By Jonathan Altman
With the fall of the Soviet Union in 1991, the over 30 year long period of MAD between the two greatest powers on Earth ended. Faced with a major foe no longer, many in the United States were quick to write off the era of deterrence as outdated. There was no longer a need for massive stockpiles of weapons and tanks this group argued; and under the leadership of Bill Clinton proceeded to slash military expenditures wholeheartedly. For them, the world was now about international law, and the newfound faith in multilateralism that emerged after the first Gulf War.
Perhaps there was some semblance of truth amidst the new ideas of this group; certainly stockpiles of WMD’s could stand to fall a little. Yet overall, their claims that “deterrence” was over have been shown to be remarkably shortsighted. Rather than end, I argue that deterrence has merely shifted into another realm, comprising not only the familiar military aspects articulated to a certain extent in the doctrines of the Cold War, but also new aspects brought out by globalization, broadly termed economic deterrence.
One of the main reasons many scholars have argued for the end of deterrence is the changing nature of our foes. Obviously, when the enemy was a state actor with clearly defined borders, overwhelming firepower made sense. It was clear who the enemy was. Yet as we see today, the main opponents of the United States are no longer such state actors; rather, they have been replaced by non-state network based groups like Al Qaeda and similar organizations. In light of this transformation, throw-weight doesn’t seem to matter any more. After all, any person could theoretically be an enemy combatant, so who do you target?
In spite of these points, the value of military deterrence has not gone the way of the typewriter; instead it has transformed. Whereas during the Cold War this policy was based on second-strike capacity and throw-weight, today’s doctrine of deterrence has evolved to fit a new measure: flexibility. Indeed, in place of massive destruction, military deterrence in our newly globalized world now focuses on how quickly and effectively a nation can respond to threats, from whichever corner they may arise. In fact, this new doctrine has already been adopted by the United States military, with the Army articulating aims to make itself as flexible as possible, as evidenced by the rapid deployment time of units like the 101st and 82nd Airborne, elements of which can be deployed in as little as 36 hours. In addition, flexibility includes effectiveness in any given situation, meaning that soldiers are equipped and trained to fight in otherwise unfamiliar situations. Once again we see the armed services adapting to such a prospect, teaching soldiers Iraqi Arabic before deployment and making use of Civilian Affairs in order to foster good relations with the populace. Taken together, the prospect of surgical, effective operations to remove threats to the United States certainly makes any rational actor think twice before acting, especially given our ability to locate those who would do us harm; though admittedly not even the prospect of death will stop the most ardent of terrorists.
All of this is not to say that certain concepts of Cold War era deterrence strategy are not still applicable. Indeed, though much rarer, state on state war does still occur in the modern day, as evidenced by the First and Second Gulf Wars. It is in this context that a dialed back version of Cold War military deterrence comes in handy. Citing the case of Iraq, the combination of first flexibility, but also superior weapons and technology was what allowed the coalition forces to defeat the vaunted Republican Guard so quickly in both 1991 and 2003. Military might is what keeps Iran and North Korea at bay and also plays a large part in the effectiveness of a force, contributing to the new deterrence measure of flexibility as well. Thus it is essential that the United States Department of Defense continue to fund as much research and development as possible, though swapping out nukes for fiber optics is almost certainly a better idea. Staying ahead is crucial to maintaining current advantages.
Coupled with a redefined idea of military deterrence is a completely new and just as important one, economic deterrence. Pre-1991, economics took a back seat to military concerns when it came to deterrence. Sure, perhaps “foreign aid” was a useful tool for keeping otherwise flaky dictators in the right ideological camp, but economics then functioned as more of a peripheral aspect of deterrence than anything else. Since the fall of the Soviet Union however, with the resulting massive increases in trade and overall interdependence between nations, and the advent of the internet, with its electronic banking and finance, all this has completely changed. Today, thousands of investors, sitting in the convenience of their homes (what Thomas Friedman termed the “Short Horn Electronic Herd” in The World is Flat) are imbued with the power to make or break governments with one click. One need look only at recent history to see numerous examples of this; Thailand, Argentina and Russia have all faced financial crises as a result of foreign investors (largely American hedge funds) selling their currency en-masse. In addition, what Friedman terms the “Long Horn Electronic Herd”, that is multinational corporations, have also developed increased power thanks to globalization. Foreign direct investment can prop up a failing regime, while a lack of it can crush an otherwise stable one. At this point, a reader may be asking what all this information has to do with economic deterrence and the United States’ role in all of this. The answer is actually a simple one in several parts. First, the United States holds a uniquely powerful position in the world as its foremost financial power. Countries like Japan would never even think of going to war with the United States, because to interrupt trade between our nations for even a day would have disastrous results for the Japanese economy. Often, the use of or even threat of economic sanctions is enough to draw rogue nations back into line. In addition, seeing as most “Long Horns” are based in the United States (as well as many “Short Horns”), the United States stands poised at the helm of powerful tool, controlling where investment occurs abroad. Due to its role as the world’s preeminent financial power, the United States is perfectly able to forbid its companies from investing in certain countries, which is in most cases a sure path to ruin. In addition, the United States has the ability to do things like downgrade its economic outlook (which usually happens anyway when sanctions are imposed) for a specific country, inevitably leading to a flight of so-called “Short Horns” and the financial ruin of one’s economy.
Taken together then, this expanded financial power has combined to form what I term “economic deterrence,” and is vital to maintaining order. To draw an analogy between the old form of deterrence and this new one, one could replace the Soviet Union with China and missiles with trade. Just as an atomic war with the USSR was unthinkable, so is an economic war with China as the disruptions in trade would likely shatter both economies. With other countries the relationship is more one-sided as taking on a financial giant is usually a poor decision.
In sum then, rather than outlive its usefulness, the doctrine of deterrence as exemplified by the motto “Peace through Strength” has simply adapted to changing times. On the one had, military deterrence continues to be a useful tool for the United States government, though it is now based around the concept of flexibility as opposed to sheer destructive capability. On the other hand, a new doctrine of economic deterrence has emerged, safeguarding world order just as effectively as MAD did during the Cold War. Combined, these two forms of power provide an integral asset to policymakers, especially in light of recent developments (China’s expansion worldwide, South American reactions against the United States), and it would be utterly irresponsible for any such legislator not to take them into account.