Paul Tucker on Unelected Power: The Quest for Legitimacy in Central Banking and the Regulatory State

TuckerCentral bankers have emerged from the financial crisis as the third great pillar of unelected power alongside the judiciary and the military. They pull the regulatory and financial levers of our economic well-being, yet unlike democratically elected leaders, their power does not come directly from the people. Unelected Power lays out the principles needed to ensure that central bankers, technocrats, regulators, and other agents of the administrative state remain stewards of the common good and do not become overmighty citizens. Like it or not, unelected power has become a hallmark of modern government. This critically important book shows how to harness it to the people’s purposes.

What is the regulatory state?

It’s a term that has come to be used to describe a host of government bodies that regulate particular economic sectors or the public more generally to protect, say, investors, the environment, consumers, workers, and so on. In a rudimentary form it has existed for a long time, going back to the 19th century and beyond. Going wider, Americans sometimes refer to the administrative state, meaning the evolution of government beyond a world of legislators and courts to one in which the executive branch makes policy and is divided up into departments, agencies, bureaus, commissions, and so on.

What are Independent agencies, and why do they matter?

They are government organizations that are not under the day-to-day control of elected politicians, whether in the executive branch or the legislature. Obvious examples today are the central banks, such as the Federal Reserve, European Central Bank, and the Bank of England, but also various regulators insulated from ongoing political control. By no means all agencies in the administrative state are independent. On both sides of the Atlantic, many are under the control of cabinet ministers or subject to annual budget approvals from the legislature, which makes them sensitive to politicians’ sentiments and whims. Independent agencies are distinctive in that politicians can control them only by amending or repealing legislation.

That sounds problematic in a democracy. Is it?

That’s the point of the book. The way I’ve just described them it could be a hell of a problem. Imagine an independent agency that had lots of powers but only the vaguest purpose and objective. Who would be able to tell whether it had succeeded in its mission if it set its own goal posts?! That’s at odds with some of our deepest values: just as “no taxation without representation” was a rallying cry a couple of centuries’ ago, we might just as well demand “no regulation without representation.”

Are central banks a particular problem?

They have become the poster boys and girls of today’s unelected power. Compared with what happened after the Great Depression in the 1930s, when it was politicians who did the heavy lifting, this time it has been central banks that have led the way in reviving the economy and redesigning the financial system. They have used their balance sheets on a truly gigantic scale to influence credit conditions in lots of markets, and have been given lots of new regulatory powers. They are more powerful than ever before, ranking with the judiciary and military as a third core pillar of unelected power.

Do people object to all this?

Yes, but in rather different ways in different countries. In the US, since the New Deal there have been critics who object that regulatory agencies violate the values associated with the separation of powers or even the Constitution itself. In France, not long ago the parliament passed legislation to put more structure around such agencies. In the UK, there is episodic antagonism to government by ‘experts.’

And on central bank independence, there have been challenges in the German constitutional court and attempts to pass reforming legislation in the US Congress.

So what is the solution?

Our democracies need norms for whether and how to delegate to independent agencies that measure up to the deep political values of our democratic, liberal republics: the various values of democracy, rule of law, constitutionalism. My book proposes and defends just such a set of Principles for Delegation, as I call them. They come in two broad parts: criteria for whether to delegate, and precepts for how to delegate.

Criteria for whether to delegate: I argue that a policy function should not be delegated to a truly independent agency unless (1) society has settled preferences; (2) the objective is capable of being framed in a reasonably clear way; (3) delegation would materially mitigate a problem of credible commitment; and (4) the policymaker would not have to make big choices on society’s values or the distribution of its resources.

Precepts for how to delegate: (1) the agency’s purposes, objectives and powers should be clear and set by elected legislators; (2) its decision-making procedures should be set largely by legislators and should accord with the values of the rule of law; (3) the agency itself should publish the operating principles that will guide its exercise of discretion within the delegated domain; (4) there should be transparency sufficient to permit accountability to the legislature for the agency’s stewardship of the regime and, separately, for politicians’ framing of the regime; and (5) it should be clear what (if anything) will happen, procedurally and/or substantively, when the edges of the regime are reached but the agency could do more to avert or contain a crisis. 

Perhaps the biggest thing is that elected legislators should set a monitorable objective. Independent agencies really can improve the credibility of commitments made by government, but only if we know what we want them to do and can track whether or not they are doing it.

Would those Principles affect anything much?

Yes. Here are just three examples.

They would challenge the acceptability of judges completely having completely overhauled the principles of competition policy a few decades ago. The legislation was vague and the views of economists had moved on, so the courts had room and reason to act. But, given our democratic values, this should have been work for elected politicians.

They suggest that role of some financial-market regulators in preserving a stable financial system needs either to be better insulated from politics (such as the SEC in the US) or subject to much clearer objectives (UK).

And they would restrict the roles and activities of central banks rather more than we have seen in recent years.  

Is any of this realistic in actual democratic states?

Well, that’s the point of the book. There are no deep constitutional blockages, so it’s a question of whether we want to be governed in a way that’s consistent with our values. I’m hoping that people who see merit in my Principles for Delegation (or something like them) will cite many more examples than I can (or even know about), generating the kind of debate that is badly needed about how state power is allocated.

Anyway, surely something has to be done to bring the role of experts in government in line with our democratic commitments.

Why did you write the book?

I spent a good part of my central banking career helping to design regulatory and monetary regimes, none more important than the expansion of the Bank of England’s powers after the Great Financial Crisis. We resisted some powers, wanted others constrained, and had strong views on how the different responsibilities should be assigned to distinct committees so as to disperse power and focus incentives. I wanted to try to write down the values and considerations lying behind that. When I moved to Harvard in late-2013, I had the opportunity to do so.

Paul Tucker is a fellow at the Harvard Kennedy School and chair of the Systemic Risk Council. For more than thirty years, he was a central banker and regulator at the Bank of England and the Bank for International Settlements. He lives in London.

Dr. John C. Hulsman: The Ten Commandments of Political Risk

Disturb us, Lord, when we are too well pleased with ourselves
When our dreams have come true because we have dreamed too little
When we arrive safely because we sailed too close to the shore.

Disturb us, Lord, to dare more boldly, to venture on wider seas
Where storms will show your mastery
Where losing sight of land, we shall find the stars.

—Excerpts from Sir Francis Drake’s prayer, 1577 (apocryphal)

HulsmanThe great goal, the Everest of my book, has been to identify the historical elements that comprise the rules of the road for mastering political risk analysis and to holistically put our ten commandments to use in explaining the baffling world we presently live in. Having discovered these commandments—and illuminated them through the use of historical story-telling, deriving them from real-world policy situations throughout the ages—we can get to the Holy Grail of actual understanding.

Here at the end of our story, through the use of this unique heuristic method, we have delineated the long and neglected history of political risk analysis, linking this important tale to the broader efforts of both business and political leaders to master risk in general. Confident in what geopolitical risk analysis has been, is, and can be, it is clear that the Delphic dream of soothsaying—in a limited way, over limited issues, for a limited period of time—can be partially fulfilled.

  • “We are the risk.” As the history surrounding Sejanus and the decline and fall of the Roman Empire makes clear (alongside the corroborating tale of present-day Europe’s decadent decline), geopolitical analysts have a terrible time looking in the mirror and seeing that the society they are part of can itself be the major geopolitical risk problem.

