance from the time of the global war which had established the current dynasty. He would recognize the richness and diversity of our sedentary culture as a sign of a civilization in its final disintegrative phase.

Does it even make sense to describe the government of the U.S. as a “dynasty?” Well, it might, in order to shoehorn Khaldun’s theory into the modern era. The current dynasty in the U.S. could be understood as the institutional framework that came into existence in the aftermath of World War II, when there was strong group feeling in the country, and trust in big institutions. As the generations have passed that group feeling and trust have eroded, and the royal authority of the government has eroded accordingly. The dynasty (that is, institutional framework) founded four generations ago is now disintegrating; hence the reeling sense of chaos that pervades our society.

I think that the way Khaldun would describe our state is something like what follows. The absence of religion (shared values) as a restraining influence (ordering principle) means that royal authority (rule of law) is required to establish order. For a new dynasty (institutional framework) to form, a new faction must arise which has the group feeling (solidarity, consensus) and desert attitude (courage, willingness to sacrifice) to achieve superiority and establish its royal authority (recognized right to rule). Applying this model to the ongoing partisan conflict between the red zone and blue zone factions in our society, about which I’ve blogged a great deal, it’s clear that the winner of the conflict will be whichever faction most successfully marshals these qualities of solidarity and courage. That is, whichever faction has the strongest group feeling.

Seen in this light, that each faction has a social media bubble, where a consensus on facts and values is continuously reinforced, makes perfect sense. It’s an effort to sustain group feeling during the conflict, since losing that group feeling means granting superiority to the other faction. It’s really that simple.

Which faction is currently favored in the conflict? A few years back I would have speculated that the red zone faction, rallying around former President Trump, had a stronger group feeling. They really seemed to have a greater solidarity of purpose than the blue zone faction, split between its progressives and moderates. But after the failed coup attempt in early 2021, my sense is that the strength of their faction just wasn’t quite enough to achieve superiority, and now they are on the defensive. However, I would note, as Khaldun might put it, that the red zone has been more clever at manipulating the laws of royal authority to favor their faction.

I’d like to think that Ibn Khaldun would agree with my interpretation of modern events in light of his historical model. I bet that if we did snatch him out of time to come observe our era, he wouldn’t want to go back just yet – not until he saw how events in the rest of this phase of civilization unfold.

A Really Good History Book from about Six Hundred Years Ago

A Really Good History Book from about Six Hundred Years Ago

I recently finished The Muqaddimah by Ibn Khaldun, a book which had been part of my tsundoku for some time and which I finally got around to reading in connection to generations theory research. Khaldun’s work is actually referenced in The Fourth Turning, by William Strauss and Neil Howe, in the chapter on archetypes in history. I might have remembered this, but it was only when I rediscovered the fact that I felt compelled to pull The Muqaddimah off my shelf to read it and find the connections.

Khaldun has his own theory of a generational cycle in politics, or at least a generational progression. It’s basically the idea that as the generations pass, the authority of a dynasty declines and eventually disappears altogether. The founding generation establishes and consolidates the authority, and the next generation continues to benefit from it while beginning the process of constricting it. The third generation is just living in the shadow of that authority, even as the dynasty is in its most materially prosperous phase. The fourth and last generation of the dynasty is dissolute and wastes the legacy of the previous generations; at that point the dynastic authority disintegrates.

The parallels to the turnings theory of Strauss & Howe, which also has a four-part cycle and theorizes four generational archetypes, are plain. There’s also a similarity to the cycles of government identified in ancient times by Polybius. It’s fascinating to think that Polybius was writing fifteen hundred years before Khaldun, and Khaldun was writing over six hundred years before our time, and yet these parallels are there, even with modern thinking. It’s like these different scholars writing in different eras are all discovering the same fundamental truths.

Khaldun’s work is comprehensive in its scope (he’s what you would call a polymath) and reminds me a bit of Aristotle, just in the breadth of what he covers and the systematic way he goes about categorizing and explaining things. His work is also reminiscent of Herodotus, in that he writes about historiography and the importance of applying a discerning intellect to the study of history, lest one simply repeat the misinformation that is frequently passed down as historical fact.

