econ growth good

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War Impact

Economic decline causes warstrong statistical support.

Royal 10Jedidiah Royal, Director of Cooperative Threat Reduction at the U.S. Departmentof Defense, M.Phil. Candidate at the University of New South Wales, 2010 (EconomicIntegration, Economic Signalling and the Problem of Economic Crises,Economics of War and

Peace: Economic, Legal and Political Perspectives, Edited by Ben Goldsmith and Jurgen Brauer,Published by Emerald Group Publishing, ISBN 0857240048, p. 213-215)

Less intuitive is howperiods of economic declinemay increase the likelihood of external conflict. Politicalscience literature has contributed a moderate degree of attention to the impact of economic decline and the security and defence

behaviour of interdependent states. Research in this vein has been considered at systemic, dyadic and national levels. Several notablecontributions follow.

First, on the systemic level, Pollins (2008) advances Modelski and Thompson's (1996) work on leadership cycle theory, finding that

rhythms in the global economy are associated with the rise and fall of a pre-eminent power andtheoftenbloody transition from onepre-eminent leader to the next. As such, exogenous shocks such as economiccrisescould usher in a redistribution of relative power(see also Gilpin. 1981) that leads to uncertaintyabout

power balances, increasing the risk of miscalculation(Feaver, 1995). Alternatively, even a relatively certainredistribution of power could lead to a permissive environment for conflict as a rising power may seek to challenge a declining power(Werner. 1999). Separately, Pollins (1996) also shows that global economic cycles combined with parallel leadership cycles impactthe likelihood of conflict among major, medium and small powers, although he suggests that the causes and connections betweenglobal economic conditions and security conditions remain unknown.

Second, on a dyadic level, Copeland's (1996, 2000) theory of trade expectations suggests that 'future expectation of trade' is asignificant variable in understanding economic conditions and security behaviour of states. He argues that interdependent states are

likely to gain pacific benefits from trade so long as they have an optimistic view of future trade relations. However, iftheexpectations of future trade decline, particularly for difficult [end page 213] to replace items such as energy resources,the likelihood for conflict increases, as states will be inclined to use force to gain access to thoseresources. Crises couldpotentially be the triggerfor decreased trade expectationseither on its own or because ittriggers protectionist moves by interdependent states.4

Third, others have considered the link between economic decline and external armed conflict at a national level. Blomberg and Hess(2002) find a strong correlation between internal conflict and external conflict, particularly during periods of economic downturn.They write,

The linkages between internal and external conflict and prosperity are strong and mutuallyreinforcing. Economic conflict tends to spawn internal conflict, which in turn returns the favour.Moreover, the presence of a recession tends to amplify the extent to which international and externalconflicts self-reinforce each other. (Blomberg & Hess, 2002. p. 89)

Economic decline hasalsobeen linked with an increase inthe likelihood of terrorism(Blomberg, Hess, &Weerapana, 2004), which has the capacity to spill across borders and lead to external tensions.

Furthermore, crisesgenerally reduce the popularity ofa sitting government. Diversionary theory" suggests that,when facing unpopularity arising from economic decline, sitting governments have increasedincentives to fabricate external military conflicts to create a 'rally around the flag' effect. Wang(1996), DeRouen (1995). and Blomberg, Hess, and Thacker (2006) find supporting evidence showing that economic decline and useof force are at least indirectly correlated. Gelpi (1997), Miller (1999), and Kisangani and Pickering (2009) suggest that the tendency

towards diversionary tactics are greater for democratic states than autocratic states, due to the fact that democratic leaders aregenerally more susceptible to being removed from office due to lack of domestic support. DeRouen (2000) has provided evidence

showing thatperiods of weak economic performance in the United States, and thus weak Presidential popularity,are statistically linked to an increase in the use of force.

In summary, recent economic scholarship positively correlates economic integration with an increase in the frequency of economic

crises, whereaspolitical science scholarship links economic decline with external conflict at systemic,dyadic and national levels.5 This implied connection between integration, crises and armed conflict has not featured

prominently in the economic-security debate and deserves more attention.


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Thisobservation is not contradictory tootherperspectives that link economic interdependence with adecrease inthe likelihood of external conflict, such as those mentioned in the first paragraph of this chapter. [end page 214]Those studiestend to focus on dyadic interdependence instead of global interdependence and do not specificallyconsiderthe occurrence of and conditions created by economic crises. As such, the view presented here should be consideredancillary to those views.


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War Impact

Economic wars go nuclear and global.

Kemp 10Director of Regional Strategic Programs at The Nixon Center, served in the WhiteHouse under Ronald Reagan, special assistant to the president for national security affairs andsenior director for Near East and South Asian affairs on the National Security Council Staff,Former Director, Middle East Arms Control Project at the Carnegie Endowment for InternationalPeace [Geoffrey Kemp, 2010, The East Moves West: India, China, and Asias Growing Presencein the Middle East, p. 233-4]

The second scenario, called Mayhem and Chaos, is the opposite of the fi rst scenario; everything that can go wrong does go wrong.

The world economic situation weakens rather than strengthens, and India, China, and Japan suffera major reduction in their growth rates, further weakening the global economy. As a result, energydemand falls and the price of fossil fuels plummets, leading to a financial crisis for the energy-

producing states, which are forced to cut back dramatically on expansion programs and socialwelfare. Thatin turn leads to political unrest: and nurturesdifferent radical groups, including, but notlimited to, Islamic extremists. The internal stabilityofsome countries is challenged, and there are more

failed states. Most serious is the collapse of the democratic government in Pakistan and its takeoverby Muslim extremists, who then take possession of a large number of nuclear weapons. Thedanger of war between India and Pakistan increases significantly. Iran, always worried about an extremistPakistan, expands and weaponizes its nuclear program. Thatfurther enhances nuclear proliferation in theMiddle East, with Saudi Arabia, Turkey, and Egypt joining Israel and Iran as nuclear states.Underthese circumstances, the potential for nuclear terrorism increases, and the possibility of a nuclearterrorist attack in either the Western world or in the oil-producing states may lead to a furtherdevastating collapse of the world economic market, with a tsunami-like impact on stability. Inthis scenario, major disruptions can be expected, with dire consequences for two-thirds of theplanets population.

The impact is the collapse of the international systemconflicts will breakout and escalate throughout the world.

Panzer 7Michael J. Panzner, Faculty Member specializing in Equities, Trading, GlobalCapital Markets and Technical Analysis at the New York Institute of Finance, 25-year veteran ofthe global stock, bond, and currency markets who has worked in New York and London forHSBC, Soros Funds, ABN Amro, Dresdner Bank, and J.P. Morgan Chase, 2007 (Geopolitics,

Financial Armageddon: Protecting Your Future from Four Impending Catastrophes, Publishedby Kaplan Publishing, ISBN 141959608X, p. 130-138)

With the United States losing its place at the head of the economic table, the energizing force thathas long led the charge for open markets and free trade will itself retreat into isolation and

protectionism. In fact, the American public, spurred by feelings of anxiety, fear, distrust, and paranoia, will likely raise a growingclamor for barbwire and poured concrete as well as legal barriers. The turnaround in attitudes toward porous borders and the

disintegration of one of the worlds leading marketplaces for other nations goods and services will parallel anti -American sentimentsweeping across the globe. For many, Americas long-time paternalistic arrogance and self-appointed role as global police officer,economic authoritarian, and enforcer of the Judeo-Christian ethic was seen as tolerable only when others either stood to benefit or hadlittle choice.

But with the cult of consumerism crumbling, the economy in a tailspin, the nations financial system being consumed from within,public finances in tatters, and military resources stretched to the breaking point, outsiders will no longer have an incentive to ignorethe new reality: the end of American hegemony. [end page 130]

Economic and financial shocks will reverberate back and forth between rich and poor, allies andadversaries, producers and consumers, and mature and developing nations. A siege mentality will


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take hold, where survival and gaining an advantage are the primary goals and every man forhimself becomes the guiding principle.

As time goes on, the United States will lose ever more control over its own destiny, especially ineconomic and financial matters, a development already apparent in the years after the 1990s boom ended and the equity

bubble burst. In the international energy markets, for example, prices and supply-demand dynamics were increasingly dominated byspeculative interests and governments operating in hotspots around the world. In the financial markets, monetary policy changes in

Japan, Europe, and China often had a more pronounced effect than did the activities of the Federal Reserve.The war in Iraq and other military operations, which involved spending more than $500 billion per year, will become untenable

burdens. They will also foment widespread anti-Americanism and growing calls to send U.S. troops home and leave the responsibilityto others. With Americas diminishing role on theworld stage will come a reappraisal of many points of contention that were eitherdiscounted or ignored when other nations depended on the United States for their good fortune.