 

  • Gaming out “lunatics.” Far too often geopolitical risk analysts let those with very different belief systems off the hook by lazily assuming that they must be crazy, rather than looking for the method to their madness. As the story of “The Old Man of the Mountain” and the Third Crusade (with inter-chapters on both Charles Manson and ISIS) makes clear, there is almost always an internal logic to any seemingly mad geopolitical interlocutor that can be followed and assessed.

 

  • Gaming out “chess players.” Amidst the daily tumult of a constant barrage of information, it is easy to lose sight of the intellectual needle in the haystack: the assessment of “chess players,” those geopolitical decision-makers who have stable, rational, coherent, long-term strategies in place to further their geopolitical goals. As reviewing the history of Niccolo Machiavelli and Pope Julius II (with an inter-chapter on George Washington and Alexander Hamilton) illuminates, finding these rare geostrategic birds is well worth the effort, as once they are identified (which is difficult), their future actions can rather easily be predicted.

 

  • Recognizing game changers. As the stirring story of John Adams in the sultry summer of 1776 makes clear, seeing the bigger picture—discerning how specific contemporaneous events fit into the larger historical pattern—is a mighty tool in political risk analysis. Separating the wheat from the chaff and intellectually drilling down on what really matters and its historical meaning (as we see both Adams and inter-chapter hero Winston Churchill doing in very different historical contexts) allows the political risk analyst as well as the foreign policy practitioner to see the world as it actually is.

 

  • Balance is the key to foreign policy. Having discovered the secrets of one major driver of geopolitics—be it macroeconomics, geopolitics, or cultural power—far too often analysts quickly forget that there are others and that it is the mix that explains everything. The twin stories of a beleaguered Venetian Republic and a seemingly all-conquering Napoleon in 1797 allow a dual critique of both an economics-only and overly militaristic policies and the doom to which both one-sided initiatives inevitably lead.

 

  • If you are digging yourself an intellectual hole in foreign policy analysis—stop. The “losing gambler in Vegas” syndrome affects both policy-makers and analysts. As the legendary Robert E. Lee found to his supreme peril at Gettysburg (and also “the best and the brightest” of the Kennedy and Johnson administrations as they met their nemesis in Indochina), pushing ahead with an already failed policy in a desperate effort to recoup past losses leads to calamity.

 

  • Know your country’s place in the world. The singular case of the late Victorian titan Lord Salisbury—who bravely and correctly righted Britain’s foreign policy to fit the paradox of its relatively declining but still dominant place in the world of the 1890s—highlights this vital requirement for both policy-makers and analysts alike. Only by fearlessly and correctly assessing your country’s true place in the world (as the inter-chapter on the Genro of Japan makes clear happened across the globe from Salisbury a generation earlier) can you pursue successful political risk analysis.

 

  • Do not put all your eggs in one strategic basket. Distantly related to the “losing gambler in Vegas” syndrome, the “promised land fallacy” besets decision-makers and analysts who ruinously rely on one overall strategy to magically attempt to alter their country’s overall geopolitical position in the world. In the case of Wilhelmine Germany, Admiral Von Tirpitz’s disastrous plan to challenge British naval might (echoing the inter-chapter on Soviet leader Nikita Khrushchev’s equally ruinous “Wars of National Liberation” gambit) helped lead to the Great War and Germany’s destruction.

 

  • Know the nature of the world you are living in. The trials and tribulations of Beatle George Harrison (with the inter-chapter focusing on the diametrically opposed case of the fall of Brian Jones and the rise of the Rolling Stones) and the stunning, lightning-quick dismemberment of his band dramatically underline that successful systems can collapse in the blink of an eye if their underlying power realities change, failing to any longer reflect the systemic power facts on the ground that created such a system in the first place. Policy-makers as well as political risk analysts must know both the nature of the global system they are living in (is it characterized by one great power, two, or many?) as well as if that system is durable, fragile, or evolving.

 

  • Prepare for the “butterfly effect.” The telling present-day case of Deng Xiaoping and the colossal success he made of both Chinese foreign and economic policy must not obscure the reality that East Asia today sits on a powder keg, a single random event away from 1914; just one drunken Chinese sea captain could quite plausibly upset the strategic equilibrium in Asia. The best policy-makers and political risk analysts (as the inter-chapter example of Harold Macmillan also makes clear) see the weaknesses in even the most successful foreign policies, having resilient initiatives at the ready to stave off seemingly unexpected disasters.

 

In traveling far from home, as Sir Francis Drake bid us to do in the swashbuckling, mesmerizing prayer that opens this article and To Dare More Boldly, our journey through history has been bountifully rewarded. For yes, within limits, the future can be foretold through the use of political risk analysis. Truly venturing far from our intellectual shore, in daring more boldly, we have come to see the stars. 

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.

The Promised Land Fallacy: Von Tirpitz Disastrously Builds a Navy

by Dr. John C. Hulsman
Hulsman

The Dangerous Mirage of the Promised Land Fallacy

Distantly related to the losing gambler’s syndrome is the promised land fallacy, the naïve view that one attribute of power or one strategy is sufficient to overcome the complexity of the world and—in silver bullet-like fashion—change the terms of the geopolitical game. In essence, it’s the very human effort to falsely manufacture a game-changing strategy rather than recognising that game-changing events generally happen organically.

Political risk analysts throughout the ages, frustrated by the constraints of living in the world as they have found it, are often highly susceptible to dreaming up analysis designed to liberate them from the shackles of reality. Ruinously, reality always wins.

In the years following the innovative genius of British Prime Minister Lord Robert Salisbury’s foreign policy, Anglo-German relations nevertheless spiraled out of control. No one was more responsible for this than Admiral Alfred von Tirpitz, whose wrong-headed promised land strategy to supersede the British navy instead led Germany directly over the cliff into the charnel house of the Great War.

For Wilhelmine Germany, the building of a fleet from scratch to challenge the mighty Royal Navy was meant to be the country’s ticket to its place in the sun. The German political and military elite, frustrated that the world (especially haughty Great Britain) failed to recognise the ascension of Germany to Great Power status, set about rushing the forces of history, rather than merely waiting for their yearly relative gains in global power to become apparent over time. Already possessing the greatest army in the world, the Kaiser became intent on building a threatening navy.

Instead of heralding an era of German dominance, the elite in Berlin unwittingly started a process that led to its doom. The naval race awoke an alarmed London to the coming German threat to its position as the single greatest power in the world (though one in relative decline), a fact that helped directly lead to war and ruinous German defeat. Far from leading to the promised land, this approach puts political risk analysts forever at the mercy of the latest intellectual fad, often leading to simplistic analysis that doesn’t stand up to the realities of a complicated world.

Von Tirpitz Recklessly Challenges British Naval Dominance

Grand Admiral Alfred von Tirpitz became the living embodiment of the Kaiser’s drive to build a world-class navy, almost from scratch. Born March 19, 1849, pictures of von Tirpitz show a man looking like nothing so much as an enraged walrus, with his long, flowing beard, fierce eyes, and stern countenance.

Yet von Tirpitz was much more than this caricature of a stiff-necked Prussian. For one thing, he knew the English personally and well, spoke the language fluently, and even sent his two daughters to the prestigious Cheltenham Ladies’ College. For another, von Tirpitz rose through the German navy’s ranks largely through his own merits, something unheard of at the time. Tirpitz, for all the Prussian glowering, was essentially a creative, outward-looking, self-made man.

