Tuesday, February 6, 2007

Economic Warfare

There has been a lot of talk about the nature of the next big conflict in the world. (Why now, when we’re still dealing with one, I’m not sure.) Major thrust of most of the speculation is armed conflict between countries is largely over. We’re unlikely to see another war with the US on one side and another well define state on the other. This is exactly what we’re seeing in Afghanistan and Iraq. Well defined countries are fighting against opponents that are hard to find and identify.

An extension to this speculation is that we’re likely to see hostilities between states move to the realm of electronic information. I don’t think this is likely. Here’s the problem. The electronic information that most of these analysts and pundits are talking about has to do with military matters. This information only has value if the potential for armed conflict exists. If you have no intent of attacking the US what difference does it make if you the deployment of its troops. This could only be of value to those non-state groups engaged in armed conflict.

There has been a lot of writing in science fiction which attempts to motivate armed conflict between corporations instead of states. This again is unlikely. Corporations don’t do battle in terms of guns and bombs. They do it with lawyers. Granted, given the nature of reality television these days, lawyers arguing their cases with guns and bombs might get great ratings, but it’s unlikely to happen.

So what are we left with for the extension of political aims by other means? Economic Policy. The two main reasons to go to war are; to capture wealth/resources or to impose a political will or system on another group of people. Both of these aims have been achieved in the past through the use of economic policy. Capturing wealth and resources is fairly easy in a country in which private property is entrenched. You simply buy it up. This is a lot cheaper than trying to take it by force. We’ve seen this throughout the last half of the 20th Century with people of different nationalities and groups buying up large chunks of real estate and other assets for the use of the nation or group. The Chinese have proven particularly able in this regard.

There are three interesting things about this approach. First, it tends to be less destructive than other methods of accomplishing the same goal. Second, it is a lot more subtle than taking something by force. It’s possible to take over something or somewhere before anybody really knows what’s going on. Explosions and gun fire are a lot more noticeable than a real estate deal. Finally, this type of maneuver doesn’t require a nation state. Like guerrilla warfare it any small group with the right resources can engage in this type of campaign. This approach has been exploited by multinational corporations as well as countries.

The use of economic policy to impose a political will on another group has been one of the main tools of the United Nations down through the years. The biggest success came against South African apartheid. Economic sanctions caused the government to collapse to overturn some of its racist policies. The US has done this to Canada on a number of occasions. This is the pursuit of political objectives by economic means.

Potential Economic Weapons of Economic Warfare? Next time.


Vanessa Childs Rolls said...

You forget that Canadian warfare has always been the warfare of others. Canada has never really declared war on anyone. OK., maybe the US in the war of 1812, I'm not sure.

economistatlarge said...

Who said anything about Canada?