Connecting NATO Forces...And Minds

Alphen, Netherlands. 5 April.  “A thorough examination of the way our military is organized and operates will...highlight our inherent strengths.  Our strategic planning must emphasise these strengths, which include leader development, training, mobility and logistics, special operations forces, cyber, space, research and development”.  Speaking at Washington’s National Defense University (NDU) this week, US Secretary of Defense Chuck Hagel, who I have had the honour to meet as a member of the Strategic Advisors Group of the Atlantic Council of the US, could have been any European minister of defence.  With sequestration the US armed forces are now facing what has been a reality of European militaries for too many years – doing too much with too little for too long over too great a distance.  So, how can NATO address it most pressing emerging security challenge; how to close the strategy-austerity-capability gap? 

The Alliance and its members have an as yet untapped capability too often overlooked – knowledge, education and training.  The fact that Secretary Hagel chose to deliver his realistic message about US defence strategy at NDU speaks volumes.  Put simply, the more NATO militaries face capability and capacity cuts and the more the need to think creatively across narrow domains.  That means quality NATO people.  It also means a wholly new approach to professional military education and much greater synergy and cohesion between the defence academies across the Alliance who deliver both education and training (they are two sides of the same quality coin).

If I have a passion (apart from my wife and Sheffield United – I think in that order) it is professional military education.  To my mind education, the knowledge it is built upon and the connectivity it breeds is the missing link between NATO nations that will help the Alliance close the strategy-austerity-capability gap.

NATO 2020 pre-supposes defence modernisation at a time of acute defence austerity.  NATO have created both Smart Defence and the Connected Forces Initiative both of which further pre-suppose much greater synergies between capabilities and capacities.  Today, value for money in defence strategy is as much about ‘human software’ as hard capability.  Therefore, critical to NATO 2020 must be a model of professional military education that aims to promote comparative advantage of NATO personnel both on and off the battlefield. 

Such a goal will only be realised if a) lessons-learned are properly captured to ensure corporate memory is translated into best operational practice; b) exercising and training really tests weaknesses rather than confirms strengths and as such are scientific, rigorous, structured and connected; and c) such lessons are communicated into the defence (and security) classroom.  In other words NATO must become as much knowledge nexus as military nexus.

Thus far professional military education has been remarkably immune to the revolution in professional education that has taken place in other fields such as medicine and engineering.  The knowledge base tends to look backward and little is made of life-long learning concepts to properly support mission success at every level of command in which and for which education and training are simply two sides of the same coin.  Moreover, the link between commanders and academic expertise is too often weak, preventing effective reach-back from the field to knowledge communities (much of which can be explained by at times frankly ridiculous sensitivity over information).  Sadly, too many commanders remain dismissive of knowledge and expertise. 

However, defence academia has also to ask itself some searching questions.  The research undertaken by defence academics too often either solves yesterday’s problems or has nothing whatsoever to do with the military challenges of today.  And, too often the syllabus is narrow and fails to involve the wider security community. Finally, the revolution in technology that is changing education seems to have been only partially grasped by defence academics.

Therefore, in my own modest way I am trying to do something about it and putting the usual backs up in the usual places for daring to try.   In May I will lead a project entitled Connected Forces, Connected Minds.  This project will start to address some of the important issues raised in Secretary Hagel’s statement. 

Knowledge transformation is the way ahead. To that best practice end new models of professional military education are needed and must be worked up in a new partnership between armed forces and defence academics.  This is both to support NATO 2020 and all important strategic unity of effort and purpose in a rapidly destabilising world.  The goal must be clear; to continually enhance and develop the education and training of NATO officers (and Partners) so that a) in effect they never leave professional military education; and b) they are continually made fit for mission success in their next command challenge.  Too often they are not.

Almost a year ago, NATO Secretary-General Anders Fogh Rasmussen launched Smart Defence.  There can be neither Smart Defence, Connected Forces, nor indeed NATO 2020, without smart education, smart training and smart research.

Thank you, Mr Secretary Hagel for being so clear and candid.

Julian Lindley-French

 

Little Britain

Alphen, Netherlands. 3 April.  Britain has created a monster.  One in every three pounds the British state spends is on welfare.  This week London embarked on the greatest reform of the once great Welfare State since its inception in 1947.  The welfare budget has doubled over the past decade.  In Brussels yesterday a senior economist told me that given the changing demographics Britain will need to grow at least 5-6% per annum simply to sustain the current Welfare State.  This is compared with a post-1945 mean average of between 2-5%.  Indeed, a leading think-tank recently suggested that if London continues to protect spending on health, education and international aid then in the absence of growth by 2018 other big departmental spenders could see their budgets cut by up to 30%.  Quite simply, funding welfare has become the single biggest factor in Britain’s international decline and if nothing is done Britain will be bankrupted by it.