In 1897, von Tirpitz was made head of the powerful Imperial Navy Office, an unassailable bureaucratic perch that allowed him to relentlessly focus on making the German navy a force to be reckoned with; he was to remain central to German naval thinking until 1916. His primary strategic recommendation was that Germany must build as many battleships as possible and challenge British naval hegemony. Initially, von Tirpitz advocated the creation of two squadrons of eight battleships, plus a fleet flagship and two reserves.

Between 1898 and 1912, von Tirpitz managed to get four naval acts through the German Parliament, greatly expanding the size of the country’s High Seas Fleet. Over time, his clearly stated strategic goal became to construct a navy that two-thirds of the size of the dominant British Fleet. In the narrowest of terms, von Tirpitz was successful, in that he took the very meagre German navy he had inherited in the 1890s and transformed it into a world-class force.

The Germans miscalculate

The irony was that, for both von Tirpitz and the Kaiser, the German naval build-up was essentially defensive in nature. They did not wish to overwhelm Britain as a revolutionary power, but merely to be taken seriously by it as a valued guarantor of the status quo. The von Tirpitz strategic plan was to build the world’s second-largest navy after Britain’s, announcing Germany’s arrival on the world stage as an undisputed great power.

In this vision, the naval build-up would get the Germans to the promised land, making the British see sense and accommodate Germany’s rise to great power status. Yet, as so often has proven the case for those whose political risk analysis leads them to adopt the promised land strategy, unintended consequences overwhelmed these initial goals.

In direct reaction to von Tirpitz’s naval programme, Britain (between 1902-1910) embarked on its own massive naval build-up, with the express purpose of safeguarding its naval dominance and seeing off the perceived German strategic threat. As such, von Tirpitz’s build-up, far from cowing Britain into supporting Germany’s overall strategic rise, instead came to be seen as a mortal threat in London.

Conclusion: The promised land strategy and unintended consequences

The unintended result of the von Tirpitz plan was to leave Germany in the worst of all possible strategic worlds. Its efforts to catch up with the dominant British navy narrowed, but did not eliminate, Britain’s maritime advantage. In an immediate, limited sense, the Germans won the naval arms race by whittling down British dominance. But the cost of this pyrrhic victory was exorbitant.

For the change in strategic circumstances was enough to alarm Britain into fundamentally changing its foreign and strategic policies, but did not alter the overriding fact that in 1914 it still possessed by a long way the most powerful naval force in the world. It was the naval arms race that persuaded Britain to wholly adopt Lord Salisbury’s evolving policy and instead look for allies to deal with what was seen—as the result of the von Tirpitz plan—as an increasingly malevolent German threat.

Unwittingly the promised land fallacy unleashed by von Tirpitz directly led to the closer Anglo-French ties that were to form the basis of the resistance to Germany in World War I. With Britain pressed to withdraw its Mediterranean fleet to its home waters to fend off the impending German naval threat, much closer ties with Paris became an absolute strategic imperative so as to safeguard (through the French navy taking London’s place in the Mediterranean) the Suez Canal, the jugular of the British Empire.

Britain, turning its back decisively on its nineteenth-century post-Napoleonic foreign policy heritage, formally allied itself with European powers France in 1904, and Russia, in 1907. Incredibly, the Germans—in pursuing their promised land strategy to secure in von Tirpitz’s words German ‘political independence’ from England—had instead forced the British into their eternal enemy France’s waiting arms, the worst possible strategic thing Berlin could have done. World War I was not far away.

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.

John Hulsman on To Dare More Boldly

HulsmanOur baffling new multipolar world grows ever more complex, desperately calling for new ways of thinking, particularly when it comes to political risk. To Dare More Boldly provides those ways, telling the story of the rise of political risk analysis, both as a discipline and a lucrative high-stakes industry that guides the strategic decisions of corporations and governments around the world. It assesses why recent predictions have gone so wrong and boldly puts forward ten analytical commandments that can stand the test of time. To Dare More Boldly creatively explains why political risk analysis is vital for business and political leaders alike, and authoritatively establishes the analytical rules of thumb that practitioners need to do it effectively.

What’s audacious about political risk?
It’s a great and arresting word, isn’t it? It’s also entirely accurate. After the Cold War (though you can actually date it back to the Pythia of Ancient Greece as I do), the political risk industry seemed to spring fully formed out of nowhere, with leading businesses, multinational corporations, and even governments hanging on the words of erudite soothsayers, who in the tradition of the Pythia or Merlin seemed to promise the magic of uniquely understanding the present and the future. As a member of this select fraternity, I wanted to tell the true story of what is actually going on here, in all of our audacity.

Why did the notion of audacity inspire you to write To Dare More Boldly?
The curse of our present age is that despite the omnipresence of communication, no one seems to have very much to say. Certainly I have found this true in my field of global geopolitical analysis, of political risk. Instead, people with precious little to say describe rather than analyze, ape other ‘right-thinking people’ clustering around one safe opinion, so that even if they are wrong, everyone is incorrect together, and there is no accountability, no price to be paid for analytical mediocrity.

I was inspired to do exactly the opposite, due to my impatience with the present very poor state of imagination in the political risk analysis field, and empathy for creative figures like Brian Wilson of the Beach Boys, who in Pet Sounds bravely and audaciously swung for the fences, and in doing so re-made popular music. I want to do nothing less than the same for the global analysis of political risk.

What’s audacious about the book?
As was true of Brian Wilson’s work, it is baroque in structure, with inter-chapters pointing out the principles—our ten commandments of political risk—that apply across time and space and are truly universal, rather than artificially cherry-picked to suit my argument. For example, there is a chapter on the need to know the nature of the world you actually live in, where the power resides, and if such a system is politically stable. I look at the rapid, shocking decline of the Beatles (epitomized by the increasing creative frustrations of George Harrison) as my main example of what I mean. But there is also a fascinating inter-chapter on the rise and surprising durability of the Rolling Stones, a band who in the mid-1960s seemed on their last legs—as another example of how systems can determine outcomes. Emulating Brian Wilson’s baroque structure allows for a creativity, a timelessness, and a richness that a straightforward analysis would not have made possible.

Examples of pop groups are not the usual fare for books focused on political risk analysis or about practical analytical insights for businesses. Is this another example of the book’s audacity?
Absolutely. Along the way, and it is part of the cult of mediocrity which so pervades modern thinking, we have falsely equated being boring with being profound. I have the opposite approach, that Shakespeare is for everyone, that murky writing and thinking are indicative of bad writing and thinking, that the novelist E.M Forster was right and that the key to life as he said at the beginning of Howard’s End is only to connect.

I use examples across all of history, but ones that fascinated me and I hope my audience. The Greco-Persian Wars, the fall of Rome, the Assassins and the Third Crusade, Machiavelli and the Borgias, John Adams and July 4, Napoleon and Venice, Robert E. Lee and Gettysburg, Lord Salisbury and the British Empire, the fall of the Kaiser’s Germany, the Beatles and the Stones, and Harold Macmillan’s friendship with Jack Kennedy are all covered. But so are more immediate topics like Charles Manson, ISIS, Europe’s present crisis, the rise and rise of China, and power ebbing away from the west as the world becomes truly one of many poles of power. We have forgotten the powerful intellectual pull of Homeric storytelling, which this book is entirely based on. I hope my analysis is profound. But I also hope it is fun.

