Context

Context

This volume analyzes how the utility of various instruments of U.S. power has changed in recent years, primarily owing to the end of the Cold War. For that reason, we need to set forth our view of the changing international context within which the instruments are applied. Our perspective on the emerging new world order was set forth in the first chapter of Strategic Assessment 1995, which we summarize here with some changes in nuance to reflect developments during 1995 and with some additional material to extend the analysis beyond the realm of geostrategy.

The essential characteristics of the present strategic environment are uncertainty and change. The world is going through several types of dramatic changes. For heuristic purposes, those changes can be grouped into three broad categories--geostrategic, information, and, less clearly defined than the others, character of government.

Geostrategic Developments

The world geostrategic scene cannot be described as simply as during the Cold War, when the Western-Soviet confrontation was the prism through which all events had to be viewed. At least three perspectives are needed now to analyze the emerging international system: seen from the top down, the major powers have changed; seen cross-sectionally, states are arraying themselves into three categories depending upon their success at establishing democracy and free-market prosperity; and seen from the bottom up, transnational problems have become a more important part of the world scene.

Major Powers. In the past, the defining characteristic of a major shift from one world order to another was the transition in relations among the major powers (indeed, among the European powers). A shift in worlds was indicated by dramatic change in the answers to three questions: who were the major players, what they could do to one another, and what did they wish to do to one another. Perhaps the classic example is the French Revolution with its new player (democratic France), its new capability (the citizen army), and its new intentions (spreading liberty, equality, and fraternity). Similar transitions occurred with the Congress of Vienna in 1815, the unification of Germany in 1870, the Treaty of Versailles in 1919, and the developments following World War II, as well as with the end of the Cold War.

While the new world geostrategic environment is more complex than great power politics, one of the new order's basic defining characteristics remains the relationship among the major powers. Those powers are the U.S., Western Europe, Russia, China, and Japan, though India may join the group within a decade or so. At the end of the Cold War, some thought that the new world would be unipolar, that is, the U.S. would dominate the world scene. In fact, the American people have not been interested in that job. Instead of being unipolar, the world consists of asymmetric poles, in which one (the U.S.) is much the strongest but the others are nonetheless important independent actors.

World Output, 1970-93

($ trillions)

Source: Budget of the U.S. Government FY 1996

Note: Percent figure is U.S. share of world total.In the first blush of enthusiasm at the end of the Cold War, the great powers were all cooperating. Now, relations among some are cooler, and differences of perspective are more pronounced: U.S.-China relations are characterized by suspicions and disagreements on many issues, the hopes for a new strategic relationship between the U.S. and Russia have faded away, the tone in trade disputes between the U.S. and Japan has become sharper, and the U.S. and Western Europe have disagreed about how to handle the Bosnian crisis. But peace prevails, and that is a powerful force for stability in the world. None of the great powers is currently preparing for conflict with another. That might change over time. If the powers were to consolidate around themselves political and economic blocs that were exclusive rather than open, tensions could emerge at the edges of the blocs, such as between Russia and Western Europe or between China and the U.S. A clash among great powers, directly or through proxies, would be the greatest international threat the U.S. could face, though it is a remote possibility in the near term.

Factors shaping the behavior of the foreign great powers include the following:

* Russia is suffering from something similar to the Versailles Syndrome that hit Germany after World War I. It feels isolated, and it is bitter about the contrast between its post-Cold War situation and its past superpower status. Moscow thinks it is the victim, with others taking advantage of its temporary difficulties. It resents being treated as a loser in the Cold War when it feels that, rather than losing, it evolved in a way advantageous to all. Its military is in decline if not disarray. And, as important as any other factor, its economy has shrunk by half over the last decade, while the rest of the world has grown stronger. Yet Russia remains a nuclear power that can threaten the survival of the U.S. as a nation.

* China is feeling more powerful in world affairs because of its spectacular economic growth over the last fifteen years. By some estimates, China already has the world's third-largest output, after the U.S. and Japan. In contrast to the vibrant economy, the political system in China has been stagnant. The elite clings to a discredited ideology that even they do not practice. As the country hangs on the edge of a transition from one leadership generation to another, decision making seems paralyzed. The leaders seem to be afraid above all of anarchy, into which category they put democratization. In international affairs, China acts with ambiguity: sometimes like a normal player and sometimes like the stereotype of the Middle Kingdom --not well informed about what others are doing and how others behave, sure that its ways should prevail despite the objections of others, and assuming that it has a natural right to get what it wants.

