Perfect Storm?

The international community’s security attention is on the Middle East and interrelated homeland terrorism. These are important areas, of course, but geopolitical events elsewhere suggest that matters of greater long-term international importance are afoot; in particular because of, first, extended global economic stagnation; second, increasing energy insecurity; and, third, early climate change impacts.

The international community’s security attention is on the Middle East and interrelated homeland terrorism. These are important areas, of course, but geopolitical events elsewhere suggest that matters of greater long-term international importance are afoot; in particular because of, first, extended global economic stagnation; second, increasing energy insecurity; and, third, early climate change impacts. It would be unwise to forecast trajectories in any of these three areas, but, nevertheless, parallel events could develop that had concerning consequences for international security in general, and European and Asian security in particular. It is thus important that we think through how the future strategic context will be affected, so we can consider what strategic preparation might be necessary.

The Reducing Threat of Terrorism

With the West’s drawdown from Afghanistan, international terrorism will be less central to future security agendas, unless there is some new ill-judged commitment of Western troops, or other foreigners, in the Lands of Islam. This is because terrorism in Western homelands is linked to the deployment of the West’s armed forces abroad in Afghanistan, Iraq and Libya: military operations in the Lands of Islam provide a political nexus for extreme Islamists, and a fertile cause upon which to throw their radicalising seeds; and the West’s homeland security has suffered as a result of its recent interventions. Fortunately, with the Afghanistan withdrawal imminent, the terrorist threat on Western mainlands will slowly reduce – which is just as well, because other strategic issues, very possibly of a millennial nature, are appearing over the horizon.

Climate Change as an Existential Threat

Photo: pubpages.unh.edu
Maslovian hierarchy of needs

With the West’s drawdown from Afghanistan, international terrorism will be less central to future security agendas, unless there is some new ill-judged commitment of Western troops, or other foreigners, in the Lands of Islam.

The climate crisis is the first imminent concern and should be a crucial area of security focus, post-Afghanistan – not least because our scientific understanding of climate’s year-to-year prospects is still poor, and it is difficult to be sure precisely how climate matters will proceed. That said, the science underpinning global warming is all but universally accepted in the international climate science community – with over 97% of climate scientists accepting CO2-induced heating as the primary driver for recent global temperature rises, the theory has scientific status equivalent to Newtonian physics or Darwinian evolution. Thus, the threats from the climate crisis are very real and, as Al Gore observes, will be of an unprecedented nature: ‘What is at risk of being destroyed is not the earth itself, of course, but the conditions that have made it hospitable to human beings [1].’

In a Maslovian hierarchy of [international security] issues, the climate crisis surely represents (with the possible exception of nuclear war) the greatest existential threat to human society. And not least because we are, by nature, short-term political animals, whereas the climate crisis represents a long-term threat that requires a long-term political response. But even in the short-term, increased climate volatility is already with us, as witnessed with so-called ‘100 year climate events now occurring 2-3 times per decade. Thus, whilst nothing should delay international efforts to mitigate our carbon emissions, nation-states will also need to ensure that their defence and security forces are trained for resilience and disaster relief, as well as operations and war, because the probability is that, in the decades ahead, these forces will be used more in the former rather than the latter.

Energy Security

International energy security is the second imminent concern, particularly in Europe and Japan. Take Britain, for example. Four years ago, in a seminal book – Sustainable energy – without the hot air – Professor David Mackay showed that a very significant reduction in Britain’s electrical generation capacity would occur between 2015 and 2016 [2]. And, amongst other G7 nations, Japan and Germany face similar challenges, again self-imposed, following political decisions to dispense with nuclear power. This matters because for an industrial society energy is, as the American energy commentator Chris Martenson observes, the ‘master resource [3].’

The issue is doubly pressing with developments in the oil-&-gas industry and with oil so central to the functioning of modern industrial states’ transport and, thus, international trading systems. The fashionable view is that the shale and ‘fracking’ revolutions have solved the world’s immediate energy problems. It is an enticing narrative but simple technical analysis soon shows it to be flawed.

These flaws have been exposed by Professor Charles Hall, and the idea of Energy Returned on Energy Invested (EROEI), which is the amount of energy that must be expended to extract energy. EROEI calls into question (Figure 1) the shale and ‘fracking’ panaceas:

• conventional oil – EROEIs have been reducing steadily since 1990, from figures of around 40:1 in the 1990s to around 12:1 in 2007.
• shale oil – EROEIs are, at around 6:1, even lower than those of conventional oil (because extraction in shale and ‘fracking’ is akin to oil mining, rather than oil drilling).