 

The welfare divide has also created a political class no longer able to conceive of Britain’s true national interest.  Indeed, be it on the Left or Right the ‘national interest’ has become a metaphor for whatever policy can afford Britain’s welfare dependency.  As such this very narrow view of the ‘national interest’ has fundamentally undermined the making of national strategy and critically weakened London’s ability to wield influence in either Europe or beyond.

The welfare divide has also made bipartisan politics virtually impossible.  The 2008 banking crash was by any stretch of the political imagination a national disaster.  It was the kind of disaster that a responsible political class would have put aside their differences to come together in the true national interest.  Indeed, the national debt (the year-on-year accumulation of the annual gap between state spending and income) is due to peak at 85% of GDP by 2018.  Therefore, the state re-capitalising of failed banks will take a strategic economic cycle to fix not the electoral cycle London’s political class obsess over.

Instead, both Labour and Conservatives (temporarily allied with the rent-seeking Liberal Democrats) have chosen to play politics with this crisis thus making it both worse and longer.  The Labour Party compounded the banking crisis by gross and irresponsible over-spending when in office (Gordon Brown called it ‘investment’).  They also placed all of Britain’s future economic eggs on relying on a sclerotic EU obsessed with protecting failing industries and thus guaranteeing Europe’s relative decline. 

Once in sort-of-power the Conservative Party decided the only way to get re-elected was to drive the debt down through a programme of austerity at the bottom of the worst economic cycle in over a century…and hope for growth.  For all the rhetoric an increasingly desperate government is making increasingly warped policy decisions much of it to feed the welfare monster in the hope it can get re-elected in 2015.  The Government now admits all it can do is control the rise of welfare spending.

The effect of warped policy is nowhere more apparent than the country’s defence.  The 2010 Strategic Defence and Security Review (SDSR) was meant to be the baseline for a radically-reformed force.  Costs were to be driven down and a new force created that would balance efficiency and effectiveness, capability and value.  However, the money-driven and hastily-contrived SDSR really had to be THE bottom-line.  Britain’s armed forces could be cut no further without really putting the military itself in danger.  Still, the mantra went if London held its nerve and given a return to growth a new force would emerge over time that could be afforded.  To that end London created a $200bn military equipment budget.   

Sadly, the forthcoming Comprehensive Spending Review will likely see further cuts to a defence budget already stretched beyond breaking point.  Critically, cuts could well be made to the vital $200bn military equipment budget without which the British armed forces will simply be unable to recover from over a decade of continuous operations.   

The impact of further cuts will go way beyond defence.  With Scotland about to decide its future one of the last unifying British institutions - the British armed forces - will to all intents and purpose have been emasculated compounding the sense of British decline that is fuelling separatism.  Influence institutions vital to Britain such as NATO will be weakened. Worst of all, politicians will simply transfer yet further unacceptable risk onto Britain’s young men and women in uniform as they try to mask decline on their watch with over-stretched action.

Unless the British state for once begins to think creatively about the balance to be struck between welfare and influence then another disaster beckons.  That means a truly radical re-organisation of state power with aid, diplomacy and force combined into a new, tight and real national strategy (rather than the current PR stunts).  Why?  Because national influence and national wealth are two-sides of the same devalued British coin.

Britain is standing on the edge of precipitous national decline.  Somehow Britain’s political class must be shaken out of their welfare-driven Little Britain complacency.  If nothing else Little Britain will mean more Europe.  Perhaps that is the plan?

Julian Lindley-French

Building BRICS?

Alphen, Netherlands.  27 March. They represent 25.9% of the world’s land mass, 43% of the population and 17% of global trade.  The UN Development Programme states that by “2020, the combined economic output of three leading developing countries alone – Brazil, China and India – will surpass the aggregate production of Canada, France, Germany, Italy and the United States”.  Today the five BRICS countries (Brazil, Russia, India, China and South Africa) at their fifth annual summit in Durban will announce a new BRICS Bank, under the catchy 1960s throwback title of “Partnership for Development, Integration and Industrialisation”.  The aim of the Fabulous Five is clear; to counterbalance what they see as a) the western-dominated International Monetary Fund and World Bank; and b) plug a gap in development financing caused by the West’s financial and economic woes.  Is the BRICS laying the foundation of a new world order?