Signs of a shift were already apparent in the summer of 2006 amid the collapse of the Doha round of global trade negotiations,initiated at the behest of the United States after the 2001 terrorist attacks on the World Trade Center. In the end, the failure came downto bitter and continuing disputes over farm subsidies and a raft of tariff measures, as well as a widening gap between America andothers over what the round should achieve, according to The Economist. All of a sudden, more was to be gained from resisting American impetus for multilateral global accords and focusing instead on the benefits of self-sufficiency and regional alliances. For nosmall number of interested parties, the appropriate endgame [end page 131] was a world split into self -contained, protectionist trading

blocks, resembling in some respects the original vision of a European Union with its porous internal borders and common currency.

This reassessment and realignment of international interests, together with a diminished respect for the United States role as globalagenda setter, underscored another transformation that was under way. In a July 2006 article, Russia-U.S. Shift in Power BalanceMay Mold Summit, the Wall Street Journal notes that the Bush administrations decision to allow Russia to store spent nuclea r fuel

ahead of a gathering of top nations reflected a shifting power balance between a United States facing challenges on several fronts anda Russia moving to reassert itself on the world stage.

The United States isalso losing the ability to influence alliances it might once have anchored orrefused to sanction. Based on common economic, social, religious, or environmental interests, nations such as Russia andChina, Venezuela and North Korea, and even Iran and Iraq are finding potentially dangerous common ground. No small number ofcommentators also note that years of relatively strong economic performance in Asia has spurred a shift in influence from West toEast. A period of rising commodity prices, aided in large part by a massive consumption boom in China, has swung the balance infavor of resource producers such as Iran, Venezuela, and Russia.

In many cases, unstable regimes are no longer willing to play second fiddle to the clique of leading nations such as the Group of Eight.Instead, they are vying to assume what they believe is their rightful place at the center of the global power nexus. Increasingly, theyassert their rights to protect their own strategic national interests, and they seek to regain control of valuable resources, either throughnationalization or expropriation, by claiming that outsiders are exploiting these resources.

Aided by sizable cash hordes and spurred by the need to source reliable and plentiful supplies of energy and raw materials, many ofthe economically awakened nations also seek to invest in businesses and markets outside their own borders. But those efforts [end

page 132] have triggered backlashes from the United States. In 2005, for example, the Chinese National Petroleum Corporationvoluntarily withdrew its bid for energy company Unocal at the request of the White House following a public outcry. Several monthslater, a hullabaloo erupted over government-owned Dubai Worlds bid to acquire the Peninsular and Oriental Steam NavigationCompany, which held contracts to manage six U.S.-based port facilities.

In the wake of such moves, legislators in Washington scrambled to introduce measures that would change the process for reviewingforeign investments in the United States, especially those involving state-owned companies and that would allow authorities to keepcloser tabs on what nonresident investors were up to. But frictions over trade and investment werent the only points of contention.When Chinas economy was expanding at a double-digit pace and its rapidly rising output was absorbing an ever-greater share of theAmerican import bill, the Asian nation also faced unwelcome pressure from the United States and elsewhere to revalue its currency,the yuan, which many believed was fixed at an artificially low level relative to the dollar.

No doubt many of these difficulties can be traced to Americas structural deficiencies and external imbalances, which include largecurrent account and budget deficits that worsen by the day. There is also the issue of the trillions of dollars held by those outside ourshoresmost of whom have no natural interest in the currency. For the better part of three decades, the United States ran a currentaccount deficit, an excess of imports and current payments over exports and current earnings. This was the result of a decl iningmanufacturing base, a rapidly expanding thirst for energy that could only be produced elsewhere, and an unhealthy predilection for

foreign-made goods. By 2005, imports were more than 16 percent of gross domestic product, up from less than 6 percent only threedecades earlier. When the trade deficit climbed to 6.6 percent of GDP by the second quarter of 2006, it had reached a dangerous stage.Americans had spent way more than they could [end page 133] afford for far too long and had relied on a staggering amount of

borrowed money to pay for it, with much of the financing coming from foreigners.

As attitudes toward the United States change, more foreigners will question the dollars longstandingrole as a global reserve currency and international unit of account, especially when they realize how many ofthese paper promises have actually been created and put into circulation. Moreover, those who might once have had aninterest in continuing to hold the currencyand perhaps to add to the $13 trillion of stocks, bonds, factories, and otherAmerican assets that foreigners owned at the end of 2005 will reconsider. In a world of intense competition,


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heightened protectionism, and collapsing consumer demand, they will no longer have the sameincentive to support the greenback and invest in Americaas an adjunct to an export-driven strategy as they didduring the upswing.

Already in 2006, there were signs of a sea change. After years of massive purchases, some overseas holders began to diversify out ofdollar-denominated securities. In March, the Wall Street Journal wrote that net foreign purchases of U.S. government securities fell 86

percent to a three-year low, while central banks were net sellers for the first time in a year. Other reports noted that the greenback wasbecoming increasingly vulnerable to a reshuffle of dollar reserves by Mideast and Asian nations. With foreigners holding more than

40 percent of U.S. Treasury bonds, 25 percent of outstanding corporate bonds, and 12 percent of corporate equities, the prospect of anabrupt, widespread exodus could only add to a dismal outlook for domestic securities prices.

More than a few foreign countries also seek to diversify out of the dollar into precious metals and other assets. Russian PresidentVladimir Putin, for instance, reportedly ordered the nations central bank in 2006 to boost golds share of its $277 billion of foreign reserves from 5 to 10 percent, while China, which held only 1.4 percent of reserves in the precious metal, according to the World GoldCouncil, was being urged by domestic officials to increase its exposure. There has also been persistent and growing chatter, led [end

page 134] by anti-American oil producers such as Iran and Venezuela, about changing the reference price for crude oil from dollars toeuros, or even to units of gold, per barrel.

As sentiment toward the United States changes for the worse, the advantages of a widely held andreadily tradable but intrinsically worthless and suddenly depreciating dollar will quickly be lost,transforming a once desirable asset into a liability. Along with this realization will comewhat manyobservers have long feared: a rapid and disorderly unwinding of existing global imbalancesand a

plunge in the dollar.

Still, although little doubt exists about the longer term outlook for the greenback, especially given that U.S. officials will eventually beforced to turn on the monetary spigot full blast, the dollar may well swing noticeably higher versus other currencies in the short run.The combination of massive speculative bets against the currency; widespread margin calls at major financial intermediaries asvolatile markets boost collateral requirements; unexpectedly tight monetary policy; and frantic efforts to convert assets of all kindsinto cash to service trillions in dollar-denominated loans, bonds, and other obligations will likely trigger a short-term boost in demand.

These moves will ultimately prove unsustainable, however, as the wholesale destruction of purchasing power amid a hyperactiveincrease in the supply of the currency proves overwhelming. With the Fed eventually seeking to monetize anything and everything insight, those who can will do their utmost to bail out of American currency. Dollar-denominated assets of all kinds, including formersafe-haven investments such as Treasury bills and the debts of Fannie Mae and Freddie Mac, belatedly recognized as unbacked bygovernment guarantee, will come under relentless selling pressure.

Markets willalso suffer from the violent aftershocks of a dramatic increase in capital flight, as theremaining wealthy Americans and exposed foreigners try to exit before the door slams completely shut. A rash of financial

problems, bank failures, legal[end page 135]proceedings, arbitrary decrees, and rising concern over a

government that seems to have abdicated any semblance of fiscal discipline will furtherexacerbate those fears.

Many will wonder whether the United States might renege on some of its financial obligations oreven declare an outright defaulton its once AAA securities. Likely adding to a widespread sense of panic will be theexodus from an array of global fiat currencies into gold, silver, property, and other tangible assets, which can hold their value in aworld of government finances run amok. Needless to say, systemic financial pressures and domino-like bank failures will make

preservation of capital the utmost concern.

Rising angst willalso wreak havoc with links among markets, financial systems, economies, andcountries. Many people could find themselves subject to stricter government controls or even find avenues closed off as a result ofattempts to stem contagion effects. The widespread urge to withdraw will feed rising xenophobia, already inflamed by illegal

immigration, unfair trade practices, and leaking borders. Playing to populist sentiment, politicians around thecountry will respond enthusiastically to calls for restrictions on foreigners. This will further feed a

brain drain, as scientists, students, and other temporary visa holders are left with little choice butto uproot and go elsewhere, further sapping Americas economic resiliency.

