THE year 2018 began with two leaders with nuclear capability arguing about whose button is bigger.
At the end of 2017, the US national security adviser General McMaster unveiled the US National Security Report. It was an America First strategy that prepares for future war and even identifies US rivals.
McMaster characterised Russia as threatening the United States with “so-called new generation warfare,” sophisticated campaigns of subversion and propaganda “attempting to divide our community.” He also described China’s economic aggression as a threat that is “challenging the rules-based economic order that helped lift hundreds of millions of people out of poverty,” and suggested the way to deal with these two threats was “competitive engagement.”
The Greek historian, Thucydides (460-395 BC), who wrote the classic History of Peloponnesian War between Athens and Sparta, argued that “war is a matter not so much of arms as of money”. Historian Graham Allison calls the dilemma of an incumbent Great Power against its challenger the Thucydides Trap, namely, “The growth of the power of Athens, and the alarm which this inspired in Sparta, made war inevitable.”
Is future war inevitable? In a nuclear war with mutual mass destruction, that is rationally unlikely. But we are not necessarily dealing with rational thinking.
Leading Israeli military historian Martin Creveld (2017) argues that theory is less helpful than experience, because “war is a practical business”, since “no two armed conflicts are ever the same” and “war itself, forming an integral part of human history, is forever changing and will continue to change.” So, ego as much as economic rivalry could easily lead to physical conflict.
There are more parallels between war and finance than meets the eye. Modern quantitative economists, confident in their ability to measure risks (as volatilities), were largely blind to uncertainty in their models. Experienced generals know that the best laid battle plans go out the window when the first bullet is fired. The best economic models and war game plans are often useless in the fog of war and financial crises.
Which is why economists are only just beginning to appreciate the importance of human psychology, whereas the best of the war strategists and thinkers, Sunzi (c.544-496 BC) and Carl von Clauswitz (1780-1831 AD) focused largely on understanding the minds of the warring parties.
Sunzi was famous for the need for understanding not only the enemy, but oneself. Clauswitz, on the other hand, understood that “war is nothing but a continuation of politics with other means.”
Just as the competition between Athens and Sparta was initially due to Athens’ growing trade and economic power, and that between Rome and Carthage over Mediterranean trade, the outcome of modern war rests on economics.
This arises because globalisation has tied all the big powers both economically and financially, whilst the cost of modern weapons and logistics are very expensive. Indeed, both the First and Second World Wars were won when the growing dominant power, the United States, threw her economic and industrial might behind the tired European allies. Sunzi understood that no country can afford a long war.
Just as Rome was founded on the back of slaves and land achieved through conquest, European and American rise to world dominance from 1450 to 1945 was fuelled by colonial conquests. Some of the problems with human migration and failing states in Africa and the Middle East are the legacies of artificial borderlines drawn between colonial powers that bear no relation to geography and tribal lands.
Anyone who has studied Arab history would know that the problems of the Middle East, which Western analysts attribute to religion and weak governance, had much to do with their colonial history, first under the Ottoman Empire and then when the region was carved up by the European powers, followed by American strategic interests in Middle East oil.
But competition in the 21st century will be less over territory, as it is over space, cyber-space, technology, media and hard industrial with soft financial power.
The intrinsic appeal to war is not just about dominance, glory and status. Van Creveld identifies four reasons on why war might benefit economic development: (1) driving technological progress, (2) creating economies of scale, (3) encouraging creative ways of financing, and (4) acting as economic stimulus.
Firstly, it is well known that the Internet was invented by the US defence industry. What appears as wasteful and expensive new armaments have huge civilian spin-offs. Secondly, mass-production of air, sea and land equipment give rise to economies of scale that make new weapons cheaper with greater mobility. Thirdly, the power to print money and buy supplies enable a country to fight without impoverishing its citizens. The first central banks, in Sweden and England, were created to finance war. Fourthly, the European and American economies did not recover out of the 1930s Great Depression, until they spent more on arms and defence.
The road to war between contending powers does not come from ego or glory, but because of basic insecurity and fear of each other. Thucydides died before the Pelopponesean war ended. If you read between the lines, Thucydides also argued that the elite in Athens may have wanted war, because they needed to divert the anger of their own citizens not against the corrupt system, but against external enemies. In the end, it was the inability to agree on how to fight the war against Sparta and to co-ordinate with allies that Athens fell.
In other words, the real Thucydides trap may have little to do with external threats, but also from internal strife that forces the elite to turn the guns outward rather than inwards. It is easier to demonise outsiders than to deal with one’s own devils. Man’s future security rests on the elite’s own insecurity. I have always wondered why even with the best technology, we cannot deal with the growing social inequality. The real Thucydides Trap therefore is essentially political, not technical.
The best wars are won when there are no battles. Human competition and conflict has been built into our genes, but as Churchill argued, it is always better to “jaw-jaw, than war war.”
Tan Sri Andrew Sheng writes on global issues with an Asian perspective.