What does To Dare More Boldly put forward to creatively improve this intellectual wasteland you describe?
That’s exactly the right question. For if you are going to tear down the present, you must put something in its place, or otherwise what you are doing is just nihilism. To Dare More Boldly puts forward ten analytical precepts derived from the real world of history—our ten commandments—a ‘do’s’ and ‘don’ts’ list across all of recorded history that makes an analytical understanding of how to master political risk in the world possible. Rather than saying nothing or being laughably wrong (how many of my colleagues called Brexit correctly?) the book underlines that the present and the future in terms of political risk can be mastered for businesses by the following of such principles that have stood the test of time throughout and across history, the real world laboratory we all live in. I hope the book is creative and valuable both for businesses that need to master the confusing new era we find ourselves in, and for the general reader who rightly also wants to understand the times they live in.

John C. Hulsman is president of John C. Hulsman Enterprises, a prominent global political-risk consulting firm. His books include Ethical Realism: A Vision for America’s Role in the World (Pantheon), The Godfather Doctrine: A Foreign Policy Parable (Princeton), and To Begin the World Over Again: Lawrence of Arabia from Damascus to Baghdad (St. Martin’s). He lives in Painswick, England.

Getting to Goldilocks: Napoleon, the Venetian Republic and Balance in Political Risk Analysis

by Dr. John C. Hulsman
Hulsman

Introduction: The Self-Inflicted Haplessness of Venice

The Most Serene Republic of Venice, one of the most consequential states of the European Renaissance, ended the 1,100 years of its existence not with a bang but with a pathetic whimper. At its height and for hundreds of years, the Venetian maritime empire dominated the Adriatic and eastern Mediterranean, as well as possessing a central land base in the Veneto on the northern Italian mainland. However, by the time the great Napoleon had fixed his sights on what he rightly called ‘the drawing room of Europe’ and determined that the Venetian pearl would be his, the city-state was but a shadow of its former self, largely because of a simple failure of political risk analysis.

Why was this former great power so utterly defenceless before Napoleon’s hordes? The simple, overriding answer to this question is that the Venetians had learned an important lesson down the centuries—war is often folly and always expensive—while entirely forgetting that they might need to keep other important—and countervailing—truisms about international relations in mind as well.

First amongst these is that having merely carrots (economic power) as an instrument on the global stage only works in a world populated entirely by rabbits; military power is sometimes required too. And whatever else you might say of him, the young Napoleon was hardly a rabbit.

Because of this fundamental misreading of human nature, the Venetian Republic responded with a reckless strategy of disarmament over the centuries that erased its mighty position in the world. By the latter days of the eighteenth century, the city-state was so divorced from the reality of power politics that when threatened by the French, it had absolutely no choice but to surrender.

Political risk analysts often exhibit a similar lack of balance, dooming their assessments. The holy grail of analysis is getting to Goldilocks—making policy assessments that are neither too hard nor too soft, by eschewing extremes and mono-causal answers and actually balancing the numerous important factors determining outcomes.

Venice’s Slow Castration

From the early sixteenth century on, the oligarchs who ran the Republic preferred to avoid the hard economic choices and belt-tightening that could have corrected their dangerous military decline (much like today’s modern European states). But as Venice was still a very rich city, and as its elite’s cosseted life of masked balls and opulence were hard to part with, it was far easier to do nothing about what seemed at the time to be merely a theoretical problem. It was only when Napoleon showed up at Venice’s doorstep that theory became all too real.

And to a point, of course, the Venetians were absolutely right. Often wars explode in the faces of those who engage in them, and almost always they are ruinously expensive. Peace in general is a better alternative for both the health of any state and the welfare of its people. No one is arguing that in general the Venetians were onto something with their peace-first strategy.

The problem was that over the centuries it became a peace-only strategy. For having grasped one essential reality of the world, the Venetian Republic wholly ignored other, darker, but no less important lessons about the nature of human beings and international relations. By 1796, on the eve of Napoleon’s brilliant Italian campaign, the Republic could no longer defend itself. Of its pathetic fleet of thirteen ships of the line, only a handful of even these proved to be seaworthy. The army was in even worse shape, consisting of only a few brigades of Croatian mercenaries.

The fundamental problem was that in policy terms the oligarchs had forgotten about balance in both foreign policy and political risk analysis, not being prepared to pay the steep price that would have been necessary to upgrade the Venetian fleet with the latest technology of eighteenth-century warfare. Through this intellectual failure of balance, Venice had castrated itself long before Napoleon came thundering out of the mountains, sealing its own doom.

Napoleon’s France as a Country on Military Steroids 

In his bedazzled, gilded youth, Napoleon Bonaparte shown like the sun. Beyond Alexander the Great, it is difficult to think of any leader in the history of the world to whom fame and glory came so early, and so overwhelmingly. Supremely competent, decisive, preternaturally driven, eloquent, quick-witted, and far-seeing, Bonaparte was capable of inspiring almost religious devotion in both his marshals and his men.

In 1797, Napoleon could uncannily see the inherent defencelessness of the Venetian Republic, a government that had chosen to simply ignore the basic imperative any state has to defend itself. However, Napoleon was to make a diametrically opposed analytical misjudgement himself.

The Venetians were undoubtedly lotus-eaters, basking in their tranquil apathy, as the forces of the real world slowly and ominously gathered around them. But in worshipping the god Mars, Napoleon was to make an equally disastrous political risk mistake. For behind all his highly impressive domestic reforms was an effort to increasingly militarise French society, to make it fit for purpose to take on the rest of Continental Europe for almost a generation. This imbalanced over-reliance on war was to doom the glorious Bonaparte. In always seeing the need for war, he was as out of kilter as were the Venetians, who never saw the need for it.

For in reality, it was the overly militaristic, self-perpetuating expansionism of Napoleon’s France that led to his greatest strategic setbacks in both Spain and Russia. Both the Spanish and Russian disasters arose out of Napoleon fighting wars of choice, conflicts that a less martial status quo power would have entirely avoided.

Of course, Napoleon paid the ultimate price for his utopian, overly militaristic, unbalanced folly, ironically much as the Venetian oligarchs had done. On May 5, 1821, the great man died in exile on the obscure island of St. Helena, far from the trappings of his once-supreme power, an unwitting victim of having legendarily used the military lever of politics without ever learning that there are other motive forces of history as well.

Conclusion: The Benefits of Balance

Two great powers, the Venetian Republic and its vanquisher, the great Napoleon, were laid waste to when they could not overcome a fundamental political risk analytical error. Commercial Venice forgot along the way that a state’s paramount need is always to defend itself, that there will always be creatures in the foreign policy jungle to be fought off. Evil and aggression in the world cannot be wished away just because it is far more pleasant to attend glittering seaside parties and to produce breath-taking works of art.

Some sort of balance is called for. Over the centuries, Venice’s abdication of responsibility for seeing the world as it is left it entirely at the mercy of the young, covetous Napoleon when he made his way over the Alps. But given the Venetians’ fundamental misreading of the world, it hardly mattered that it was Napoleon who brought the Venetian Republic down. Someone would have.

