Daily Wisdom

April 13, 2014

The Coming World War

It seems that most people missed this as an attachment to my last post, so I'm making it a stand-alone article. I originally wrote this on January 22, 2009. Yes, it was only 2 days after Barack Obama was sworn in as President, but it seems just as pertinent today as it did then.

Those that fail to learn from history, are doomed to repeat it. --Winston Churchill

I hope I'm wrong, but I have this nagging feeling that America will soon be embroiled in another world war. Of course, I was not around during the lead up to World War II, but I've read enough history to say, "This feels like deja vu all over again". Why do I say that? Well, consider the following parallels...

International Organizations
Following World War I (or, "The Great War"), the League of Nations was established as a super-state organization with the goals of disarmament, preventing war through collective security, settling disputes between countries through negotiation and diplomacy, and improving the global quality of life. Without any military forces of its own, the League was essentially incapable of enforcing sanctions or preventing aggression by the Axis powers in the 1930s.

Following World War II, the United Nations replaced the League of Nations and even inherited a number of agencies and organizations that were founded by the League. It was established along similar principles and suffers from the same deficincies that afflicted the League. It is essentially an impotent organization that has no inherent ability to enforce sanctions or prevent aggression. It has been unable to prevent wars since its founding and will find itself unable to prevent the next World War.

A Bad Economy
Prior to World War II (WWII), the world was in the midst of a "Great Depression" brought on by the U.S. stock market crash of 1929. It was a worldwide economic downturn that caused bank runs and bank failures, loss of confidence in the markets, fear on the part of consumers to incur new debt, a significant reduction in consumer spending, a deflationary price spiral, a massive reduction in international trade, high unemployment, and a loss of personal income.

Despite major spending by the U.S. government and businesses in 1930, consumers cut back expenditures and prices began to decline. Wages held steady for awhile, but then they too began to decline. There were frantic attempts by the governments of various nations to shore up their economies, but the policies that were implemented in many cases only exacerbated the problems.

Recently, we have seen a major stock market decline, bank failures, loss of personal income, a reduction in consumer spending, rising unemployment numbers, and falling prices for oil and gasoline. And while today's economy may not yet be as bad as the 1930s, we are told that this is the worst economic situation since the Great Depression.

While there are many theories as to what caused the Great Depression, there is one school of thought which blames the uncontrolled expansion of the money supply in the 1920s which led to an unsustainable credit-driven boom. The Federal Reserve, these scholars say, deserves much of the blame.

Likewise, we had a major credit-driven boom in the late 1990s and early 2000s. Credit was cheap and easy. Risky home mortgages were being given to customers that could not afford them and were unlikely to pay them back. Again, the Federal Reserve deserves at least some of the blame for not speaking out more vigorously against these practices. On October 23, 2008 former Fed Chairman Alan Greenspan admitted that he had put too much faith in the self-correcting power of free markets and had failed to anticipate the self-destructive power of wanton mortgage lending.

In fairness to the Federal Reserve however, it should be noted that the U.S. government itself created the climate in which bad lending practices were encouraged. In 1977 Congress passed the Community Reinvestment Act (CRA), which sought to encourage mortgage lending to the poor and minorities. But the banks failed to make many such loans since such mortgages would often be considered "risky".

During the Clinton administration in the early 1990s, Congress established a "CRA-rating" for banks. A high CRA-rating would be awarded to banks that made more such loans, while a low rating would be given to banks that failed to make such loans. The Congress then used low CRA-ratings against the banks when it came to matters requiring congressional approval such as mergers, acquisitions or expansion into new markets. Thus, Congress itself created an incentive to make risky loans and it resisted any attempts to curb such practices even as late as 2005 when it became increasingly apparent that a dangerous housing bubble was forming that might threaten the entire economy.