 

On the strategic face of it the Durban summit would seem a natural extension of Chinese President Xi Jingping’s Kissingeresque Moscow démarche of last week.  Clearly, the vacuum created in strategic leadership by the West’s rapid decline, accentuated and accelerated by the EU/Germany’s incompetent handling of the Cyprus default, will see new actors emerge.  However, for all the clear ambitions of China (and to a markedly lesser extent Russia) the five countries are still divided on many issues.

The most obvious is the strategic provenance of the BRICS.  Whilst China and Russia clearly think in terms of classical Kennanesque Cold War Realism, and thus see the strategic game with the West as ultimately zero sum, Brazil and India come from that rather woolly tradition of non-alignment.  The Non-Aligned Movement emerged in the 1960s as an attempt by India in particular not to be dragged into somebody else’s potentially destructive grand strategy.  For a country that had lost well over a million people fighting Britain’s grand and not-so-grand wars this made sense.

Today, India is emerging in its own right and is as a much regional-strategic competitor of China as partner, particularly given China’s role in nuclearizing New Delhi’s arch-adversary, Islamabad.  To that end, as an example of constructive multilateralism a BRICS that promotes stability and co-operation rather than competition is a good thing. 

Brazil fits into pretty much the same category as India.  At several conferences of late I have attended the Brazilians present clearly identified their strategic interests with those of the West.  Moreover, in my Oxford Handbook of War a leading Franco-Brazilian academic summed up Brazil’s foreign policy as essentially Latin American in focus and by and large aligned with that of the US, so long as Washington worked with Brazil.  The BRICS can thus be seen very much in the light of a Brazil keen to remind America of its burgeoning regional-strategic influence.  

As for South Africa the ANC-led government still sees its roots as having been established in a form of colonial war and as such is instinctively drawn to any form of non-alignment with a vague anti-Western tinge.  And, of course, Pretoria is desperately in need of Chinese capital.

Furthermore, for all the grandiose talk last week of a new strategic partnership between Russia and China, Moscow has no desire to be Athens to China’s Rome, particularly if tensions between the US and China reach a point where Moscow’s commercial and energy relationship with Europe is affected.  That may change over time but Moscow will continue to hedge its strategic bets.

However, if there are divisions between the BRICS based on geography, alignment and allegiance there are also huge gaps.  Indeed, it is the issue of capital that will most probably highlight such gaps.  The choice of ‘partnership’ as the key word for the summit is critical.  If the BRICS become seen too overtly as part of a new Chinasphere it will rapidly fall apart.  However, partnership means equality and the word at the summit is that each member will put some $10bn (€7.8bn) into the BRICS Bank.  This figure represents only 0.1% of Chinese GDP and yet some 2% of South African.

Therefore, for the moment the BRICS will remain far more a non-aligned movement than a counter-balancing mechanism.  However, it is the long-term context that makes the BRICS interesting.  One report suggests that whilst Asia alone accounts today for some 24% of world trade, it will be 42% by 2030 and 48% by 2050.  Whereas thanks to the EU, Europe’s mutual impoverishment pact, whilst Western Europe represented 48% of world trade in 1990, it is 34% today and likely to fall to 19% in 2030 and 15% by 2050. 

If the report is right the BRICS could one day find itself at the very core of a new world order.  This summit is clearly building BRICS for the future.

Julian Lindley-French

Xi's Kissinger Move

Alphen, Netherlands. 25 March.  At the start of his historic visit to Russia last week newly-installed Chinese President Xi Jingping said that the “two countries spoke a common language”.  If America sees itself as the indispensable global pivot China clearly has the ambition to become the other global pivot in a new bipolar order.  Xi’s visit to Moscow last week, just over forty years on from Henry Kissinger’s famous 1971 visit to Beijing, makes it is clear that China is embarked on a grand strategy to balance America on the world stage.  This will be a tumultuous twenty-first century.
 

Kissinger’s 1971 visit to China was set against the backdrop of a Nixon administration desperate to extract itself from a failing Vietnam War.  Henry Kissinger, the grand architect of Cold War Realpolitik, wanted to force the Soviet Union to look both east and west.  Moscow was already at the time embroiled in a full-scale border war with China, its supposedly Communist partner.  In a sense by forcing the Soviet Union to face the prospect of a ‘zweifrontenskrieg’ (two-front war) Kissinger applied lessons from his native Germany’s history to US grand strategy

Cue Xi.  The aim of Chinese grand strategy is certainly not to trigger a war with the Americans.  However, Chinese strategic logic is still embedded in Sun Tzu; force an opponent to confront so many options over such time and distance that to all intents and purposes they render themselves weak by uncertainty.  And, Xi clearly understands Kissinger’s dictum that “no country can act wisely in every part of the globe at every moment of time”.