But Napoleon, in his diametrically opposed way, made the same fundamental error as the Italian oligarchs he so effortlessly conquered. The sword had made Napoleon the most famous man in the world and given him, a minor Corsican aristocrat, first a throne and then the dominant position in Europe.

It is human and understandable that even a man of Bonaparte’s first-rate intellect, having personally experienced how far the military component of power could take both a genius and a country, failed to see that his over-reliance on the military instrument of power was highly skewed, to the exclusion of a more balanced strategy, such as that pursued by Pitt’s England throughout the period. It is understandable, but Napoleon’s sad end makes it clear that his failure of balance was absolutely toxic.

Modern political risk analysts would do well to take note of both the historical examples of Venice and Napoleon. There are many motive forces of history and analysis, and all the major ones must be taken into account altogether if political risk analysis is to get anywhere. To forget the absolute need for getting to Goldilocks—the essential political risk commandment of the imperative of finding analytical balance—is to get every big thing wrong, no matter how right analysts are about the detail. For both analysis and policy require more than one basic insight into how our complicated world works.

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.

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.

Dr. John C. Hulsman: Will the US ever escape the Losing Gambler Syndrome in Afghanistan?

HulsmanThe Losing Gambler Syndrome is a fact of the human condition that casino magnates have come to well understand. When someone loses big at the tables, almost always they have an overwhelming urge to invest ever more resources to make good on their catastrophic losses, rarely bothering to think about the reasons for these losses in the first place. Dad cannot go back to Mom telling her he has lost the kids’ college fund at the roulette table, so he keeps playing . . . and keeps losing. The reason for his demise—the terrible odds—is never analytically addressed.

Policymakers are not immune to this folly, often doubling down on a bad assessment emotionally in order to wipe the slate clean of their intellectual mistakes. I saw this doleful analytical process up close and personal in Washington as the Iraq War slid toward the abyss; very often those policymakers urging ever-greater efforts in Iraq from the American people did so largely to make good on their already monumental strategic losses.

History’s graveyard is replete with losing gamblers

Anyone who has ever walked the mile and a half in that beautiful, tragic open field between Seminary and Cemetery Ridges at Gettysburg knows that the Confederate assault on the third day of the battle should never have been made. The simple reason for Pickett’s disastrous charge is that Robert E. Lee had emotionally invested too much at Gettysburg to easily turn back. The famed Confederate general was both desperate and overconfident, a fatal combination. Lee was held intellectual hostage by his tantalizing near success (and actual failure) on the second day of the battle, becoming an unwitting prisoner of the Losing Gambler Syndrome.

Likewise, as the years rolled by without the United States ever finding a political ally in South Vietnam with local political legitimacy, it never seems to have occurred to Lyndon Johnson that the lack of such a partner was a sure sign to get out, not to redouble his efforts.

When will they ever learn?

Tragically, the losing gambler’s curse continues today, with America’s seemingly endless war in Afghanistan being a textbook example. Within of few months of 9/11, American-led forces had routed the Taliban and dislodged al-Qaeda from its bases. However, then the war goals fatefully shifted. To prevent al-Qaeda’s resurgence, the US ended up endlessly propping up weak, corrupt, unrepresentative governments in Kabul.

As these governments did not have sufficient organic political legitimacy, the US found itself mired in an unwinnable situation, as without Taliban involvement in the central government (the Taliban represent almost exclusively the interests of the Pashtun, the largest single tribe in the country) any local rule was bound to be seen as inherently unrepresentative. This political reality is at the base of the 16-year unwinnable war in Afghanistan.

Doubling down yet again

Yet President Trump’s ‘new plan’ (there have been an endless number of these over the past decade and a half) does nothing to deal with this central political conundrum. Despite in his campaign saying the war in Afghanistan had been ‘a total disaster,’ the President was persuaded by his respected Secretary of Defense, James Mattis, and National Security Adviser H.R. McMaster, to increase American troop levels in-country to 16,000, ignoring the fact that during the Obama administration 100,000 American soldiers had been fighting there, all to no avail.

I suspect a key reason for this strange decision is that both Generals Mattis and McMaster served with distinction in Afghanistan. Like Lee, President Johnson, and the neo-conservatives huddled around George W. Bush, both have invested too much emotionally and practically to turn back, whatever the fearful odds.

So an unwinnable war is set to continue, as the unsolvable political reality at its base goes unremarked upon. The losing gambler’s syndrome tells us that once resources and intellectual credibility have been expended, it is all too tempting, whether met with crisis or entranced by near-success, to keep doing what has been failing up until that point. It is entirely understandable to do this, but as Gettysburg, Vietnam, and Iraq point out, practically disastrous. Policymakers must instead have the courage to look at failure straight in the eye and make adjustments to mitigate its effects, rather than doubling down and inviting more.

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.

Everything to play for: Winston Churchill, the rise of Asia, and game changers

By Dr. John C. Hulsman

HulsmanThe ability to know when game-changing events are actually happening in real time is to see history moving. It is an invaluable commandment in the mastering of political risk analysis. To do so, an analyst must adopt an almost Olympian view, seeing beyond the immediate to make sense of what is going on now by placing it into the broader tapestry of world history itself.

The rewards for this rare but necessary ability are legion, for it allows the policy-maker or analyst to make real sense of the present, assessing the true context of what is going on presently and what is likely to happen in the future. It is jarring to compare the lacklustre abilities of today’s Western politicians—so far behind the curve in seeing the game-changing rise of Asia and the decline of the West as we enter a new multipolar age—to the phenomenal analytical abilities of earlier statesmen of vision, such as the querulous, needy, challenging, maddening, often wrongheaded but overwhelmingly talented greatest Prime Minister of England.

Churchill Rejoices over Pearl Harbor

In the hustle and bustle of the everyday world, recognizing game-changing events can prove exceedingly difficult. Being surrounded by monumental goings on makes separating the very important from the essential almost impossible. So it was in December 1941, undoubtedly the turning point of the Second World War. During that momentous month, the Red Army turned back the Nazi invasion at the very gates of Moscow, marking the first time Hitler’s war machine had met with a real setback. But for all that the Battle of Moscow mattered enormously, it did nothing to change the overall balance of forces fighting the war, with the outcome still sitting on a knife’s edge.

But half a world away, something else did. At 7:48 AM in Hawaii, on December 7, 1941, the Imperial Navy of the Empire of Japan, attacking without warning as it had done in the earlier Russo-Japanese War, unleashed itself against the American Pacific Fleet, serenely docked at Pearl Harbor that Sunday morning. The damage was immense. All eight American battleships docked at Pearl were struck, and four of them sunk. The Japanese attack destroyed 188 US aircraft, while 2,400 were killed and 1,200 wounded. Japanese losses were negligible.

The Japanese attack on Pearl Harbor misfired spectacularly, changing the course of the war fundamentally, drawing America into the conflict as the decisive force which altered the correlation of power around the world. Stalin, with his back still to the wall in the snows of Russia, did not immediately grasp the game-changing significance of what had just happened any more than Franklin Roosevelt did, now grimly intent on surveying the wreckage of America’s Pacific Fleet and marshalling the American public for global war.