Continuing calls for curbs on the flow of finance and trade will inspire the United States and othernations to spew forth protectionist legislationlike the notorious Smoot-Hawley bill. Introduced at the start of theGreat Depression, it triggered a series of tit-for-tat economic responses, which many commentators believe helped turn a seriouseconomic downturn into a prolonged and devastating global disaster. But if history is any guide, those lessons will have been longforgotten during the next collapse. Eventually, fed by a mood of desperation and growing public anger, restrictions on trade, finance,investment, and immigration will almost certainly intensify. [end page 136]

Authorities and ordinary citizens will likely scrutinize the cross-border movement of Americans and outsiders alike, and lawmakersmay even call for a general crackdown on nonessential travel. Meanwhile, many nations will make transporting or sending funds to


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other countries exceedingly difficult. As desperate officials try to limit the fallout from decades of ill-conceived, corrupt, and recklesspolicies, they will introduce controls on foreign exchange. Foreign individuals and companies seeking to acquire certain Americaninfrastructure assets, or trying to buy property and other assets on the cheap thanks to a rapidly depreciating dollar, will be stymied bylimits on investment by noncitizens. Those efforts will cause spasms to ripple across economies and markets, disrupting global

payment, settlement, and clearing mechanisms. All of this will, of course, continue to undermine business confidence and consumerspending.

In a world of lockouts and lockdowns, any link that transmits systemic financial pressures across markets through arbitrage orportfolio-based risk management, or that allows diseases to be easily spread from one country to the next by tourists and wildlife, orthat otherwise facilitates unwelcome exchanges of any kind will be viewed with suspicion and dealt with accordingly.

The rise in isolationism and protectionism will bring about ever more heated arguments anddangerous confrontations over shared sources of oil, gas, and other key commodities as well asfactors of production that must, out of necessity,be acquired from less-than-friendly nations. Whetherinvolving raw materials used in strategic industries or basic necessities such as food, water, and energy, efforts to secure adequate

supplies will take increasing precedence in a world where demand seems constantly out of kilter with supply. Disputes over themisuse, overuse, and pollution of the environment and natural resources will become morecommonplace.

Around the world, such tensions will give rise to full-scale military encounters, often withminimal provocation. In some instances, economic conditions will serve as a convenient pretextfor conflicts that stem from cultural and religious[end page 137] differences. Alternatively, nations may

look to divert attention away from domestic problems by channeling frustration and populistsentiment toward other countries and cultures. Enabled by cheap technology and the waningthreat of American retribution, terrorist groups will likely boost the frequency and scale of theirhorrifying attacks, bringing the threat of random violence to a whole new level.

Turbulent conditions will encourage aggressive saber rattling and interdictions by rogue nationsrunning amok. Age-old clashes willalso take on a new, more heated sense of urgency. China willlikely assume an increasingly belligerent posture toward Taiwan, while Iran may embark on overtcolonization of its neighbors in the Mideast. Israel, for its part, may look to draw a dwindling list ofallies from around the world into a growing number of conflicts. Some observers, like John Mearsheimer, a

political scientist at the University of Chicago, have even speculated that an intense confrontation between the United States andChina is inevitable at some point.

More than a few disputes will turn out to be almost wholly ideological. Growing cultural and

religious differences will be transformed from wars of words to battles soaked in blood. Long-simmering resentments could also degenerate quickly, spurring the basest of human instincts andtriggering genocidal acts. Terrorists employing biological or nuclear weapons will vie withconventional forces using jets, cruise missiles, and bunker-busting bombs to cause widespreaddestruction. Many will interpret stepped-up conflicts between Muslims and Western societies as the beginnings of a new worldwar.

As events unfold, unsettling geopolitical tensions and the continuing economic collapse willweigh heavily on the familiar routines of everyday life, forcing many Americans to wonder when,or if, it will ever end.

Economic decline heightens the risk of global conflictmultiple scenarios.Harris and Burrows 9Mathew J. Burrows, counselor in the National IntelligenceCouncil, principal drafter of Global Trends 2025: A Transformed Worldan unclassified report

by the NIC published every four years that projects trends over a 15-year period, has served in theCentral Intelligence Agency since 1986, holds a Ph.D. in European History from CambridgeUniversity, and Jennifer Harris, Member of the Long Range Analysis Unit at the NationalIntelligence Council, holds an M.Phil. in International Relations from Oxford University and aJ.D. from Yale University, 2009 (Revisiting the Future: Geopolitical Effects of the Financial


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Crisis, The Washington Quarterly, Volume 32, Issue 2, April, Available Online athttp://www.twq.com/09april/docs/09apr_Burrows.pdf, Accessed 08-22-2011, p. 35-37)

Of course, the report encompasses more than economics and indeed believes the future is likely to be the result of a number ofintersecting and interlocking forces. With so many possible permutations of outcomes, each with ample [end page 35] opportunity forunintended consequences, there is a growing sense of insecurity.

Even so, history may be more instructive than ever. While we continue to believe that the Great Depression is

not likely to be repeated, the lessonsto be drawn from that period include the harmful effects onfledgling democracies and multiethnic societies(think Central Europe in 1920s and 1930s) and on the sustainabilityof multilateral institutions (think League of Nations in the same period). There is no reason to think that this wouldnot be true in the twenty-firstas much as in the twentieth century. For that reason, the ways in which the

potential for greater conflict could grow would seem to be even more apt in a constantly volatileeconomic environment as they would be if change would be steadier.

In surveying those risks, the report stressed the likelihood that terrorism and nonproliferation will remain priorities even as resource

issues move up on the international agenda. Terrorisms appeal will decline if economic growth continuesinthe Middle East and youth unemployment is reduced. For those terrorist groups that remain active in 2025, however, the diffusionof technologies and scientific knowledge will place some of the worlds most dangerouscapabilities within their reach. Terrorist groups in 2025 will likely be a combination of descendants of long establishedgroupsinheriting organizational structures, command and control processes, and training procedures necessary to conduct

sophisticated attacksand newly emergent collections of the angry and disenfranchised that become self-radicalized, particularly inthe absence of economic outlets that would become narrower in an economic downturn.

The most dangerous casualty of any economically-induced drawdown of U.S. military presencewouldalmost certainlybe the Middle East. Although Irans acquisition of nuclear weapons is not inevitable, worries about anuclear-armed Iran could lead states in the region to develop new security arrangements with external powers, acquire additionalweapons, and consider pursuing their own nuclear ambitions. It is not clear that the type of stable deterrent relationship that existed

between the great powers for most of the Cold War would emerge naturally in the Middle East with a nuclear Iran. Episodes oflow intensity conflict and terrorism taking place under a nuclear umbrella could lead to anunintended escalation and broader conflictif clear red lines between those states involved are not well established.The close proximity of potential nuclear rivals combined with underdeveloped surveillancecapabilities and mobile dual-capable Iranian missile systems also will produce inherentdifficulties in achieving reliable indications and warning of an impending nuclear attack. The lackof strategic depth in neighboring states like Israel, short warning and missile flight times, anduncertainty of Iranian intentions may place more focus on preemption rather than defense,

potentially leading to escalating crises. [end page 36]

Types of conflictthat the world continues to experience, such as over resources, could reemerge, particularly ifprotectionism grows and there is a resort to neo-mercantilist practices. Perceptions of renewed energy scarcity willdrive countries to take actions to assuretheir future accessto energy supplies. In the worst case, this couldresult in interstate conflictsif government leaders deem assured access to energy resources, for example, to be essential formaintaining domestic stability and the survival of their regime. Even actions short of war, however, will haveimportant geopolitical implications. Maritime security concerns are providing a rationale for naval buildups andmodernization efforts, such as Chinas and Indias development of blue water naval capabilities. If the fiscal stimulus focus for thesecountries indeed turns inward, one of the most obvious funding targets may be military. Buildup of regional naval capabilities couldlead to increased tensions, rivalries, and counterbalancing moves, but it also will create opportunities for multinational cooperation in

protecting critical sea lanes. With water also becoming scarcer in Asia and the Middle East, cooperationto manage changing

water resources is likely to be increasingly difficultboth within and between states in a more dog-eat-dogworld.

Extended economic crisis risk protectionism, failed states, democratic

backsliding, and global conflict

Green and Schrage 9Michael J Green is Senior Advisor and Japan Chair at the Center forStrategic and International Studies (CSIS) and Associate Professor at Georgetown University.


