Dr. John C. Hulsman: Harold Macmillan and the Butterfly Effect in Political Risk Analysis

Hulsman

Mastering Real World Bolts from the Blue

Political risk analysis is only as good as the unplanned for, real world events that it rubs up against. However elegant the assessment, however spot on the analysis, it must survive contact with the random. Or, as when John Kennedy asked British Prime Minister Harold Macmillan what worried him, the sage old premier supposedly replied, “Events, dear boy, events.”

While by definition such random events are beyond human control, that does not mean that they cannot be analytically managed. It is the job of the political risk analyst to identify weak spots in today’s political constellations, links that can be broken when an unforeseen event blows up, where a single spark can ignite a prairie fire, such as occurred following the assassination of Archduke Franz Ferdinand in Sarajevo in 1914, precipitating the calamity of the Great War.

Dealing with the “butterfly effect” in foreign relations—wherein small random events can have outsized consequences—is a major commandment necessary for mastering political risk analysis. Analysts must check, and check again, for a global system’s weak links, waiting for the day when they must be instantly shored up in order to head off potential disaster.

Macmillan Strives to Salvage Britain’s Place in the World

All through his passage through time he had been haunted by unwanted ghosts, both of his own life and that of his country. Now, in December 1962, Harold Macmillan found himself in the Bahamas, attempting to save what could be saved—to salvage the reputation of Great Britain as one the world’s great powers.

The broader context of the Nassau Conference was that of Britain’s place in a post-Suez world. Greatly regretting the damage that he had personally done as Prime Minister Anthony Eden’s Chancellor of the Exchequer during the Suez crisis—initiated by President Gamal Abdel Nasser when he nationalised the Suez Canal in Egypt on July 26, 1956—a butterfly effect that had seemingly come out of nowhere—Macmillan used his subsequent premiership to make a grand effort to repair British foreign policy.

When forced to choose between France/Europe and the United States, he came down strongly on the side of Washington, setting about rebuilding the “special relationship.” One of the many ways Macmillan did this was to jointly work with the American nuclear program. In fact, the Prime Minister’s staunch unwillingness to disclose US nuclear secrets to France contributed to Paris’s veto of Britain’s proposed entry into the European Economic Community. Shorn of its empire and cut off from Europe, Macmillan had put all of his strategic eggs into the American basket.

However, once again an unforeseen event threatened Britain’s newfound place in the world. The special relationship was in danger of collapsing, and all over the inadvertent cancellation of an obscure missile program.

The Skybolt Crisis

Skybolt, a ballistic missile jointly developed by the UK and the US during the early 1960s, had run well over projected costs. Without giving any thought to the broader strategic symbolism of Skybolt—the fact that it served as a concrete illustration for the enduring Anglo-American strategic partnership—the Kennedy administration had unilaterally cancelled the program because it had become enormously expensive, and also because it was so far behind schedule that it would have been obsolete before it was even deployed.

However, utterly unexpectedly, the cancellation of Skybolt provoked a crisis of confidence between the United States and Britain. The optics of the cancellation caused unthought-of tensions, as it looked as if the US was yet again (as at Suez) cutting the UK down to size, this time high-handedly divesting London of its independent nuclear deterrent. Given that Macmillan had staked everything on the centrality of the special relationship, the Skybolt crisis came to be seen as a litmus test of the true post-Suez value of the US-British alliance as a whole. It was in this atmosphere of unexpected existential crisis that the December 1962 Nassau conference was convened.

Macmillan finally triumphs over the butterfly effect

The Prime Minister was left to walk a very fine diplomatic line at Nassau. He was eager not to alienate the Americans, but also absolutely needed to ensure Britain’s independent nuclear deterrent. Macmillan had to either convince Kennedy to countermand his original order and retain Skybolt, or secure a viable replacement, which in this case was the Polaris missile. Britain’s perceived status as a great power hung in the balance.

Fortunately for Macmillan, he was just the sort of man Kennedy instinctively liked: brave, stylish, witty, and unflappable. And it was at this pivotal moment, with the President wavering, that the Prime Minister successfully managed to save his world from the butterfly effect.

Standing to speak, Macmillan invoked his own horrendous experiences in World War I (where he had been wounded three times, once severely), and eloquently detailed to the Americans what Britain had sacrificed for the world in its storied past in the greater cause of preserving Western civilization. After tugging at the President’s heartstrings, the Prime Minister dropped the hammer. Macmillan directly demanded Polaris, and pointedly noted that a failure to get it would result in a dramatic strategic reappraisal of British foreign and defence policy.

Kennedy, at last realizing what was at stake in Nassau—how devastating the Skybolt controversy was proving for Macmillan in particular and the special relationship in general—quickly agreed to provide Britain with Polaris missiles on extremely favourable terms. The Prime Minister had (just) managed to stop random events from upsetting his world yet another time.

Conclusion: Macmillan’s warning

The Prime Minister had a parting political risk warning for the President. In Nassau in December 1962, on the evening they both arrived in the Bahamas, Kennedy and Macmillan—at the Prime Minister’s urging—walked alone together for a long time, a rarity given Kennedy’s ever-present and vast staff.

They immediately hit it off, talking not only about the Skybolt crisis and domestic politics but also about their shared interest in history and the things in their lives that both found ridiculous, funny, or deadly serious. It was during this intimate walk that Macmillan queried Kennedy as to what he feared most. The President, ever the literal rationalist, admitted that nuclear weapons and the American balance-of-payments deficit were the two issues that most frightened him. Kennedy was scared of the known.

However, when the President asked Macmillan what frightened him the most, the Prime Minister (perhaps mythically) replied, “Events, dear boy, events.” Macmillan, unlike the modern, cerebral President, knew from his own bitter experience that it is the unknown that is to be most feared by analysts of all stripes, as it can—at a stroke—upend the best-laid plans of mice and men.

Dr. John C. Hulsman is the president and cofounder of John C. Hulsman Enterprises, a successful global political risk consulting firm. For three years, Hulsman was the Senior Columnist for City AM, the newspaper of the city of London. Hulsman is a Life Member of the Council on Foreign Relations, the preeminent foreign policy organization. The author of all or part of 14 books, Hulsman has given over 1520 interviews, written over 650 articles, prepared over 1290 briefings, and delivered more than 510 speeches on foreign policy around the world. His most recent work is To Dare More Boldly: The Audacious Story of Political Risk.