Although there are very large volumes of oil-&-gas available, in shale and ‘fracked’ sources, they will not be cheap. Indeed quite the reverse: if it takes even greater amounts of expensive existing energy to extract future energy, then we may be sure that that future energy will, in turn, be even more expensive Thus whether or not peak oil has arrived, it is clear that peak cheap oil has been and gone.

Figure 1. [4]

The economic consequences of the end of cheap energy, in particular end of cheap transport and cheap heating energy, will be difficult for international society to confront, especially for industrial populations weaned on cheap energy, and who assume – mistakenly – that there is some magic wand that governments can wave to make things better. But confront the possibility we must, including by commissioning scenario analyses that will allow us to consider the strategic implications – national and international – so that the international defence and security forces can be reorganised to help ensure that they are able to promote the stability of the international energy system, and thus help ensure that problems of systemic volatility are not added to those of price.

International Debt

International economics, particular international debt, is the third and final imminent concern. It is the general policy of developed countries that the solution to our economic problems lie in a “return to growth”, and the only serious policy differences are to do with how that return is to be engineered. But even were growth the panacea, two structural headwinds make its sustained achievement extremely problematic, the first energy prices, the second debt.

The interaction between energy and growth is poorly understood by the neo-Keynesian economists who run the main economic policy institutions, both national and international. Conventional economists assume energy is a GDP output – this is how they account for it in GDP statistics. Whereas Richard Ayres, the American physicist and economist, demonstrates that energy is a GDP input and, with labour and capital, one of the three factors of production [5].

This matters because it means there is an inverse relationship between future energy prices and future growth – if we have to employ more capital to extract new energy, then there will be less capital available for all the other features of economic life. Thus, if energy prices continue upwards, as the EROEI analysis above suggests, then our ability to grow, economically, will continue downwards.

The second great headwind to growth is debt. International debt levels are acknowledged as high in political circles, but few recognise that the West’s debt levels are without historical precedent. McKinseys (Figure 2) expose the scale of the problem.

Figure 2.

The graphs show statistics not simply government debt as a proportion of GDP, but also include household, corporate, and financial institution debt. From this analysis, Britain and Japan are the most indebted of the world’s 10 largest economies, albeit a significant proportion – around a quarter – of Britain’s debt lies in the City of London’s, by virtue of its role as an international finance centre.

Conventional neo-Keynesian economists assume that debt is good: whether for consumption or investment; and whatever the overall level. Hence the favourable Western government tax treatment for corporate debt and the strong push to get Western banks to lend to re-ignite growth. And yet, as Professor Steve Keen, the Australian mathematician and economist, shows, high levels of debt, especially for consumption, have a negative impact on GDP growth – because, sooner or later, debts must be paid down and the inevitable de-leveraging systemically reduces an economy’s capacity to grow [6]. Furthermore, such is the size of the West’s debts, that the time required to de-leverage from these current levels is much longer than politically forecast or popularly accepted – well into the late 2020s in Keen’s view.

At best, thus, we may see stuttering growth in the international economy, along the lines that we currently see in the US. But at worst, we may be in for a period of sustained contraction. And as we can see in Greece, Spain and Portugal, contraction leads to increasingly unstable political situations. It will be important, thus, to think through the international consequences of protracted deleveraging, and decide whether there is a need to rebalance our defence and security forces as a consequence, including in the maintenance of internal peace and stability in countries that have, until now, been relative bastions of internal peace and stability.

The Pursuit of Economic Growth

Photo: UN Photo / Rick Bajornas
The more internationally integrated approaches
to these issues were – for example, through multi-
national organisations such as the UN – the less
likely it would be that the systemic stresses and
strains would lead to war, which has all too often
been associated, historically, with periods of
economic contraction.

The possibility of long-term rises in energy prices and extended debt deleveraging may lead us to consider whether something more fundamental is afoot in the world – in particular whether, as Professor Tim Jackson suggests, it is the very philosophy of the pursuit of economic growth that is the underlying cause of the systemic problems international society is encountering [7]. And whether this pursuit may, in turn, lead to scenarios altogether more problematic than those of presaged above.

It is a fact of mathematics that mathematical growth cannot continue indefinitely – because it leads geometrically to infinity, sooner or later. And it is a fact of physics that physical growth cannot continue indefinitely – at least not on a finite planet, with finite resources and carrying capacity limits. At some stage, economic growth must surely, thus, arrive at a limit imposed by mathematics or physics.