While he does echo these ancient Greek philosophers, he is also plainly a denizen of the medieval age. He takes for granted the validity of his religion, Islam, and believes in spiritual reality and supernatural powers (he has a whole section railing against sorcery and its danger to religion). His model of physics is based on the four elements, and his model of biology and medicine is the medieval one of the four humours corresponding to those elements. We might think of these views as scientifically backward, but he’s simply working with what was known in his time, before the advances of the modern era.

What’s truly remarkable about Khaldun’s work is his discourse on social and political science. He has this conceptual framework around which he constructs a theory of how and why civilization forms, and its sources in religious and dynastic authority. In his view, religion forms dynasty and dynasty forms civilization, which sort of marks him as a theocratic medievalist. But you could think of this view as simply the idea that government must be rooted in some kind of moral ground in order to establish its definition of justice.

In his treatise, Khaldun repeatedly invokes the same concepts as he describes civilization in general, and the difference between simple desert civilization and what he calls sedentary civilization with its wealth and cities, basically describing a rural-urban divide. Let’s see if I can do a good job summarizing his theory.

In order for humans to live together cooperatively in a society they need some sort of “restraining influence” to prevent them from simply predating on one another. This influence can come from religion or it can come from the “royal authority” of a ruler. The royal authority of a ruling dynasty derives from “group feeling,” which is like social cohesion within a population, creating mutual esteem and loyalty. At first a dynasty has “desert attitude,” meaning a simple way of life and qualities of toughness and courage. This enables it to prevail over its enemies and establish its rule. But subsequent generations of the dynasty lose the desert attitude as the dynasty develops “sedentary culture.” The dynasty prospers economically, its cities grow in wealth and population and become advanced in the sciences and crafts, but all of this is at the expense of group feeling. Eventually the dynasty falls to some other one which has the desert attitude and group feeling that enable it to achieve military superiority.

It’s clear why Strauss & Howe would have referenced Khaldun, since his analysis has similarities to their turnings theory. You can also see how Khaldun anticipates the future thinking of Western philosophers. While reading The Muqaddimah and encountering his ideas, it occurred to me that the Age of Enlightenment might as well be considered to be the time when Western philosophy finally caught up to Ibn Khaldun. Honestly, encountering these ideas in a book written in the 14th century makes me reconsider the whole concept of a rift between the “medieval” and “modern” ages. It also make me wonder how Khaldun would see our world today, if he were to somehow be here to observe it.

I found The Muqaddimah to be a very easy read. Khaldun writes with confident authority and with common sense, and his thinking is very clear. Credit must go to the translator, Franz Rosenthal, for transforming Khaldun’s Arabic into straightforward English. I’m very happy to add The Muqaddimah to my “Read” bookshelf, from where I’m sure I will keeping referring to it as I continue my studies of generations and history.

The Red-Blue Network-Centric Wars, or, Clash of the Media Bubbles

The Red-Blue Network-Centric Wars, or, Clash of the Media Bubbles

In the late 1990s, with the Cold War just ended and the United States as the world hegemonic “sole superpower”, a new doctrine of warfare called network-centric warfare emerged. The gist of it: “use information networks to get an advantage.” It was an acknowledgement of the growing power of densely networked computers, such as the Internet which we take for granted today.

Meanwhile, a constitutional lawyer named Philip Bobbitt was writing his seminal book The Shield of Achilles, in which he argued that the constitutional order of the industrial nation state was giving way to a new order, which he called the informational market state. Securing opportunity and choice were the new functions of government, over providing welfare and solidarity.

Fast forward to 2020, and we are in the midst of Cold Civil War II, the battle between the red zone and the blue zone that I’ve been blogging about lately. The United States has abandoned the world stage, and is focused internally. A pandemic undermines the legitimacy of the new market state order, by both reducing economic opportunity and creating a public welfare imperative. And the power of the world wide computer network is something to be feared now; it lets bad actors, even foreign powers, manipulate public consciousness. Information runs amok and the Internet is a battlefield in a domestic war, with each side using the network to spread agitprop promoting its particular version of reality.