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Steven P Schrage is the CSIS Scholl Chair in International Business and a former senior officialwith the US Trade Representative's Office, State Department and Ways & Means Committee[March 26, 2009, It's not just the economy,http://www.atimes.com/atimes/Asian_Economy/KC26Dk01.html]However, the Great Depression taught us that a downward global economic spiral can even have

jarring impacts on great powers. It is no mere coincidence that the last great global economic

downturn was followed by the most destructive war in human history.In the 1930s, economic desperation helped fuel autocratic regimes and protectionism in adownward economic-security death spiral that engulfed the world in conflict. This spiral wasaided by the preoccupation of the United States and other leading nations with economic troublesat home and insufficient attention to working with other powers to maintain stability abroad.Today's challenges are different, yet 1933's London Economic Conference, which failed to stop the drift toward deeper depression andworld war, should be a cautionary tale for leaders heading to next month's London Group of 20 (G-20) meeting.There is no question the US must urgently act to address banking issues and to restart its economy. But the lessons of the past suggestthat we will also have to keep an eye on those fragile threads in the international system that could begin to unravel if the financial

crisis is not reversed early in the Barack Obama administration and realize that economics and security are intertwinedin most of the critical challenges we face.A disillusioned rising power? Four areas in Asia merit particular attention, although so far the current financial crisis has not changedAsia's fundamental strategic picture. China is not replacing the US as regional hegemon, since the leadership in Beijing is too nervousabout the political implications of the financial crisis at home to actually play a leading role in solving it internationally.

Predictions that the US will be brought to its knees because China is the leading holder of US debt often miss key points. China'scurrency controls and full employment/export-oriented growth strategy give Beijing few choices other than buying US Treasury billsor harming its own economy. Rather than creating new rules or institutions in international finance, or reorienting the Chineseeconomy to generate greater long-term consumer demand at home, Chinese leaders are desperately clinging to the s tatus quo (thoughBeijing deserves credit for short-term efforts to stimulate economic growth).

The greater danger with China is not an eclipsing of US leadership, but instead the kind of shift instrategic orientation that happened to Japan after the Great Depression. Japan was arguably not arevisionist power before 1932 and sought instead to converge with the global economy throughopen trade and adoption of the gold standard.The worldwide depression and protectionism of the 1930s devastated the newly exposed Japaneseeconomy and contributed directly to militaristic and autarkic policies in Asia as the Japanese

people reacted against what counted for globalization at the time. China today is similarlyconverging with the global economy, and many experts believe China needs at least 8% annual growth to sustain socialstability. Realistic growth predictions for 2009 are closer to 5%.Veteran China hands were watching closely when millions of migrant workers returned to work after the Lunar New Year holiday last

month to find factories closed and jobs gone. There were pockets of protests, but nationwide unrest seems unlikely thisyear, and Chinese leaders are working around the clock to ensure that it does not happen nextyear either. However, the economic slowdown has only just begun and nobody is certain how it willimpact the social contract in China between the ruling communist party and the 1.3 billionChinese who have come to see President Hu Jintao's call for "harmonious society" as inextricablylinked to his promise of "peaceful development".If the Japanese example is any precedent, a sustained economic slowdown has the potential to open adangerous path from economic nationalism to strategic revisionism in China too.Dangerous states

It is noteworthy thatNorth Korea, Myanmar and Iran have all intensified their defiance in the wake ofthe financial crisis, which has distracted the world's leading nations, limited their moral authority

and sown potential discord. With Beijing worried about the potential impact of North Korean belligerence or instability onChinese internal stability, and leaders in Japan and South Korea under siege in parliament because of the collapse of their s tockmarkets, leaders in the North Korean capital of Pyongyang have grown increasingly boisterousabout their country's claims to great power status as a nuclear weapons state.The junta in Myanmar has chosen this moment to arrest hundreds of political dissidents andthumb its nose atfellow members of the 10-country Association of Southeast Asian Nations. Iran continues itsnuclear program while exploiting differences between the US, UK and France(or the P-3 group) andChina and Russia- differences that could become more pronounced if economic friction with Beijing or Russia crowds outcooperation or if Western European governments grow nervous about sanctions as a tool of policy.


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It is possible that the economic downturn will make these dangerous states more pliable because of falling fuel prices (Iran) andgreater need for foreign aid (North Korea and Myanmar), but that may depend on the extent that authoritarian leaders care about thewell-being of their people or face internal political pressures linked to the economy. So far, there is little evidence to suggest eitherand much evidence to suggest these dangerous states see an opportunity to advance their asymmetrical advantages against theinternational system.Challenges to the democratic model

The trend in East Asia has been for developing economies to steadily embrace democracy and therule of law in order to sustain their national success. But to thrive, new democracies also have todeliver basic economic growth. The economic crisis has hit democracies hard, with Japanese PrimeMinister Aso Taro's approval collapsing to single digits in the polls and South Korea's Lee Myung-bak and Taiwan's Ma Ying Jeoudoing only a little better (and the collapse in Taiwan's exports - particularly to China - is sure to undermine Ma's argument that a moreaccommodating stance toward Beijing will bring economic benefits to Taiwan). Thailand's new coalition government has an uncertainfuture after two years of post-coup drift and now economic crisis.

The string of old and new democracies in East Asia has helped to anchor US relations with Chinaand to maintainwhat former secretary of state Condoleezza Rice once called a "balance of power that favorsfreedom". A reversal of the democratic expansion of the past two decades would not only impactthe global balance of power but also increase the potential number of failed states, with all theattendant risk they bring from harboring terrorists to incubating pandemic diseases and traffickingin persons. It would also undermine the demonstration effect of liberal norms we are urging China to embrace at home.ProtectionismThe collapse of financial markets in 1929 was compounded by protectionist measures such as the Smoot-Hawley tariff act in 1932.

Suddenly, the economic collapse became a zero-sum race for autarkic trading blocs that became akey cause of war.Today, the globalization of finance, services and manufacturing networks and theWorld Trade Organization (WTO) make such a rapid move to trading blocs unlikely. However,

protectionism could still unravel the international system through other guises.Already, new spending packages around the world are providing support for certain industries thatmight be perceived by foreign competitors as unfair trade measures, potentially creating a"Smoot-Hawley 2.0" stimulus effect as governments race to prop up industries. "Buy American"conditionality in the US economic stimulus package earlier this year was watered downsomewhatby the Obama administration,but it set a tempting precedent for other countries to put up

barriers to close markets.Nations pushing the bounds of their trade commitments could overload the circuits of a systemthat can take two years to determine violations - more than enough time for a global meltdown.Climate change legislation is also likely to become a stalking horse for protectionism as legislatures enthusiastically embrace punitivetariffs against Chinese or Indian goods that are produced outside of the framework for reducing greenhouse gas emissions.

Finally, competitive devaluation- already being pursued by China in the view of some economists - could intensifyinternational protectionism and friction. Global trade has already contracted for the first time inover two decades and governments have only just begun exploring unilateral measures that couldcause further barriers. Meanwhile, trade liberalization has stalled inthe DohaRound of the WTO and theObama administration has come into office expressing strong reservations about major bilateral free trade agreements alreadynegotiated with allies like South Korea and Columbia.

Even if the clarion call of protectionism does not lead to the kind of autarkic blocs thatcontributed to war in the 1930s, it could still distract governments from collaboration on commonthreats and slow the prospects for more rapid recovery.


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Turns Hegemony

Economic decline collapses U.S. hegemonythe impact is great power

conflict.

Khalilzad 11Zalmay Khalilzad, Counselor at the Center for Strategic and InternationalStudies, served as the United States ambassador to Afghanistan, Iraq, and the United Nationsduring the presidency of George W. Bush, served as the director of policy planning at the DefenseDepartment during the Presidency of George H.W. Bush, holds a Ph.D. from the University ofChicago, 2011 (The Economy and National Security,National Review, February 8th, AvailableOnline at http://www.nationalreview.com/articles/print/259024, Accessed 02-08-2011)

Today, economic and fiscal trends pose the most severe long-term threat to the United Statespositionas global leader. While the United States suffers from fiscal imbalances and low economic growth,the economies of rival powers are developing rapidly. The continuation of thesetwo trends couldlead to a shift from American primacy toward a multi-polar global system, leadingin turn toincreased geopolitical rivalry andeven war amongthe great powers.

The current recession is the result of a deep financial crisis, not a mere fluctuation in the business cycle. Recovery is likely to be

protracted. The crisis was preceded by the buildup over two decades of enormous amounts of debt throughout the U.S. economyultimately totaling almost 350 percent of GDPand the development of credit-fueled asset bubbles, particularly in the housingsector. When the bubbles burst, huge amounts of wealth were destroyed, and unemployment rose to over 10 percent. The decline oftax revenues and massive countercyclical spending put the U.S. government on an unsustainable fiscal path. Publicly held nationaldebt rose from 38 to over 60 percent of GDP in three years.

Without faster economic growth and actions to reduce deficits, publicly held national debt isprojected to reach dangerous proportions. If interest rates were to rise significantly, annualinterest paymentswhich already are larger than the defense budgetwould crowd out other spending orrequire substantial tax increases that would undercut economic growth. Even worse, if unanticipatedevents triggerwhat economists call a sudden stop in credit markets for U.S. debt, the United Stateswould be unable to roll over its outstanding obligations, precipitating a sovereign-debt crisis thatwould almost certainly compel a radical retrenchmentof the United States internationally.