Xi’s timing is impeccable.  There are of course perfectly legitimate reasons for close Chinese-Russian relations.  They are partners in the Shanghai Co-operation Organisation.  China is the world’s biggest energy consumer whilst Russia is the biggest energy provider.  Trade between the two countries is booming and is now worth some $88bn or €68bn per annum. 

However, Xi’s visit and indeed his vision is grand strategic and must be seen as such. China intends to lead the strategic counter-balance to the American not-so-well led West and to that end will forge relationships that exploit American uncertainty and Europe’s precipitous decline. 

Kissinger famously said that “If you don’t know where you are going, every road will get you nowhere”.  As Xi was speaking to Russian President Putin I was attending a conference in The Hague organised by the excellent Atlantic Commission on the transatlantic partnership.  Set against Xi’s visit to Moscow the extent to which Europe’s political class has completely lost the strategic plot was all too evident.  As Xi talked about a new anti-democracy global balance of power pact with Putin all my fellow Europeans could worry about was Cyprus and trying to blame America and Britain for causing the Eurozone crisis. Not only is that laughably wrong it completely and dangerously misses Xi’s point. 

And there is a link.  The Russian media has been running stories all week about the EU’s attempts to resolve the Cyprus crisis as being anti-Russian.  Given that the deal struck over the weekend will possibly see a levy of up to 20% on depositor’s accounts worth €100,000 and more the deal will indeed have a real impact on Russian depositors.  Now, much of that money is of very dubious provenance and it is clear that Germany in particular wants to stop Cyprus being used as an offshore bank haven within the Euro.  However, the timing could not have been worse and will simply help push Russia towards a new anti-Western strategic partnership with China. 

That dynamic will be made all the more certain by the strategic denial that now afflicts the Euro-world.  For example, the Chinese are clearly building a blue-water navy and Xi’s comments demonstrate clear intent to use the Chinese fleet as a platform for strategic influence.  Do not worry, I was told by a senior NATO official, because the Chinese do not know how to use such a fleet.  Sorry NATO but should you not be thinking about these developments?

Clearly, the West must not fall into the trap of concluding that legitimate Chinese ambitions are a precursor to conflict and somehow a new narrative is needed in the US-Chinese strategic relationship (the only strategic relationship that now matters).  Equally, neither Americans nor Europeans can ignore Chinese intent as stated by Xi in Moscow or its burgeoning capability.  In others words the transatlantic allies need a China strategy. 

Sadly that was not the worst of it in The Hague.  A senior European said that in December the European Union will devote a WHOLE session of the European Council meeting to defence.  Whoopee!

Kissinger said that “power is the great aphrodisiac”.  Perhaps he should now add that weakness is the great sedative.

Xi’s Kissinger move – it will not be his last.

Julian Lindley-French

Oxford Blues

Alphen, Netherlands. 20 March.  Sometimes my alma mater Oxford University needs to be dragged kicking and screaming into the eighteenth century (Enlightenment).  The sacking of a librarian and graduate student, the wonderfully-named Calypso Nash, is just another example of a college leadership completely out of touch with the young people it serves.  The 'crime' was that some students performed something called the Harlem Shake in the library of St Hilda's College (always a bit uppity and conservative).  One can almost hear the tut-tutting amongst the fossilised academics in the Senior Common Room who probably think the Harlem Shake is a cocktail and are still wondering how one can dance such a thing. 

 

What is particularly galling is that back in the seventies when I was an undergraduate at University College, Oxford (the oldest and the best) some of the things we got up to in the college library makes a thirty second performance of the latest u-tube craze seem like a papal inauguration.  We even played cricket! 

 

So, Hilda's wake up, smell the coffee and remember that you are an institution dedicated to the education of young people and that within reason a little bit of creative exuberance should be celebrated not crushed.  Above all re-instate Ms Nash because her sacking is unjust and makes you look like an ass.  Clearly, someone called Calypso can hardly be sacked for permitting the occasional library dance!  As some of your young people might say (so I have heard) - der!

 

Julian Lindley-French

Who Will Pay for Cyprus?