For example, in the red zone reality bubble, millions of votes cast for Joe Biden in the 2020 Presidential election were fraudulent. Personally, I think that’s BS – if it were true, Trump’s lawyers would explicitly make the claim in court instead of only in media statements. But I am a partisan of the blue zone in this war, so how could my words carry any weight with a partisan of the red zone? It seems we’re at an impasse – and it shows in the paralyzation of our government.

The problem is, with each side convinced of the veracity of its version of the truth, how is the consumer-citizen of the informational market state supposed to know which version is correct? If we are a really in a state, as Bobbitt argues, where we can choose from a menu of informational realities – will that be facebook, or parler, sir? – then how could we ever function as a polity? We need some common ground to stand on.

I am reminded of the time of the French Revolution, when rumors spread readily and people on either side easily believed the worst about the other faction. It was a mindset that pushed the people of that time to extremes of violence. I worried about this earlier in a book review. No, they didn’t have the Internet then, but that’s beside the point. An information network is there, regardless of the technology in use.

Ultimately, the chaos and violence of the French Revolution opened a path for an autocratic ruler to emerge and restore order. The people of the time were just glad for extremists on either side of the partisan divide to be put down. The moderates prevailed, but only because an authoritarian silenced the mobs. Trump might have been like Napolean and achieved this…but as it turned out, he didn’t.

I think the willingness of people to ensconce themselves in their media bubbles and stick with their partisan “zone” reflects a strong need for a consensus narrative, for a sense of collective purpose. We just need that purpose not to be at odds with the vision of a major segment of the populace within our same society. Maybe the United States is paying a price for becoming the sole superpower: there is no external power to unite us, as there was in the last crisis, so we’re left to fight each other. 9/11 might have been like Pearl Harbor…but as it turned out, it wasn’t.

So how will the center hold now? I honestly can’t say, but I suspect we’ll find out in the months to come. This will probably be my last red-vs-blue post for awhile, until some major change breaks. Meanwhile, I certainly will be watching my media bubble feeds with trepidation.

Covid-19: The Tempering Test of the Market State

Covid-19: The Tempering Test of the Market State

I wanted to exposit a bit on some of the points I made in my last blog post about the dilemma that Covid-19 presents. As many commentators have observed, the pandemic has disrupted our economic system and starkly revealed its defects. In particular it has exposed the risks to a bulk of the population who live on marginal income and can barely, if at all, afford health insurance. But of course these were known issues already, it’s just that Covid-19 is shining a harsh spotlight on them.

I’ve categorized this post as “Strategy Review” because I want to think of this problem with one of the strategic theories I’ve reviewed in the past in mind. That would be Philip Bobbitt’s conception of a newly evolving constitutional order called the “market state.” Here’s a key quote from the linked blog post:

the familiar nation state of the 20th century is giving way to what Bobbitt calls the “market state.” A key difference between the two orders is that whereas the nation state serves the welfare of the nation through public services and social safety nets, the market state maximizes economic opportunity for its citizens, while protecting them from environmental degradation and network-infiltrating dangers such as infectious disease and terrorism. The state’s role has evolved from managing the system for the benefit of the people, in competition with other states with different ideologies (the Cold War status quo), to protecting the system’s perimeters while allowing the people to manage themselves in a loosely controlled consumer marketplace of global extent 

The Covid dilemma as it relates to this constitutional order is this: if the market state is supposed to protect the citizen while maximizing opportunities, what does it do when these goals are mutually exclusive? Simply put, an endemic disease that is highly infectious and lethal entails restricting economic activity in order to save lives, but that necessarily reduces economic opportunity. This is especially problematic in the United States, which has a flavor of the market state which Bobbitt calls “entrepreneurial” – meaning that it favors individual over corporate responsibility for well-being.

Hence the quandary the U.S. is in, with its fraying social safety net, and too many people living on a thin margin. Gig economy workers are suddenly in an environment in which there are no gigs. Unskilled laborers have become “essential workers” and are expected to endure dangerous workplaces with no extra compensation, and rudimentary protection measures.

At least the public at large has shown a willingness to follow one simple, minimally disruptive safety measure – the wearing of face masks. I believe that the broad compliance with this mandate shows that society is ready and willing to cooperate and take collective action. The desire is there. But there is a political problem of extreme partisanship and incoherent national leadership.