This was the case made by Donella and Daniel Meadows and Jorgen Randers, in their seminal text Limits to Growth [8]. Published in 1972, the book set out a system-dynamics analysis of human society on a finite planet over time. As Figure 3 shows, the book predicted that in a ‘business as usual’ scenario – i.e. no significant changes in population trends, fossil fuel consumption or economic growth – limits to industrial output would be reached in the second decade of the 21st Century, during the 2013-2017 period.

The limits occur because increasing population and the pursuit of economic growth consume the finite energy, mineral and food resources of the finite planet. The “business as usual” approach is the one we have, essentially, followed in the 40 years since the book’s publication.

Figure 3.

The predicted output peak in 2013-2017 may thus cause us to question whether recent geo-political events – the financial crash, the Eurozone economic crisis, the Japanese debt crisis, the Arab Spring, and recent capital city riots in London, Stockholm, Istanbul and Sao Paulo – are not unrelated but instead connected symptoms of a more deeply systemic problem, of a human society intent on the pursuit of infinite economic growth finally coming up against the finite limits of its host planet’s carrying capacity.

In deciding whether to prepare for such a scenario, the test – for the national security planner – is not of the scenario’s probability but rather of its plausibility and the potential national security impact. If the idea of a period of violent economic contraction after 2017 passes the plausibility test, which I judge it does, the next question is on international security impact.

This is difficult to judge, but the consequences of economic contractions of the order of just 5-10% in the Greece, Portugal, Italy and Spain have been acute, and even more so in Egypt – whereas inspection of the Limits to Growth graph reveals a predicted economic contraction in excess of 50% over the next 20 or so years. It is difficult to see how a GDP collapse of greater than 50% in two decades, with associated reductions in international employment, food and energy production, trade and wealth generation, could lead to anything else other than an era of extended international instability, chronic societal crisis, and associated international insecurity.

In such circumstances, defence and security forces would be central to the maintenance of international security, law and order, with potential roles including:

• Military Aid to the Civil Power – including disaster relief, crowd control, and security of offshore Exclusive Economic Zones.
• Resource Security – security of energy, food and commodity sources, including of the sea and land lines of communication along which they travel.
• Containment of Conflict – including migration and border control and the maintenance of maritime and air exclusion zones.
• Stabilisation Operations – in a range of potential areas including, for example, the Mediterranean, North Africa and the Middle East.

The more internationally integrated approaches to these issues were – for example, through multi-national organisations such as the UN – the less likely it would be that the systemic stresses and strains would lead to war, which has all too often been associated, historically, with periods of economic contraction.

Conclusion

Photo: US Army / Spc. Eric-James Estrada
A lightning storm over Forward Operating
Base Salerno

The West’s departure from Afghanistan presents a strategic opportunity for the international community to raise its vision, toward our new strategic horizon. But the three issues that are appearing over that horizon have the makings of a perfect international security storm, with the potential to present political challenges of an unprecedented nature for political classes throughout the international community.

How should these challenges be faced? Ideally in coalition is the answer. This is because if such events were to lead to the need to deploy the international forces for stabilisation or international security reasons, it would be unconscionable to do so unprepared, when the scenarios predicted had indeed been foreseen. Rather, international forces should be given the best chances to prepare, no matter how politically unattractive the messages therein.

Defence and security are the fundamental responsibilities of governments and thus, with the possibility of a perfect storm of early stage climate crisis impacts, rapidly increasing energy costs and sustained and severe economic contraction, there is surely a constitutional requirement for governments throughout the world to think and to act. And if they are able to do so in coalition, then so much the better. Because if this perfect storm plays out as it plausibly could, then the consequences will make the last decades, and security threats of international terrorism, seem like a strategic walk in the park.

1. Gore, A., Our choice: a plan to solve the climate crisis, London, 2009. p.18.

2. Mackay, D.J.C. Sustainable energy – without the hot air, London, 2009. p.5

3. Martenson, C., Crash Course: the unsustainable future of our economy, energy and environment. New Jersey, 2011.

4. The positive ratios for hydro and, to a lesser extent, wind demonstrate a much stronger case for renewable energy, based on this measure.

5. Ayres, R.U. & Ayres, E.H., Crossing the energy divide – moving from fossil fuel dependence to a clean energy future., New Jersey, 2009.

6. Keen, S., Debunking Economics, London, 2011.

7. Jackson, T., Prosperity without Growth, London, 2009.

8. Meadows, D.H. Meadows, D.L. & Randers, J. The Limits to Growth: A report to the Club of Rome’s Project on the Predicament of Mankind, London, 1972.