* Japan is experiencing political turbulence about whether the old system of governance and economy is still the best. Five years of economic stagnation, with essentially no growth in 1990-95, has shaken national confidence. Meanwhile, the trade surplus with the rest of the world continues at levels that cause tensions in relations with the U.S., and to some extent with the European Union (EU) and tensions are increasing over the U.S. bases, especially those in Okinawa.

U.S. Air Force F-16s flying with a German Mig-29 in Sardinia.

* Western Europe remains uncertain how it will structure itself in the future, especially in the area of security and the military. Whether agreement is reached upon a coherent system for making decisions will determine if Western Europe has the same weight in international affairs as it does in the world's economy.

Three Categories of States. Another geostrategic perspective is the cross-sectional view, in which the world can be seen as divided among three categories of states. At the height of the Cold War, there were also three worlds: a generally industrialized and free First World, a communist Second World, and an underdeveloped, largely unaligned Third World. By the late 1980s, these divisions had eroded, as some communist lands developed freer institutions and some underdeveloped nations evolved into industrial democracies.

In the new world order, the three categories of states are characterized by how successful they are at achieving the almost universally proclaimed goals of democracy and market-based prosperity:

* The market democracies of free and prosperous--or at least rapidly developing--nations, were once found only in North America, Japan, and much of Europe. Large parts of Latin America, the newly industrialized nations of East Asia, and Central Europe are now joining this group.

* The transitional states of ex-communist lands, as well as countries such as India and South Africa, are progressing from a low economic baseline, which run the risk of becoming frozen short of freedom and prosperity with authoritarian politics, heavily politicized economies, and relatively low levels of economic development.

* The troubled states, primarily in Africa, the Middle East, and parts of Asia, are falling behind the rest of the globe economically, politically, and ecologically, often plagued with rampant ethnic and religious extremism.

These categories are not firm; some very important countries, like China, combine characteristics of two or even three groups.

Some of the troubled or transitional states may be tempted to divert attention from domestic problems by means of external aggression aimed at establishing regional hegemony. It should be no surprise were some such efforts by a rogue state, such as Iraq or North Korea, to lead to a major regional conflict. The proliferation of weapons of mass destruction, particularly nuclear weapons, could increase the propensity of aggressive states to threaten their neighbors and increase the risks for the U.S.

Conflict within troubled states is likely to be a common occurrence, and in some cases, the state will fail--the government will cease to function effectively, and civil society will degenerate into near chaos. In the 1990s, state failure occurred to one degree or another in such places as Bosnia, Rwanda, Somalia, Liberia, and Haiti. Most such internal conflicts will not pose a sharp threat to U.S. interests, though they may trouble U.S. humanitarian values. The great powers are often willing to provide humanitarian and peace operations for failed states. They are increasingly reluctant to intervene militarily in civil wars, however, unless a particular crisis takes place in their backyard, threatens to escalate to engulf other states, create a humanitarian disaster, or otherwise affect great power interests. The U.S. will have neither the means nor the will to intervene in every such case around the world, but it will intervene in areas of its historic and strategic interest as well as in situations of horrendous suffering that offend U.S. sensibilities.

Transnational Issues. A third geostrategic perspective looks from the bottom up at transnational problems, that is, those which do not stem from the actions of governments. Some of the major problems are:

* The internationalization of crime, especially drug cartels that operate on such a large scale as to threaten governments.

* Terrorists take advantage of more open societies to mount increasingly brazen attacks, such as the 1993 bombing of New York's World Trade Center. The March 1995 Tokyo subway attack by the Aum Shinrikyo cult, which caused twelve deaths and five thousand injuries, "demonstrates the threat a well financed, sophisticated and international terrorist group poses [in what could be the United States's] greatest national security concern in the years ahead," to quote Senator Sam Nunn (D., Georgia).

* Ethnic hatreds that erupt into genocide or ethnic cleansing, as in Rwanda or the former Yugoslavia. A related phenomenon has been the collapse of organized government under the pressure of warlords and clan rivalries.

* Sudden mass migrations becoming more common, partly in response to state failure and ethnic violence. These waves of people, who may or may not fit the traditional definition of refugee, can overwhelm poor neighbors. As illustrated by the experience with Haitians and Cubans, migrants can pose an unacceptable burden on industrial nations like the U.S. that are concerned that the refugees may become permanent residents.

Coast Guard vessel picking up Haitian migrants.

* Environmental problems spilling over from one nation to another as the planet's resources are used more intensively. Dangers to the global commons multiply: all nations are affected by depletion of the ozone layer and global warming.

Some of these threats seem to call for military forces to back up police forces that are outmaneuvered, overwhelmed, or outgunned. Constabulary operations, such as picking up illegal immigrants, intercepting narcotics shipments, and protecting delivery of relief supplies in failed states, do not require the specialized equipment and training needed for combat, but they can tie up multibillion dollar aircraft carriers and high-readiness troops unless a more cost effective rapid response force is developed.