Such scenarios would reshape the international order. It was the economic devastation of Britain and Franceduring World War II, as well as the rise of other powers, that led both countries to relinquish their empires. In the late 1960s, Britishleaders concluded that they lacked the economic capacity to maintain a presence east of Suez. Soviet economic weakness, whichcrystallized under Gorbachev, contributed to their decisions to withdraw from Afghanistan, abandon Communist regimes in Eastern

Europe, and allow the Soviet Union to fragment. If the U.S. debt problem goes critical, the United States would becompelled to retrench, reducing its military spending and shedding international commitments.

We face this domestic challenge while other major powers are experiencing rapid economic growth. Eventhough countries such as China, India, and Brazilhave profound political, social, demographic, and economic

problems, their economies are growing fasterthan ours, andthis could alter the global distribution of power.These trends could in the long term produce a multi-polar world. If U.S. policymakers fail to actand other powers continue to grow, it is not a question of whether but when a new internationalorder will emerge. The closing of the gap between the United States and its rivals could intensifygeopolitical competition among major powers, increase incentives for local powers to play major

powers against one another, and undercut our will to preclude or respond to international crisesbecause of the higher risk of escalation.

The stakes are high. In modern history, the longest period of peace among the great powers hasbeen the era of U.S. leadership. By contrast, multi-polar systems have been unstable, with theircompetitive dynamics resulting in frequent crises and major wars among the great powers.Failures of multi-polar international systems produced both world wars.


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American retrenchment could have devastating consequences. Without an American securityblanket, regional powers could rearm in an attempt to balance against emerging threats. Underthis scenario, there would be a heightened possibility of arms races, miscalculation, or othercrises spiraling into all-out conflict. Alternatively, in seeking to accommodate the stronger powers, weaker powers mayshift their geopolitical posture away from the United States. Either way, hostile states would be emboldened to makeaggressive moves in their regions.

As rival powers rise, Asiain particular is likely to emerge as a zone of great-power competition.Beijings economic rise has enabled a dramatic military buildup focused on acquisitions of naval, cruise, and ballistic missiles, long-range stealth aircraft, and anti-satellite capabilities. Chinas strategic modernization is aimed, ultimately, at denying the United Sta tesaccess to the seas around China. Even as cooperative economic ties in the region have grown, Chinas expansive territorial cl aimsand provocative statements and actions following crises in Korea and incidents at sea have roiled its relations with South Korea,Japan, India, and Southeast Asian states. Still, the United States is the most significant barrier facing Chinese hegemony andaggression.

Given the risks, the United States must focus on restoring its economic and fiscal condition whilechecking and managing the rise of potential adversarial regional powers such as China. While we facesignificant challenges, the U.S. economy still accounts for over 20 percent of the worlds GDP. American institutions particularlythose providing enforceable rule of lawset it apart from all the rising powers. Social cohesion underwrites political stability. U.S.demographic trends are healthier than those of any other developed country. A culture of innovation, excellent institutions of highereducation, and a vital sector of small and medium-sized enterprises propel the U.S. economy in ways difficult to quantify. Historically,Americans have responded pragmatically, and sometimes through trial and error, to work our way through the kind of crisis that we

face today.The policy question is how to enhance economic growth and employment while cutting discretionary spending in the near term andcurbing the growth of entitlement spending in the out years. Republican members of Congress have outlined a plan. Several thinktanks and commissions, including President Obamas debt commission, have done so as well. Some consensus exists on measures t o

pare back the recent increases in domestic spending, restrain future growth in defense spending, and reform the tax code (by reducingtax expenditures while lowering individual and corporate rates). These are promising options.

The key remaining question is whether the president and leaders of both parties on Capitol Hill have the will to act and the skill tofashion bipartisan solutions. Whether we take the needed actions is a choice, however difficult it might be. It is clearly within ourcapacity to put our economy on a better trajectory. In garnering political support for cutbacks, the president and members of Congressshould point not only to the domestic consequences of inactionbut also to the geopolitical implications.

As the United States gets its economic and fiscal house in order, it should take steps to prevent a flare-up in Asia. The United Statescan do so by signaling that its domestic challenges will not impede its intentions to check Chinese expansionism. This can be done incost-efficient ways.

While Chinas economic rise enables its military modernization and international assertiveness, it also frighte ns rival powers. The

Obama administration has wisely moved to strengthen relations with allies and potential partners in the region but more can be done.Some Chinese policies encourage other parties to join with the United States, and the U.S. should not let these opportunities pass.Chinas military assertiveness should enable security cooperation with countries on Chinas periphery particularly Japan, India, andVietnamin ways that complicate Beijings strategic calculus. Chinas mercantilist polici es and currency manipulationwhichharm developing states both in East Asia and elsewhereshould be used to fashion a coalition in favor of a more balanced tradesystem. Since Beijings over-the-top reaction to the awarding of the Nobel Peace Prize to a Chinese democracy activist alienatedEuropean leaders, highlighting human-rights questions would not only draw supporters from nearby countries but also emboldenreformers within China.

Since the end of the Cold War, a stable economic and financial condition at home has enabledAmerica to have an expansive role in the world. Today we can no longer take this for granted.Unless we get our economic house in order, there is a risk that domestic stagnation incombination with the rise of rival powers will undermine our ability to deal with growinginternational problems. Regional hegemons in Asia could seize the moment, leading the world

toward a new, dangerous era of multi-polarity.


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Nuclear War Turns Environment

Nuclear war turns and outweighs any environmental impactthe most

recent studies prove.

Toon et. al 8Brian Toon is chair of the department of atmospheric and oceanic sciences and amember of the laboratory for atmospheric and space physics at the University of Colorado atBoulder. Alan Robock is a professor of atmospheric science at Rutgers University in NewBrunswick, New Jersey. Rich Turco is a professor of atmospheric science at the University ofCalifornia, Los Angeles. [December, 2008, Environmental consequences of nuclear war,Physics Today, http://ptonline.aip.org/journals/doc/PHTOAD-ft/vol_61/iss_12/37_1.shtml]

Environmental effects of sootFigure 3a indicates changes in global average precipitation and temperature as a function of soot emission, as calculated with the help

of a modern version of a major US climate model.6,8 A relatively modest 5 Tg of soot, which could be generated in anexchange between India and Pakistan, would be sufficient to produce the lowest temperaturesEarth has experienced in the past 1000 yearslower than during the post-medieval Little Ice Age or in 1816, the so-called year without a summer. With 75 Tg of soot, less than half of what we project in a hypothetical SORT

war, temperatures would correspond to the last full Ice Age, and precipitation would decline bymore than 25% globally.Calculations in the 1980s had already predicted the cooling from a 150-Tg soot injection to be quitelarge.3 Our new results, however, show that soot would rise to much higher altitudes than previously

believedindeed, to well above the tops of the models used in the 1980s. As a result, the time requiredfor the soot mass to be reduced by a factor of e is about five years in our simulations, as opposedto about one year as assumed in the 1980s. That increased lifetime causes a more dramatic andlonger-lasting climate response.The temperature changes represented in figure 3a would have a profound effect on mid- and high-latitude agriculture. Precipitationchanges, on the other hand, would have their greatest impact in the tropics.6 Even a 5-Tg soot injection would lead to a 40%

precipitation decrease in the Asian monsoon region. South America and Africa would see a large diminution of rainfall fromconvection in the rising branch of the Hadley circulation, the major global meridional wind system connecting the tropics andsubtropics. Changes in the Hadley circulations dynamics can, in general, affect climate on a global scale.

Complementary to temperature change is radiative forcing, the change in energy flux.Figure 3bshows how nuclear soot changes the radiative forcing at Earths surfaceand compares its effect tothose of two well-known phenomena: warming associated with greenhouse gases and the1991 Mount Pinatubovolcanic eruption, the largest in the 20th century. Since the Industrial Revolution, greenhouse gases have increased the energyflux by 2.5 W/m2. The transient forcing from the Pinatubo eruption peaked at about 4 W/m2 (the minus sign means the flux

decreased). One implication of the figure is that even a regional war between India and Pakistan can force theclimate to a far greater degree than the greenhouse gases that many fear will alter the climate in theforeseeable future.Of course, the durations of the forcings are different: The radiative forcing by nuclear-weapons-generatedsoot might persist for a decade, but that from greenhouse gases is expected to last for a century or more, allowing time for the climatesystem to respond to the forcing. Accordingly, while the Ice Agelike temperatures in figure 3a could lead to an expansion of sea iceand terrestrial snowpack, they probably would not be persistent enough to cause the buildup of global ice sheets.