Economic Recovery
The Great Depression lasted until 1939 in the U.S. when the country began to move into a war-time economy. Why it lasted so long is also a matter of much discussion, but at least part of the answer can be attributed to the policies of President Franklin Delano Roosevelt (FDR) who blamed "big business" for causing an unstable bubble in the economy. Democrats felt that business had "too much money" and sought to deprive them of their wealth by increasing taxes on corporate profits. This created an unfavorable business climate and produced an incentive against making profits.

FDR also initiated a number of government-backed "make-work" programs, including infrastructure projects such as the Hoover Dam and the Tennessee Valley Authority electrification program. While these were noteworthy achievements, they did not in and of themselves help end the Depression. Likewise, today's Democrats seem eager to invest in infrastructure projects, but the non-partisan Congressional Budget Office recently issued a report suggesting that such projects will do little to stimulate the economy any time soon, and perhaps not for ten years.

Weak Governments
Following WWI, Germany had a weak government known as the Weimar Republic. Germany had financed the war with borrowing which led to inflation, and under the Treaty of Versailles it was forced to make war reparations which were financed by even more borrowing. This led to hyper-inflation and economic chaos. Eventually, the German Reichsbank got things under control by simply not allowing the government to borrow any further and by creating a new currency called the Rentenmark, where one Rentenmark was equal to one billion old Marks! But the German people not only wanted financial stability, they wanted to be proud of their country again. Their loss of the war also resulted in the loss of international prestige. As a result, the Nazi party began to gain ascendency because it appealed to these desires of the German people with a promise of restored national greatness.

Following the Cold War and the collapse of the Soviet Union, Russia had a weak democratic government that was faced with transitioning from communism to capitalism. Unfortunately, it was not a smooth transition. Where formerly, prices were fixed at unreasonably low levels, stores could never maintain an adequate supply of goods. People waited in long lines at a bakery only to find that there was no more bread left when they got to the counter. When capitalism was instituted, the store shelves were suddenly stocked and there was no problem finding almost anything. However, prices had skyrocketed and many people couldn't afford to buy anything.

The discontent this created led some people to pine for the old days of communism. They were also disenchanted about the fact that Russia was no longer a super-power that made the world stand up and take notice of its space achievments, its Olympic victories, its military prowess, etc. The Russians wanted a return of national pride and began to find it in the person of Vladimir Putin, just as the Germans had found it in the person of Adolf Hitler.

Political Machinations
Adolf Hitler used political machinations to gain the Chancellorship in Germany. Following his appointment to the Chancellorship, Hitler catapulted himself into a full-blown dictatorship. Likewise, Vladimir Putin has used political machinations to maintain his grip on power in Russia.

Putin became acting President in 1999 when president Boris Yeltsin resigned, and then Putin won the 2000 presidential election. In 2004, he was re-elected for a second term lasting until 2008. Due to constitutionally mandated term limits, Putin was ineligible to run for a third consecutive term. After the victory of Putin's successor - Dmitry Medvedev - in the 2008 presidential elections, Putin was nominated by Medvedev to be Russia's Prime Minister. Putin in fact took the post in May 2008. The move was seen by most analysts as a method whereby Putin could remain in power behind the scenes (i.e., he would be the power behind the throne).

It appears that Putin aspires to return to the presidency in 2012, and conveniently for Putin, Medvedev in late December signed a law extending the presidential term from four years to six. This would allow Putin to remain in office for twelve more years until 2024. These are all steps being taken at the direction of Putin to consolidate and extend his power.

Silencing the Opposition
After attaining the German Chancellorship, Adolf Hitler began to pressure rival parties and political factions. Following the Reichstag fire in 1933, Hitler used the event to suspend basic rights including habeus corpus. The German Communist Party (KPD) and other groups were suppressed. Later, the Social Democratic Party (SPD) was banned, while all other political parties were forced to dissolve themselves. Hitler's political opponents started winding up dead.

In Russia similarly, opposition voices to Putin are being silenced. Since coming to power in 1999, Putin has seized control of the country's major TV channels, all of which are now under the thumb of the government or its allies. The rollback of press freedoms is a sign of Putin's deepening authoritarianism. Nearly all serious opposition to Putin has been broken or marginalized. Prominent businessmen unwise enough to oppose him have been prosecuted and imprisoned, or forced to flee the country.