These were pressing times and it is entirely human and understandable that both Stalin and FDR had other more immediate concerns to worry about during those early December days. But Winston Churchill, the last of the Big Three, immediately latched onto the game-changing significance of what had just occurred. For the Prime Minister understood, even in the chaos of that moment, that the misguided Japanese attack had just won Britain and its allies the war and amounted to the game changer a hard-pressed London had been praying for.

In his history of World War II, Churchill wrote of that seminal day, ‘Being saturated and satiated with emotion and sensation, I went to bed and slept the sleep of the saved and thankful.’ The great British Prime Minister slept well that night because he understood the fluidity of geopolitics, how a single event can change the overall global balance of power overnight, if one can but see.

On December 11, 1941, compounding Tokyo’s incredible blunder, Germany suicidally declared war on America. Hitler, vastly underestimating the endless productive capacity of the United States, didn’t think the declaration mattered all that much. The miscalculation was to prove his doom, as the US largely bankrolled both its Russian and British allies, supplying them with both massive loans and a limitless supply of armaments and material. Because of Pearl Harbor and Hitler’s disastrous decision, America would eventually eradicate the dark night of Nazi barbarism. Churchill was right in seeing the full consequences of what was going on at that pivotal time. December 1941 saved the world.

The decline of the West and the rise of Asia is the headline of our times

In the crush of our 24-hour news cycle, it is all too easy—as it was during the stirring days of World War II—to miss the analytical forest for the trees. Confusing the interesting from the pivotal, the fascinating from the essential, remains an occupational hazard for both policy-makers and political risk analysts. But beneath the sensory overload of constant news, the headline of our own time is clear if, like, Churchill we can but see.

Our age is one where the world is moving from the easy dominance of America’s unipolar moment to a multipolar world of many powers. It is characterized by the end of 500-plus years of western dominance, as Asia (especially with the rise of China and then India) is where most of the world’s future growth will come from, as well as a great deal of its future political risk. The days of International Relations being largely centered on Transatlantic Relations are well and truly at an end, as an economically sclerotic and demographically crippled Europe recedes as a power, and even the United States (still by far the most powerful country in the world) sinks into relative decline.

To understand the world of the future requires a knowledge of Asia as well as Europe, of macroeconomics as well as military strategy, of countries the West has given precious little thought to, such as China, India, Indonesia, Turkey, Argentina, Brazil, South Africa, Saudi Arabia, and Mexico, as well as the usual suspects such as a declining Russia and Europe. International Relations has become truly ‘international’ again. And that, coupled with the decline of the West and the Rise of Asia, is the undoubted headline of the age. Churchill, and all first rate analysts who understand the absolute value of perceiving game-changing events, would surely have agreed.

Dr. John C. Hulsman is the President and Co-Founder of John C. Hulsman Enterprises, a prominent 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 pre-eminent foreign policy organisation. 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.

Julian Zelizer on The Presidency of Barack Obama

ZelizerBarack Obama’s election as the first African American president seemed to usher in a new era, and he took office in 2009 with great expectations. But by his second term, Republicans controlled Congress, and, after the 2016 presidential election, Obama’s legacy and the health of the Democratic Party itself appeared in doubt. In The Presidency of Barack Obama, Julian Zelizer gathers leading American historians to put President Obama and his administration into political and historical context. Engaging and deeply informed, The Presidency of Barack Obama is a must-read for anyone who wants to better understand Obama and the uncertain aftermath of his presidency.

What was your vision for this book? What kind of story are you trying to tell?

My goal with this book is to provide an original account of the Barack Obama that places his presidency in broader historical context. Rather than grading or ranking the president, my hope is to bring together the nation’s finest historians to analyze the different key issues of his presidency and connect them to a longer trajectory of political history. Some of the issues that we examined had to do with health care, inequality, partisan polarization, energy, international relations, and race.

How did you approach compiling the essays that make up this book? What criteria did you use when choosing contributors?

The key criteria was to find historians who are comfortable writing for the general public and who are interested in the presidency—without necessarily thinking of the president as the center of their analysis. I wanted smart historians who can figure out how to connect the presidency to other elements of society—ranging from the news media to race relations to national security institutions.

What do you see as the future of Obama’s legacy?

Legacies change over time. There will be more appreciation of aspects of his presidency that are today considered less significant, but which in time will be understood to have a big impact. Our authors, for instance, reveal some of the policy accomplishments in areas like the environment and the economy that were underappreciated during the time he was in the White House.  In other ways, we will see how some parts of the presidency that at the time were considered “transformative” or “path-breaking”—such as his policies on counterterrorism—were in fact extensions and continuations of political developments from the era.

How did the political landscape of the country change during Obama’s tenure?

While we obtained many new government programs, from climate change, to ACA, to the Iran Nuclear Deal, we also saw the hardening of a new generation of conservatism who were more rightward in their policies and more aggressive, if not ruthless, in their political practices. Some of his biggest victories, such as the Affordable Care Act, pushed the Republican Party even further to the right and inspired them to be even more radical in their approach to legislative obstruction.

What do you hope readers will take away from reading this book?

I hope that they will have a better sense of where this presidency came from, some of the accomplishments that we saw during these eight years, and some of the ways that Obama was limited by the political and institutional context within which he governed. I want readers to get outside the world of journalistic accounts and come away understanding how Obama’s presidency was a product of the post-1960s era in political history.

Julian E. Zelizer is the Malcolm Stevenson Forbes, Class of 1941 Professor of History and Public Affairs at Princeton University and a CNN Political Analyst. He is the author and editor of eighteen books on American political history, has written hundreds of op-eds, and appears regularly on television as a news commentator.

Michael Brenner explains why a Jewish State is “not like any other state”

BrennerIs Israel a state like any other or is it unique? As Michael Brenner argues in In Search of Israel, the Zionists attempted to put an end to the millennia-old history of the Jews as the archetypical “other” by creating a Jewish state that would be just like any other state, but today, Israel is regarded as anything but a “normal” state. Instead of overcoming the Jewish fate of otherness, Israel has in fact become the “Jew among the nations.” Israel ranks as 148th of the 196 independent states in terms of geographical area, and as 97th in terms of population, which is somewhere between Belize and Djibouti. However, the international attention it attracts is exponentially greater than that of either. Considering only the volume of media attention it attracts, one might reasonably assume that the Jewish state is in the same league as the United States, Russia, and China. In the United States, Israel has figured more prominently over the last three decades than almost any other country in foreign policy debates; in polls across Europe, Israel is considered to be the greatest danger to world peace; and in Islamic societies it has become routine to burn Israeli flags and argue for Israel’s demise. No other country has been the target of as many UN resolutions as Israel. At the same time, many people around the world credit Israel with a unique role in the future course of world history. Evangelical Christians regard the Jewish state as a major player in their eschatological model of the world. Their convictions have influenced US policies in the Middle East and the opinions of some political leaders in other parts of the world.

Why does Israel attract so much attention?

The answer lies in history. Many people call Israel “the holy land” for a reason: it is here where the origins of their religions were shaped. The Jewish people too are regarded as special: they played a crucial role in the theological framework of the world’s dominant religions. In Christianity and in Islam, Jews were both seen as a people especially close to God and at the same time uniquely rejected by God. While over the last two hundred years these ideas have become secularized, many stereotypes have remained. That the Jews became victims of the most systematic genocide in modern history lent them yet another mark of uniqueness. After two thousand years in exile, the fact that Jews returned to their ancient homeland to build a sovereign state again surrounded the people and place with additional mystique.