Agriculture responds to length of growing season, temperature during the growing season, light levels,precipitation, and other factors. The 1980s saw systematic studies of the agricultural changes expected from a nuclear war, but no suchstudies have been conducted using modern climate models. Figure 4 presents our calculations of the decrease in length of the growing

seasonthe time between freezing temperaturesfor the second summer after the release of soot in a nuclear attack.6,8 Even a 5-

Tg soot injection reduces the growing season length toward the shortest average range observedin the midwestern US corn-growing states. Earlier studies concluded that for a full-scale nuclearconflict, What can be said with assurance is that the Earths human population has a muchgreater vulnerability to the indirect effects of nuclear war [including damage to the worlds

agricultural, transportation, energy, medical, political, and social infrastructure], especiallymediated through impacts on food productivity and food availability, than to the direct effects ofnuclear war itself. As a result, The indirect effects could result in the loss of one to several billionsof humans.4Because the soot associated with a nuclear exchange is injected into the upper atmosphere, the stratosphere is heated and stratosphericcirculation is perturbed. For the 5-Tg injection associated with a regional conflict, stratospheric temperatures would remain elevated


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by 30 C after four years.68 The resulting temperature and circulation anomalies would reduce ozone columns by 20% globally, by2545% at middle latitudes, and by 5070% at northern high latitudes for perhaps as much as five years, with substantial losses

persisting for an additional five years.7 The calculations of the 1980s generally did not consider such effects or the mechanisms thatcause them. Rather, they focused on the direct injection of nitrogen oxides by the fireballs of large-yield weapons that are no longerdeployed. Global-scale models have only recently become capable of performing the sophisticated atmospheric chemical calculationsneeded to delineate detailed ozone-depletion mechanisms. Indeed, simulations of ozone loss following a SORT conflict have not yet

been conducted.Policy implications

Scientific debate and analysis of the issues discussed in this article are essential not only to ascertain the science behind the results butalso to create political action. Gorbachev, who together with Reagan had the courage to initiate the builddown of nuclear weapons in1986, said in an interview at the 2000 State of the World Forum, Models made by Russian and American scientists showed that anuclear war would result in a nuclear winter that would be extremely destructive to all life on Earth; the knowledge of that was a greatstimulus to us, to people of honor and morality, to act in that situation. Former vice president Al Gore noted in his 2007 N obel Prizeacceptance speech, More than two decades ago, scientists calculated that nuclear war could throw so much debris and soot into theair that it would block life-giving sunlight from our atmosphere, causing a nuclear winter. Their eloquent warnings here in Oslohelped galvanize the worlds resolve to halt the nuclear arms race. Many researchers have evaluated the consequences of single nuclear explosions, and a few groups have considered the results of a

small number of explosions. But our work represents the only unclassified study of the consequences of aregional nuclear conflict and the only one to consider the consequences of a nuclear exchangeinvolving the SORT arsenal.Neither the US Department of Homeland Security nor any other governmental agency in theworld currently has an unclassified program to evaluate the impact of nuclear conflict. Neither the US National Academy of Sciences,

nor any other scientific body in the world, has conducted a study of the issue in the past 20 years.That said, the science community has long recognized the importance of nuclear winter. It was investigated by numerous

organizations during the 1980s, all of which found the basic science to be sound. Our most recent calculations alsosupport the nuclear-winter concept and show that the effects would be more long lasting andtherefore worse than thought in the 1980s.

Nevertheless, a misperception that the nuclear-winter idea has been discredited has permeated thenuclear policy community.That error has resulted in many misleading policy conclusions. Forinstance, one research group recently concluded that the US could successfully destroy Russia in a surprise first-strike nuclearattack.10 However, because of nuclear winter, such an action might be suicidal. To recall some specifics, an attack by the US onRussia and China with 2200 weapons could produce 86.4 Tg of soot, enough to create Ice Age conditions, affect agricultureworldwide, and possibly lead to mass starvation.Lynn Eden of the Center for International Security and Cooperation explores the military view of nuclear damage in her book WholeWorld on Fire.11 Blast is a sure result of a nuclear explosion. And military planners know how to consider blast effects when they

evaluate whether a nuclear force is capable of destroying a target. Fires are collateral damage that may not beplanned or accounted for.Unfortunately, that collateral damage may be capable of killing most ofEarths population.

Climate and chemistry models have greatly advanced since the 1980s, and the ability to computethe environmental changes after a nuclear conflict has been much improved.Our climate andatmospheric chemistry work is based on standard global models from NASA Goddards Institute

for Space Studies and from the US National Center for Atmospheric Research. Many scientistshave used those models to investigate climate change and volcanic eruptions, both of which arerelevant to considerations of the environmental effects of nuclear war.In the past two decades, researchershave extensively studied other bodies whose atmospheres exhibit behaviors corresponding to nuclear winter; included in such studiesare the thermal structure of Titans ambient atmospheres and the thermal structure of Marss atmosphere during global dust storms.

Like volcanoes, large forest fires regularly produce phenomena similar to those associated withthe injection of soot into the upper atmosphere following a nuclear attack.Although plenty remains to bedone, over the past 20 years scientists have gained a much greater understanding of natural analogues to nuclear-weapons explosions.Substantial uncertainties attend the analysis presented in this article; references 5 and 8 discuss many of them in detail. Someuncertainties may be reduced relatively easily. To give a few examples: Surveys of fuel loading would reduce the uncertainty in fuelconsumption in urban firestorms. Numerical modeling of large urban fires would reduce the uncertainty in smoke plume heights.Investigations of smoke removal in pyrocumulus clouds associated with fires would reduce the uncertainty in how much soot isactually injected into the upper atmosphere. Particularly valuable would be analyses of agricultural impacts associated with the climatechanges following regional conflicts.

For any nuclear conflict, nuclear winter would seriously affect noncombatant countries.12 In a hypotheticalSORT war, forexample, we estimate that most of the worlds population, including that of the SouthernHemisphere, would be threatened by the indirect effects on global climate. Even a regional war

between India and Pakistan, for instance, has the potential to dramatically damage Europe, theUS, and other regions through global ozone loss and climate change. The current nuclear buildupsin an increasing number of countries point to conflicts in the next few decades that would be


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more extreme than a war today between India and Pakistan. The growing number of countrieswith weapons also makes nuclear conflict more likely.The environmental threat posed by nuclear weapons demands serious attention.It should be carefullyanalyzed by governments worldwideadvised by a broad section of the scientific communityand widely debated by the public.

Nuclear war would collapse ag and the environmenteven small arsenalsthreaten humanity.

Toon et. al 8Brian Toon is chair of the department of atmospheric and oceanic sciences and amember of the laboratory for atmospheric and space physics at the University of Colorado atBoulder. Alan Robock is a professor of atmospheric science at Rutgers University in NewBrunswick, New Jersey. Rich Turco is a professor of atmospheric science at the University ofCalifornia, Los Angeles. [December, 2008, Environmental consequences of nuclear war,Physics Today, http://ptonline.aip.org/journals/doc/PHTOAD-ft/vol_61/iss_12/37_1.shtml]

More than 25 years ago, three independent research groups made valuable contributions to elaborating the consequences of nuclear

warfare.1 Paul Crutzen and John Birks proposed that massive fires and smoke emissions in the lower atmosphereafter a global nuclear exchange would create severe short-term environmental aftereffects.Extending their work, two of us (Toon and Turco) and colleagues discovered

nuclear winter,which

posited thatworldwide climatic cooling from stratospheric smoke would cause agricultural collapse thatthreatened the majority of the human population with starvation. Vladimir Aleksandrov and GeorgiyStenchikov conducted the first general circulation model simulations in the USSR. Subsequent investigationsin the mid- andlate 1980s by the US National Academy of Sciences2 and the International Council of Scientific Unions3,4 supported thoseinitial studies and shed further light on the phenomena involved.In that same period, Presidents RonaldReagan and Mikhail Gorbachev recognized the potential environmental damage attending the use of nuclear weapons and devisedtreaties to reduce the numbers from their peak in 1986a decline that continues today. When the cold war ended in 1992, the

likelihood of a superpower nuclear conflict greatly decreased. Significant arsenals remain, however, andproliferation has led to several new nuclear states. Recent workby our colleagues and us57 shows thateven small arsenals threaten people far removed from the sites of conflict because ofenvironmental changes triggered by smoke from firestorms.Meanwhile, modern climate modelsconfirm that the 1980s predictions of nuclear winter effects were,if anything, underestimates.8

The Strategic Offensive Reductions Treaty (SORT) of 2002 calls for the US and Russia each to limit their operationally deployedwarheads to 17002200 by December 2012. The treaty has many unusual features: warheads, rather than delivery systems, are limited;verification measures are not specified; permanent arsenal reductions are not required; warheads need not be destroyed; either sidemay quickly withdraw; and the treaty expires on the same day that the arsenal limits are to be reached. Nevertheless, should the limitsenvisioned in SORT be achieved and the excess warheads destroyed, only about 6% of the 70 000 warheads existing in 1986 wouldremain. Given such a large reduction, one might assume a concomitant large reduction in the number of potential fatalities from anuclear war and in the likelihood of environmental consequences that threaten the bulk of humanity. Unfortunately, that assumption is

incorrect. Indeed, we estimate that the direct effects of using the 2012 arsenals would lead to hundredsof millions of fatalities. The indirect effects would likely eliminate the majority of the human

population.