As recently as January 20th, the Washington Post reported that another Russian person fighting for human rights and the rule of law has been murdered in Vladimir Putin's Moscow...

The larger story here is of serial murders of Mr. Putin's opponents, at home and abroad. Ms. Baburova, 25, is at least the 15th journalist to be slain since Mr. Putin took power. No one has been held accountable in any of the cases -- including that of Anna Politkovskaya... who also was murdered execution-style in broad daylight, on Mr. Putin's birthday in 2006. In London, dissident former KGB agent Alexander Litvinenko was poisoned; so was Ukrainian President Viktor Yushchenko, who survived. Karina Moskalenko, another opposition lawyer who has represented Ms. Politkovkaya's family, fell ill from mercury poisoning in Strasbourg, France, in October, just before a hearing in the case. Last week in Vienna, a Chechen dissident who had received political asylum was murdered on the street -- shot twice in the head... What is indisputable is that Russians live in a political climate in which those who criticize Mr. Putin or the human rights violations of his government can be murdered with impunity. --More Moscow Murder, Washington Post, 20 January 2009

Muscle Flexing
Prior to WWII, Adolf Hitler began flexing his military muscles. He built up Germany's military in violation of the Versailles Treaty. In 1933, Hitler ordered his army generals to prepare to treble the size of the army to 300,000 men. He ordered the Air Ministry to plan to build 1,000 war planes. Military buildings such as barracks were built. For two years, the German military expanded in secret. By March 1935, Europe learned that the Nazis had 2,500 war planes in its Luftwaffe and an army of 300,000 men in its Wehrmacht. Hitler felt confident enough to publicly announce that there would be compulsory military conscription in Nazi Germany and that the army would be increased to 550,000 men.

With an army to bolster his confidence, in 1938 Hitler decided to make his first territorial acquisitions. On March 12th, the 8th Army of the German Wehrmacht crossed the German-Austrian border. They did not face any resistance by the Austrian Army — on the contrary, the German troops were greeted by cheering Austrians.

Immediately following the Austrian "Anschluss" (or "joining"), Hitler set his sights on the Sudetenland. The Sudetenland had previously been part of the German confederation, but after WWI it became part of Czechoslovakia. Nazi sympathizers in the Sudeten-German Party (financed by Nazi Germany) began to argue that the Germans in Sudetenland might be better off under Hitler. Hitler wanted to invade Czechoslovakia but was persuaded by his generals against the move. British prime minsister Neville Chamberlain met with Hitler who threatened to invade Czechoslovakia unless Britain supported his plan to take over the Sudetenland. A four-power conference was held with Germany, Britain, Italy and France, at which time Neville Chamberlain and Edouard Daladier of France agreed that Germany could have the Sudetenland. In return, Hitler promised not to make any further territorial demands in Europe. The German Army marched into the Sudetenland on October 1st, 1938.

Similarly, since taking office in 1999, Vladimir Putin has begun flexing his military muscles in a number of ways. Russia has been flying long-range bomber patrols toward the U.S. and Britain, launching planes from its aircraft carrier, redeploying the Russian fleet to the Mediterranean, engaging in war games, and sending warships to Venezuela. It also threatened Poland with a nuclear strike for agreeing to accept U.S. defensive missile systems. But perhaps the most notable recent event was when Russia marched into the Georgian provinces of South Ossetia and Abkhazia.

Following the break-up of the Soviet Union, a civil war left parts of South Ossetia under the control of an unrecognized separatist government composed largely of Russian sympathizers. Hostilities escalated during 2008, and on the evening of August 7th, Georgia launched a ground- and air-based military attack on South Ossetia's capital, Tskhinvali. Russia responded by sending troops into South Ossetia and launching bombing raids farther into Georgia. After days of heavy fighting, on August 26th Russia recognized the "independence" of South Ossetia and Abkhazia, and following international agreements, Russia completed its withdrawal from Georgia on October 8th. The "international agreements" were essentially terms of appeasement, and Russian troops still remain stationed in Abkhazia and South Ossetia, including areas that were formerly under Georgian control before the war.

