26/12/17: U.S. Wars Budgets: More Lessons Never Learned

An interesting report on the official accounts for war-related spending in the U.S. is available here: http://www.ibtimes.com/political-capital/defense-department-war-terror-has-cost-250-million-day-16-years-2608639. Which is, of course, a massive under-estimate of the full cost of 2001-2017 wars to the U.S. taxpayers.

It is worth remembering that war-related expenditures are outside discretionary budgetary allocations (follow links here: http://trueeconomics.blogspot.com/2017/12/231217-bloomberg-view-on-asymmetric.html). And you can read more here: http://trueeconomics.blogspot.com/2017/11/201117-tallying-costs-us-wars-in-iraq.html.

The problem, as I repeatedly pointed out, is that no one can tell us what exactly - aside from misery, failed states, collapsed economies, piles of dead bodies etc - did these expenditures achieve, or for that matter what did all the adventurous entanglements the U.S. got into in recent year deliver?  In Afghanistan, Libya, Yemen and Syria, in Pakistan and  Sudan, in Ukraine, in Somalia and Egypt. The sole bright spot on the U.S. 'policy horizon' is Kurdistan. But the problem is, the U.S. has been quietly undermining its main ally in the Syria-Iraq-Turkey sub-region in recent years. In South China Seas, Beijing is fully running the show, as multi-billion U.S. hardware bobbles up and down the waves to no effect. In North Korea, a villain with a bucket of uranium is in charge, and Iran is standing strong. In its historical backyard of Latin America, the U.S. is now confronting growing Chinese influence, while losing allies.

Yes, many of the above problems are down to the lack of long-term consistent strategy for soft diplomacy. And many are down to the fact that the world is multipolar, despite the U.S. strategy still pivoting around the hegemonic doctrine of single superpower-driven politics. But many are also down to the simple and brutal fact of military ineffectiveness and over-reliance on force (or threat of such) as a key lever for geopolitical engagement.

It is time to awaken to the fact that the world is not the imaginary stage for Fox News broadcasts about the U.S. military greatness. The world has moved on. Military can swiftly dismantle the existent order. But it cannot bring resolution to the roots of the crisis. And the combination of these two realities yields mostly chaos.

23/12/17: Bloomberg View on Asymmetric Military Budgets: Russia v U.S.

I have written before about asymmetric conflicts and power balances in the context, among other bilateral comparatives, the U.S.-Russia military spending: http://trueeconomics.blogspot.com/2017/09/12917-asymmetric-conflicts-and-us.html. And the latest budgetary appropriations from the U.S. for 2018 are suggesting that Washington has a serious problem learning any lessons - whether these are lessons from being punched around repeatedly in the Afghanistan, or being derailed in Iraq, being made irrelevant in Syria and so on.

There is a very good op-ed from Bloomberg View by Leonid Bershidsky that is worth reading: https://www.bloomberg.com/view/articles/2017-12-14/russia-s-military-is-leaner-but-meaner. This too covers the same topic, albeit from a slightly different angle.

The article also cites our recent research on the causal relationship between the U.S. military budgets, war engagements and the valuations of the U.S. defense stocks (see here https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2975368).

12/9/17: Asymmetric Conflicts and U.S. 'Learning Curve'

'Asymmetric warfare' or more aptly, 'asymmetric conflict' involves a confrontation between two sets of agents in which one set possesses vastly greater resources. In more recent time, the notion of 'asymmetric conflicts' involved the less endowed agents winning against more endowed ones. And the degree of asymmetries has grown significantly over time:

• In Vietnam War, vastly outgunned Vietnamese forces literally defeated vastly over-equipped French and U.S. military machines;
• In the Cold War confrontation, significantly less resourced Warsaw Pact managed to sustain relative long-term parity with much more resourced Western counterparts (including Nato);
• In post-USSR years, vastly under-resourced Russia, compared to vastly over-resourced U.S. has been able to achieve quite a few 'wins' in geopolitical arena; 
• Isis - with barely any resources, has managed to achieve huge gains against a range of much better equipped counterparties;
• In Afghanistan, Taliban - with military expenditure of just a few million per annum, is successfully holding the line against both the Afghan state and its backers; and of course,
• The 'rust-bucket' North Korea has just outplayed the U.S. in its race for nukes as a deterrent.

In summary, thus: spending does not secure reduction of risks in the age of asymmetric conflicts.

Now, consider the two key sources of 'existential' threats to the U.S. geopolitical positioning in the world: Russia and China. Illustrating asymmetric conflict:

And despite this obvious lack of connection between volume of spend and outruns in terms of geopolitical achievements, the prevalent consensus in Washington remains the same: more funds for Pentagon is the only way to assure preservation of the U.S. geopolitical positioning. 

Learning, anyone?