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War Turns Environment

War turns environment/human welfare/disease.

Sidel et. al 9*Victor W. Sidel is Distinguished University Professor of Social Medicine,Department of Family and Social Medicine, Montefiore Medical Center and Albert EinsteinCollege of Medicine. **Barry S. Levy is Adjunct Professor of Public Health, Tufts UniversitySchool of Medicine. ***Jonathan E. Slutzman is Medical Student, Albert Einstein College ofMedicine. [Prevention of War and Its Environmental Consequences, Hdb Env Chem (2009):

2139, http://swbplus.bsz-bw.de/bsz305627961kap.pdf]

War and other military activities also cause serious health consequences through their impact onthe physical, biological, economic, and social environmentsin which people live. The environmentaldamage affects peoplenot only in nations directly engaged in war, but inotherand sometimes allnations. Much ofthe morbidity and mortality during war, especially among civilians, has been the result of damage to or disruption of societalinfrastructure, including medical-care facilities and public health services, systems to provide safefood and water supply, sewage disposal systems, power plants and electrical grids, andtransportation and communication systems.Destruction of infrastructure has led to food shortages

and resultant malnutrition, contamination of food and of drinking water and resultant foodborneand waterborne illness, and medical-care and public-health deficiencies and resultant disease.Preparation for war also can adversely affect human health. Some of the impacts are direct, such as injuries and deaths during training

exercises; others are indirect. As with war itself, preparation for war can divert human, financial, and otherresources that otherwise might be used for health and human services.Damage to the physical environmentwater, land, air, and outer spaceand use of nonrenewableresources may result from war or preparation for war. Lakes, rivers, streams and aquifers, landmasses, and the atmosphere may be polluted through testing and use of weaponry. Outer space may bedamaged through placement of weapons.Nonrenewable resources may be used in weapons production,testing, and use.A nations economy may be adversely affected through diversion of resources to militaryactivities from education, housing, nutrition and other human and health servicesand through an

increase in national debt and/or taxation. These economic impacts affect both developed and developing countries.Governmental and societal preoccupation with preparation for warsoften known as militarism may lead to massivediversion and subversion of efforts to promote human welfare.This preoccupation and this diversion may be

part of policies that lead to preemptive war (when an attack is allegedly imminent) and to preventive war (when an attack may be

feared sometime in the future). Diversion of resources is a problem worldwide, but is especially acute indeveloping countries. Many developing countries spend substantially more on militaryexpenditures than on health-related expenditures; for example, in 1990, Ethiopia spent $16 per capita for militaryexpenditures and only $1 per capita for health, and Sudan spent $25 per capita for military expenditures and only $1 per capita forhealth.The social environment may be affected by increasing militarism, by encouragement of violence as a means of settling disputes, and

by infringement on civil rights and civil liberties. In addition, preparation for war, like war itself, can promote violence as a means forsettling disputes. It is not surprising, in this context, that the United States has, by far, the highest rate of gun-related deaths in theworld, with about 30,000 dying each year [4] .Another indirect impact of war is the creation of many refugees and internally displaced persons, whose basic human needs may not

be met. A substantial number of the 12 million refugees and 2225 million internally displaced persons worldwide have been uprooted

from their homes due to war or the threat of war.The biological environment may be disrupted in many ways as a result of weapons technologies.

Nuclear weapons production, testing, use, and disposal may release ionizing radiation; shellshardened with depleted uranium also release ionizing radiation.Conventional and chemical weapons mayrelease toxic substances during production, testing, use, and disposal. Infectious diseases have been rarely caused by the production,

testing, and use of biological weapons; much more commonly during war, infectious diseases occur due toinadequate medical care and public health services, lack of safe food or water, unsafe sewagedisposal, forced migration, and crowded living circumstances.


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AT: Bennett and Nordstrum

Diversionary theory is trueBennett and Nordstrum conclude aff.

Bennett and Nordstrom 2k*D. Scott Bennett is Professor of Political Science at thePennsylvania State University. **Timothy Nordstrom is an assistant professor of politicalscience, University of Mississippi. [Foreign Policy Substitutability and Internal EconomicProblems in Enduring Rivalries, The Journal of Conflict Resolution, Vol. 44, No. 1,Substitutability in Foreign Policy: Applications and Advances (Feb., 2000), pp. 33-61]

The second primary option that we posited for leaders in rivalries in response to economic trouble was rivalry termination. Turning

back to Table 4, however, we observe that poor economic conditions actually appear to hinder rivalrytermination.The probability of a rivalry terminating increases as the rivals move from low to average growthand from average to high growth, with the highest probability of termination occurring when both states experience highgrowth rates in their per capita GDP. The argument that rivalries should terminate as the states involvedexperience bad economic times receives no support.Combined with our finding that badeconomic conditions do appear to encourage diversionary actions, this suggests that it is only

when times are good and states do not initiate disputes that hostility can fade and meaningfulprogress toward dispute settlement can be made.Perhaps it is only when a country is focused onforward progress rather than its problems that leaders can look ahead to the additional growth thatmight be possible if a rivalry ends.We also find rather complicated interactions between economic conditions and termination at different levels of relative capabilitiesand regime types. We find that the positive effects of high economic growth in state 1 are magnified both when state 1 is democraticand when it is powerful. From Table 5, it appears that when the more powerful state is also autocratic, rivalry termination is ratherunlikely, although in this case it may be that when growth is bad, the autocratic state may be more likely to make peace. In contrast,from Table 6 it appears that rivalry termination is most likely when the more powerful state in the dyad is both democratic andsatisfied (growing rapidly). Tables 7 and 8 also suggest that in general it is when there is a power advantage that rivalry terminationcan occur. Overall, this may suggest that a satisfied, powerful democracy can make peace with its rivals more readily than ca nrelatively weak states beset by internal problems. Of course, since these results are rather complicated and based on projections fromdata with relatively few rivalry terminations, it may be pre- mature to draw too sweeping conclusions, but they do suggest interestinginteractions to be explored in further research.

CONCLUSIONS

In this article, we applied arguments about substitutability to the problem of how economic conditions influence state behavior ininternational rivalries. We first developed a general argument about how substitutability might be handled theoretically andstatistically and then explored how states respond to internal economic problems by substituting between diversionary behavior and

seeking rivalry termination. After conducting a multinomial logit analysis, we found significant supportfor the application of the diversionary conflict hypothesiswithin rivalries; we found that statesexperiencing slower rates of growth in their per capita GDP appear to be more likely to initiate aconflict against a rival than do states with higher growth rates.We also found no support for the Blaineytargeting hypothesis; rivals initiated with higher probability against states without economic problems (consistent with the strategic

application of diversionary conflict theory). We also found that diversionary conflict was a more likelyreaction to internal problems than was rivalry termination; rivalry termination actually appearedmost likely in the context of good economic conditions within the rivals.The relatively largersupport for externalization in our analysis compared to previous studies may have been revealed

by our more sophisticated model, which allows for the possibility of another policy choice,

namely, rivalry termination; by our focus on rival states; and by our analysis of economic growthas a precursor to manifest conflict behavior within states.

Turning inward is the impactcauses global war. We control uniqueness

threats are coming now.