Did the Zionists view themselves as unique?

The irony is that the Zionist movement was established at the end of the 19th century precisely in order to overcome this mark of difference and uniqueness. Many Zionists claimed that they just wanted to be like anyone else. Chaim Weizmann, longtime leader of the Zionist movement and Israel’s first president, was quoted with saying: “We just want to be another Albania,” meaning a small state that nobody really cares about. Even Israel’s founding document, the declaration of independence, says that Israel has the right to be “like all other nations.” But at the same time the notion of being different, perhaps being special, was internalized by Zionists as well. Many of its leaders argued that a Jewish state has a special responsibility. Even the most secular among them regarded Israel’s serving as “a light unto the nations” as a crucial part of a prophetic tradition.

Does this mean that Zionism was a religious movement?

Not at all. Most of its early leaders were strictly secular. Theodor Herzl, the founder of Zionism, knew no Hebrew and in fact very little about Jewish traditions. But he wanted to establish a model state for humanity, and saw the formation of Israel as an example for the liberation of African-Americans. Long before any other state granted voting rights for women, he let women be active participants in the Zionist congresses. He drew a flag for the future Jewish state that had seven stars, symbolizing a seven-hour-workday for everyone. David Ben-Gurion, the first prime minister of Israel, was a Socialist and rejected organized religion. But just like Herzl, he believed in the mission of a model state that could spread the prophetic ideals of universal peace and equality among the nations.

Why then is Israel seen by many today not as a model state but as a pariah state?

Herzl discussed other potential destinations, such as Argentina and British East Africa, as refuge for the persecuted European Jews. But the only place Jews had an emotional connection with was the territory they had originated from. Over centuries, Jews prayed for their return to the land of Israel. But it was not an empty land. The Arab Palestinians soon developed their own ideas of nationhood and rejected the growing Jewish immigration. In the meantime, antisemitism increased in Europe and other countries closed their doors to Jewish refugees. The establishment of the State of Israel in 1948 came too late to save the lives of millions of Jews who perished in the Holocaust. But by then, most of the world recognized the Jews’ right to their own state in their ancient homeland, as reflected in the 1947 UN partition of Palestine into a Jewish and an Arab state. Yet the Arab world did not see why they should pay the price for the sins of the Europeans. The situation reflected the parable of a person (the Jews) jumping out of the window of a burning house (Europe) and hitting another person (the Palestinians) on the street in order to save his own life. The ongoing conflict of two peoples over the same land, combined with the special significance of this land in the eyes of the world, led to a situation where even outsiders have strong opinions. For Evangelical Christians, Israel fulfills a divine mission, while for others, especially in the Arab world, Israel is regarded as a foreign intruder in the tradition of the medieval Crusaders and modern Imperialists.

So, can Israel one day become just a “normal state?”

To begin with, let me qualify this question. The idea of a “normal state” is a fiction altogether. Every state sees itself as special. But it is true that some states receive more attention from the rest of the world than others. Can Israel just be another Albania in the eyes of the world, or relegated in our attention to its place among the nations between Djibouti and Belize? I do not believe so. The history of Jerusalem is different from that of Tirana (Albania’s capital), and the Jews have attracted so much more attention than nations of comparable size. Thus, Israel will most likely always remain in the limelight of media attention. However, let us not forget: The people in Israel live their everyday lives just like everywhere else. They worry about their jobs and about their sports teams, they want their children to be safe and successful in school, and they dream of a peaceful future. In this deeply personal sense, Israel has become a state just like any other.

Michael Brenner is the Seymour and Lilian Abensohn Chair in Israel Studies and director of the Center for Israel Studies at American University and Professor of Jewish History and Culture at Ludwig Maximilian University in Munich. His many books include A Short History of the Jews.

Gaming out chess players: The Italian Renaissance and Vladimir Putin

By Dr. John C. Hulsman

HulsmanIf learning the precious truth that we can be the danger (see my Gibbon column of last week) is the first commandment of political risk analysis, gaming out chess players is surely another. Chess players—foreign policy actors playing the long game, possessing fixed, long-term strategic goals even as they use whatever tactical means come to hand to achieve them—are rare birds indeed. Patient, low-key, but implacable, chess players do that rarest of things: they actually think ahead and are not prisoners of short-term day-to-day events, instead conditioning all that they do in furtherance of their long-term strategy.

Chess players manage to cloak their dogged, disciplined strategies, hiding them in plan sight of our frenetic 24-hour news cycle, from a world that does not generally follow such fixed principles and cannot really conceive of how others might be able to hold to a clear strategic line. In a world of tacticians, it is easy for a strategist to conceal themselves.

Pope Julius II as the true hero of The Prince

Following on from the Crusades, the western world entered a period of cultural and political regeneration we now call the Renaissance. As is true for most eras, it was more politically chaotic, brutal, and bloody than it seems in retrospect. In the confusing, uncertain milieu of early-sixteenth century Italy, a man arose who fit the tenor of his times.

Pope Julius II has been shamefully underrated by history, as his contemporary Niccolo Machiavelli—the author of The Prince, the bible of modern realpolitik—instead lionized failed Bond villain Cesare Borgia rather than the more successful pope. However, we have five centuries of distance from the swirling events of the Renaissance, allowing us to take up the more dispassionate, chess-playing view that Machiavelli urges on us. So let us here re-write the ending of The Prince, this time using Julius II as the proper analytical hero of the piece.

Julius was born Giuliano Della Rovere around 1443. Like Cesare Borgia, his path to power was speeded along by close familial contacts to the papacy. Della Rovere was the much-loved nephew of Pope Sixtus IV, becoming his uncle’s de facto prime minister. Following on from the death of Sixtus, Della Rovere assumed that he would succeed him. However, he was beaten out by Cardinal Rodrigo Borgia, Cesare’s father, who assumed the title of Pope Alexander VI. So Della Rovere, in good chess player fashion, tried to undercut Alexander, knowing his time was coming.

When Alexander VI died in 1503 (and with the lightning quick demise of his successor, Pope Pius III, in just 26 days) Della Rovere at last made his long-considered move. He deceived the supposedly worldly Cesare and ran rings around him diplomatically, securing the papal throne by means of bribery, both in terms of money and future promises. With Cesare throwing the powerful Borgia family’s crucial support behind him, the new papal conclave was one of the shortest in history, with Della Rovere winning on only the second ballot, taking all but two cardinals’ votes. He ascended to the papal throne at the end of 1503.

Now that Cesare had outlived his usefulness, Julius withdrew his promised political support from him in true Machiavellian fashion, seeing to it that the Borgias found it impossible to retain their political control over the papal states of central Italy. Julius rightly reasoned that to fail to eradicate the Borgia principality would have left the Vatican surrounded by Borgia possessions and at Cesare’s very limited mercy.

Without papal support Cesare’s rule on his own—without the critical backing his father Alexander VI had provided—lasted merely a matter of months, with his lands reverting to Julius and the papacy itself. Julius had run rings around Machiavelli’s hero, fulfilling the chess-playing maxim that securing one’s political position leads to political stability and long-term rule. That, Niccolo, is what a real chess player looks like.