So this pandemic has become the tempering test of the emerging market state. Can it survive as an ordering principle, or will it break under the strain and need to be replaced? One way to help think about this question is to consider the state in relation to the strategic environment, a key feature of Bobbitt’s line of thinking.

In Bobbit’s model, the nation state prevailed in a particular security environment, which pertained to the World War and Cold War eras. The rise of certain technologies – weapons of mass destruction, advanced computing, telecommunication networks – altered the strategic landscape from that in which the nation state was successful. For the new market state to be successful, it must be able to counter security threats in this new environment.

Threats primarily intrude on the order of the market state by exploiting open networks. In the quote above I explicitly mention infectious disease as a network-infiltrating danger. I had in mind SARS and H1N1, which have turned out to be the preludes to Covid-19. Other potential threats include computer hackers, social media disruptors, and smugglers of WMDs.

The best strategies against these kinds of threats are defensive; think of tower defense casual games, where an infrastructure is built up against ongoing waves of enemies trying to get past a perimeter. Hence the pandemic related shutdowns and other measures – limiting mass gatherings is a defensive strategy against an airborne virus. Surveillance is also crucial (you have to detect the network infiltrators), which is why nations which implemented intensive testing and tracking programs are the ones that have been the most successful at mitigating against the coronavirus.

So you can see the fundamental problem the United States has, with its “entrepreneurial market state.” It is just too open of a society. It is large in extent, and its citizens are used to free travel and a high degree of autonomy. Which is why so many are railing against the measures (though I still think the majority accepts the need for them).

Not only that, the ethos of the independent, self-made American (the “entrepreneur”) means there is resistance to the concept of public assistance, which is another useful defensive measure. The government is calling what pandemic aid has been given “stimulus” money, a complete misnomer. If the economic recession were on the demand side, meaning people didn’t have money to spend for goods or services, then the term “stimulus” would make sense. But the recession is supply side, meaning that businesses can’t deliver goods or services because of the shutdown measures. The loss of income to these businesses is the problem being alleviated, so the money is relief money, not stimulus money. But we can’t call it that, lest we admit that we aren’t a purely capitalist society.

Have other societies, with more of a “managerial market state” (Bobbitt’s term) fared better? Those would mostly be other developed countries of the West – in Europe, for example. I’m not sure of the answer, though it would be interesting to go over Bobbitt’s work, identify his taxonomy of states, and then see how each has done in the 2020 pandemic. There may be a pattern. It would be a bit of lengthy task, but might be worth the time.

Meanwhile, it’s plain to see one thing that has suffered in reputation in light of the pandemic: globalization. It is, in fact, globalization, with its increased access to markets and increased movement of goods and people, that is the reason new viral diseases keep popping up and rapidly spreading around the world. This latest one, Covid-19, seems to have put the brakes on globalization for some time to come, probably for at least a generational cycle. It had already lost its popularity among anyone except economic elites anyway.

What will happen to the market state? I’ve already noted in previous strategy review posts that we will not simply revert back to the nation state. Time isn’t reversible, for one thing, and the changes in the strategic environment – the nature of threats to the security of society – remain. We still need a state capable of countering danger in a complex, networked world.

It’s not just communicable disease that exploits networks. What about dangerous ideologies, spread on social media? If you’ve seen the Netlfix documentary The Social Dilemma you know what I mean. Given the deep political trouble the United States is in, there may be even hotter fires for the market state to endure before it is strong enough to rule in the twenty-first century.

Strategy Review: Turnings Theory and the Crisis Era

Strategy Review: Turnings Theory and the Crisis Era

In January I posted a series of “Strategy Reviews” where I examined the thinking of several authors who analyzed the state of politics and war at the beginning of this century. These were Thomas P. M. Barnett with the Pentagon’s New Map that divided the world between Core and Gap, Philip Bobbitt and the market state as defined in The Shield of Achilles, and John Robb with his Brave New War fought in a networked world. Each author’s viewpoint provided a way of understanding the tumultuous events of our time.

I would now like to reexamine these interpretations, but from another viewpoint – that provided by the generational theory of William Strauss and Neil Howe. This is a theory that I have been studying since I discovered it in the early 1990s, when I picked up the book 13th Gen: Abort, Retry, Ignore, Fail? at a book store. That book spoke to my personal experience, and I continued to explore generations by reading the other works of the authors. I won’t expound on the theory to a great degree in this post; you can read a review I wrote here, where you will find links to even more information.