Alphen, Netherlands.  19 March.  In “1984” George Orwell wrote, “Doublethink means the power of holding two contradictory beliefs in one’s mind, simultaneously, and accepting both of them”.  I was reminded of doublethink (to that add double-speak) watching Europe’s politicians and Eurocrats dance on the head of a political pin to distance themselves from the so-called ‘one-off’ Deposit Tax Levy Confiscation of ordinary Cypriot’s  money.  So, who will pay for Cyprus and will the money be put to good use?

 

The logic is brutal.  With Cyprus representing only 0.2% of the Eurozone economy, the Cypriot banking sector some 330% of Cypriot GDP and with 30% of deposits in Cypriot banks Russian (and much of it of very dubious provenance) Cyprus can only fund its side of the proposed €10 billion ($13 bn) bailout via bank depositors. 

Why this particular deal and why now?  For once the EU is being unfairly blamed for a crisis not of its making (aside from the fact that the Euro is a political project that does not work).  German Chancellor Angela Merkel, supported by her Finnish and Dutch counterparts, wants to demonstrate prior to the September German elections that she is being prudent with German taxpayer’s money.  And, under no circumstances must the bond markets be spooked so that the borrowing costs soar of the bigger Eurozone debtors such as Greece, Italy, Ireland, Portugal and Spain – at least not until after September. 

As of today all involved are either retreating fast from imposing the now infamous ‘haircut’ on the small depositor or blaming the Cypriots themselves for this disaster.  The suggestion is that depositors with over €20,000 ($26k) will now have 6.9% of their savings in Cypriot banks taken from them whilst those over €100,000 ($130k) will have 10% confiscated.  This means dodgy Russians and retired Brits neither of whom are hugely popular with those who run the Eurozone will be hit.

Would the money be put to good use?  Well, this reflects yet another fundamental untruth this crisis has spawned.  Yes, it is true that the northern, western European taxpayer has already paid a lot either funding or under-writing ‘loans’ that will never be repaid.  At the same time Berlin has done all it can to ring-fence its taxpayers and find other people to pay for a crisis that by and large had its origins in the ill-conceived leadership of Berlin, Brussels and Paris when the Euro was set up.  The half-measures under discussion simply prolong the agony and increase the costs which have effectively turned the EU into a mutual impoverishment pact.

Therefore, ‘haircuts’ will fail because they do not address the fundamental problem of the Eurozone; the need for tight and common fiscal discipline and structural reform of southern Eurozone economies.  In other words, the Euro will only ever be stable if there is real fiscal and banking union or if the Eurozone contracts into a customs zone of reasonably similar economies organised around Germany.  However, the former would demand the effective end of national sovereignty and democratic accountability, whilst the latter would see southern European economies cast out into the global economy and forced to compete.  That would make current austerity measures look like benign charity.

There is a more immediate consequence; the future cost of crisis-management will now inevitably grow.  This morning the spokesman of EU Council President Herman van Rompuy tried to play down the Cyprus crisis by suggesting it was a special case.  Special or not a clear message has been sent that future bailouts could well involve EU-inspired raids on the small savings of small people.  This will almost certainly mean that when the next crisis inevitably erupts in Spain, Italy or elsewhere people will rush to withdraw their savings from banks and thus triggering a massive banking run. It is banking runs that kill currencies.  In other words this proposal will make contagion more not less likely. 

So, making small depositors pay for the crisis makes little or no sense other than to stave off the immediate disaster.  Indeed, without federation or fracture the crisis cannot be resolved only temporarily contained.  Critically, the Cypriot fiasco reinforces the toxicity that is the political incompetence that created the Eurozone crisis and which is sustaining it.

Orwell also wrote in “1984”, “The choice for mankind lies between freedom and happiness and for the great bulk of mankind happiness is better”.  Sadly, as Cyprus reveals the Eurozone is generating neither freedom nor happiness, just fear.

Come September and the German elections these realities will have to be faced and the EU’s current phoney war will come to an end with a bang…if not before. 

Who will pay for Cyprus? All of us sooner or later.

Julian Lindley-French

A Tragic Moment in History

Alphen, Netherlands. 19 March.  Tony Blair suggested yesterday that the West would come to regret not intervening in Syria.  He is of course right.  Tony Blair had to make a terrifying call ten years ago which clearly weighs heavily upon him.   Equally, he must accept it is precisely his ill-conceived and under-planned invasion of Iraq ten years ago tomorrow that makes impossible any attempt to rescue the Syrian people.  Indeed, the tenth anniversary of the Iraq invasion and the linkages that could be inferred between that act and any Western intervention in Syria today that will doom the Syrian people to their terrifying fate.  Something more for Mr Blair to ponder.

Julian Lindley-French