Information Technology

The pulse of the planet has quickened. Computers, faxes, fiber optic cables, and satellites speed the flow of information across frontiers, as illustrated by the explosive growth of the Internet. Faster and larger information flows reinforce the political trend towards increasingly open societies. Ideas, people, and goods are moving across borders at an unprecedented rate.

Internet Hosts in the World
(millions)

Source: International Data Corporation.

Technology progress is not a new phenomenon. Historically, longbows, stirrups, gunpowder, steam engines, airplanes, and a host of other technological advances dramatically changed the nature of warfare. What makes the information explosion so revolutionary is not that technology is advancing but the pace at which it improves. While societies have often been confronted with profound social changes owing to advancing technologies, never before have societies been forced to adapt to a technology which for decades has been improving by an order of magnitude every three or four years. The speed at which computers function--the rate at which information can be transmitted over long distances--looks set to continue increasing at the rate of tenfold every three to four years, which translates into up to 1,000-fold per decade.

No one can foretell all the ways in which information technologies will enhance (or mitigate) traditional venues of national power, but some themes are beginning to emerge.

One is that access to information is being recognized as a sine qua non of economic growth. Mastery of information technology is surpassing mastery of heavy industry as the primary source of national power, whether exercised through commercial or military channels. A useful concept in this regard is "waves" of technology, popularized by Alan and Heidi Toffler. The new wave of computers and communications will be the key to future economic growth, but the older waves of agriculture and industry will remain indispensable elements of national economic life. Because the United States possesses the richest information flux, other countries have become increasingly interested in tapping into these flows. Linkages to sources of expertise (e.g., Silicon Valley), sources of finance (e.g., Wall Street), or sources of knowledge (e.g., universities, think tanks, and selected government agencies) are considered desirable and one more reason for nations to cultivate good relations with the United States.

Another trend is that the ubiquity of global communications is creating new avenues for the interests, culture, and values of the United States to percolate overseas (and vice versa). For the most part, this influence exists independent of national policy; in some cases, however, the existence of these channels makes it easier for the United States government to go over the heads of other governments and communicate directly to their citizens.

On the other end of the spectrum, the ability of the Defense Department (DOD) to generate and distribute vast quantities of intelligence permits the United States to influence the outcomes of conflicts in which it chooses not to intervene directly. At little direct risk, the United States can provide an "information umbrella" to its friends by providing imagery and weather data, software and other systems integration services, and, within the next few years, simulation and other training tools. All these methods, taken collectively, intensify the ability of the United States to exercise what Assistant Secretary of Defense for International Security Affairs Joseph Nye calls "soft power."

USS Roosevelt and carrier group

The extension of the rapid communication and computer technological advances to the battlefield suggests that information-based warfare will become more widespread within a decade or two. Defense requirements will demand more investment in information systems and less in industrial-era configurations of tanks, planes, and ships. Information may come to rival explosive force as a factor in warfare. The development of an integrated approach--a system of systems--that combines sensors, communications, and processors with weapons delivery will allow further advances in the precision with which U.S. forces can strike. Improvements in precision are not new--on average, a target that took one bomb to destroy during Desert Storm required 170 bombs during the Vietnam War and 9,000 bombs during World War II--but the cumulative effect is becoming revolutionary. With more precise information about where to strike, weapons delivery systems can shrink in size, facilitating the trend towards striking from a long distance, possibly directly from the continental U.S. to the battlefield.

The nature and conduct of information warfare is becoming a subject of intense interest to defense analysts. Information looks set to be a new dimension in which warfare can be conducted, requiring defense against enemy actions that cause vital computer nets to malfunction and providing new opportunities for immobilizing an enemy.

The Changing Character of Government

After decades of increasing state involvement in area after area of society in country after country, central governments have been on the retreat since the late days of the Cold War. Publics in many countries seem to have changed their views about national priorities and the role of the government in achieving those national goals.

The Devolution of Power. The most obvious characteristic of the retreat of the state has been the end of the totalitarian systems in the Warsaw Pact, in which the state dominated all aspects of life, stifling the institutions of civil society. But in many other countries as well, a dramatic change has taken place in what citizens expect from their governments. After decades in which the power of central governments grew steadily, those central governments are now reinventing themselves, and power is diffusing from the center. Two changes stand out in particular.