Failure of Diplomacy
While Germany became increasingly aggressive in the lead up to WWII, the response of the former Allies (Britain, France and the U.S.) was silence or appeasement. They knew that Germany was flagrantly violating the terms of Versailles, but essentially did nothing. Americans wanted to remain isolationist. Britain was still recovering from the Depression which had devastated the economy and could not afford a conflict. The French preferred a defensive posture against the potential German threat and spent time and money building the vast "Maginot Line" - a series of forts and battle positions along the French and German border. They all sought to depend on diplomacy as a means of dealing with an aggressive nation... a move which clearly failed in the long run.

Today, the mood of many Americans and Europeans is distinctly anti-war. Barack Obama was overwhelmingly elected President of the United States having run on a platform that places great emphasis on diplomacy as a means of dealing with world problems. The tough-stance policies of George W. Bush have been rejected as militaristic, confrontational and inflammatory. Yet, as Neville Chamberlain would ultimately learn, diplomacy may be popular but it is doomed to failure when it comes to dictators and rogue regimes.

Military Preparedness
At the beginning of WWII, America was woefully unprepared for a military conflict. America wanted to remain isolationist and to "leave Europe's problems to the Europeans". Thus, when war came to America via the surprise attack on Pearl Harbor, it was a challenge to gear up the economy quickly for a war-time footing.

Among his many promises during the presidential campaign, Barack Obama said he would unilaterally disarm America. He said he would reduce military spending, stop work on missile defense systems, and cut inventories of nuclear weapons. He vowed to get the troops out of Iraq and divert war funding to domestic spending programs in the United States. It is nothing less than a return to isolationism. But withdrawal and isolationism only creates a power vacuum that America's enemies are eager to fill. Isolationism can only leave America more vulnerable when it comes time for the next war. And as we have learned from history, there is always a "next" war.

By now you have surmised that I foresee a World War between the U.S. and Russia. But who might the other players be? As for Russia's allies, we might get a clue from Garry Kasparov, former Russian chess champion and democracy advocate...

Just as in the old days, Moscow has become an ally for troublemakers and anti-democratic rulers around the world. Nuclear aid to Iran, missile technology to North Korea, military aircraft to Sudan, Myanmar and Venezuela, and a budding friendship with Hamas: these are the West's rewards for keeping its mouth shut about human rights in Russia. --Garry Kasparov, New York Times, 10 July 2006

If all these countries were to side with Russia during a conflict, we could only imagine what kind of war it might be. Iran might invade Iraq to control its oil fields, assuming that the U.S. has already pulled out. North Korea might invade South Korea. Sudan could create problems in Africa. Myanmar could create problems in southeast Asia. Venezuela could create problems in our own backyard, particularly if it convinced Cuba and/or other Latin American countries to join the fight. Russia has also made overtures to Syria, and it could be assumed that along with Hamas, America's ally Israel would be a prime target for attack.

One would assume that Britain, Canada, Australia and New Zealand - America's traditional allies - would side with the U.S. We can only suppose that Japan would likewise side with us. But China is a big question mark. Although we have enjoyed good relations with China during the Bush administration, Obama has started out on the wrong foot even during his innaugural address by making comments about "communism" and "dissent" - comments that were censored by China's communist ruling party from live broadcasts and Chinese translations of the address.

Europe is likewise a big question mark. Ordinarily, one would assume that as NATO allies, they would join a fight against Russia without hesitation. Nevertheless, Russia recently cut off its natural gas supply to Europe during a bitter cold snap, an event which might make Europe think twice about picking a fight. One could imagine that, unless attacked, Europeans might wish to remain neutral.

Beyond that, I have nothing further to offer. Your thoughts and comments are always welcome.


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