Making sense of Putin

However, chess players are not just relic of the byzantine Renaissance age. Russian President Vladimir Putin is a perfect modern-day example of a chess player, as all the many devious tactics he pursues ultimately amount to a very single-minded effort to restore Russian greatness, often by blunting the West’s drives into what he sees as Russia’s traditional sphere of influence in the countries surrounding it. In other words, the Russian strong man resembles another chess player, former French President Charles De Gaulle, in his single-minded efforts to restore pride and great power status to his humiliated country.

As such, Putin’s many gambits: theatrically opposing the US despite having a puny, corrupt economy the size of Texas; pursuing an aggressive adventurist policy against the pro-Western government in Ukraine; intervening to decisive effect in the horrendous Syrian war; all serve one overarching strategic goal. They are designed to make the world (and even more the Russian people) change their perceptions about Russia as a declining, corrupt, demographically challenged former superpower (which it is), and instead see it as a rejuvenated global great power, one that is back at the geo-strategic top table.

Despite all facts to the contrary (and in the end, as was true for De Gaulle’s France, the facts just don’t bear out the incorrect perception that Russia will again be a superpower), Putin has been very successful in (wrongly) changing global perceptions of Russia’s place in the world. It is also the reason the current tsar has an 80% approval rating in his own country, as he has restored pride to his formerly humiliated countrymen. By knowing what ultimately motivates the chess-playing Putin, we in the West can do a far better job in assessing the entirely explicable tactical gambits emanating from the Kremlin.

The rewards for spotting the rare chess player

Despite the difficulty in spotting them, it is well worth the time trying to game out chess players, perhaps the rarest of creatures in global politics. For once they are analytically brought to ground, the fixed, rational, patterns that chess players live by means a true analytical understanding of them is possible, as well as a far better understanding of the world in which they live.

Dr. John C. Hulsman is the President and Co-Founder 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 pre-eminent 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.

Robert Wuthnow on The Left Behind

WuthnowWhat is fueling rural America’s outrage toward the federal government? Why did rural Americans vote overwhelmingly for Donald Trump? And, beyond economic and demographic decline, is there a more nuanced explanation for the growing rural-urban divide? Drawing on more than a decade of research and hundreds of interviews, Robert Wuthnow brings us into America’s small towns, farms, and rural communities to paint a rich portrait of the moral order—the interactions, loyalties, obligations, and identities—underpinning this critical segment of the nation. Wuthnow demonstrates that to truly understand rural Americans’ anger, their culture must be explored more fully. Moving beyond simplistic depictions of the residents of America’s heartland, The Left Behind offers a clearer picture of how this important population will influence the nation’s political future.

You argue that rural America’s politics cannot be understood in terms of economic problems, but require a cultural explanation. What do you mean by that?

What I learned from the research over the past decade in which my research assistants and I interviewed hundreds of rural Americans is that their identity is deeply connected with their communities. We cannot understand rural Americans by thinking of them only as individuals. They have to be understood in terms of their communities. I call these moral communities because people feel obligated to them and take their cues about what is right and good from their neighbors. These moral communities define their way of life. But these ways of life are slipping away. Population is declining, schools are closing, jobs are disappearing, and young people are moving away. Even families who are doing well economically feel the changes. They are having to commute farther for work and to conduct business. The major forces shaping society are beyond their control. People feel threatened and misunderstood.

Are you suggesting that Donald Trump appealed to this sense of displacement? Did rural voters win him the election?

Many factors went into the 2016 presidential election. Political analysts are still sorting them out. Rural voters did opt for Trump is greater percentages than urban voters. My research was less concerned with the election, though, than with understanding at a deeper level what people in small towns and on farms value and why they feel threatened. You have to spend time in rural communities and talk at length with people to understand this. You can go out as a reporter and ask them about politics. But ordinarily they don’t talk that much about politics. They live from day to day going to work, taking their kids to school, maybe volunteering for a local church or club, and maybe helping their neighbors. They see problems, but basically like their communities and want them to stay strong. If you just see rural Americans as voters, you miss the warp and woof of their daily lives.

When they did talk about politics, the people you studied seemed to be totally alienated from Washington. What troubles them about the federal government?

They voiced two major complaints about Washington: the federal government is distant and at the same time it is intrusive. Washington’s distance is both geographic (in most cases) and cultural. It is perceived as catering to urban interests. Washington bureaucrats don’t seem to care about rural America or even inquire about its needs. They seem to look down on people in small towns. Washington nevertheless intrudes on daily life through taxes, regulations, and unfunded mandates. Besides that, Washington deviates from small town residents’ notions of common sense. It strikes them that big bureaucracy is inevitably inefficient and ineffective.

From what you’ve learned about rural Americans, would you think they now have buyer’s remorse and will vote Democratic next time?

Some may. Current trade policies have hurt farm families. Rural hospitals and small-town schools are struggling. Nothing is being done to promote jobs in rural areas or to address the opioid epidemic. Rural people are certainly aware that President Trump is very different from them in terms of origin, wealth, and values. But many rural Americans have been Republicans all their lives and are unlikely to change their affiliations. In those locations, voting preferences happen in Republican primaries. Anger at Washington, as we know, can be directed at “establishment” Republicans as well as at Democrats.

You paint a largely sympathetic portrait of rural America, but you also say you heard things you disagreed with. Can you say something about that?

The most disturbing comments were ones with blatant racist overtones. These were not common but surfaced in reference to President Obama especially in the South. Comments about immigrants were more mixed than Trump’s anti-immigrant rhetoric might suggest. Farmers and construction companies often relied on immigrant labor. Sometimes small towns were happy to have newcomers and had done well adapting schools and service programs to immigrant families. Negative sentiment mostly focused on undocumented immigrants and Muslims.

How are rural churches faring these days?

Church-going still occurs at higher rates in rural communities than in cities. Depopulation has forced some congregations to merge or close. Clergy sometimes minister to congregations in several locations, much like circuit riders did in the nineteenth century. Membership may be declining and aging, but churches still provide vital community services, including assistance to the poor.

There are approximately 14,000 small towns in the United States and the rural population is estimated at somewhere between 30 and 50 million people. Surely you observed a great deal of variety.

Absolutely. The biggest differences are between towns of fewer than 5,000 people and towns with 10,000 to 25,000 people. While most of the smaller towns are declining, most of the larger ones are holding their own or growing. It also helps growth to be a county seat and located near an interstate highway. Towns with better climate and natural amenities are doing well too. Agriculture is the mainstay of small town America, but the most common jobs are often in social services. I was surprised at how many towns have small manufacturing plants. Many of these towns of course are struggling to prevent plant closings.

You grew up in a small town in Kansas. How did that experience affect your research? Did you find that things nowadays are dramatically different?

My hometown, like many small towns, is smaller than it was by about 50 percent. It is also more ethnically diverse. Farms are larger. People commute to other towns to work. Townspeople have had to work hard to keep the hospital open and build a new middle school. The ambience is a mixture of cautious optimism and concern. I found that it other places too. People are proud of their community. It’s home. But they worry. When a school closes or a large family moves away, it affects everyone. As one resident put it, “It tears at your gut.”

Robert Wuthnow is the Gerhard R. Andlinger ’52 Professor of Social Sciences at Princeton University. His many books include American Misfits and the Making of Middle-Class Respectability, Small-Town America, and Remaking the Heartland.