I was recently given the opportunity to play Donald Trump in a wargame that examined some near term futures for the Baltic States. The operational brief was fairly loose, in that I could determine my own objectives, so I thought that I would have a look at how 'Offshore Balancing' might unfold as a policy option for the US.
I set myself three objectives as Donald Trump - one long term and two short term. The long term objective was to ensure that Europe took a greater responsibility for it's own defence. The first short term objective was to get Finland and Sweden to become more engaged in the European common security architecture; and the second short term objective was to encourage the European nations to pay their way within the common NATO framework. Perhaps we might unpack those objectives?
The policy of Offshore Balancing is one in which the United States draws back from it's international obligations, and leaves it's regional partners with primary responsibility for their own defence. In the shape of a transactional President - such as President Trump - this means holding greater amounts of fiscal resources within the continental United States. It is a marked change of policy for America, and creates a degree of uncertainty on the part of the allied nations as to whether or not the United States would adhere to it's security guarantees.
Sweden and Finland are not NATO members, but are part of the European Union common security framework. I thought that it would be interesting to try to drive Sweden and Finland away from their implicit neutrality and closer to the NATO framework through the European Union structures. How would Sweden and Finland respond to a less engaged United States?
I have been reading about the problem of burden sharing in NATO for over thirty years. No effective solution to the problem has been found in that time. There is a target of NATO members to spend 2% of GDP on defence, but very few do. Instead, they rely upon the American taxpayers to fund a common defence structure. This is a classic case of what economists call the 'free rider'. By defending it's interests in Europe, the United States also defends the interests of the European NATO nations at the same time. A more transactional President might seek to change that situation, and that was what was wrapped up in my objectives.
In the game, I sought to achieve my objectives using two strategies. The first was to relax financial sanctions upon Russia. To encourage Russia to be a bit more aggressive towards the Baltic. This happened as we moved up towards the nuclear threshold. I don't quite think that the European NATO allies quite understood that the US under President Trump wouldn't underwrite their aggression with an American nuclear umbrella. I don't think that it had sunk in fully that Europe would be on it's own unless they accepted the demands of President Trump, and that wasn't a particularly good place to be.
My second strategy was aimed at Germany. In particular, the German twin surpluses - the trade surplus (currently 8.0% of GDP) and the fiscal surplus (currently 0.5% of GDP). I was using a post-Keynesian sector balance argument to the effect that Germany needed to operate a fiscal deficit in order to redress the trade surplus, particularly the trade surplus with America. Putting this into English, I was arguing that the German government should debt finance a programme of rearmament, which ought to purchase military equipment from American suppliers. This argument wasn't especially successful, but it was a long fuse that had started to burn slowly.
In the end, in the game, we retreated from the nuclear threshold. That, quite clearly, is in nobody's interest. I think that I did manage to plant some seeds of doubt in the minds of the European NATO allies about how responsive the United States would be to a more aggressive Russia. I think that I did encourage Russia to be more aggressive towards the Baltic States. This did result in a certain movement of Sweden and Finland towards the European security framework. However, my one takeaway from the game is how long it takes to bring a policy anywhere near fruition. In my view, Offshore Balancing is a long game, requiring a great deal of patience, persistence, and skill. I doubt whether the current incumbent of the Oval Office has these.
I now have a template against which I can measure events as they unfold. Will truth be stranger than fiction?
Stephen Aguilar-Millan
© The European Futures Observatory 2017
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