The important thing to know about Strauss and Howe theory for the purposes of this posting is that they identified different social eras called turnings, which are characterized by particular social priorities and proclivities. In the United States of America, we are currently in a Crisis era which began with the financial crash of 2008. Previously, we were in an Unraveling era, which began during the Reagan years.

The Crisis Era

In an Unraveling, society is inward-driven, focused on the individual and loosely regulated. This changes in the Crisis, as a sense of urgency grows over problems which were allowed to remain unresolved in the previous era. Society becomes focused on the community, and more restrictive in what it allows of the individual.

Since the strategists mentioned above are primarily concerned with security and with international relations, we should examine what the implications of the Crisis are in these realms. The main consideration is that, in a Crisis era, society seeks to close itself off and insulate itself from perceived threats. This is apparent, for example, in the crackdown on illegal immigration which began during the Obama administration and continues bitterly into the Trump administration.

Another way in which the United States is closing off is by withdrawing from the rest of the world, changing its posture with respect to international security relations. This began with Obama’s pullback from the wars started by the previous administration, and continues with the more drastic policies of Trump, who has pulled out of international agreements and adopted an overtly nationalist stance for his administration. “America First” couldn’t be a more fitting slogan for a Crisis era.

Trumpism repudiates the idea of the United States as a responsible global hegemon promoting democracy and free-market capitalism – the role the country took on in the aftermath of the Cold War, albeit a role which proved costly, unpopular – and perhaps hopeless. Trumpism also repudiates economic globalization, which came at the price of high-paying working class jobs in the United States. These Unraveling era policies could be labeled the “neo-liberal regime,” which in the Crisis era has become delegitimized. In fact, John Robb specifically describes the Trump victory as rolling back neo-liberalism.

Thomas Barnett acknowledges this fact about Trump’s appeal in his own election post-mortem post. Barnett’s vision of the United States securing peace by maintaining military overwatch while helping to connect the world into a global economy of functioning, developed states, is not suited for the Crisis era social mood. Americans see the problems that grew in the era of globalization, particularly the erosion of the middle class, as no longer endurable. It is telling that both the Trump and Sanders campaigns in 2016 called for reversing trade policies that are perceived to have driven down wages in the United States.

In his work, Thomas Barnett cautioned against the urge to “firewall the Core against the Gap,” instead promoting the idea of greater connectivity among nations. But that was an idea better suited for the Unraveling era. In the Crisis era the desire is to “circle the wagons” and protect what remains of the social order from further collapse. To the political left this means addressing wealth inequality through government largesse (which the right calls socialism). To the political right this means restricting travel and immigration, even to the point of building a wall on the southern border (which the left calls racism). For neither side, however, is the status quo acceptable.

The New Form of the State

So what of the fate of Philip Bobbitt’s market state? According to Bobbitt, it is a form of the state that derives legitimacy from maximizing opportunity for its citizens, not from advancing their welfare. But in turnings theory, maximal opportunity for the individual is a priority of the Unraveling era. In the Crisis era, community takes precedence, hence the return of nationalist rhetoric into politics. So is the nation state, which the market state was supposed to supplant, making a comeback?

John Robb isn’t the only way who sees the market state being rolled backed; in another post, a pseudonymous author argues that the failure of the market state paradigm comes from the agency problem: market state elites have not been looking out for the best interests of the citizens they ostensibly serve. This is indeed a primary criticism of the old neo-liberal regime, particularly from the extreme political right, who would go so far as to call internationalists traitors.

The irony of Trump’s electoral victory, of course, is that his opponent, Hillary Clinton, was arguably a champion of neo-liberalism, and yet she still received more popular votes than Trump in the election. She was, in fact, the second most popular U.S. Presidential candidate in history, after Barack Obama. The accusations that there was meddling in the election, in Trump’s favor, by hackers sponsored by the Russian government, segues into another area covered by our strategists – network warfare.