First, central governments are ceding more power to regional and local governments. For instance, not only did the Soviet Union break up into its constituent republics, but Moscow has had to permit regions more free reign. In post-Mao China, the provinces acquired a large measure of economic independence that they used to deny resources to the central government, which finds that its budget is growing only modestly while the national economy races ahead. In the EU, after years of defining detailed unionwide directives, the new principle is "subsidiarity," under which responsibility for each problem is to be assigned to as local a level of government as possible--preferably local rather than national, and then national rather than EU-wide. In the U.S., the 1994 House Republicans' Contract with America exemplifies the strong interest in devolving to the states responsibility for programs that the federal government previously controlled.

Secondly, central governments are shedding functions, partly to reduce expenditures and thereby contain budget deficits. The most important reduction in the role of the state has been a wave of privatization that swept Western Europe, the ex-Soviet bloc, and Latin America, and created ripples elsewhere. In 1994, governments privatized about $80 billion in assets. The general mood is that states are poor managers of factories, and that selling off such enterprises is a way to raise growth rates. The change in attitudes in Latin America has been particularly sharp, from a general assumption that the state must organize economic development to enthusiasm for the rule of the markets.

National Defense and International Affairs in the FY 1995 Budget

Source: 1996 Budget.

A related phenomenon has been a greater attention to the domestic side of national power, especially the economic foundations of power, relative to the projection of national power abroad. A focus on domestic issues, especially economic problems, characterizes Moscow, Beijing, Tokyo, and Brussels (that is, the EU) as much as Washington. To some extent, that is a reflection of the less threatening international environment. But there is also dissatisfaction about growth rates, which in the U.S. and the rest of the industrialized world have been much lower in the two decades since the oil shock of 1973 than in the preceding postwar decades. It seems likely that the highest priority in U.S. politics in the next few years will be long-term economic growth in a manner consistent with providing appropriate safety nets for the unfortunate, and addressing social problems, such as race relations. Concern about international and military affairs will be seen in large part through this optic. In addition, the U.S. body politic is of many minds about what issues are worth risking blood and treasure for: which values are so fundamental that they must be defended irrespective of the importance of the geostrategic interests at stake, which areas of the world are the most vital to the U.S., and which geostrategic interests are the most important.

As a result of the refocus on domestic issues, the U.S. public and publics in many other countries have less of an internationalist outlook and are less willing to spend money on foreign affairs. Calls are being heard to restructure the foreign-policy and national-security establishments to reflect the decreasing interest in international issues compared to domestic ones.

A Perspective on Isolationism and Unilateralism. The debate over the U.S. approach towards national security could be thought of as a compass, with two pairs of polar opposites. If the north pole is engagement, then the south pole is isolation, while the east is unilateralism and the west is multilateralism.

The strength of this analogy is that there are distinct and powerful groups pointing in each of the four directions. For instance, there are those (generally on the left) who believe that no matter whether the U.S. intervenes regularly or seldom, it should always do so through international institutions. Meanwhile there are those (generally on the right) who believe that the most important issue is that the U.S. always act in defense of its own interests and under its own direction, irrespective of how often the U.S. decides to intervene abroad. That is, to the extent that the U.S. engages internationally, they want it done unilaterally, but they are not sure how much the U.S. should engage abroad.

Another phenomenon illustrated by the compass analogy is that a policy like isolationism can be approached from either right or left. The Right tends to believe that the triumph of democratic and free market ideals removes the rationale for active intervention abroad (building upon the thesis of the "end of history"). The Left is sympathetic to the argument that military and foreign expenditures are a drain on resources that could be better used at home (the theory of "imperial overstretch" as a cause for national decline). As one pundit described isolationists, those on the right do not want to inflict the world on America while those on the left do not want to inflict America on the world.

The compass analogy can be extended to include the groups at the intermediate points, e.g., those on the southeast who want the U.S. generally to remain aloof from foreign problems but to act on its own (or with its close allies in a subordinate position) when it does move.

On the whole, the mood in American politics in the immediate aftermath of the Cold War seems to have put the compass arrow towards north, or engagement. In the early days of the Clinton administration, the arrow swung so strongly towards multilateralism that it was in danger of going right on through towards isolation--that is, the popular reaction to the failures of multilateral institutions caused many to think that the U.S. should dramatically reduce its involvement in world affairs. Since then, the arrow has swung again. In 1995, the new Republican majority in Congress seemed to move the arrow to the right, towards unilateralism (e.g., the votes to lift the arms embargo on Bosnia irrespective of the U.N. sanctions). Given these wild swings, it is by no means clear where the compass will end up over the five to seven year time-frame of this report.

Reorienting U.S. Priorities

From the perspective of U.S. national security, an assessment of major trends in the unfolding world order includes grounds for both optimism and pessimism.

On the optimistic side: