How U.S. military and economic policies mesh
Amsden, Alice H. & Hiking, Takashi
COLIN POWELL, George W. Bush's bedazzlingsecretary of state, emphasized the importance in his Senate confirmation hearings of tightening ties between trade and national security. There is a...
...What is most important is to win the trade wars and finesse the shooting wars...
...ALICE H. AMSDEN is professor of political economy at the Massachusetts Institute of Technology...
...It may become more difficult than Cohn Powell imagines for the United States to win the trade wars to which he sensibly accords primary importance...
...economy slows, other countries may withdraw their money from American markets, wreaking financial havoc, weakening American industry, and thus compromising points two and four above...
...Colin Powell's vision—of trade leading the flag—is based on the premise that the United States is the global political and economic hegemon...
...If it doesn't pay, then don't do it...
...domestic market...
...Since then, the mixture of security, trade, empire, and military power has become less holistic...
...As the U.S...
...What, concretely, does Powell mean...
...market contingent on their introduction of human rights, labor standards, and democratic freedoms...
...The good news is that by according trade top priority, the United States may be less trigger-happy than one might expect with a retired five-star general as secretary of state...
...Like the proverbial hedgehog of Aeschalus, the Hanoverian Governments [1688-1815] knew some big things, namely that security, trade, Empire and military power really mattered...
...If child labor in developing countries draws demands for labor standards, child soldiers in developing countries ought to draw vociferous demands for comprehensive monitoring and regulation of the arms trade...
...Fighting fire with fire, political destabilization and ethnic cleansing in the Balkans were countered by (reluctant) political intervention...
...3) it must have sustained current account surpluses to support the expansion of foreign aid and investment...
...There is a need, he asserted, for better coordination of American foreign economic and military policies...
...But when Iraq withdrew to its original borders, the United States switched tactics from military intervention to economic sanctions...
...Washington used politics, in the form of gunboats and colonial annexation (in the Philippines and Cuba, for example) to further American economic goals...
...The United States can be expected to remain a reluctant enforcer of human rights and an enthusiastic enforcer of anti-left insurgency movements...
...In practice, such demands often amount to economic protectionism...
...But they won't...
...Thus, when U.S...
...The United States operates behind the scenes in Congo, but overt intervention is relatively minor because the political threat is minor, despite Congo's rich raw materials...
...Left-wing insurgency in Latin America's weakest economies is typically greeted with CIA-type political "counter-insurgency" maneuvers...
...industry is threatened by low-wage exports from undemocratic developing countries, demands are voiced for making such countries' access to the U.S...
...The Vietnam War, however, was possibly a turning point in the crude relationship between political intervention and economic gain...
...The new secretary of state can be interpreted as being the most economically rational of imperialists: Don't go to war unless it is an absolute political necessity or makes good economic sense...
...54 • DISSENT / Spring 2001...
...In general, for a country to wield world hegemonic power, it must fulfill four conditions: (1) it must be a strong military power to broker world security...
...Even the coldest warrior could find no economic rationale for fighting in Vietnam, which had few raw materials and was of little use to American investors or traders...
...exporters and investors, let us not mobilize our military might against it unnecessarily...
...The "rogue state" of Saddam Hussein triggered a massive show of force, with oil firmly DISSENT / Spring 2001 n 53 BRAVE NEW GLOBE in Washington's mind...
...By that time men of the pen, especially the pens of the political economy, had forgotten, and did not wish to be reminded, what the first industrial nation owed to men of the sword...
...Emphasis added)* The United States, too, recognized that security, trade, empire, and military power really mattered...
...Consider the entanglement of global economic and political power characteristic of Britain's early rise: For more than a century, when the British economy was on its way to maturity as the workshop of the world, its governments were not particularly liberal nor wedded ideologically to laissez-faire...
...China is a competitor, a potential regional rival, but also a trading partner willing to cooperate in areas where our strategic interests overlap...
...we even pressured Japan to increase its own military spending so as to relieve the American defense "burden...
...The murkiest relationship between politics and economics characterizes the U.S...
...missile build-up appears likely—the knee-jerk military version of making the world safe for free trade...
...Whereas gunboat diplomacy was used to pry open markets in the past, Japan's elusive markets in the 1980s did not suggest the usefulness of another A-bomb attack...
...Consequently, a strong possibility also exists for global instability...
...Yet the Israeli-Palestinian conflict has become so deep, intractable, and politically explosive that huge American military spending in the region now transcends the issue of oil...
...A U.S...
...TAKASHI HIKINO is professor of economics at Kyoto University...
...He shows his hand when he is sizing up China: "A strategic partner China is not, but neither is China our inevitable and implacable foe...
...Economic threats to the United States have largely been countered by economic reprisals...
...The bad news is that the relationship between politics and military force will probably remain unchanged from the days of George Bush the Elder...
...and political threats, real or imagined, have brought political responses, including the use of overt or covert force...
...When American banks wanted to operate in Korea, the United States forced open Korea's markets (and precipitated the Asian financial crisis) using economic rather than political arm-twisting...
...If all four conditions are not met, then imperfect hegemony exists...
...reaction to foreign economic competition in the U.S...
...Foreign competition elicits what appears to be a political response, but really is an economic defense in disguise...
...The Great Warrior seems to be saying that because China is a big deal for U.S...
...There is both good news and bad news in Powell's philosophy...
...Rather than a sustained current account surplus, it has been running a large and growing current account deficit due to its excess of imports over exports...
...military exploits ended in failure...
...E. Silbner, The Problems of War in Nineteenth Century Economic Thought (Princeton University Press, 1972...
...Economic threats are really being dealt with by economic tactics...
...Military intervention, after all, is costly, and if there are alternative energy sources to oil, if synthetics can replace Congo's raw materials, then keep the gunboats at home...
...2) it must enjoy a dominant technological and economic position to pay for its military might...
...and (4) it must have a stable key currency to ensure international financial stability...
...In fruitful (if uneasy) partnership with bourgeois merchants and industrialists they poured millions into strategic objectives which we can see (with hindsight) formed preconditions for the market economy and night-watchman state of Victorian England, as well as the British world order which flourished under British hegemony from 1846 to 1914...
...When the business community's support for the war waned, antiwar activism carried the day, and one of the costliest U.S...
...Even if a shooting war that involves the United States directly is no longer regarded as good for American business, a shooting war that involves other economically backward countries is still very good business for American, British, French, Russian, Israeli, and Chinese armaments manufacturers...
...The United States today meets only three of these four conditions...
...The entanglement between economics and politics has been greatest where oil is present, as in the Middle East...
...s0 WHAT, after all, does Colin Powell have in mind when he calls for a still stronger connection between trade policy and defense policy...
Vol. 48 • April 2001 • No. 2