The problem with dispensing with Bobbitt’s theory of the market state is that, while he missed the fact that social priorities would alter because of generational change, he is probably correct in identifying a new strategic landscape. Assuming that nuclear weapons really have rendered conventional war between Great Powers obsolete (the M.A.D. doctrine), warfare has shifted to the level of network exploitation. The new threat environment is rife with computer hackers and social media trolls. This is no joke – these bad actors can sway public opinion, influencing election outcomes and paralyzing governments, and can radicalize young people in far-away countries, prompting them to commit mass murder. They can even penetrate the computer networks responsible for operating vital infrastructure.

So the state will still need to adapt its strategy for protecting its citizens, in order to maintain legitimacy. The question of what form it will ultimately take remains open. It is particularly unclear in the United States, since the country is so deeply split along partisan lines. Will Trumpism become entrenched, or will the political tide turn against it, as Trump-resisters hope? Either way, turnings theory predicts that the institutions of government will transform. If the “nation state” returns, it won’t have the same form as the nation state of the World War era.

With the United States having abandoned global leadership, there is now more open competition among the Great Powers for determining the best internal order for surviving in the new international strategic environment. Momentum likely favors what Barnett called the “New Core” – the nations which more recently joined the developed world. All bets seem to be on China as the new world leader – though this thinking could reflect the West’s anxiety more than reality.

The old liberal, international regime which attempted to thwart and contain authoritarianism in the previous era has been hamstrung, and authoritarianism is on the rise, even in formerly liberal nations. The international order will continue to break down, as individual nations become more focused on their own affairs. The Crisis era is characterized by a lack of trust, and it is the misfortune of the United States that this includes a lack of trust across the partisan divide.

A new mode of competition over cooperation clearly presents dangers. There is no ironbound guarantee that the late twentieth century paradigm that rendered WMDs for deterrence use only will prevail. There is no sublime, unbreakable bond keeping the United States united. But whatever events lie ahead, it is likely the Crisis era will last at least another decade, and that the world will look much different when we emerge from it. We are on a journey through one of history’s great turning points.

The Crisis Era in Turnings Theory Terms

The Crisis Era in Turnings Theory Terms

Here is a quick explanation of the recent political upheavals in Turnings Theory terms. More on this in a future post.

In Search of a Consensus

The Third Turning triumph of capitalism and the global hegemony of the United States culminated in the dominance of the political ideology of neoliberalism. The private sector was favored over the public sector, along with an ethos of diversity and inclusiveness. U.S. elites became globally oriented, and to many it seemed that both major political parties were simply pawns of wealthy corporate interests.

Behind the facade of this New World Order, a Culture War was being fought within American society. Hard lines were drawn on issues like gun control and abortion, as the nation split into polarized opposing camps.

A disastrous war prompted by a terrorist attack soured the country’s outlook on global military intervention. Then a financial crisis precipitated by shady lending practices only exacerbated the sense that elites were simply exploiting the system for their own benefit.

Eight years into the Fourth Turning, a contentious Presidential election led to the downfall of the neoliberal regime and the rise of a new American nationalism, fiercely anti-global and tinged with white supremacy. The opposition entrenched and adopted the language of resistance. It seems a consensus was farther away than ever.

Strategy Review: Brave New War

Strategy Review: Brave New War

In my most recent posts I looked at the strategic theories of two different authors. The first was Thomas P. M. Barnett, who divided the world into functioning, integrated Core states, and their danger-producing opposites, the Gap states. His mantra was “disconnectedness defines danger.” The second was Philip Bobbitt, who divided history into epochs in which different forms of the state ruled. He taught us that the nation state is on its way out, and the new market state is taking its place.

John Robb is an author who actually references both of the previous authors, in his book Brave New War. He springboards off of Bobbitt’s concept of the market state to argue that the nature of warfare has changed, becoming network-focused, and refutes Barnett’s mantra. Basically, in the globally networked world, connectedness defines danger, so good luck finding peace through integration. Better to develop doctrines of fighting networked war.

A war fought between social networks is exactly how Robb portrays the current Crisis Era in American politics. He calls this “open source warfare” in that anyone can participate in an era when the Internet gives individuals powers of surveillance and intelligence gathering that were once reserved for governments. You can follow more of John Robb’s analysis of current events here at his blog.