Ockham Research 8Ockham Research is an independent equity research provider based inAtlanta, Georgia. Ockham covers an expansive universe of stocks mostly in the US, but also from


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a variety of exchanges throughout the world. [November 18, 2008,http://seekingalpha.com/article/106562-economic-distress-and-geopolitical-risks]The economic turmoil roiling world markets right now brings with it plenty of pain. Jobs are being lost, peoples savings decimated,retirement plans/goals thrown out the window, etc. Hard times bring with them harsh consequences. However, it is perhaps useful to

be mindful of the geopolitical risksthat accompany economic dislocation. Many analysts are eager to compare thedifficulties now confronting the global economic system with those of the Great Depression. While I do not believe that the world is

facing a second Great Depression, it might be worthwhile to recall from history that the Great Depression spawnedgeopolitical turmoil that lead to the Second World War. The incoming Obama administrationand Democraticmembers of Congress who talk of implementing massive defense cutbacksmay want toremember the lessons of the past as they stand on the threshold of power.The hardship and turmoil which impacted the world during the Great Depression provided fertileground for the rise of fascist, expansionist regimes in Germany, Italy and Japan. Hard times also

precluded the Western democracies from a more muscular response in the face of growingbelligerence from these countries. The United States largely turned inward during the difficult years ofthe 1930s. The end result was a global war of a size and scale never seen by man either before orsince. Economic hardship is distracting. It can cause nations to turn their focus inward with littleor no regard for rising global threats that inevitably build in tumultuous times. Authoritarianregimes invariably look for scapegoats to blame for the hardship affecting their populace. Thisenables them to project the anger of their citizenry away from the regime itself and onto another

race, country, ideology, etc.Looking at the world today, one can certainly envision numerous potential flashpoints that could

become problematic in a protracted economic downturn. Pakistan, already a hotbed of Islamicextremism and armed with atomic weapons, has been particularly hard hit by the global economiccrisis. An increasingly impoverished Pakistan will be harder and harder for its new and shakydemocratically-elected government to control. Should Pakistans economic troubles cause its politicalsituationalways chaoticto spin out of control, this would be a major setback in the global war onterror.Russia, whose economy, stock markets and financial system have literally implodedover the past fewmonths, could become increasingly problematic if faced with a protracted economic downturn.Theincreasingly authoritarian and aggressive Russian regime is already showing signs of anger

projection. Its invasion of Georgiathis summer and increasing willingness to confront the West

reflect a desire to stoke the pride and anger of its people against foreign powersparticularly theUnited States. It is no accident that the Russians announced a willingness to deploy tactical missilesystems to Kaliningradthe day after Barack Obamas election in the U.S. Thiswas a clear shot across the bowof the newadministration and demonstrates Russian willingness to pursue a much more confrontational foreign

policygoing forward. Furthermore, the collapse in the price of oil augers poorly for Russias economy.The Russian budget reputedly needs oil at $70 per barrel or higher in order to be in balance.Russian foreign currency reserves, once huge, have been depleted massively over the past fewmonths by ham-fisted attempts to arrest the slide in both markets and the financial system.Bristling with nuclear weapons and nursing an ego still badly bruised by the collapse of theSoviet Union and loss of superpower status, an impoverished and unstable Russia would be adangerous thing to behold.China too is threatened by the global economic downturn. There is no doubt that China has emerged during the

past decade as a major economic power. Parts of the country have been transformed by its meteoric growth. However, in truth, onlyabout a quarter of the nations billion plus inhabitantsthose living in the thriving cities on the coast and inBeijinghave truly felt the impact of the economic boom. Many of these people have now seen a

brutal bear market and are adjusting to economic loss and diminished future prospects.However, thevast majority of Chinas population did not benefit from the economic boom and could becomeincreasingly restive in an economic slowdown.Enough economic hardship could conceivablythreaten the stability of the regime and would more than likely make China more bellicose andunpredictable in its behavior, with dangerous consequences for the U.S. and the world.


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Economic hardship invariably has consequences that can dwarf the original impact of those troubles. With the U.S. already at war andfacing an increasingly troubled world, it is probably not a good time to make large reductions to the defense budget. With the U.S.government carrying massively greater amounts of debt now as a result of the financial carnage of the past few months, there will be

increased pressure to wring savings out of almost every element of government. However, given past experience in tougheconomic times, it would be wise for our new government to understand the dire need to maintaina strong national defense.


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AT: KWaves

Kwave theory is empirically and methodologically bankrupt.

North 9Gary North is an economic historian and publisher who prolifically writes on topicsincluding economics, history, and Christian theology, PhD in history from the University ofCalifornia, Riverside [June 27, 2009, The Myth of the Kondratieff Wave,http://www.lewrockwell.com/north/north725.html]PUGSLEY'S CRITIQUETwo years before Rothbard published his critique, John Pugsley wrote a detailed critique of Kondratieff's cycle. He ran it in hisnewsletter, Common Sense Viewpoint (Nov. 1982). I remember it well, and I contacted him to see if he would FAX me a copy. Hedid.He began with the observation that all of the promoters of the theory were forecasting 30 years of recession and deflation. This was in1982, the year the Dow Jones Industrial Average bottomed in mid-August, at 777.

Kondratieff had at most two and a half cycles in his two papers. That number was available foronly four data series. Of the 36 data series, he could find evidence of cycles in only 11 of them.The monetary series and the real series correlated in only 11 of 21 series, all short.

Pugsley then cited extensively from an article by C. Van Ewijk of the University of Amsterdam (The Economist, Nov. 3, 1981). VanEwijk noted that Kondratieff followed no consistent methodology in choosing the types of trend

curves that he selected for different data sources. Kondratieff used various statistical techniquesto smooth the curves to make them appear as long waves. "In case after case, no wave could beidentified." He used price data, but these did not correlate with the actual economic output of thefour economies that he studied.Then the waves that he presented were further "idealized" by whoever created the chart that hascirculated ever since. Pugsley noted: "The upward movement of prices from 1933 to the present hasalready spanned fifty years, which is supposed to be the average length of a complete cycle."So far,price inflation has extended for about 75 years. Yet the deflationists are still predicting long-term, severe price deflation, and some of them invoke the Kondratieff wave to prove their assertion. Pugsley concluded:In not one case does the evidence corroborate the existence of the wave. Prices and output are not directlyrelatedif anything they are inversely related. The forty-five to sixty-year period of the wave is only

partially evident in the nineteenth century, and then only in the price series. Price moves in thetwentieth century do not correspond to this periodicity, as claimed by long-wave proponents. There isabsolutely no statistical correlation between series of real variables such as production andconsumption, and monetary series such as prices and interest rates. Production and prices of thefour countries studied do not statistically correlate; thus there is no wave operating coincidentally in theindustrialized countries.

In other words, Kondratieff's hypothesis is simply not supported by any evidence. The long waveexists only in the minds of a few misguided analysts, but not in the real world. It is pure hokum.

Kwaves have no theoretical backing and are all hype.

North 9Gary North is an economic historian and publisher who prolifically writes on topicsincluding economics, history, and Christian theology, PhD in history from the University ofCalifornia, Riverside [June 27, 2009, The Myth of the Kondratieff Wave,

http://www.lewrockwell.com/north/north725.html]Maybe you have not heard of the Kondratieff wave. But if your favorite investment guru is structuring his recommendations in termsof the Kondratieff wave, you are in big trouble if you have followed his advice.

The Kondratieff wave is a supposed macroeconomic force that creates a 54-year cycle of boomand bust. There is no explanation for it. The man who discovered it, or thought he had, said thatthere was no theory to explain it.There may bea Kondratieff cycle: a cycle of popularity for this theory-free assertion of inescapableeconomic boom and bust cycles. We are now in a boom phase of its popularity. It had a similar boom,197585.


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In short, the Kondratieff wave, like Frankenstein's monster, like Dracula, like Godzilla, like FreddyKrueger, is back. Like the other four, it offers thrills and chills. It offers excitement. It also offers a myriad ofways to lose money.THE K-WAVEThese days, the Kondratieff Wave has a spiffy new name: the K-Wave. (I can almost hear it: "Attention: K-Wave shoppers!")The K-Wave is supposedly going to bring a deflationary collapse Real Soon Now. The Western world's debt structure will disappear

in a wave of defaults. Kondratieff's 54-year cycle is almost upon us.Again.The last deflationary period ended in 1933. This became clear no later than 1940. World War II orders from Great Britain, funded byAmerican loans and Federal Reserve policy, ended the Great Depression by lowering real wages.In 1942, price and wage controls were imposed by Washington, the FED began pumping out new money, ration stamps replaced thefree market, the black market overcame shortages, and the inflationary era began. That was a long time ago. But the K-Wave isheralded as a 50 to 60-year cycle, or even more specifically, a 54-year cycle. That's the entire cycle, trough to trough or peak to peak.

The K-Wave supposedly should have bottomed in 1933, risen for 27 years(1960), declined ineconomic contraction until 1987, and boomed thereafter. The peak should therefore be in 2014.There is a problem here: the cyclical decline from 1960 to 1987. It never materialized. Prices keptrising, escalating with a vengeance after 1968, then slowing somewhatjust in time for thelongest stock market boom in American history: 19822000.OK, say the K-Wavers: let's extend the cycle to 60 years. Fine. Let's do just that. Boom, 193262; bust, 196393;

boom, 19942024. Does this correspond to anything that happened in American economic history

since 1932? No.

Kondratieff admitted a

econ growth good

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