Reason for a New Age

The Economics of Belligerence

Posted by publius2point0 on 2010/06/06


Possibly one of the largest, key misunderstandings of economics through history was the idea that conquest was good. This was likely based on the idea of the economy being a zero-sum game. That is to say, if the economy was a pie, you’re rich if you hold most of the pie. One of the key proposals for modern economics was that this was a false and shortsighted way of looking at the world. Why try to take control of the one pie in the world when you could just focus on making more pies? There’s an endless quantity that could be made and here everyone is squabbling over this one like there is nothing more.

In general, conquest is bad. If I pay a million dollars to build a bomb so that I can drop it on Tasmania and conquer it, the best I get out of that is the remaining resources of Tasmania that weren’t destroyed by the bomb. And of course, I’m out the one million dollars. On the other hand, if I use that same million dollars to purchase resources from Tasmania, I can use those resources to make things that make money, with which I can buy even more resources from Tasmania, etc. until in end effect I have complete access to all of Tasmania’s resources, without having destroyed any of them, and having made money in the process all the way. And what if there wasn’t a million dollars worth of resources to be had in Tasmania to begin with?

This was essentially the lesson learned by the British in India and subsequently practiced in China. There is no need to conquer a country simply to have trade with it. The former just costs extra expense for the same end result.

Economically speaking, the following uses of military belligerence can be said to be justifiable:

Total Occupation and Conquest

Entirely to the opposite of what I just said, conquest can be financially acceptable. If a region is unstable or is rife with bad leaders, poor economic values like anti-usury beliefs, or whatever, then there really is no trade to be had with the region. They might be sitting on top of good mineral resources or prime farmland, but it is simply all going to waste. If one can stabilize the region, teach basic economics, and establish a stable government, then trade suddenly becomes possible. But of course, that requires establishing political, military, and police might in the region.

After that point, though, there is no major value in continuing to maintain control of the region. One could argue that there is less overhead in having it become a sub-territory of the larger nation, being able to leverage resources between both. In general, though, trying to integrate a region with a very different economic status into another doesn’t seem to work very gracefully. The EU, for example, has had some problems in trying to include countries that simply aren’t very modern into their fold.

But, regardless of whether continued occupation is to be desired or not, everything still comes down to the original question of how much future trade there is to be gotten from that region? Military conquest of this sort is, essentially, little different from a loan. You’re giving them the resources (forcefully) they need to become profitable, on the basis that they’ll pay you back. But unlike a loan, where the payments are mandated by contract, here we’re assuming that the profit from trade will be its own reward. That’s very hard to quantify. And to get to that point, you need to entirely occupy and secure a nation, rebuild its government, military, and police organizations, and control the education of at least one or two full generations. Even for a small state, like Hong Kong, this is a significant outlay.

Basically, if you haven’t done that math, you’re just being silly though (all other ethical questions aside).

Regional Stabilization

The military can, on a global platform, be considered to be little more than police. The police are good for creating a stable, dependable market that people feel open to send their money off in without needlessly worrying that country A is about to be taken over by country B anytime soon.

In this area, though, I think that we have been being quite deficient.

The military is currently treated and operated as an American institution based on the ancient ideas of defense and conquest. Even now, with its focus on battling terrorism, one could still view that as something more in the region of defense than policing.

For the military to be able to act as a proper police force, it needs to have clear infractions that it will be known to act against, consistency in seeking out and acting against those things, and to not consider itself as being at war with the foreign state that it is operating in. If a leader of a nation commits genocide within his own territory, going in, picking him up, and locking him up does not require taking over that country. It doesn’t require fighting their military at all beyond the simple direct mission of locating the target and extracting him. If pirates are rife in a particularly region of the ocean, identifying them and destroying their boats is something entirely independent of nationality and foreign relations.

Regional Stabilization – The Dark Side

On the other hand, there’s the sort of work that the CIA was quite effective at during the Cold War, stepping into countries and fiddling about with the local government, military, paramilitary, terrorist, and news agencies to see to it that trade continued (predominantly with the people that we wanted trade to continue with) and wasn’t stopped by some local leader who would be stupid enough to try and go his own way — like Kim Jong-Il —  to the detriment of his people and the rest of the world. Of course, none of this means that the nation in question will actually have a good leader so far as the people of his nation goes. Trade with such a nation might simply result in the supplying of Bad People with lots of foreign money, instead of building up the local economy.

On the plus side, this sort of playing about has the advantages of being far cheaper than military action (I believe) and can be said to save lives if you view it as a preventative measure against later outright military force should the region fall apart or become belligerent under its new leader. And, ethically speaking, while it’s cynical to put in a bad leader who is at least stable and open to trade even if he’ll have death squads and establish himself as a tyrant, etc. I can’t say that in most cases the alternative leader would have been any better.

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